Crypto Custodian BitGo Joins Race to Provide Prime Brokerage Services

[Cordillerabit]

Crypto custodian BitGo is moving into the prime brokerage space, announcing a fully integrated suite of services Wednesday to serve institutional traders.

The services will be offered by BitGo Prime, a new entity that will be headed by Nick Carmi, BitGo’s head of financial services. Carmi joined the firm last year after stints at various banks and other financial institutions.

BitGo Prime has already launched crypto lending services, and plans to expand these as well as build liquidity on its platform this year.

BitGo CEO Mike Belshe told CoinDesk said building a prime brokerage in the crypto space is a difficult undertaking, at least in part because the overall infrastructure is still relatively young. In his view, a true prime brokerage begins with regulated custody, followed by lending and borrowing services.

He said the company’s recent acquisition of tax management provider Lumina might have been “the biggest part” of its prime brokerage announcement.

 

“They had already had some elements of trade but it fits in well with the portfolio views that we’re doing,” he said. “We’re trying to shift the overall product focus from like ‘here’s our wallets,’ … [to] more about like ‘what’s your overall portfolio?’”

BitGo Prime offers trading on a fully non-disclosed basis, he said, meaning that while BitGo knows who its clients are through its know-your-customer/anti-money laundering measures, the outside world is not privy to which companies are conducting a given trade.

Carmi said the services are targeted to institutional investors already familiar with the prime brokerage model.

“You can trade right now out of your cold storage,” Carmi said. “Operational security is there, operation controls are there, it’s an insured wallet, right, to be protected and nobody knows whether it’s you buying or you selling because all they see in the market is BitGo buying.”

Source: Bityard