In 2023, the crypto custody market reached a substantial $448 billion, witnessing a notable surge, with major banks entering the arena. A recent Bitget study unveiled a remarkable 250% increase in assets under custodial management, highlighting the expanding opportunities within the cryptocurrency sector. The rise in custodial accounts, crucial for secure storage of digital assets, has been particularly pronounced following the final approval of the Bitcoin ETF.
The study also revealed a nearly doubled count of custodial accounts since November 2023. Notably, short-term custodial accounts, holding funds for less than three months, constitute around 77% of the total, with 43% of these accounts witnessing redeposits.
Analyzing data from Bitget’s custodial accounts, established in collaboration with providers such as Copper and Cobo in August 2023, the research aimed to assess the impact of market trends on the usage duration of these accounts. Understanding investor behavior and the evolving crypto ecosystem were key objectives.
Despite the inherent volatility of the crypto market, the crypto custody sector has sustained growth, fueled by factors such as the anticipation of digital asset value appreciation, the integration of crypto payments into daily life, and global economic uncertainties. Additionally, the influx of traditional market users into the crypto space and the positive sentiment surrounding Bitcoin and Ether ETFs have contributed to this surge.
Major banks like Commerzbank AG and HSBC entering the digital asset custody services arena in 2023 further underscore the growing mainstream interest in crypto custody services.