In a significant development, spot Bitcoin exchange-traded fund (ETF) manager WisdomTree, has been granted a trust company charter by the New York State Department of Financial Services (NYDFS), marking another regulatory victory for the company following its ETF approval by the US Securities and Exchange Commission on January 10.
This regulatory win allows the company to operate as a limited-purpose trust company under the New York Banking Law, clearing the path for the asset manager to launch its highly anticipated crypto app in New York.
WisdomTree Receives NYDFS Trust Company Charter
The NYDFS trust company charter authorizes WisdomTree to provide fiduciary custody services for digital assets, including digital wallet services. The firm is also authorized to issue and exchange DFS-approved stablecoins and manage stablecoin reserves.
Jonathan Steinberg, the Founder and CEO of WisdomTree, expressed the significance of the NYDFS approval, stating:
The New York State Department of Financial Services is the premier regulator for businesses that engage in digital asset activity. This well-established trust company charter program – which long predates digital assets – is based on bank-grade regulation, allowing us to offer products that capitalize on innovation without sacrificing customer protection.
Steinberg further emphasized that this approval not only positions the company to participate in New York’s “rapidly growing” digital asset marketplace but also equips the asset manager to lead the industry’s evolution in the future.
Tokenized Gold And Dollar Assets
According to the announcement, under the umbrella of WisdomTree Prime, the firm’s digital trust will initially offer products to customers. These include the Gold Token and the WisdomTree Dollar Token, which will be available within the Prime ecosystem.
The company will also maintain reserves for these assets under the framework approved by the NYDFS. Furthermore, the trust company charter enables WisdomTree to provide New York retail customers with access to WisdomTree Prime, which is expected to be available in the coming weeks.
Will Peck, Head of Digital Assets at WisdomTree and CEO of WisdomTree Digital Trust Company, LLC, highlighted the compliance standards upheld by the company, stating:
Held to the highest compliance standards in the industry, a New York limited-purpose trust company provides the leading platform to offer regulated tokenized products and services to WisdomTree’s retail and institutional customers.
WisdomTree’s grant of the trust company charter by the NYDFS signifies a significant step forward in its mission to provide new and regulated financial services in the digital asset space.
With the imminent launch of its crypto app, the digital asset manager aims to play a pivotal role at the intersection of traditional finance and blockchain technology, improving access to digital assets for retail and institutional clients.
Featured image from Shutterstock, chart from TradingView.com