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Zodia Custody and Bybit, the world's second largest crypto exchange by volume, have announced a strategic partnership designed to address key security challenges facing institutional cryptocurrency investors, with Zodia's Interchange solution offering independent custody and off-venue settlement capabilities to Bybit's institutional clients.
Industry scrutiny has intensified concerns about on-exchange settlement risks, particularly regarding centralised control and counterparty exposure.
Zodia Custody's Interchange solution provides independent asset custody through what the company describes as regulatory-grade infrastructure. The system allows institutional users to trade immediately on Bybit while their assets remain securely held by Zodia Custody, ensuring full segregation and significantly reducing exchange-side risks. This arrangement eliminates counterparty risk and removes the need to pre-fund exchange accounts, improving both capital efficiency and operational security.
Zodia Custody, backed by Standard Chartered, Northern Trust, SBI Holdings, National Australia Bank, and Emirates NBD, has positioned itself as a custody provider built specifically for institutional requirements. The company operates under authorisations from several financial regulators, including the UK's Financial Conduct Authority and the Central Bank of Ireland.
Julian Sawyer, CEO of Zodia Custody, commented: "Institutional clients need more than speed – they need to know their assets are held securely, off-exchange, and fully under their control. As leading players in the industry, Zodia Custody and Bybit have a shared responsibility to provide tailor-made solutions to increase security and protect capital for the institutions that use our services. That's what we're delivering through this partnership. With Interchange, we're enabling Bybit's clients to access trading liquidity without compromising on custody standards, counterparty risk, or capital efficiency. It's custody and settlement built for institutions, not retrofitted for crypto."
Shunyet Jan, Head of Institutional and Derivatives at Bybit, added: "At Bybit, our mission is to provide institutional-grade solutions that meet the evolving needs of sophisticated investors. Our partnership with Zodia Custody underscores our dedication to compliance, security, and innovation in the digital asset space. Zodia Custody's reputation as a trusted, highly regulated custodian makes it the ideal partner to safeguard our clients' assets while enhancing capital efficiency. Together, we are setting new standards for the institutional adoption of digital assets."
Bybit serves over 60 million users globally. The exchange has been expanding its institutional offerings as traditional financial institutions increasingly engage with digital assets.
