If you’re looking for a list of the best crypto custodians in 2023 then you’ve come to the right place! We know all about crypto custody, because we’re a crypto custodian ourselves.
Now, you might be thinking that that makes us biased… And well, let’s be honest: it does just a little. But it does guarantee that we know what we’re talking about. And we’ve literally been through the onboarding process and reviewed the services of every one of these providers ourselves. So we know them first hand and can tell you from personal experience which is good and which is not so good.
We’ve even gone a step further and categorised them at the end to help you find the right crypto custody provider for whatever your needs may be.
But first, let’s cover the basics:
Crypto custody providers are independent third parties that securely store crypto currencies like Ethereum and Bitcoin on behalf of their clients in return for a fee (usually calculated as a percentage of the value of the assets). It’s important to distinguish this from something like MetaMask which is a self-custody wallet where your private keys are stored on your local device.
There are crypto custody solutions for everyone from individuals to institutions and everyone in between. Choosing the right custody provider can be difficult and is going to depend largely on your circumstances and the type of services you need. But here are a few considerations:
What type of storage is your crypto custodian providing: hot, warm, or cold? And what security features does it have? Does it use multisig or MPC?
How big is your business or is it for personal use? What kind of business are you conducting?
Are you going to need immediate access to your assets or can you afford to wait up to 24 hours for your assets to be available? Do you need built in integrations to manage the assets?
Some custody providers have monthly minimum fees. Depending on the value of your assets the fees could end up amounting to a significant percentage of your asset value.
Are your assets protected? Does your crypto custodian insure your assets against loss or theft? And if so, up to what value?
What will happen to your assets in the event of the crypto custodian going into bankruptcy? It’s vital to ensure that you’ll be able to recover your assets and move them to a new custodian if your existing crypto custody provider were to go bankrupt.
Is data sovereignty an important consideration for your business? Under which jurisdiction will you have legal recourse to your crypto custodian in any adverse event? It’s important to consider that it’s located in a favourable jurisdiction with a reliable legal system.
All of these factors can heavily influence your decision when deciding which custodian is right for you.
Fireblocks is the largest of all of the crypto custodians and probably the best known. It uses an MPC solution to secure users private keys, which in usability terms is similar to a multisig but much more secure. I’ll go more into MPC below, but for now you should just know that it's a relatively new solution in the crypto custody space, but it's quickly becoming the de facto choice for custody providers given its high degree of security with relative accessibility.
Fireblocks claims to service over 1,300 of the largest institutional players in the crypto space. Other than custody, it also offers services like AML/KYC and Permissioned DeFi. The latter being DeFi protocols that are restricted exclusively to KYC’d counterparties in order to make it compliant for regulated firms to use.
Fireblocks is mostly used by major institutions like Northern Trust and Standard Chartered. Which isn’t all that surprising given its pricing. Expect high monthly minimums and a relatively high basis point charge on your crypto assets, which makes it an unviable option for small and medium businesses with less than $100m of digital assets.
Similar to Fireblocks, Copper also uses an MPC solution and primarily caters to institutional investors. Copper is personally one of the best products I’ve seen on the market and one of the most innovative teams in this space. Copper’s ClearLoop enables trading firms to deploy capital across 40+ exchanges, while maintaining independent custody. In other words, you can keep your assets on Copper’s custody solution and use it as collateral to trade on centralised exchanges. Which offers broad appeal to hedge funds and investment managers actively trading cryptocurrencies.
In pricing terms, Copper is also one of the more expensive custody providers and you can expect relatively high monthly minimums as well as a basis point charge on the total value of assets you keep with them.
Krayon is a new challenger to the crypto custody space. Founded in 2022 by experts in Fintech and Cyber Security, it offers a complete crypto treasury management solution to crypto companies and investment firms holding digital assets. Like Fireblocks and Copper, Krayon uses an MPC (multi-party computation) solution to provide institutional grade crypto custody to users, as well as additional security measures to protect users against exploits from direct or phishing attacks. However, unlike Copper and Fireblocks, Krayon caters to smaller companies and even teams.
