BitGo Adds 57 ERC-20 Tokens And Continues With its Custody Service Expansion
Institutional investors may now be able to have a better access to the cryptocurrency market. The startup known as BitGo, said that it expanded its suite of custody products and services to support 57 new ERC-20 tokens.
BitGo has been an industry leader in working with wallets on cryptocurrency exchanges, but the service may now be limited to larger protocols like Bitcoin and Ethereum, for example. The company is working very hard in order to release its institutional custody services. Other companies like Coinbase, Smart Valor and bank Nomura are also three important companies developing licensed crypto storage solutions.
The addition of these tokens could be very promising for the company and a first-move advantage. According to BitGo’s CTO, Benedict Chan, there has been a surge in the demand for custody solutions for other assets and not just Ethereum and Bitcoin.
“These institutions, they generally don’t want to self-manage their coins. They are looking for someone that can support multiple coins.”
Another firm focused on advising institutions about investments in Initial Coin Offerings, describe the blockchain industry trend as an ‘arms race’ which is trying to offer institutional-grade custody solutions for different assets in the market.
This is why, the VP of product marketing, Robin Verderosa, explained that BitGo is trying to do everything as possible to have a BitLicense in New York and a qualified custodian license in South Dakota. By the end of 2018, BitGo aims to offer more than 100 different virtual currencies to its clients.
Verderosa Commented On The Matter:
“What we’ve learned is that they’re interested in investing in a basket of coins and tokens that kind of help hedge the market and give better returns.”
But it is also important to mention that dealing with smaller cryptocurrencies is related to higher risks. In the future, BitGO will include the Kin cryptocurrency offered by the chat messaging app Kik, tokens for decentralized exchanges and the blockchain identity crypto Civic.
All the tokens added by BitGo in the first batch were requested by institutional clients that work with BitGo. Isaac Eleftheriadis, which heads a team at BitGo, said that every token added has been studied to make sure that the issuers and founding team are reputable.
Arianna Simpson, former BitGo employee sai that an important challenge for custodians that are coming to the market is trying to figure out how to handle issues like airdrops, hard forks and more. It is also difficult to decide which ones they will be supporting and which ones not.
Some other clients like ICOs have been asking the company to hold their tokens before even launching the token to the market because they want to offer better quality products than other competitors.
Olga Feldmeier, Smart Valor CEO, said that many high net worth individuals around the world and institutions want to have a licensed expert that handles their storage and security. This is why the Smart Valor platform is partnering with the wallet manufacturer Ledger, an important recognized company in the market. It offers on-site storage of private keys and other services which is comparable with deposits at a bank.
Mr. Chan has also explained that ethereum tokens are also prone to bugs in the smart contracts behind them and that some hackers exploited them. For example, back in 2017, attackers were able to steal $30 million dollars worth of Ethereum tokens from parity wallet users.
Chan commented on the smart contract issues:
“There’s a lot of different events that have happened because of smart contract bugs. So, we try to be on the safer side there.”