Standard Chartered Expands Its Digital Asset Custody Business

Standard Chartered has signed a deal to acquire 100% of Zodia Custody, a company that provides digital asset custody services to institutional clients.

The agreement, announced on October 21, will bring Zodia’s regulated custody business into Standard Chartered’s existing banking operations. However, the deal still needs regulatory approval before it can be completed.

Under the agreement, Standard Chartered I H Limited will acquire Zodia Custody Limited, which owns regulated businesses in Singapore, Hong Kong, Australia, Luxembourg and the United Arab Emirates (UAE). The bank has not disclosed the financial terms of the deal or when it expects the acquisition to be completed.

The agreement follows an announcement in May, when Zodia’s shareholders and noteholders accepted Standard Chartered’s non-binding offer to buy the business.

Digital assets custody involves securely holding assets such as bitcoin on behalf of customers. Banks and other financial institutions offer these services to help large investors store and manage their digital asset holdings.

After the acquisition is completed, Zodia’s custody operations will become part of Standard Chartered’s Securities Services business. The bank expects the move to strengthen its digital asset services and make it easier for institutional clients to access both traditional financial assets and digital assets through one provider.

Ying Ying Tan, Standard Chartered’s global head of Securities Services and Digital Assets, said the acquisition would strengthen the bank’s position in the market.

“The acquisition of Zodia Custody further deepens our digital asset custody portfolio and reinforces our position as a leading provider of digital asset services globally,” Tan said.

Zodia CEO Richard Clark said demand for digital asset custody was growing as more financial institutions entered the digital asset market. “As institutional adoption of digital assets accelerates, custody is increasingly becoming part of the global banking landscape,” Clark said.

He added that combining Zodia’s experience with Standard Chartered’s international network would help the bank provide more institutional clients with access to regulated digital asset custody services.

Standard Chartered said existing Zodia customers would continue receiving services as usual, with no expected disruption from the acquisition.

Not all of Zodia will become part of Standard Chartered. Its software and professional services business will be separated from the custody operations and transferred to a new independent company called Zodia Solutions.

The company will operate under SC Ventures, Standard Chartered’s innovation and investment arm, and continue providing digital asset technology to financial institutions, including Standard Chartered itself.

Zodia Solutions will be supported by several investors, including Northern Trust, NAB Ventures, SBI Ventures Asset and Emirates NBD Bank.

Craig Perrin, CEO of Zodia Solutions, said financial institutions were moving beyond small-scale digital asset experiments and preparing to offer digital asset services more widely. He said they needed reliable technology partners with the expertise and infrastructure to support that growth.

The arrangement will allow Standard Chartered to bring bitcoin and digital asset custody into its banking business while Zodia Solutions continues selling its technology to other financial institutions.

Zodia Custody launched in 2020 with support from Standard Chartered and Northern Trust. It was created to help institutional investors securely store bitcoin and other digital assets.

Since then, the company has expanded into five markets: Singapore, Hong Kong, Australia, Luxembourg and the UAE. It has also attracted investment from other financial institutions.

The acquisition brings Zodia’s custody business closer to the bank that helped establish it, while allowing its technology business to continue operating separately.