Standard Chartered Bank is set to acquire Zodia Custody, enhancing its digital asset custody services.
Standard Chartered Bank has announced its acquisition of Zodia Custody, a company specializing in digital asset custody services. Founded in 2020 via a collaboration between Standard Chartered's investment branch, SC Ventures, and Northern Trust, Zodia was initially majority-owned by the bank, although its share was reduced following outside investments.
The details of the financial agreement remain confidential. This acquisition is part of Standard Chartered's strategy to enhance its capabilities in the digital asset custody sector, integrating these services into its broader financing and securities operations.
According to a bank spokesperson, the move is expected to unlock new revenue opportunities and streamline costs, offering clients a more complete suite of services for managing digital assets globally.
Upon acquisition, all assets will be transitioned to a new company called Zodia Solutions, which will operate independently under SC Ventures. This new entity will focus on providing robust infrastructure for financial institutions, working under a Software as a Service (SaaS) model.
"The acquisition will expedite the growth of our digital asset custody services and bolster our financing and securities offerings, reinforcing our role as a vital link between traditional finance and decentralized finance (DeFi)," stated a bank representative.
Projected Growth in Tokenized Assets to $4 Trillion by 2028
Standard Chartered also forecasts that the market for tokenized assets will surge to $4 trillion by the end of 2028. Analysts suggest a significant portion of this growth will favor DeFi protocols, as highlighted in recent reports.
The bank anticipates an even split between stablecoins and other real-world asset (RWA) products in this market expansion.
Jeffrey Kendrick, who leads digital asset research at Standard Chartered, attributes this expected growth to the unique capabilities of DeFi, where tokenized assets can be used flexibly across various applications, such as generating yield, acting as collateral, and maintaining liquidity.
- Utilize the same asset in multiple contexts.
- Generate yield through various mechanisms.
- Provide collateral for loans.
- Facilitate liquidity across platforms.
"Such versatility is unachievable without blockchain technology," Kendrick noted.
In traditional finance, similar functionalities typically involve several intermediaries, making processes more cumbersome.
