- Standard Chartered Bank has launched a digital asset custody service in the UAE, initially supporting Bitcoin and Ethereum.
- The Dubai Financial Services Authority regulates the service and it operates within the Dubai International Financial Centre.
- The UAE’s progressive attitude towards digital finance makes it an ideal launch pad for this service.
Standard Chartered Bank has officially launched its digital asset custody service in the United Arab Emirates (UAE). The new service will be provided by DIFC, a UAE-based institution regulated by the Dubai Financial Services Authority (DFSA).
To launch the service, it will only accept Bitcoin and Ethereum due to their dominance in the market.
Standard Chartered Bank Expands Cryptocurrency Services in UAE
The UAE was chosen as one of the leading and progressive countries in the field of financial digitization. Standard Chartered Bank noted that the country’s favorable legal framework is well suited to promote the development of cryptocurrencies.
The launch signals the UAE’s strategic goal to position itself as a world power in the digital financial industry. Standard Chartered said institutional clients in the region need a regulated digital asset custody service provider.
Given the growing demand for cryptocurrency storage, offering this service through a secure platform will be of great significance. The move comes amid the growing adoption of digital assets by financial institutions around the world.
Institutional adoption of cryptocurrencies gains momentum
Standard Chartered is one of the banks working to expand its services in the cryptocurrency space. In June 2023, the bank opened a Bitcoin (BTC) and Ethereum (ETH) trading desk for institutional investors.
It has also entered into a strategic partnership with Web3 companies Animoca Brands and Crypto.com. The move is aimed at expanding the company’s position in the digital asset space. Brevan Howard Digital Asset, the cryptocurrency arm of British hedge fund Brevan Howard, is the first client of the new service.
The move is another sign of the growing institutional adoption of cryptocurrencies as a bona fide investment asset class. Meeting the needs of institutions that require robust and secure storage solutions is critical.
UAE ranks among the top crypto adoption countries in the world
Standard Chartered plans to offer the same custody services in other financial markets in the coming months. For example, the bank is also exploring the possibility of expanding its digital asset portfolio to include more cryptocurrencies. This expansion is in line with the bank’s strategic plan to become one of the leading digital asset service providers.
The UAE’s position in the Henry Cryptocurrency Adoption Index 2024 demonstrates its support for developing new technologies. The UAE ranks third in the global digital asset adoption index, behind Singapore and Hong Kong. This environment has attracted financial institutions such as Standard Chartered to enter the fast-growing cryptocurrency market.
Standard Chartered’s entry into the digital asset custody space comes at an opportune time. As demand for regulated solutions continues to grow, the bank’s services are likely to attract more interest from institutional clients. Hopefully, this move will increase confidence in the security of digital assets in the space.
UAE policies drive cryptocurrency adoption growth
The adoption of cryptocurrencies has been made easy due to the policies implemented in the UAE. The launch of Standard Chartered’s custody service is indicative of the country’s dominance in the digital financial services sector.
This is consistent with Dubai's attitude towards digital assets. It is also reflected in the regulatory approach of the Dubai Financial Services Authority and the support of financial innovation by the Dubai International Financial Center. The bank has also taken other strategic measures in the crypto field. For example, it joined the Hong Kong Monetary Authority's stablecoin sandbox.
In August 2023, the bank partnered with Crypto.com to enable fiat currency processing in more than 8 countries, with the UAE being the first. These initiatives demonstrate the bank’s willingness to expand its presence in the digital asset market.