Why working with regulated and licensed digital asset custodians matters, especially in times of digital asset uncertainties
With the recent crypto crash and crypto lenders filing for bankruptcy protection after freezing customer accounts, some investors who had their savings in “custody” accounts are still anxiously waiting to see whether they will get a full recovery.
“The custody customers have a decent chance of prevailing and getting their money back,” said Adam Levitin, a bankruptcy professor at Georgetown Law, from a recent article reported in The New York Times.
Accordingly, for the interest-bearing accounts, that would be a difficult case to make, legal experts said.
Propine, a MAS-regulated custodian with the Capital Market Services license, is required under Singapore laws to ensure that clients’ money and assets are segregated from the company’s own money and assets.
Therefore, in the unlikely event of insolvency, the clients’ money and assets held will be excluded from the money and assets of the company available to the creditors and will remain for the benefit of the relevant client.