Zodia Custody, a leading crypto asset service provider backed by Standard Chartered and Northern Trust, has developed and launched a new service: Interchange. The service offers an alternative to the pre-funding and margin models on exchanges. Using Interchange, clients can keep their assets with Zodia Custody, while mirroring holdings on exchanges. This protects clients’ digital assets from exchange insolvency. As the first FCA-registered bank-backed firm to provide this service, Zodia Custody is committed to helping its clients safely and securely trade cryptocurrencies, while mitigating counterparty risk between participants involved in digital asset trading activities.

Zodia Custody’s Interchange service is now live, providing clients with more flexibility for both Proof of Reserves and multi-exchanges. Zodia Custody’s sister company, Zodia Markets, is also leveraging the offering. Interchange provides transparency and control to exchanges, without ownership of the underlying assets. The technology provides instant access to exchange trading balances and automates post-trade settlement.

Institutions adding digital assets to their strategies continue to face challenges relating to counterparty and credit risk when trading. The market’s lack of security and transparency has since resulted in losses that otherwise could have been avoided. Interchange overcomes this by combining institutional-grade security with the backing of a regulated entity. This includes full segregation of digital assets, ensuring clients are in full command of their investments. Interchange offers a better way to trade digital assets by connecting with regulated, KYC, and AML-compliant venues. This provides flexibility and security for clients, allowing them to take advantage of market opportunities without having to leave funds on exchanges.

Maxime de Guillebon, CEO of Zodia Custody, comments: “Zodia Custody’s key principles have always evolved around asset safety, segregation between custody and trading, and the effective management of counterparty risk.

The difficulties crypto investors have endured over the last year have exacerbated how critical these principles are today. At Zodia Custody, we believe that such a solution, like Interchange, is not optional, but mandatory.”