21Shares diversifies custodians to reduce ‘single-point failure risk’ in crypto ETFs
21Shares has appointed Anchorage Digital Bank and BitGo as custodians for its ARK 21Shares Bitcoin ETF (ARKB) and 21Shares Core Ethereum ETF (CETH), alongside existing custodian Coinbase. This decision aims to enhance the firm's spot exchange-traded product (ETP) operations in the US, emphasizing regulatory compliance, security, and reliability. BitGo now serves as custodian for four ETFs, having partnerships with Hashdex and Valkyrie. The expansion follows an FBI warning about North Korea-linked hackers targeting crypto ETFs, highlighting the need for diversification to mitigate risks associated with relying solely on Coinbase, which currently custodies eight of the eleven US spot crypto ETFs. Industry experts predict that more issuers will seek to diversify custodial services to reduce single points of failure and negotiate better fee structures.
