Tax consultancy for cryptocurrency custody companies

Are you involved in cryptocurrency custody? Do you know the laundering regulations you must follow? Do you know what data to collect from your customers?

What is the custody of cryptocurrencies?

Simply put, cryptocurrency escrow means securing the private key that proves you own the funds in your cryptocurrency wallet..

In traditional banking, all companies engaged in the custody of cryptocurrencies are financial institutions, as required by law. However, with cryptocurrencies, cryptocurrency owners have the opportunity to become their own custodians.

As well as small or medium-sized companies or start-ups that have identified the opportunity and are positioning themselves as leading companies in the custody of crypto-assets, thanks to their cybersecurity measures and latest technology in physical custody.

Types of custody

Using fiat currency as an analogy, you can store cryptocurrencies under your bed to keep them safe or pay an external custodian to store them in a vault protected by security guards.

Con eso en mente, hay dos tipos principales de cripto custodia que debe conocer.

Self-custody

Pros:

Your password, your coins: Only you have access to your account.
No risk of being attacked by ohackeenal supplier that safeguards your coins.
You have full power over your cryptos.

Cons:

If you lose your password, you lose access to your coins.
Your assets are not insured.
If you get hacked, you can say goodbye to your property forever.

Third-party custody

Pros:

The supplier takes care of everything.
Easy access for beginners.
Suppliers have insurance on the assets they manage.
In some cases, you can earn interest on the cryptocurrencies you deposit by stacking.

Cons:

The supplier holds your coins.
They can freeze your assets, block your access to your wallet or limit withdrawals.
The supplier may be hacked or go bankrupt.
Rates may increase.

If you are interested in performing this activity of custody of crypto-assets, please read carefully our registration services before the Bank of Spain because you are one of the obligated parties.