Nomura JV gains regulatory approval for crypto custody and depositary services in Jersey

Nomura's joint venture platform, Komainu, is aiming to create a cryptocurrency ecosystem fit for institutional investors.

By Jonathan Watkins

Nomura’s bid to bring custody and depositary services for cryptocurrencies to institutional investors has been boosted by the receipt of regulatory approval from the Jersey Financial Services Commission.

A notice on the regulator’s website confirmed that Komainu, established by Nomura, Ledger and Global Advisors Partners in May 2018, has been approved as a custodian and depositary.

Nomura, along with the likes of Fidelity and Intercontinental Exchange (ICE)-owned Bakkt, are aiming to create a cryptocurrency ecosystem fit for institutional investors with the security and infrastructure they are familiar with when trading traditional assets.

A spokesperson from Nomura declined to comment.

From a custody perspective, incumbent players such as State Street, Standard Chartered and Northern Trust, have been open to exploring servicing around digital assets without committing to an offering at this time.

In a joint statement from Nomura last year, the bank said Komainu was set up to “overcome barriers to institutional investment in digital assets with new services, standards and best practice”.

Earlier this week the New York State Department of Financial Services (DFS) approved Fidelity Digital Asset Services to provide a virtual currency custody and execution platform, on which institutional investors and individuals can securely store, purchase, sell, and transfer Bitcoin. 

Earlier this year the EU financial watchdog said divergent definitions of safekeeping between regulations and national authorities should be addressed in order to overcome custody challenges for crypto-assets.

A paper published by the European Securities and Markets Authority (ESMA) highlighted how there is no harmonised definition of safekeeping and record-keeping of ownership of securities at an EU-level, and would therefore be difficult to apply to a new asset class such as crypto.