In a landmark moment for the Canadian digital asset industry, Tetra Trust Company has officially become the nation's first regulated cryptocurrency custodian. This pivotal achievement was marked by the receipt of a registration certificate from the Alberta government on July 5, 2021, authorizing its operations under the National Instrument 31-103 and National Instrument 81-102 regulatory frameworks. This establishes a new standard for security and compliance in the country's burgeoning crypto market.
The company's core business is the secure storage and custody of a wide array of digital assets, including major cryptocurrencies like Bitcoin and Ethereum, as well as various other digital tokens and tokenized securities. Prior to Tetra Trust’s launch, Canadian institutions and investors were limited to using either unregulated domestic providers or custody services from international, primarily U.S.-based, suppliers. Tetra’s arrival provides a trusted, Canada-based solution.
A Milestone for the Canadian Crypto Ecosystem
The emergence of a regulated custodian within Canada's borders is a critical development. It provides the necessary infrastructure for greater institutional participation, which is widely seen as a key driver for the next phase of growth in the digital asset space. For financial advisors, investment funds, and public companies, working with a qualified custodian is a fundamental requirement.
Eric Richmond, CEO of Tetra Trust Company, emphasized the significance of this development: "Canada has become a hotspot for cryptocurrency-related public companies, exchange-traded funds, and trading platforms. There has been a pressing need for a regulated custodian provider within Canada to serve this rapidly growing market."
Strategic Investment and Industry Backing
Concurrent with its regulatory approval, Tetra Trust successfully closed multiple rounds of funding. The investment was led by a consortium of prominent strategic investors, demonstrating strong confidence in the company's mission and the future of Canada's digital asset infrastructure. Key participants included:
- Coinbase Ventures: The investment arm of the world's largest publicly-traded cryptocurrency exchange.
- Coinsquare: A leading Canadian digital asset trading platform.
- Canadian Securities Exchange (CSE): A major stock exchange in Canada.
- Mogo Inc.: A Canadian leader in digital payments and financial technology, publicly traded on NASDAQ and TSX.
- Urbana Corporation and the Caldwell Growth Opportunities Fund.
This diverse group of backers represents a cross-section of the traditional finance and crypto-native worlds, highlighting the broad-based support for regulated custody solutions.
Jenna Kaye, CEO of Odyssey Trust Company and Chair of the Tetra Trust Board, commented on the timing: "Over the past six months, we have witnessed a significant shift in the adoption of digital assets. As we look to the future, we know digitization is a key piece of the puzzle, and we understand the importance of regulation in building capital markets' confidence in this sector."
The Critical Role of a Regulated Custodian
A custodian's primary function is to safeguard clients' assets, drastically reducing the risk of theft or loss that comes with individuals storing their own private cryptographic keys. For institutions, this is a non-negotiable aspect of risk management. Tetra Trust specializes in advanced cryptographic key management, providing this essential service to crypto service providers, investors, and trustees.
The market opportunity is substantial. Tetra Trust estimates the current market for crypto custody services to be worth tens of billions of dollars. The company has set an ambitious target to hold over $1 billion in assets under management by the end of 2021, a goal that now seems highly achievable with its regulated status and strategic backing.
This development is expected to accelerate the launch of new crypto-based financial products in Canada, including additional Exchange-Traded Funds (ETFs) and other investment vehicles that require a regulated custodian to operate. 👉 Explore more strategies for secure digital asset management
Frequently Asked Questions
What is a cryptocurrency custodian?
A cryptocurrency custodian is a specialized service that stores and secures digital assets—like Bitcoin and Ethereum—on behalf of its clients. They use sophisticated security measures, often involving multi-signature wallets and cold storage, to protect private keys from theft, loss, or unauthorized access, similar to how a bank safeguards cash and securities.
Why is Tetra Trust's registration so important for Canada?
Tetra Trust is the first company of its kind to be fully regulated by a Canadian provincial government (Alberta) under specific securities laws. This provides a long-missing piece of infrastructure, enabling Canadian institutions, funds, and registered advisors to invest in digital assets with a trusted, compliant, and domestically based partner, which is crucial for broader market adoption.
Who are the typical clients for a service like Tetra Trust?
Their primary clients are institutional players rather than individual retail investors. This includes cryptocurrency exchanges, investment fund managers, publicly-traded companies holding crypto on their balance sheets, financial advisors, and any entity requiring secure, auditable, and compliant storage for large volumes of digital assets.
How does regulated custody help the average crypto investor?
While most individuals may not directly use Tetra's services, they benefit indirectly. Regulated custody facilitates the creation of safer and more accessible crypto investment products, like ETFs and mutual funds, which everyday investors can buy through their standard brokerage accounts. It also brings greater legitimacy and stability to the entire market.
What is the difference between cold and hot storage?
Cold storage refers to keeping private keys completely offline, making them immune to online hacking attempts. This is the most secure method for storing large amounts of crypto. Hot storage keeps keys connected to the internet, facilitating faster transactions but presenting a higher security risk. A qualified custodian like Tetra uses a combination of both, with the majority of assets held in cold storage.
Does this mean cryptocurrencies are becoming more accepted by traditional finance?
Absolutely. The investment from traditional entities like the Canadian Securities Exchange and a publicly-traded fintech company like Mogo, coupled with rigorous regulatory approval, signals a major step towards the integration of digital assets into the established financial system. It signifies growing acceptance and maturation of the entire asset class.