The “changing business and regulatory environment,” as Nasdaq CEO Adena Freidman put it during an earnings call, has caused the exchange to abandon its ambitions to launch a cryptocurrency custody service.
CEO Adena Friedman said at Wednesday’s earnings conference that Nasdaq will no longer develop its planned cryptocurrency custody service due to commercial and regulatory constraints.
Friedman said that the company has decided to delay the launch of its U.S. digital assets custodian business and associated activities to acquire a relevant licence because of the changing business and regulatory climate in the United States this quarter.
The operator of the exchange had hoped to begin providing custody services to customers by the end of June, after receiving the necessary licence from the New York Department of Financial Services. After the failure of Three Arrows in July 2022, Nasdaq stated its ambition to enter the industry and continued ahead despite a dip in the cryptocurrency market.
According to Friedman, the bourse intends to expand its technological infrastructure to “position Nasdaq as a top digital assets software solutions provider to the broader global industry.”
Nasdaq and BlackRock have collaborated on a spot bitcoin ETF that is seeking clearance from the SEC. Previously, the SEC has cited fears about fraud and manipulation as reasons for not approving such a product.
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