Crypto custody is a pretty hot topic as cryptocurrency, security tokens, stable coins, and other assets are more and more adapted and created on the blockchain. Since the start of Bitcoin in 2009, the industry has taken a huge step forward into adoption in the real economies of nearly all global countries.
As a result of that, politicians have also addressed the topic around blockchain, assets, and wallets in form of regulation. This regulation comes in different faces depending on the jurisdiction. While the US was quite passive on that matter, other regions have taken a more active approach. Especially the European Union and specifically its member-states Germany, Malta, and Estonia have implemented a number of regulatory requirements.
Crypto custody is one of the most important services for any blockchain-based project. The requirements on custody are huge in terms of
- scalability and
- regulatory compliance.
This article will present top 5 EU crypto custodians:
- Metaco (Switzerland)
- Solaris Digital Assets (Germany)
- Finoa (Germany)
- Arkane Network (Belgium)
- Tangany (Germany)
All crypto custodians have proven themselves reliable and are active on the market at least for the last three years. Furthermore, they are headquartered within Europe (not necessarily in the European Union). As Germany has issued the ‘crypto custody license’, three out of five are part of the top/best 3 German crypto custodians.
This article covers the EU market and its custody providers for digital assets. Non-EU players like BitGo, Coinbase, and Anchorage are not included as this article focuses on the needs and peculiarities of the European market.
Metaco is one of the pioneers when it comes to crypto custody. The Switzerland-based* solution is on the market for more than five years and one of the relevant shareholders is Avaloq, which itself is well-known for core-banking solution services.
Metaco offers mostly an on-premise solution to large and global banks. On-premise products are (in contract to cloud solutions) implemented and managed in the server centers of the client. This reflects the regulatory requirement of many large banks quite perfectly. Their solution is able to leverage HSM and also MPC technology for security.
* Switzerland is not part of the EU, but of Europe.
- On the market since 2015
- Many well-known banks as clients
- A strong relationship with Avaloq
- On-premise hosting
- No regulatory know-how (tech only)
- The solution combines their own IP and bought IP
- Limited flexibility
Solaris Digital Assets
Solaris Bank has seen rapid growth since its start a couple of years ago. The Berlin-based Bank provides white-label solutions to banks and other players in the finance industry. For a few months Solaris also entered the crypto custody market by partnering up with different white-label crypto custody providers.
The bank aims to provide all related products that are usually helpful for a finance project. In the field of blockchain, it’s not only crypto custody but also credit cards, core-banking solutions, and a bunch of other services.
- Full-service strategy
- Biggest white-label service provider in the German banking market
- White-label solution
- Not specialized in crypto custody or blockchain in general
- The products are not (yet) perfectly integrated with each other
- Focused on banks and finance
Finoa aims to become the bank for digital assets. The German-based company has started 2018 with a cold wallet solution and has since then developed their own warm wallet solution for their clients. Originally started with a B2C business model they have expanded to also B2B.
Finoa offers a crypto online banking experience where customers can log in and manage their digital assets on the blockchain. The solution supports various coins and tokens of a lot of blockchains. It also offers the ability to trade crypto assets within the platform.
They have expressed their intention to apply for the German crypto custody license by BaFin.
- All-in-one platform
- Supports various coins and tokens
- Integrated exchange and staking functionality
- About to acquire crypto custody license
- Not white-labeled (Finoa is a platform)
- Rudimentary API interface
- Mixed target groups (B2C and B2B)
- Unknown technical specification
Arkane Network is a Belgium custodian for digital assets. They have chosen a quite unique approach by servicing the gaming industry as well as the finance industry. The solution supports various blockchains, which includes gaming-related ones like GoChain and Tron. Overall there are nine connected blockchains.
The solution can be used on the website of Arkane, similar to Finoa’s service, but also by integrating a decentralized wallet such as Metamask for Ethereum. That allows users to use their existing non-custodian wallet.
Arkane Network targets both, B2C and B2B, with its solution. That gives it a good flexibility for different use cases. Another function, which is rarely seen in the market, is the support of non-fungible tokens. Unlike traditional tokens with fungible ones all tokens are unique. That design is often used by online games.
- Supports non-fungible tokens
- Many handy features for online games
- Integration of some exotic blockchains
- Ready-to-use solution
- Supports Metamask usage
- Broad target group (use cases and B2B/B2C)
- Lacks regulation for the German market
- Kind of decentralized approach
Tangany is a crypto custody provider based in Munich, Germany. I am trying not to be biased by the fact that I am one of the co-founders of Tangany. Transparency about technical, regulatory, and product questions is one of our values.
Tangany is a full white-label provider for B2B clients that want to work with blockchain and digital assets. We currently support Bitcoin, Ethereum, and provide universal smart contract support (includes of course ERC20 and Tether). The solution can be used via API for warm wallets (wallet as a service) and as a cold wallet. For both, we provide a reliable node infrastructure and crypto payment processing engine.
The solution is based on Microsoft Azure, where we have an active partnership in place. This ensures the highest availability, scalability, and security of Tangany Custody Suite. The target markets are finance (banks, core-banking providers), tokenization (issuer, Whitelabel service provider), and crypto market (exchanges, lending, etc.).
We have entered the market in 2018 and were awarded with the FinTech Germany Award 2020 for being highly innovative. Additionally, our company is regularly featured in print newspapers such as Süddeutsche Zeitung (one of the top 5 newspapers in Germany).
Martin, our CEO, is the official comptroller of Bundesblock e.V. (German blockchain association) and has worked on different statements of upcoming bills (such as the recent ‘electronic security bill’).
- Applied for German crypto custody license
- 100% white-label (API or customizable frontend)
- Provides warm and cold wallets
- Ethereum Gas Tank (for Etherless transactions)
- Well-known in the European market
- Solely focused on crypto custody
- Limitation of crypto assets
- Limited to three target groups (finance, tokenization, crypto market)
- Heavily API-based
All the presented service solutions are recommendable. This table gives you a structured comparison of some of the most relevant metrics:
As you can see very quickly: none of the solutions presented are bad, on the contrary – you have to think about what exactly you want:
- 100% White-Label and API: Tangany (http://tangany.com)
- Gaming & Non-Fungible Tokens: Arkane Network (https://arkane.network)
- On-Premise Hosting: Metaco (http://metaco.com)
- Full-Service-Finance: Solaris Digital Assets (https://www.solarisdigitalassets.com/en)
- One-Stop-Platform: Finoa (http://finoa.io)
Disclaimer: This article was created to the best of knowledge and researched information. If you find any inaccurate information, please let me know in order to update the article.