State Street reaffirms its presence in the Bitcoin industry by expanding its service offering. On July 29, the second oldest active bank in the United States announced a new partnership with Lukka, a provider of active cryptographic software and data for businesses. Now, State Street will support its private mutual fund clients for the collection, standardization, processing and reporting related to cryptocurrencies and other digital assets.
The agreement adds to the efforts of State Street in the space of digital and crypto assets, following the launch of State Street Digital, a division focused on the evolution of the industry towards digital finance, the statement notes.
The partnership also occurs after Lukka’s Series C funding round in December 2020, led by State Street. Nadine Chakar, Head of State Street Digital, noted that the popularity of digital assets is on the rise. That is why the institution is committing to build the necessary infrastructure for the development of its digital asset service models.
Our work with Lukka will take advantage of its software and data to help expand our crypto and digital asset fund management capabilities to alternate managers. This is just another advance in our suite of digital solutions and marks a very exciting development.
Nadine Chakar, Head of State Street Digital.
Within the package of products that State Street will have, thanks to Lukka, is the patented data management solution, specifically designed to work with blockchains and crypto asset data. This includes, back office (for data reconciliation, settlements, accounting, record keeping, regulatory compliance) and middle office (in charge of risk management, profit and loss calculation among others). It will also have Lukka Reference Data and Lukka Prime Pricing Data, software for managing cryptocurrencies.
«Lukka was the ideal partner to help to provide these services given its leadership position in crypto asset data as State Street continues to add to our growing offering in the digital asset space, “said Jen Tribush, Alternatives Leader at State Street Digital.
According to E Lukka CEO Robert Materazzi “State Street is leading the charge to usher in the next generation of fund management. Large traditional funds are quickly looking to add cryptocurrencies to their offerings. (…) State Street quickly recognized the importance of developing capabilities to support crypto assets and we are proud to partner with them. ”
State Street and its path to new technologies
State Street Corporation is an American financial services company and bank holding company. It is the second active US bank on the list of oldest banks, founded in 1792. It is also one of the largest asset management companies and the largest custodian bank in the world, with $ 3.1 trillion under management. and 38.8 billion in custody.
Since 2017, the financial giant, State Street, has shown interest in incorporating new technologies into its financial products. In that year, the institution developed proofs of concept for different blockchain tools that they planned to merge into their own blockchain, the State Street Chain.
In 2019 State Street had reconsidered its plan to create a blockchain platform, after it had to face the challenges posed by adopting technologies that could disrupt its existing business models. The biggest problem that large banks such as State Street have faced is updating their legacy systems.
However, as CriptoNoticias reported, in April of this year, the financial consortium partnered with Pure Digital, a London, UK-based startup that plans to be an institutional platform for bitcoin. The association, as reported, will be a trading space for operations with cryptocurrencies for investors, through the Currenex platform of State Street.
State Street is not the only traditional bank in the United States that incorporates to bitcoin within their products. The Bank of New York Mellon (BNY Mellon) is another of the most important financial institutions, which also announced, on July 21, its support for the new institutional platform for investments in bitcoin (BTC), also developed by the London startup , Pure Digital.