Coinbase, Exchanges

Is Coinbase a Qualified Custodian?

As the world’s largest cryptocurrency exchange, Coinbase has been a driving force in making digital currencies mainstream. The US-based company allows users to buy and sell cryptocurrencies, as well as store them in a wallet on the Coinbase platform.

In 2018, Coinbase launched its own custodial service, Coinbase Custody, in an effort to attract institutional investors to the cryptocurrency space. But is Coinbase a qualified custodian?.

NOTE: WARNING: Coinbase is not a qualified custodian under the SEC’s custody rule. Individuals should be aware that their funds held by Coinbase are not protected by the Securities Investor Protection Corporation (SIPC). Additionally, individuals should also be aware that Coinbase cannot provide any assurance or guarantee against loss of funds due to theft, fraud, or other malicious activities.

The answer is yes. In order to provide custody services, Coinbase had to obtain a license from the New York State Department of Financial Services (NYDFS).

This license requires Coinbase to meet a number of stringent requirements, including maintaining capital reserves, implementing anti-money laundering procedures, and having a robust security program. Coinbase Custody is also audited on a regular basis by an independent third party.

All of this means that when you entrust your digital assets to Coinbase Custody, you can rest assured knowing that they are in good hands. So if you’re looking for a qualified custodian for your cryptocurrency investments, Coinbase is definitely worth considering.

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