Zodia, Standard Chartered's Crypto Subsidiary, Commences Operations in Singapore

12 Sep, 2023

Zodia, Standard Chartered's Crypto Subsidiary, Commences Operations in Singapore

Zodia Custody, a company specializing in providing crypto storage solutions for large institutions, has made its debut in Singapore as it seeks to tap into the nation's rapidly growing digital asset industry.

This development marks a significant milestone as Zodia becomes the first entity jointly owned by and partnered with banks to offer digital asset custody services to financial institutions in Singapore. The announcement was made by Zodia through an official news release.

Zodia operates as a subsidiary of Standard Chartered, a renowned British bank with a strong presence in emerging markets, including Asia, Africa, and the Middle East. The genesis of Zodia dates back to 2021 when Standard Chartered, in collaboration with Northern Trust, launched the venture. This strategic move underscored the increasing interest of major financial institutions in exploring the world of digital currencies. Notably, Zodia also counts SBI Digital Asset Holdings, the crypto division of Japan's SBI bank, as one of its partial owners. As part of this partnership, SBI also committed to initiating its own custody business in Japan.

With its sights set on further expansion, Zodia aims to cater to the burgeoning demand for bank-grade digital asset custody solutions across the Asia-Pacific region. This expansion aligns with the growing requirements of both new and existing clients in the area.

Singapore is currently on the cusp of evolving its regulatory framework for crypto assets and advancing the development of central bank digital currencies. Julian Sawyer, CEO of Zodia, emphasized the significance of Singapore's role in the crypto space. He noted that Singapore has long been a key player in the crypto world and that Zodia is eager to become an integral part of this thriving market. He believes that a bank-owned custodian like Zodia perfectly aligns with the market's needs.

Zodia serves a diverse clientele, ranging from hedge funds and high-frequency traders to prime brokers, exchanges, and asset managers.

Sawyer also highlighted the pivotal role played by Standard Chartered's reputable brand in Singapore. Being associated with such a well-established institution has significantly bolstered Zodia's engagement with major financial firms.

Singapore has been experiencing a surge in digital asset adoption, with a crypto ownership rate of 19%, surpassing the global average of 15%, according to Statista, a prominent market research firm.

Despite challenges faced by the crypto industry, including market volatility and notable incidents involving platforms like FTX, Three Arrows Capital, and Terra, funding for crypto companies in Singapore has remained robust. Crypto and blockchain secured the top spot in fintech investment in Singapore for 2022, amassing $1.2 billion in funding, as reported in KPMG's Pulse of Fintech report for the second half of 2022. While funding in crypto-related ventures did experience a 21% dip, the global crypto startup ecosystem still managed to raise an impressive $23.1 billion in 2022, although this represented a 23% decrease from the previous year.

Zodia's expansion into Singapore follows its recent foray into Abu Dhabi, where the company received in-principle regulatory approval. This strategic move allows Zodia to leverage the crypto-friendly regulatory environment and the financial center status of the United Arab Emirates capital.