There’s no monthly minimum for crypto custody, making it a viable option for companies with a much lower value of assets under management. On top of this, its core focus is on treasury management for crypto companies and VCs. So the features built on top of its custody solution, like wallet management and transaction reconciliations, make it a much better option to these types of companies.
Anchorage offers a cold storage solution to large institutions, using HSMs (Hardware Security Modules), biometric authentication and robust controls to secure user’s private keys and safeguard their digital assets. The primary downside to cold storage is typically accessibility as the private keys need to be retrieved before transactions can be signed, however, Anchorage has done a great job of combatting the typical accessibility issues associated with cold storage solutions.
Probably the most exciting thing about Anchorage is that it's the first ever federally chartered crypto bank. Meaning that it's regulated by the same agency and offering the same seamless experience its clients have come to expect from traditional financial services.
Perhaps the biggest downside to Anchorage is that it only caters to very large institutional clients and the nature of its service infrastructure means that it lacks the scalability to provide such services to smaller companies and institutions. On top of that, there are still limitations to cold storage when it comes to DeFi, so most organisations would be better off pairing Anchorage with an MPC solution.
Silver lining, it does offer an API which third parties can build upon. And it's certainly one component I would love to integrate as part of Krayon’s product suite in the near future.
Founded in 2017, Cobo is Asia-Pacific’s largest crypto custodian, trusted by over 300 institutions and HNWIs. Their crypto custody solution is a little outdated and uses a combination of HSMs and multi-sig. It’s not clear which HSM solution they’re using which leaves me a little nervous as I’ve heard stories of crypto custodians using Trezor and Ledger hardware wallets as the core infrastructure for their cold storage services. On top of this, multi-sig is fine for small teams, but operationally it’s a nightmare to scale and it's not blockchain agnostic.
As far as disaster recovery goes, I’d much rather use an MPC solution. Yes, it means having to use a centralised custody solution, but if you’re looking for a third party crypto custodian then chances are that you’re not bothered by the centralised versus decentralised debate.
Atato is another MPC custody provider, but targeting the mid-market and HNWIs. They only provide custody, so don’t expect any other features or services. If you need more, then you’ll have to integrate with third party applications, so expect to expend some developer resources. The app itself leaves something to be desired - it’s fairly clunky. And the onboarding process is cumbersome.
I can’t say I’m a fan of this particular crypto custodian mostly because they’ve been around since 2017 and haven’t really had any innovations at all.
But one advantage to using Atato is that they offer fixed-fee digital asset custody, so you won’t have to pay a percentage of your assets. This does of course make it great for those with a large enough volume of assets as you can achieve economies of scale.
Propine has come up with its own trademarked name for its custody solution, ProTect, which is basically another MPC solution so don’t be confused by their marketing tactics. As per their website: “[Propine’s] institutional-grade solution provides highest levels of certified security, compliance and granular governance policies for safeguarding multiple asset classes including digital securities, cryptocurrencies, stable coins, NFTs and Fiat while ensuring ease of access to your digital assets in our custody.”
Again, personally I wasn’t very impressed with their solution. They’ve done little to innovate above and beyond a basic MPC solution which they’ve whitelabelled from a third party. That’s not to say it doesn’t offer a robust crypto custody solution, I just think there are better alternatives available.
Taiwan-based Cybavo was founded in 2018 and originally used a multi-sig for their crypto custody solution, but recently transitioned to MPC. Cybavo Vault is their digital asset custody solution for enterprise clients, which also uses multi-party computation. On top of this they provide users with a custom policy engine (address whitelisting, spending limits, etc.), threshold signing and role-based access. Besides custody, they offer a range of services catered to crypto developers.
BitGo offers a cold storage solution secured by a multi-sig. The one advantage to BitGo is that it offers insured cold storage custody via BitGo Trust Company—a regulated Trust Company under the Division of Banking in South Dakota. Cold storage assets are held in segregated accounts, insured and secured by BitGo’s multi-signature security.
Given that they’re still using a multi-sig in 2022, I can’t recommend it. But I have heard rumours that they’re switching to an MPC solution. If that does happen, there could be some advantage to a cold storage solution secured by MPC. But honestly, I think Krayon will build it before them just because we’re more agile.
