Popular online crypto service provider BitGo has recently announced receiving approval from South Dakota regulators to operate a digital asset custody service. The company spent most of the previous year attempting to offer regulated custody solutions for its clients. BitGo finally secured the necessary licensing in October 2018 and now aims to bring traditional wealth management approaches to the forefront of the crypto market.
Digital Asset Custody Solutions
BitGo currently provides clients with a suite of services, including:
- Wallet solutions
- Regulated custody services
- Enterprise blockchain integrations
Clients can access both online (hot) and offline (cold) storage options. These compliant services offer institutional-grade protections sought by major investors, financial firms, and corporations.
To enhance security, BitGo established the BitGo Trust, operating under full regulatory compliance with South Dakota’s Anti-Money Laundering (AML) and Know-Your-Customer (KYC) protocols.
👉 Explore how BitGo Trust redefines crypto security
This trust provides registered advisors and broker-dealers a safer entry point into digital markets. Previously, large crypto investors had to self-custody assets, exposing them to significant risks from both cyber and physical threats.
Securing Your Crypto Holdings
The absence of regulated custody previously led to unintended consequences, such as the rise of crypto insurance markets. Holders of substantial assets could pay premiums to insure their holdings, a service BitGo also offers.
However, many insurance options remain cost-prohibitive for small-to-medium investors.
Rising Theft Incidents
As Bitcoin’s price surged, so did theft rates within the market. Beyond typical hacks and scams, physical crimes like armed robberies increased. In one harrowing case, a Dutch investor was tortured with a power drill to extract private keys.
BitGo recognizes these dangers and aims to deliver a more cost-effective and secure solution for the crypto community.
Ground-Up Development
BitGo built its custody service from scratch, a unique approach in the market. This marks the first regulated custody solution exclusively designed for digital assets.
Shahla Ali, BitGo’s Chief Compliance and Legal Officer, emphasized the platform’s differentiation:
"We wanted to demonstrate to clients and regulators that digital asset custody is a critical market need. Our solution bridges the gap for traditional investors."
Analysts frequently cite the lack of institutional capital as a barrier to crypto adoption. BitGo’s service could be a pivotal answer.
Market Positioning
BitGo now enables large investors to store assets safely and familiarly. If successful, the company could position itself at the forefront of the digital economy.
FAQs
Q: How does BitGo Trust enhance security?
A: It operates under strict AML/KYC compliance and offers both hot/cold storage with institutional-grade protections.
Q: Is BitGo’s service affordable for small investors?
A: Currently, its primary focus is on institutional clients, but the trust model may expand accessibility.
Q: What makes BitGo’s custody unique?
A: It’s the first platform built specifically for digital assets, unlike retrofitted traditional custody services.
👉 Learn more about crypto custody innovations
David Hamilton is a full-time journalist and long-time Bitcoin enthusiast specializing in blockchain coverage. His work has appeared in major crypto publications.
### Keywords:
- Cryptocurrency custody
- BitGo Trust
- Digital asset security
- Regulated crypto services
- Institutional crypto investments
- AML/KYC compliance
- Cold storage solutions
- Crypto theft prevention