July 27, 2023 | Cryptocurrencies | No Comments
Nasdaq, the online electronic exchange platform where securities are purchased and traded globally, has halted plans of offering digital asset custody as an investment service. According to CEO Adena Friedman, they have abandoned all plans of launching the service they previously planned to roll out by the 2nd quarter of 2023. The decision was in light of the shifts in regulatory concerns surrounding digital assets.
Ms. Friedman made the announcement in a recent earnings call, stating that because of the uncertainties of the business, they have arrived at a decision to halt all plans of engaging in rendering digital assets custodianship services.
Uncertainties, Results of Intense Crackdowns on Non-Compliant Digital Asset Companies
The uncertainty of the regulatory environment is apparently a result of the increasing regulatory pressure being imposed by US financial authorities, particularly the Securities and Exchange Commission (SEC).
Incumbent SEC Chairperson Gary Gensler has been intent in going after Binance, Coinbase and other similar digital assets companies. Chairman Gensler said
he is committed to weeding them out because in all of his four decades of acting as a regulator, he has never seen so many cases of non-compliance and of masquerading as a real firm.
Nevertheless, sources at Nasdaq say that even if the digital custody plans have been shelved, Nasdaq will continue to support the exchange partnership formed with Coinbase and Blackrock. The pledge pertains to the partnership’s application to establish the first digital asset market place for Exchange-Traded Funds (ETFs). This is a different story altogether since ETFs refer to trading of funds derived from exchanges, but can also be impacted by the SEC’s ongoing crackdowns.