"Coinbase Custody Trust Company and BNY will act as bitcoin custodians, responsible for safeguarding the fund's digital assets and facilitating transfers tied to share creations and redemptions. BNY will also serve as administrator, transfer agent and cash custodian, overseeing accounting, shareholder records and cash management for the trust."
"The ETF is designed as a passive vehicle that will hold bitcoin directly rather than using derivatives or leverage. Shares of the trust would reflect the performance of the underlying bitcoin held in custody, giving investors exposure through brokerage accounts without requiring direct ownership of the cryptocurrency."
"Under the proposed custody framework, most of the trust's bitcoin would be stored in offline cold-storage vaults, where private keys remain disconnected from the internet. The structure is a popular one and is intended to reduce exposure to cyber threats that have long concerned institutional allocators."
Morgan Stanley filed an amended registration statement for a spot Bitcoin ETF using Coinbase Custody Trust Company and BNY Mellon as key service providers. Coinbase serves as bitcoin custodian, safeguarding digital assets and facilitating transfers during share creation and redemption. BNY functions as administrator, transfer agent, and cash custodian, managing accounting, shareholder records, and cash operations. The ETF operates as a passive vehicle holding bitcoin directly without derivatives or leverage, allowing investors brokerage account exposure without direct cryptocurrency ownership. Most bitcoin holdings remain in offline cold-storage vaults with disconnected private keys to minimize cyber threats. Portions may move to trading wallets during share creation or redemption periods. Custody insurance is maintained but shared across multiple clients with potential coverage limitations.
Read at Bitcoin Magazine
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