• Nasdaq, a tech-forward U.S. stock exchange, announced it is calling off plans to launch a cryptocurrency custody service due to regulatory challenges.
• The news comes amid emerging signs of life in the crypto industry, including an unexpected proposal from world’s largest asset manager BlackRock for a spot bitcoin ETF and other proposals.
• Nasdaq’s decision is likely not enough to derail the increasingly positive sentiment in crypto, but it is nonetheless a significant blow.
Nasdaq Calls Off Crypto Custody Plans
Financial Giant Struggles with Red Tape
Nasdaq, the prominent, tech-forward U.S. stock exchange, recently announced that it is calling off plans to launch a cryptocurrency custody service due to regulatory challenges. This was slated to launch in the second quarter of this year as a special purpose trust regulated by New York State laws.
Recent Crypto Developments
The news comes amid emerging signs of life in the crypto industry – last month BlackRock proposed a spot bitcoin ETF rekindling optimism for an asset class that had been pummeled by regulators and bad news for at least 16 months. This was followed by other spot bitcoin ETF filings and then more recently U.S Securities and Exchange Commission (SEC) missed its window to deny another type of bitcoin ETF trading which further boosted sentiment in crypto markets. Additionally, Ripple received some good news when their long simmering legal dispute ended with an agreement from SEC disguised under what appeared as technical defeat after district judge found $700 million worth of XRP sales were illicit securities offerings which led many exchanges to restart XRP trading reversing delistings from 2020 resulting in liquidation of XRP short sellers .
Nasdaq Exit Bad News for Crypto
Despite these positives developments Nasdaq’s decision to exit the crypto custody business before it fully entered sends out negative signals about financial giant’s ability to navigate red tape and raises questions about who can lead institutional entry into this space if one of its biggest players cannot make it happen .
Crypto Market Still Positive
However , given all the recent positive developments , Nasdaq’s departure may not be enough to derail the increasingly positive sentiment that has been building up around cryptocurrencies .
Conclusion
Although Nasdaq’s withdrawal from this space could have serious implications on future institutional investments into cryptocurrency , there are still plenty of signs that show hope for digital assets going forward .