Key facts
- Over 30% of digital assets, excluding centralized exchange holdings, are now held through institutional custody models.
- A regional bank with a $200-30 billion balance sheet could improve its profit and loss by up to $100 million with the right custody decisions.
- Security and key management have become requirements under MiCA and the GENIUS Act.
Custody is evolving beyond a mere storage solution to become a core operational layer for digital finance, according to a report by Boston Consulting Group (BCG) commissioned by crypto firm Ripple. As the convergence of traditional finance and crypto grows, financial institutions are increasingly investing in digital assets and the underlying custody services. The report found that over 30% of digital assets, excluding those held on centralized exchanges, are now managed through institutional custody models, a figure that is expected to rise. Regulatory requirements like MiCA and the GENIUS Act have made security and key management essential, prompting institutions to prioritize governance, interoperability, and integration with existing financial infrastructure when selecting custody providers. BCG estimates that proper custody decisions could boost the annual profit and loss of a regional bank with a $200-300 billion balance sheet by up to $100 million. Major institutions like Morgan Stanley, Citi, and BNY are already expanding their custody offerings, while fintechs are adopting Wallet-as-a-Service models. Ripple offers integrated crypto infrastructure services, combining custody with other financial functions, and has partnered with Meritz Securities to bring these capabilities to South Korea's capital markets.