Tag: Institutional Custody

  • BNY Mellon to Offer In-Custody Crypto Staking for Institutions via Galaxy Partnership

    BNY Mellon to Offer In-Custody Crypto Staking for Institutions via Galaxy Partnership

    BNY Mellon has announced plans to integrate crypto staking into its digital asset custody platform through a collaboration with Galaxy, the bank confirmed on August 4, 2026. The proposed service would allow eligible institutional clients to earn staking rewards while keeping their assets within BNY’s custody system, pending regulatory approval.

    Under the arrangement, Galaxy will provide the staking infrastructure and technical support, enabling clients to participate in proof-of-stake blockchain networks without transferring their tokens to a third party. BNY said the service would maintain the same controls, governance standards, and asset protections expected by institutional investors.

    “As digital assets continue to evolve, clients want more than safekeeping alone — they want a broader set of capabilities delivered through an institutional-grade model,” said Carolyn Weinberg, BNY’s chief product and innovation officer.

    Galaxy will also serve as a design partner for BNY’s broader digital asset platform, contributing to infrastructure development beyond staking. The Nasdaq-listed firm, which already uses BNY’s custody platform as an early client, brings expertise in proof-of-stake networks and digital asset operations.

    Steve Kurz, Galaxy’s global co-head of digital assets, said: “The future of financial markets will be built on open, programmable rails, and the institutions that move first will define the era that follows.”

    BNY launched its digital asset custody service in 2022 and continues to expand blockchain-related services. The bank manages tens of trillions of dollars in assets under custody and administration. It also plans to move core transfer agency record-keeping onto blockchain, enable around-the-clock settlement for U.S. Treasuries by 2027, and test tokenized Treasuries on a private blockchain before the end of 2026.

    Ethereum, the largest proof-of-stake network by market value, remains a key reference point for staking services. At press time, Ethereum traded near $1,868, with a market value of about $225 billion. However, BNY did not specify which networks or tokens the staking service would support, nor did it provide a launch date, fee structure, or client eligibility details.

  • Bitcoin Exchange Supply Drops to Multi-Year Lows as ETFs and Institutional Custody Shift Market Dynamics

    Bitcoin Exchange Supply Drops to Multi-Year Lows as ETFs and Institutional Custody Shift Market Dynamics

    Bitcoin exchange balances have fallen to levels not seen in years, but analysts warn that the traditional bullish interpretation of this trend no longer holds the same weight. According to blockchain analytics firm Santiment, the amount of Bitcoin held on exchanges has dropped to just 6.6% of its circulating supply, while Ether stands at 4.3%—the lowest since 2017 and 2015, respectively.

    Industry executives point to the rise of institutional custody, spot exchange-traded funds (ETFs), and decentralized finance (DeFi) as key factors reshaping how digital assets move. In the past, declining exchange reserves signaled that investors were moving coins into self-custody, reducing immediate selling pressure and often preceding price rallies. Today, the picture is more complex.

    Mark Zalan, CEO of GoMining, noted that prolonged declines in exchange supply have historically appeared before multi-quarter bull markets, but he cautioned that accurate timing remains uncertain. Meanwhile, Eneko Knorr, CEO of Stabolut, explained that many assets now flow into staking platforms, DeFi protocols, and institutional custody rather than remaining on exchanges. Bitcoin withdrawn from exchanges often becomes wrapped assets like WBTC, used as collateral or lent across decentralized markets.

    Spot Bitcoin ETFs further complicate the narrative. When demand rises, ETF issuers purchase Bitcoin and place it with custodians such as Coinbase Custody, Fidelity Digital Assets, and BitGo. Investors then trade ETF shares on regulated exchanges while the underlying Bitcoin stays off exchange wallets. Currently, U.S. spot Bitcoin ETFs hold over $73 billion in net assets (more than 641,400 BTC), and Ether ETFs manage roughly $13.7 billion (about 7.7 million ETH).

    Ben Nadareski, CEO of Solstice, described lower exchange balances as the end of the exchange-custody era rather than a simple bullish indicator. Assets are now moving toward regulated custodians or productive on-chain positions. Historical data also shows that low exchange reserves do not guarantee higher prices—during 2022, reserves stayed relatively low while Bitcoin prices still declined sharply.

    Despite these shifts, accumulation continues across multiple sectors. Public companies now hold about 1,264,579 BTC, private companies own 281,752 BTC, and government entities control 649,954 BTC. DeFi and related protocols hold 369,595 BTC, while ETFs and exchanges account for 1,622,533 BTC. Nearly seven million Bitcoins remain in dormant wallets, meaning about 56.5% of the circulating supply (roughly 11.2 million BTC) sits outside active trading.

    In summary, while Bitcoin’s exchange supply remains near historic lows, the indicator no longer provides a straightforward bullish signal. The market has matured, and investors must consider ETFs, institutional custody, and DeFi to understand true supply dynamics.