Digivault: Digital asset custodian is first of its kind

On 14 May 2021, Digivault became the first stand-alone digital asset custodian to receive approval from the FCA to register as a custodian wallet provider under the UK's Money Laundering Regulations.

Under these regulations, a "custodian wallet provider" is described as a firm or sole practitioner who by way of business provides services to safeguard, or to safeguard and administer:

• cryptoassets on behalf of its customers, or
• private cryptographic keys on behalf of its customers in order to hold, store and transfer cryptoassets, when providing such services.

Digivault, which is the secure digital asset custody business of Nasdaq-listed Digninex Limited, provides one of the widest custody offerings on the market, including custodial services for assets in bitcoin (BTC), ethereum (ETH) and USDC.

The FCA’s approval, which Digivault hails as a key milestone in its strategy to provide compliant and secure custody services to corporate investors, comes not long after the FCA's CEO, Nikhil Rathi, warned in a speech that direct investment in cryptoassets is high risk and investors should be prepared to lose all their money.

Crypto is an area increasingly under scrutiny by wary regulators, with lots of regulatory activity on the horizon. For example, the FCA's April 2021 discussion paper 21/1 is seeking views on changes the FCA can make to strengthen its financial promotion rules for high-risk investments, which applies to firms operating in the cryptoassets market.