As 2021 draws to a close, Richard Gardner released a statement on what’s next for the burgeoning digital assets space. Gardner serves as CEO of Modulus, a US-based developer of ultra-high-performance trading and surveillance technology that powers global equities, derivatives, and digital asset exchanges. His ideas have been published by Forbes, Reuters, CIO Magazine, NASDAQ, Business Insider, The Detroit Free-Press, and dozens of other regional and industry-related publications. 

“If 2021 was the year of cryptocurrency, then 2022 will be the year of custody and CBDCs,” noted Gardner. “Over the course of the past twelve months, cryptocurrencies really came into their own. Institutional investors came on board. Even regulators and longtime naysayers decided, finally, that digital assets were here to stay. Even though the fundamentals and technology are strong, there are some kinks still to be worked out. Custody is one such area. In 2022, the industry will realize that cryptocurrency and digital assets simply cannot reach its true potential without competent custodianship.”
 

“Custody, I think, has eluded the spotlight thus far because, in traditional finance, it is simply an administrative afterthought. When you purchase traditional assets, you typically don’t spend much time considering the custody process. With digital assets, it is very different. It isn’t solely an administrative function. Now, it also becomes a security function. Your custodian is responsible to keep your digital assets safe from malfeasance and incompetence. If you can’t trust that your assets are safe from hackers and other bad actors, you can’t seriously expect cryptocurrency to really expand to its fullest potential,” said Gardner.
 

“Self-custody is an option, but, frankly, it is impractical. It requires a level of technological expertise that many Main Street investors lack. And, for institutional investors, it simply isn’t in their wheelhouse. They need a custodian they can trust. But who? Consider the existing field. The leading providers have serious security concerns. One such company has been named in a lawsuit which alleges that they are responsible for the loss of $70 million in digital assets. That’s not a custodial situation that the industry will earnestly be able to accept --- particularly as institutional investors continue to come on board. Now that cryptocurrency is here to stay, 2022 will be the year that the industry gets serious about custody. I expect that you’ll see companies with a penchant for security step up and fill the void,” said Gardner.

Modulus is known throughout the financial technology segment as a leader in the development of ultra-high frequency trading systems and blockchain technologies. Modulus has provided its exchange solution to some of the industry’s most profitable digital asset exchanges, including a well-known multi-billion-dollar cryptocurrency exchange. Over the past twenty years, the company has built technology for the world’s most notable institutions, with a client list which includes NASA, NASDAQ, Goldman Sachs, Merrill Lynch, JP Morgan Chase, Bank of America, Barclays, Siemens, Shell, Yahoo!, Microsoft, Cornell University, and the University of Chicago.

“Beyond custody, I think 2022 is going to be the year where we start to see all of the work central banks have put into developing their own digital currencies finally come to fruition. In 2021, they worked hard to develop the infrastructure. 2022 will be the year that many central banks will begin their beta tests and make their launch. All in all, 2022 will be an exciting year for fintech.”