Coinbase has launched Coinbase Custody International Inc., a European entity for handling cryptocurrency deposits.
Based in Dublin, Ireland, Coinbase said in a blog post that client demand for institutional-grade custodial services drove the move. Separately, a spokesman for the exchange said Coinbase Custody now has $8 billion in assets under custody, up from the $7 billion announced in November.
“While Coinbase Custody has served European-based clients in the UK, Switzerland, Germany, Finland, the Netherlands and more since 2018, our dedicated presence in Europe will allow us to offer these services in a completely localized way, with local staff, localized [service-level agreements] and in compliance with local laws,” the company wrote.
As part of the transition, “all staking activity performed by Coinbase” will also migrate to Coinbase Custody International, the firm said. According to a source with knowledge of the regulatory landscape, there is still ambiguity regarding the tax implications of staking, where asset holders are rewarded in crypto for helping to secure Proof-of-Stake (PoS) networks such as Tezos and others. Some investors outside the U.S. are therefore hesitant to stake with U.S.-based firms, the source added.
Coinbase, a separate entity from Coinbase Custody International, received an Irish e-money license in October 2019. The company announced the creation of its Dublin office in October 2018.
Coinbase is not alone in expanding its custodial offerings. French startup Ledger recently announced a partnership with South Korean blockchain platform FLETA to provide compliant custody services across Asia.
“Our international launch is aimed to meet the demands of institutional investors in Europe and beyond,” Coinbase wrote in its blog post.