Fireblocks is scaling its custody framework, and Zerocap is consolidating its operations on Deribit. The two moves, announced this week, point to a growing industry push for Off Exchange custody solutions — a model that could meaningfully reduce counterparty risk and boost institutional confidence in crypto markets.
What Fireblocks is doing
Fireblocks, a major digital asset custody provider, is expanding its infrastructure to support more institutional clients. The company is scaling its custody framework to handle increased demand for secure asset storage and settlement. The move comes as more traditional finance players look to enter crypto, and as regulators globally tighten requirements around asset segregation.
Zerocap consolidates on Deribit
Zerocap, an over-the-counter trading desk, is consolidating its operations on the Deribit exchange. By moving its flow onto a single venue, Zerocap aims to streamline settlement and reduce the number of counterparties it deals with. The shift is part of a broader trend where firms are choosing to concentrate liquidity and custody on regulated or well-capitalized platforms.
Why Off Exchange custody matters
Off Exchange custody solutions let institutional investors keep their assets with a qualified custodian while trading on an exchange. That means the exchange never actually holds the crypto — it just records the trade. If the exchange gets hacked or goes under, the assets remain safe with the custodian. This model is gaining traction as a way to address one of the biggest fears for institutional entrants: exchange failure.
The adoption of these solutions could reduce counterparty risk and enhance institutional confidence in crypto markets. For now, the moves by Fireblocks and Zerocap are early signals. But they suggest the infrastructure is slowly being built to handle the kind of capital that has so far stayed on the sidelines.
Neither company provided a timeline for when the expanded custody framework or the full Deribit consolidation would be complete. But the direction is clear: the industry is trying to make crypto look more like traditional finance — where the custodian and the exchange are separate entities.
