Bitget to Roll Out Open Custody Network Connecting Banks to Crypto Trading# Introductory
Bitget has unveiled a new initiative, the Open Custody Network (OCN), designed to link banks, external custodians, and its cryptocurrency trading platform. The network’s objective is to make trading digital and standard assets more accessible for institutional participants, while still giving them control over where their assets are held.
This offering now allows eligible users to access Bitget’s trading services without transferring their underlying holdings directly to the exchange. The development is a move away from the traditional centralized exchange model, by separating asset custody and trading activities.# Bitget launches external custody trading with OCN
Open Custody Network solves the age-old problem of centralized cryptocurrency exchanges: users need to deposit digital currencies directly to an exchange before they can gain access to its trading services.
Traditionally, cryptocurrency traders have had to move their holdings to an exchange-controlled wallet to participate in spot, margin or futures markets. This setup allows for easy access to trading, but also requires users to trust the exchange with custody of their assets.
Bitget’s OCN is taking a different approach, by separating custody and trading. This model allows eligible participants to hold their digital possessions with third-party custodians that are part of the program and benefit from Bitget’s trading infrastructure.
The network uses an asset-mirroring mechanism that ties assets held externally to trading activity on the exchange. This enables eligible users to utilize their holdings for various trading strategies without having to move the underlying assets to Bitget for direct custody.
The offering allows for several kinds of trading:
- Spot Trading: Eligible users can access Bitget’s spot markets with custody through participating external providers.
- Margin Trading. Participants may utilize eligible externally custodied assets in supported margin trading activities.
Futures Trading: Institutional clients can access Bitget’s futures markets without moving their underlying holdings to the exchange. - Institutional Trading: Professional participants can utilize Bitget’s trading infrastructure while maintaining their existing custody solutions.
In particular, the network is relevant for institutional clients such as market makers, asset managers and professional trading firms. These participants often need specialist custody solutions, operational flexibility and access to deep cryptocurrency liquidity.
Bitget is looking to give institutions more leeway in managing digital property while engaging in crypto trading by separating custody from execution.# Gracy Chen on the importance of custody independence
Bitget CEO Gracy Chen said that the Open Custody Network is different from the traditional model where customers are required to deposit their assets with an exchange before being allowed to trade on its platform.
Chen stressed that institutional users should be able to choose where their electronic assets are stored, while still being able to access trading opportunities.
She launched the initiative with the words, “Assets in Bank, Tradings on Bitget.” The concept underscores Bitget’s goal to integrate third-party custody solutions with its trading infrastructure.
The network aims to provide institutional-grade liquidity and improved capital efficiency, while reducing barriers for professional market participants, said Chen.
Also, the announcement underscores the increasing importance of custody independence in the cryptocurrency industry. Institutional investors tend to prefer asset security, operational transparency and long-standing custody relationships when selecting digital asset trading platforms.
How the Bitget Open Custody Network Supports Institutional Users
The OCN model could provide several potential benefits to eligible institutional participants:
- Enhanced Custody Control: Users can store their digital possessions with supported third-party custodians instead of sending them to Bitget directly.
- Trading Flexibility: Qualified users can trade spot, margin and futures on the Bitget infrastructure.
- Institutional Access: Asset managers and market makers can access the cryptocurrency markets and keep their preferred custody arrangements.
- Capital Efficiency: The asset mirroring mechanism aims to render the externally held assets usable to the supported trading activities.
- Enhanced Market Connectivity: Connecting external custodians to Bitget could increase institutional participation and trading liquidity.
What Does Bitget’s OCN Launch Mean for the Crypto Market?
Bitget’s Open Custody Network represents a major milestone in the development of the relationship between cryptocurrency exchanges and institutional custody providers. The initiative offers an alternative to the traditional model of exchange custody, separating custody of assets from execution of trades.
The network is designed to grant eligible users more control over their custody arrangements, while also offering access to the Bitget trading markets. Its success will hinge on institutional adoption, participating custody providers, operational safeguards and the effectiveness of its asset mirroring mechanism.
Overall, the launch is a sign of the growing focus in the cryptocurrency industry on institutional infrastructure, flexibility in custody and capital efficiency.