Insurance is always a bonus, but you’ll need to dig into the documentation to understand exactly what it covers and assess whether its likely to payout. It’s all well and good having insurance, but not much use to you if the insurer refuses to payout for something you’d expect it to be on the hook for. It’s also not really a competitive advantage as most custodians now offer some form of insurance.
Onchain provides custody and open finance services to institutional clients and accredited investors to manage digital assets in a secure, insured and compliant way. Their custody solution, SAFE, uses a multisignature wallet to secure client’s digital assets. I don’t really understand what the advantage to using OnChain’s crypto custody services is over using another multisig, for example a Gnosis-Safe. In fact, you’d be better off using a Gnosis instead of OnChain, because OnChain has limited support for cryptocurrencies and currently only supports around 10 different coins.
That said, I’d assume the reason institutions use their crypto custody services is to fulfil some compliance requirement at a lower cost than using one of the above. But given the wave of MPC custodians, there’s really no point in using OnChain.
Coinbase Custody is the institutional crypto custody service from Coinbase which offers a cold storage custody solution. Coinbase Custody operates as a standalone, independently-capitalised business to Coinbase, Inc. Coinbase Custody is a fiduciary under NY State Banking Law. And all digital assets are segregated and held in trust for the benefit of their clients.
They offer segregated cold storage with dedicated on-chain addresses as well insurance for your digital assets. However, under the hood it’s a pretty crappy solution that relies on the Coinbase brand to support it. And from what I understood about it, it has to be the least secure cold storage solution I’ve come across. On top of this, it only services institutional clients. So if you’re an institution looking for a cold storage solution, you’d be much better off speaking to Anchorage.
BitPanda recently acquired Trustology to be able to offer BitPanda Custody using Trustology’s TrustVault crypto custody solution. TrustVault is an HSM-based cold storage solution - an HSM is a physical electronic device that safeguards and stores private keys. BitPanda’s HSMs are hosted in secure data centres and private keys are only accessible using instruction keys, which is another type of encrypted private key that’s created and stored on the user’s phone’s secure enclave when setting up an account.
As far as crypto custody solutions are concerned, BitPanda is one of the most secure solutions available. Whilst Anchorage is marginally better, BitPanda is still a viable option for smaller institutions where cost is a concern.
Qredo is another MPC solution, but with one major difference - it’s decentralised. Qredo combines the cryptographic security of multi-party computation (MPC) with its own Layer 2 blockchain network. The result is something they call decentralised MPC (dMPC).
Their argument for self-custodied MPC is that it means you no longer have to depend on centralised storage solutions controlled by a vendor. It’s a fair point in the case of exchanges and some CeFi businesses, but at the same time many MPC crypto custodians have disaster recovery mechanics and client assets don’t fall to creditors in the event of the custodian going insolvent.
One other thing to consider is that early in the life of decentralised networks, they’re actually not that decentralised as it takes time for node operators to join the network. It will be interesting to see how Qredo’s product evolves.
Qredo is available through MetaMask Institutional, but be aware that you’ll need a minimum of $10M to use MetaMask Institutional. And personally, I’m really not a fan of MetaMask as to be frank: the user experience sucks. Thankfully, Qredo is building its own wallet solution. So it’s decentralised is important to you, check it out.
Ledger is best known for its hardware wallets, but the company also has a crypto custody solution called Ledger Vault.
Ledger Vault provides the infrastructure for financial institutions to securely control their crypto assets with a multi-authorization self-custody management solution. This is an HSM-based cold storage solution for institutional clients built on top of Ledger’s existing hardware. The primary difference from other custodians mentioned above is that Ledger Vault offers a self-custody solution.
Self-custody isn’t viable for most organisations, so unless you’re JP Morgan, it’s unlikely you’ll want that kind of responsibility.
