Standard Chartered Acquires Zodia Crypto Custody Firm

Standard Chartered Bolsters Digital Asset Custody with Zodia Acquisition

The acquisition sees Standard Chartered taking full ownership of Zodia Custody, a crypto custody service that was jointly launched in 2020 by SC Ventures, the venture arm of Standard Chartered, and Northern Trust. Initially, Standard Chartered maintained a controlling 90% stake in Zodia through a subsidiary. This stake was later diluted after external funding was secured from various investors.

The newly acquired assets will be transferred to an independent entity, Zodia Solutions, which will operate under the management of SC Ventures. This new enterprise is expected to continue providing bank-grade infrastructure to financial institutions through a Software as a Service (SaaS) model.

Strategic Integration to Bridge TradFi and DeFi

This acquisition is designed to integrate Zodia Custody’s services into Standard Chartered’s existing financing and securities business. According to a press release, this move will enhance value by unlocking revenue and cost synergies, and provide a more comprehensive offering for clients holding digital assets globally. The bank emphasizes that this reflects its focus on creating a comprehensive digital asset offering.

A bank representative stated, The acquisition will accelerate the growth of Standard Chartered’s global digital asset custody portfolio and support the expansion of our financing and securities services business. This also reinforces Standard Chartered’s role as a trusted bridge between traditional finance (TradFi) and decentralized finance (DeFi).

Standard Chartered Forecasts $4 Trillion Tokenized Asset Market by 2028

In a related development, Standard Chartered has significantly raised its forecast for the volume of tokenized assets, or Real World Assets (RWA), anticipating growth to $4 trillion by the end of 2028. Analysts believe that DeFi protocols will be the primary beneficiaries of this trend, as reported by The Block. The total figure is expected to be evenly split between stablecoins and other RWA products.

Jeffrey Kendrick, head of digital asset research at Standard Chartered, highlights the composability of DeFi as a key growth driver. This refers to the ability to use the same asset in multiple scenarios simultaneously. In decentralized finance, a tokenized product can:

• Generate yield.
• Be used as collateral.
• Maintain liquidity.
• Move freely between networks.

Kendrick noted that achieving such functionality in TradFi requires multiple intermediaries and extensive infrastructure, making it impossible outside of blockchain. Standard Chartered analysts previously maintained their DeFi forecast in April, even after the $292 million hack of the cross-chain protocol Kelp.

The full acquisition of Zodia Custody underscores Standard Chartered’s strategic vision to deepen its involvement in the digital asset ecosystem. This move positions the bank to capitalize on the anticipated surge in tokenized assets and further integrate blockchain technology into its core financial services.