coincodex.com
Key highlights:
- BNY Mellon has set up a "Digital Innovation Hub" unit in Dublin to custody crypto assets
- The unit is regulated by the Central Bank of Ireland
- Central bank officials in Ireland and elsewhere have been expressing concerns about cryptocurrency
BNY Mellon's "Digital Innovation Hub" will provide crypto custody services
Earlier this year, reports indicated that major investment bank BNY Mellon was planning to offer cryptocurrency custody as a service to its clients. The bank itself confirmed its intentions publicly, and said that it was going to launch a dedicated unit for digital assets, which would also include cryptocurrency-related services.
Now, Irish news outlet The Business Post is reporting that BNY Mellon has created a new unit in Dublin called the “Digital Innovation Hub”. The unit will provide digital custody services, and plans to support assets like Bitcoin, NFTs (non-fungible tokens) and even CBDCs (central bank digital currencies). The business is regulated by the Central Bank of Ireland (CBI).
Central bank officials express concerns about crypto
Interestingly enough, the news of BNY Mellon’s new Dublin-based unit almost coincided with reports of CBI official Derville Rowland stating that the growing popularity of cryptocurrencies is “of great concern”. According to Bloomberg, Rowland stressed that cryptocurrencies were an unregulated and speculative investment that can lead to large losses for investors.
Rowland’s views on cryptocurrency are particularly notable as she will assume the role as the chairwoman of EU financial regulator ESMA’s investment management standing committee in July.
Central bank officials from other countries have also expressed concerns with cryptocurrencies. Bank of England governor Andrew Bailey recently said that he believes crypto assets are dangerous, and commented on the “huge enthusiasm” surrounding the emerging asset class. Bailey’s comments echoed his previous statements on cryptocurrencies – for example, he stated that people who put their money into cryptocurrency should be prepared for a scenario where they lose their whole investment.
Bank of Japan governor Haruhiko Kuroda recently pointed out the extreme volatility of the Bitcoin market and said that the majority of trading is purely speculative in nature. Kuroda also said that Bitcoin is “barely used as a means of settlement”. Regardless of his skepticism about Bitcoin, the Bank of Japan plans to conduct experiments related to a central bank digital currency, which would be a digital version of the yen.