Connect to many custodians at once and expand the variety of your offering with ease. Avoid being locked into a single crypto custody service provider relationship and take advantage of many providers utilising different jurisdictions and specialisations.
Expand bandwidth of digital asset portfolio
Avoid vendor lock In
Expand specialisation (Cryptocurrencies, NFTs, Security Token)
The crypto sector is characterized not only by its rapid growth, but also by constant change. Today there exist several thousand different cryptocurrencies worldwide, up from less than a thousand in 2016 and less than a hundred in 2013. Simultaneously, the total number of distinct protocols has skyrocketed, with no hints of this trend slowing down.
Hence, the challenge of keeping pace with market developments is twofold: on the one hand, virtual asset service providers (VASPs) need to flexibly scale their existing service capabilities around dominant assets such as Bitcoin, Ethereum, and Ripple. On the other hand, the volatile rise of other protocols implies the need to adopt new technologies on demand rapidly.
This development poses a challenge for custodians, as supporting new blockchains requires upfront investments and technical expertise. Offering custody services for an additional blockchain involves the hosting of a new node, a respective integration into the existing infrastructure, and potentially immense compliance efforts.
Putting this into perspective: custodians earn their revenue based on the volume of assets they are storing. As these fees usually range between 10 to 20 basis points, the custodians’ business model heavily relies on securing large asset volumes. Without the necessary volume, making the required upfront investments in the custodial infrastructure is not economical.
A consequence is that it is not attractive to any custodian to host and support all digital assets. However, while the described economic tradeoff forces custodians to specialize around a range of cryptocurrencies, the digital asset boom is driving clients’ demand for increasingly broader exposure.
With some protocols being rather exotic, cases arise where only a few customers are interested in particular assets. As outlined above, if the respective volume in custody is (comparably) low, it is neither feasible for existing custody providers nor for internal custody solutions to accommodate the protocol.
The logical solution to a landscape of specialized custodians is not to engage one provider exclusively but to connect to the entire market. DECUS solves this issue by providing access to a wide variety of custodians, enabling you to service your clients with all assets they might want.