Recently, Alessio Quaglini, Managing Partner at Hex Trust, was featured in Blockchain.news discussing the evolving state of institutional custody for digital assets.
Q: What is the difference between custody of traditional versus digital assets?
A: “To answer this question, we can look at the problem from two different perspectives: (1) From a user perspective there should actually be no difference at all. In theory, as platforms evolve into more enterprise solutions, customers should be able to access any type of assets independently of the underlying protocol complications. (2) From a custodian perspective, however, there are a number of differences. First of all the underlying technology that is completely different from the way traditional assets are transacted. Secondly, the market structure where the depository institutions disappear and are replaced by the blockchain itself. Lastly, the complications of the specific protocols, such as voting, staking, forking, upgrading, which have different processes and representation than in the traditional world.”