In the bank’s new custodial service, individual and institutional clients of Seba Bank can now hold tokens of Ethereum-based NFT collections such as Bored Apes and CryptoPunks.
The decline of the nonfungible tokens (NFT) market does not appear to be a problem for Seba, a Swiss bank specializing in cryptocurrencies, as the company now permits customers to store NFTs.
Seba Bank launched a regulated custody facility on October 26 that allows its clients to hold NFTs. The NFT custody solution enables retail and institutional clients of Seba Bank to hold any Ethereum-based NFTs, including tokens from world-renowned NFT collections such as Bored Apes and CryptoPunks, according to the company.
“There is no marketplace integration with Seba Bank at this time,” a spokesperson for the firm told. Before deciding whether to give custody for a particular NFT, the company will additionally do due diligence at the client’s request. “The custody service offered is by no means restricted to top collections,” the firm’s representative stated.
Seba’s new NFT custody platform is designed to store customers’ NFTs securely without requiring them to manage the private keys. The feature is incorporated into consumers’ bank accounts, allowing them to include NFTs in their total wealth and manage them like they would any other digital asset.
A company spokesman stated that Seba Bank is the “first regulated bank to offer NFT custody,” expressing optimism for the future of NFTs :
“We believe that in the coming years, digital assets, including NFTs, will gain adoption and will be increasingly accepted even by traditional finance operators.”
Urs Bernegger, co-head of markets and investment solutions at Seba Bank, emphasized that Seba is supervised by the Swiss Financial Market Supervisory Authority (FINMA) and possesses “core competence” in cryptocurrencies.
Seba Bank is a significant crypto-focused Swiss financial institution with headquarters in Zug, renowned for its close collaboration with local regulators. FINMA issued Seba Crypto AG a Swiss banking and securities dealer license in 2019. The regulator also issued Seba Bank AG a Certified Information Systems Auditor certification in 2021, allowing the company to provide a custodial service of institutional caliber.
The release of NFT custody by Seba Bank coincides with difficult circumstances for the NFT business. As of late September 2022, weekly NFT trade volumes have dropped by as much as 98% since the beginning of the year. The median price of an NFT has also declined significantly, while the entire NFT market has continued to deteriorate as the average weekly trading volume of NFTs has decreased by around 30% in September versus its August.
On the opposite side, the number of NFT wallets has increased this year, increasing from 3.4 million in January to 6.1 million in September.
Despite the decline in the NFT sector, many platforms and businesses have lately released NFT-related solutions. MetaMask Institutional, the institution-compliant version of the MetaMask cryptocurrency wallet, unveiled the inclusion of NFT services to its custodial capabilities last month.
“A lot of investors who held NFTs have continued to stay in the market showing conviction despite the market downturn,” a spokesperson for Seba told. According to the company, the field for NFTs has continued to mature, with institutional investors forming NFT funds and funding new projects. “SEBA Bank is addressing the need for a regulated custodian that can guarantee the security and integrity of NFTs for professional and institutional investors,” the person added.
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