That’s a pretty extensive list and there are more I haven’t mentioned. Alas, if you’ve made it this far, you should have a sense of what the market has to offer. But when it comes to the best of the best, who reigns supreme? I’ve included my favourites for each category below. Here are the top crypto custodians of 2022:
Anchorage is hands down the best crypto custodian I’ve seen as far as institutional clients are concerned. Now, there is a caveat to this as it's really only been built to cater to massive providers as a core component of a broader custody proposition for underlying clients. This is really the go to solution for bulge bracket banks, governments and infrastructure providers looking to add a cold storage component to their own crypto custody solutions. It also offers KYC’d lending pools and CEX aggregation for trading.
For hedge funds, Copper is definitely the crypto custodian of choice. Although Fireblocks is the better known, better funded competitor, Copper has managed to pull off a win in this space by building a vastly better product. Their platform feels more intuitive and they’re innovating a lot faster to build products that cater to active crypto investors. Their ClearLoop product makes a lot of sense for investment firms actively buying and selling crypto.
Krayon wins the top spot among crypto custodians when it comes to SMEs and crypto businesses. In any nascent industry, most firms tend to ignore the mid-market and focus on major institutions, but Krayon has purposely built for small and medium corporates. It offers the same institutional grade MPC custody you’ll get from Fireblocks or Copper, but offers additional features built specifically for treasury management. The ability to create custom governance rules makes it perfect for almost any business and enables it to scale with extensive customer support, so you don’t have to pay through the nose for an enterprise solution.
I haven't mentioned GridPlus in my list above as it's not technically a crypto custodian, but its worthy of a mention here because its the best hardware wallet I've come across. And for individuals that aren't comfortable with hot wallets, it might not make sense to use a crypto custodian unless you have at least a couple million dollars worth of crypto.
That's not to say crypto custodians aren't available to individuals. You can certainly use a third party custodian, but you'll want one that:
I'm going to be shameless and pick Krayon here as the best crypto custodian for NFTs. I know I'm biased, but the team has been working closely with NFT issuers and gaming DAOs to come up with better solutions for NFT custody. So whilst the product is still in its early days, I'm excited to see what gets built. And its definitely a market that other MPC custody providers haven't been paying enough attention to.
A hot wallet is a crypto wallet that is always connected to the internet and cryptocurrency networks.
Browser-based wallets, mobile wallets and desktop wallets are typically hot wallets.
And they tend to be most popular amongst casual crypto investors - think MetaMask and Trustwallet.
The primary benefit of a hot wallet is ease of use. Because they’re always online, they’re convenient for handling your crypto.
The biggest problem with hot wallets is that they store your private keys on your physical device. So anyone with access to your device could potentially steal your crypto. Now, don’t forget they don’t need physical access to your device either. If a hacker manages to put malware onto your machine, they could gain control of your wallet. Which is why people with large amounts of crypto don’t tend to store them in hot wallets.
Web wallets are the least secure, though all crypto hot wallets are vulnerable to online attacks.
Warm wallets combine the transaction speed of hot wallets with an additional level of security. With a warm wallet your private keys are held online and transactions can be created automatically, but human involvement is needed to sign the transaction before it can be sent to the blockchain.
Most people are familiar with multisignature wallets - these require two or more parties to sign a transaction before it can be executed, but the underlying wallets that form parts of the multisig are hot wallets.
The best warm wallets are MPC-based.
MPC wallets are more advanced than multisig wallets. They also require a quorum of two or more parties to approve transactions before they can be sent to the blockchain. However, they have more advanced security features and great operational flexibility.
Hardware wallets or hardware security modules (HSMs) are cold wallets.
Cold wallets store your private keys offline.
You may have heard of people referring to this as air gapping or on an air gapped device. What it means is that your private keys are stored on a device which isn’t connected to the internet. The advantage to this is that if your private keys aren’t online, they’re impossible for a hacker to steal without access to the physical device. And even with access to the device, you’d still need the pin/password to open it.
The downside to cold wallets is that they’re cumbersome, because the private keys need to be retrieved before you can sign a transaction. So you’re sacrificing convenience for marginal security improvements.
Ordinarily, if you were managing large sums of cryptocurrencies, I’d argue that it’s absolutely worth using cold storage. However, if you’re using an MPC-based wallet you’re not gaining much in terms of additional security by using a cold wallet.
