Institutional investors still face a conundrum when deciding how to hold their crypto assets in custody, according to the results of an informal poll done by crypto-exchange operator Gemini.

Before starting a webinar regarding the state of crypto custody, Gemini asked which custody methods the attendees currently used. The largest plurality (18%) used crypto wallets while self-custody (16%) and third-party custody (10%) proved the second and third most popular methods.

However, some respondents have taken a belt-and-suspenders route and have adopted a hybrid model of self-custody and crypto-wallets (7%) or used all three models in conjunction (6%). The largest plurality (42%) answered that they were looking to learn more about crypto-asset custody.

The poll results were not that surprising given the new asset class’ retail-to-institutional adoption pattern, according to Kevin Johnson, COO at crypto-asset brokerage Tagomi, and who participated in the webinar.

“You learn about different personal solutions like a hardware wallet, which tend to suffice for a little while as you get used to learning about crypto, and your security needs are not that great,” he said. “You are not storing a life-changing amount of crypto all at once. As you grow your holdings or are in a position where you are holding assets on behalf of someone else as a fund or broker, you need a much better solution in order to do that.”

Unlike asset classes that have well-defined custody models, such as US equities, crypto assets are in their nascent stages. Each crypto custodian uses a different method to store client keys.

“We are at the beginning of the growth of a new type of banking industry that encompasses a lot of different assets and a lot of different services,” said fellow panelist Dana Syracuse, a partner at the law practice of Perkins Coie. “There is room for multiple types of players.”

There is a significant amount of innovation coming from forward-thinking state regulators developing new licensing regimes or use older regimes, such as trusts, to analogize or adapt to new and emerging technologies, he added.

At the Federal level, Syracuse noted that there were several legal arguments that held banks regulated by the Office of the Comptroller of the Currency could be permitted to custody crypto assets under their existing charters.

“Another promising place is getting groups together like the Virtual Commodity Association and the Crypto Rating Council where there are groupings of highly regulated entities coming together to figure out which standards should they ask of themselves.”

When polled regarding which was the safest manner to store digital assets, the vast majority of the audience (79%) said in offline storage at a custodian. Twice as many of the respondents (14%) thought that storing digital assets in a self-secured USB device was more secure than storing the assets in an online exchange account.

Despite the poll’s results, Johnson and Syracuse were wary of regulators including specific requirements, such as mandated hot or cold storage, into future crypto regulations.

“Each of those have their own problems,” said Syracuse. “If you have something that is touching the Internet, it can be moved without human interaction and could be subject to some form of cyber loss. If you have something purely offline, it could be subject to a malicious internal loss.”

Besides offering their security methodologies to their clients, crypto custodians also can add a layer of business logic on top of their platforms to provide custom security models like white lists to individual clients, according to Johnson.

“Even if someone gains access to the system, the only place they would be able to take the crypto is back to another wallet controlled by the client,” he said.

Other controls might include a throttle on how much or how often clients could withdraw crypto assets in a defined period or whether they stray outside their regular transaction patterns.

“Given the different types of trading you need to do, there are different types of governance and activities that need to happen,” said Johnson. “It is good to have a variety of options.”