Category Archives: Mike Belshe

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BitGo Becomes Officially Qualified Crypto Custodian in United States

BitGo has received approval from the South Dakota Division of Banking to be a public South Dakota Trust Company. This makes it an officially licensed crypto custodian in South Dakota, and the rest of the United States, because other states generally practice reciprocity when it comes to this sort of license.

BitGo claims to be the first qualified crypto custodian in the United States, although, there are certainly other major crypto custodians active in the United States such as Coinbase and Xapo. At the least, BitGo is probably the custodian with the most cryptos available – more than 75, including major cryptos like Bitcoin and Ethereum, and numerous Ethereum based tokens.

Mike Belshe, the CEO of BitGo had this to say:

“Custody has been the missing piece of cryptocurrency market infrastructure and this gap has kept institutional investors out of the market. Traditional custodians don’t have experience handling cryptocurrency. Exchanges that double as custodians present a conflict of interest and raise regulatory concerns. BitGo Trust Company is a qualified custodian, and therefore the only custody offering that delivers the highest levels of both security and regulatory compliance”.

In this statement is a direct jab at Coinbase, which runs both an exchange and a custodian service for crypto.

Indeed, crypto custodianship is an essential piece of infrastructure for institutional investors, and BitGo will be specifically targeting institutional investors with this new trust company. Institutional investors deal with large amounts of money in the USD 1 million to USD 10 billion range, and they need a crypto custodian to bank their crypto to ensure no chance of getting hacked or robbed. Crypto custodians are generally insured, leaving no chance of losing crypto for people using a true crypto custodian service.

Also, when dealing with large amounts of crypto, it is essential to follow know your customer (KYC) and anti-money laundering (AML) laws to ensure no violations of regulations. BitGo will make sure institutional investors don’t have any run-ins with the law.

Crypto custodians like BitGo Trust Company are essential for crypto hedge funds. There are at least 466 crypto hedge funds and that number is rapidly growing. Crypto hedge funds will link up with crypto custodians, creating optimal investment conditions for institutional investors that want crypto. This institutional investment infrastructure could lead to the next big crypto rally.

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Chat Giant LINE Launches BITBOX Crypto Exchange, Signs BitGo Partnership

Global messaging giant LINE, which is headquartered in Tokyo, Japan has announced the launch of the BITBOX cryptocurrency exchange. BITBOX is based in Singapore and offers 15 languages and 30 different cryptocurrencies.

Due to lack of regulatory approval BITBOX is unavailable to users in the United States and Japan. The site is blocked off to citizens of these countries but BITBOX is open for business in all other countries.

The primary goal of BITBOX is to merge the social experience of LINE with a cryptocurrency exchange, so perhaps the main draw of BITBOX will be an active community with easy-to-use chat software. There are plenty of crypto exchanges that have at least rudimentary chat software, but by using LINE’s messaging technology BITBOX can take crypto exchange chat rooms to more sophisticated levels.

LINE is a popular messaging app with 600 million users as of 2015. This will make it easy for LINE to get customers for BITBOX since it can advertise it to a large user base. Further, LINE is offering free trading for the first month after launch, and USD 10 of cryptocurrency for the first 2 million users.

BITBOX has partnered with BitGo, a cryptocurrency custodian, to provide security for the exchange. LINE’s BITBOX announcement says, “The BitGo wallet is the only institutional-grade, multi-signature, multi-coin hot wallet. Multi-signature, three-key management removes any single point of failure, and advanced security configurations ensure that assets are secure as they move in and out of the wallet. The BitGo wallet pairs seamlessly with BitGo’s cold storage custody making asset transfer simple and secure.”

Apparently, LINE and BitGo are aiming to attract institutional investors. BitGo CEO Mike Belshe says, “LINE and BitGo are both leaders in our industry and this partnership with BITBOX is an important step in bringing institutional investors the security, compliance, and custodial solutions they need. LINE has an established history of success in the global market. Together BITBOX and BitGo are committed to providing the most secure and reliable user experience in the digital token ecosystem.”

 

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