Crypto custodians, once boring infrastructure providers, are rapidly transforming into full-service financial platforms that rival traditional exchanges. Companies like BitGo and Anchorage Digital are leveraging their trusted relationships with institutions to offer trading, stablecoin issuance, derivatives, and AI banking services, fundamentally reshaping how institutions access digital assets.

What Are Crypto Custodians and Why Do They Matter?

Custodians are companies that securely hold cryptocurrency on behalf of clients, much like a bank holds your cash. When BitGo launched in 2013, the crypto industry faced a critical problem: how to keep digital assets safe. Most wallets at the time relied on a single private key, meaning one compromised employee or stolen password could drain an entire account instantly.

BitGo solved this with multisig technology, short for multi-signature, which requires multiple keys to approve any transaction. This innovation made crypto usable for institutions by dramatically reducing security risk. Today, BitGo secures more than $80 billion in crypto for approximately 5,500 clients across dozens of blockchains.

How Are Custodians Expanding Beyond Their Original Role?

Custody itself is a low-margin business. Institutional clients with over $1 million in digital assets typically pay 20 basis points, or two-tenths of a penny, for every dollar of crypto stored. But custodians have discovered that their trusted relationships with institutions create opportunities to offer much higher-margin services.

• Trading Services: BitGo now offers institutional clients access to trading across multiple exchanges, including OKX and Deribit, without requiring assets to leave custody. This broker-style model seeks the best prices across venues, similar to how traditional investment banks operate.
• Stablecoin Infrastructure: Anchorage Digital has partnerships with roughly 20 stablecoin issuers, including Tether and Ethena, and helps institutions mint and manage branded stablecoins. This business generated $66.7 million for BitGo in 2025, with clients including World Liberty Financial and SoFi.
• Derivatives and Settlement: BitGo added derivatives trading in the first quarter of 2026, generating roughly $3 billion in notional trading volume. Anchorage expanded its Atlas settlement and collateral-management network fourfold to nearly 600 institutions in the past year.
• AI and Agentic Banking: Anchorage added agentic banking capabilities in May 2026, allowing enterprises to fund and control artificial intelligence agents that operate on their behalf, opening a new frontier in automated financial operations.

BitGo's revenue growth demonstrates the scale of this shift. The company reported revenues of $16.2 billion in 2025, up nearly 425% from 2024, though much of this reflects full transaction value from trading activity. More telling is the 57% rise in subscriptions and services revenue to $121.5 million, which better captures the expansion into higher-margin businesses.

Why Are Institutions Choosing Custodians Over Exchanges?

Mike Belshe, cofounder and CEO of BitGo, argues that custodians now offer a superior model compared to traditional crypto exchanges. "The institutions are discovering that the model BitGo has is, frankly, just better than what the exchanges in crypto have built so far," he stated.

"In terms of where BitGo is going to grow the most in the next phase, I think it is actually going to be trading for both spot and derivatives," said Mike Belshe, cofounder and CEO of BitGo.

Mike Belshe, Cofounder and CEO of BitGo

The appeal is straightforward: institutional investors are accustomed to working with brokers who shop for the best prices across multiple venues. Custodians now offer that same service while keeping assets in secure, regulated custody. This eliminates the need to move funds between exchanges, reducing counterparty risk and operational complexity.

Nathan McCauley, cofounder and CEO of Anchorage Digital, emphasized that the traditional definition of custodian no longer applies. "Custody is almost a misnomer at this point for this category," he noted.

"Custody is almost a misnomer at this point for this category," said Nathan McCauley, cofounder and CEO of Anchorage Digital.

Nathan McCauley, Cofounder and CEO of Anchorage Digital

Anchorage Digital, which became the first federally chartered crypto bank in 2021, now serves more than 1,000 institutional clients and has doubled revenue every year for the past three years. Its fastest-growing businesses are derivatives and stablecoin issuance.

What Does This Mean for the Broader Crypto Market?

The rise of custodians as full-service platforms reflects a fundamental shift in how institutions access crypto. More than $80 billion in spot exchange-traded funds (ETFs), or investment vehicles that track crypto prices, have been raised in the last two years, turning custodians into essential vendors for Wall Street.

The market opportunity is substantial. Grand View Research estimates that the global digital-asset custody market was $683 billion in 2024 and projects it will reach $4.4 trillion by 2033. While crypto market forecasts should be treated cautiously, BitGo's fivefold revenue surge from $3.1 billion in 2024 to $16.2 billion in 2025 suggests genuine institutional demand for crypto infrastructure.

McCauley believes the trend will accelerate once regulatory clarity improves. "Once the CLARITY Act passes, every single bank in the country is going to want to partner with a crypto bank, with us, in order to enable its crypto offerings," he explained. The cost and complexity of building secure crypto infrastructure in-house will push traditional banks toward partnerships with specialized custodians.

This transformation represents a maturation of the crypto industry. Rather than competing on flashy trading features or viral marketing, the companies winning institutional business are those solving the unglamorous but essential problem of secure asset management and reliable infrastructure. For institutions considering crypto exposure, the rise of custodians as comprehensive service providers offers an alternative to relying solely on crypto exchanges.