Zodia Custody, a leading institution-first digital asset custodian whose shareholders include Standard Chartered, SBI Holdings, Northern Trust and National Australia Bank, has partnered with 21Shares, one of the largest ETP issuers, to provide custody services for physically backed ETP products in Switzerland and the wider European market.

Digital asset exchange-traded products (ETPs) — which include exchange traded funds (ETFs) such as the Bitcoin Spot ETF — have become big business for institutional investors in the short time they have been approved for investors. Data from 21Shares shows that by the end of Q1 2024, 937 professional investors owned $11B in US Bitcoin Spot ETFs — around 20% of the ETFs’ total assets. By contrast, Gold ETFs had only 95 professional investors in their first quarter post-launch, representing less than 10% of Bitcoin ETFs’ reach.

Against the backdrop of a continuing sharp increase in ETP demand, institutions require greater security and expert custody services throughout the issuance to redemption lifecycle — which is where the partnership between 21Shares and Zodia Custody comes into play.

Through this partnership, 21Shares will bring to its investors an additional layer of security, protection, regulatory compliance and transparency to its physically-backed ETPs . Additionally, Institutions using 21Shares for ETP investments will also benefit from cold-storage wallets, coupled with 24/7 instant access to allow investors to move at the speed of the market.

For institutional investors, the crucial end result is greater risk management controls, stemming from the custodian’s bank-grade and compliant approach to custody.

“ETPs promise a lot of potential, and institutional demand is loud and clear.” says Julian Sawyer, CEO of Zodia Custody. “We’ve listened. That’s why we have partnered with true market leaders in the ETP digital asset space, 21Shares, to deliver a partnership that will have a real impact on the whole ecosystem – without any compromise on security, risk management, or compliance.”

The partnership highlights both firms’ commitment to security and transparency, representing a means for institutions to get exposure to digital assets, including ETPs, with the same standards and guardrails as seen in traditional finance.

“21Shares is thrilled to partner with Zodia Custody, leveraging their unparalleled expertise in secure digital asset storage and management,” said Mandy Chiu, Head of Financial Product Development at 21 Shares. “This collaboration marks a significant milestone in our commitment to providing top-tier investment opportunities for our clients. Zodia Custody’s industry-leading cold storage infrastructure and streamlined compliance solutions have enhanced our offerings, ensuring our investors benefit from the most advanced and diversified custodial services available. Together, we are setting new standards in the digital asset market, driving growth, and fostering trust among institutional investors.”

Source: Zodia Custody