One of Japan’s largest banks, Sumitomo Mitsui Trust, is apparently planning to enter the bitcoin custody market. The company is teaming up with Bitbank a Tokyo-based cryptocurrency exchange to form a new company dedicated to providing institutional-grade custody for digital assets and NFTs.
Sumitomo Mitsui Trust Bank is Planning on Joining the Digital Custody Market
A prominent Japanese financial institution, Sumitomo Mitsui Trust Bank, has decided to enter the cryptocurrency custody sector. In collaboration with Bitbank, a Tokyo-based cryptocurrency exchange, the company announced the creation of a digital asset custody company. The firm, which will be known as Japan Digital Asset Trust and will be owned 15 percent by Sumitomo Mitsui Trust and 85 percent by Bitbank, will focus on providing institutional customers with crypto and NFT custody.
The goal is to grab the local institutional sector, which is still hesitant to engage in these new products due to the issue of custody. Sumitomo Mitsui Trust feels that investors will be more comfortable owning digital assets if the custody is given by established financial institutions rather than crypto exchanges, which are not subject to the same regulatory scrutiny.
The company’s initial capital is said to be 300 million yen ($2.3 million), with the two corporations hoping to raise 10 billion yen ($78 million) by attracting more investors.
Overview of Sumitomo Mitsui Trust
Mitsui Trust Company, founded in 1924, and Chuo Trust Banking Co., founded in Tokyo in 1962, are the forerunners of SMT Holdings.
In 1999, Mitsui and Chuo inked a merger agreement. Following the collapse of the massive Japanese bubble in the late 2000s, Chuo Mitsui joined with Sumitomo Bank to become the current Sumitomo Mitsui Trust.
Sumitomo Mitsui Trust Holdings was the sixth Japanese megabank by assets and the fifth by market capitalization at the end of 2016. The megabank has a large foreign section and a nationwide corporate presence.
Sumitomo Mitsui Trust Holdings is Japan’s sixth-largest bank by assets and a reliable financial player in the country.
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