Standard Chartered Expands Crypto Services in UAE

The UAE, being among the leading and progressive countries in the digitization of finance, was selected for this launch.

Standard Chartered has officially launched its digital asset custody service in the United Arab Emirates (UAE). Offered by DIFC, a financial center based in the UAE and regulated by the Dubai Financial Services Authority (DFSA), this new service will initially only support Bitcoin and Ethereum due to their market dominance.

The launch was chosen for the UAE due to the country being progressive and a leader in digitizing finance. Standard Chartered noted the country’s enabling legal framework, which is designed to advance cryptocurrency.

The launch furthers the UAE’s strategic goal of becoming a world powerhouse in the digital finance industry. According to Standard Chartered, there was a need for a regulated custody service provider for digital assets for institutional clients in the region.

This service will be important as demand for storing cryptocurrencies increases, offering a secure platform for this purpose. The move comes as more global financial institutions are adopting digital assets.

Standard Chartered is among the banks that have been expanding their crypto offerings. The bank opened a Bitcoin (BTC) and Ethereum (ETH) trading desk for institutional investors in June 2023.

It has also made strategic collaborations with Web3 company Animoca Brands and Crypto.com to expand the firm’s digital assets footprint. Brevan Howard Digital Asset, the cryptocurrency arm of British hedge fund Brevan Howard, will be the first client of the new service.

This move is another sign of the institutional adoption of crypto as a legitimate investment asset class, which will be needed to service institutions that need strong and secure storage solutions.

Standard Chartered Bank is set to offer the same custody service in other financial markets in the coming months. The bank is also exploring the possibility of expanding its digital asset portfolio to include more cryptocurrencies, for example. This expansion is part of the bank’s strategy to become a leading provider of digital asset services.

The UAE’s support for new technologies is evident in its ranking in the Henley Crypto Adoption Index 2024. The UAE comes third in the global index of digital asset adoption after Singapore and Hong Kong. This environment has attracted financial institutions such as Standard Chartered to enter the rapidly growing crypto market.

Standard Chartered’s entry into the digital asset custody space is timely. The bank’s service will likely be sought after by more institutional clients as the need for regulated solutions increases. This step will hopefully instill more confidence in the safety of digital assets in the region.

Due to the policies implemented by the UAE, the adoption of cryptocurrencies has been facilitated. The launch of Standard Chartered’s custody service highlights the country’s leadership in digital financial services.

This aligns with Dubai’s approach to digital assets, which is evident in the DFSA’s regulatory approach and the DIFC’s support for financial innovation. The bank has also taken other strategic steps in the crypto space. For instance, it has joined the Hong Kong Monetary Authority’s stablecoin sandbox.

In August 2023, it partnered with Crypto.com to enable fiat processing in over 90 countries, with the UAE being the first. These steps show the bank’s commitment to increasing its reach in the digital asset markets.