UnionBank of the Philippines, one of the country’s largest banks by total assets, has selected Hex Trust, a Hong Kong-based digital assets custodian, to test a crypto custody service. UnionBank aims to pilot crypto custody services in the country.
Hex Trust will begin by providing an in-house service for the bank’s employees in a pilot run. UnionBank said it is looking to tap into the digital assets market as institutional and customer interest grows.
The next step will involve rolling out a custody service for the bank’s customers, according to a press release shared with CoinDesk on Wednesday. The move will allow the bank to secure customers’ digital assets on their behalf in a regulated environment.
UnionBank, one of the Philippines ‘ top 10 banks by total assets, said it is fully compliant in its latest offering with the Philippines’ central bank, the Bangko Sentral ng Pilipinas (BSP).
“We are excited to be the first Philippine bank to pilot a custody service for digital assets for our own employees, overseen by the BSP so that we can prepare the groundwork for a safe and protected system for customers’ digital assets,” Henry Aguda, the bank’s chief technology and operations officer, said.
Last year, Hex Trust teamed up with enterprise blockchain company R3 to offer banking clients another option for issuing security tokens using R3’s Corda software development kit. It also said it is working with one of Asia’s largest banks.
Hex Trust, which has offices in Hong Kong and Singapore, said it is expanding to the European market this year.
Play-to-earn games, such as Axie Infinity, have exploded in popularity in the Philippines, with users being able to earn crypto and non-fungible tokens (NFTs) through playing the game.
UnionBank believes this partnership will enable it to respond to the needs of customers who are now looking for a trusted and regulated institution to safe keep their digital assets. Around 70 percent of the adult population of the country remains unbanked, rendering them unserved by financial institutions according to data from BSP. This initiative could allow the digital assets industry to continue its growth, and at the same time, together with the BSP, remain safe and regulated for new and existing investors.
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