The business of cryptocurrency custody—the crypto equivalent of providing a safety deposit box—is booming. The latest company to enter the market is Gemini, which on Tuesday announced Gemini Custody, a service that will let investors and institutions securely park 18 different types of cryptocurrency.
Gemini, which is owned by Cameron and Tyler Winklevoss of Facebook fame, has long offered custody service for a handful of clients of its crypto exchange service. The service unveiled on Tuesday, however, is a new offering built from the ground up that can store a greater selection of assets, and also allows clients to trade instantly from so-called “cold storage”—assets that are stored offline.
While cryptocurrencies like Bitcoin are designed to be perfectly secure, this security depends on the owner safeguarding their private key—a long string of alphanumeric characters that provides access to the digital wallet where the crypto is stored. To protect the private key from hackers and criminals, many wealthy crypto owners choose to pay custodian services a small fee to store it for them. In addition, many institutional investors are obligated by law to park their assets with a registered custodian.
All of this explains the growing number of crypto companies offering custody services. These include Anchorage, a startup backed by Visa and the venture capital firm Andreessen Horowitz, as well as crypto giant Coinbase, which recently paid $55 million to acquire another company’s custody business.
Gemini believes it can make inroads into this growing niche by offering tools such as view-only access for auditors and other third parties, allowing them to confirm balances, transactions, and activity. The company is also touting its solid relationships with regulators, and certifications it has earned from the New York Department of Financial Services.
For Gemini, the launch of the new custody service offers a chance for a new revenue stream, but also an opportunity to attract fresh attention from the crypto industry. While Gemini has been operating since 2015, its exchange has struggled to win market share, and recent reports suggest it is winning no more than 1% of overall trading volumes.
In an interview with Fortune, Tyler Winklevoss said he is not concerned with such figures, saying Gemini offers a superior type of exchange and custody service than many of its competitors, and that the company is focusing on the long game.
“We’re trying to be the fastest tortoise in the race,” said Winklevoss.