BitGo, a blockchain security services startup, has added support for 11 more Ethereum-based tokens, making the market that bit more attractive for hugely lucrative institutional investments where custodianship is the final barrier to entry.
The update brings the total number of tokens it supports up to 68, according to a press release provided exclusively to The Block, as it looks to realise a goal of 100 by year-end.
BitGo became a specialist in managing wallets at cryptocurrency exchanges that require multiple cryptographic signatures to access following its launch in 2012 and subsequently evolved to cater for institutional demand for ‘hot’ and ‘cold’ storage.
While those security services were previously limited to just six currencies, including bitcoin, ethereum and ripple, the company has been making a concerted push to widen its net, adding 57 new coins just last month.
A report by Bloomberg in June said the development of crypto-custody services – such as BitGo, among those being developed by Circle and Coinbase among score of others – had “huge implications” for the industry’s future by paving the way for “vast tracts” of new investors such as hedge funds, pensions and retail brokerages who have so far shied away from digital currencies over security concerns.
Coinbase predicts that some $20bm could be poised to flow into custody services once they’re on the market – despite the mean downturn in cryptocurrency prices since late last year – and could potentially cost up to $100,000 in setup fees while requiring multi-million minimum balances.
While many of BitGo’s rivals are looking to partner with global custodians such as Northern Trust and JPMorgan, the company forgoed a bid to acquire one in Kingdom Trust, deciding instead to build its own “new, regulated, qualified, custodian” specifically for cryptocurrencies.
BitGo’s pace in adding support for new tokens is by no means a vanity measure. Last month, the group’s CTO, Benedict Chan told Coindesk that there had been a surge in interest for custody solutions for alternative assets; “These institutions, they generally don’t want to self-manage their coins. They are looking for someone that can support multiple coins.”
That same report featured words Satis Group CFA & head of banking, Timothy Furey, who described an industry “arms race” among institutional custody solutions to provide support for a spectrum of tokens.
Some of those BitGo has added include Bancor (BNT), Blox (CDT), Metal (MTL), Storm (STORM), Tokenomy (TEN) and TrueUSD (TUSD).