Availing professional cryptocurrency custody solutions is one of the best ways to protect your digital assets against security threats. But the truth is, not all crypto custodians are equal, and choosing the wrong one can incur losses. 

So before you hand over your hard-earned assets, thoroughly assess the features of a cryptocurrency custodian. Here are six features every qualified cryptocurrency custodian must offer:

1. Ease of Use

Investing in digital assets brings numerous risks and challenges. Understanding how blockchain networks operate itself is difficult. In such situations, the last thing you need is a crypto custodian that makes acquiring your assets more difficult than making them. 

Make sure the crypto custodian has the following features:

• Easy-to-navigate interface
• Intuitive dashboard
• Password management
• Multi-device functionality
• Streamlined account recovery procedure

2. Up-to-Date Storage Solutions

Depending on the type of your digital assets and long-term financial needs, crypto custodians offer a variety of storage solutions. Examples include:

Hot wallets – these are internet-connected wallets that facilitate investors who need to make frequent transactions.

Cold wallets – these are offline wallets suitable for large amounts of cryptocurrencies. Assessing assets from a cold wallet requires more time than from a hot wallet. 

Multi-sig wallets – these require three to five keys to access cryptocurrencies. 

Institutional-grade vaults – these are physical high-security vaults and bunkers for storing crypto offline.

3. Institutional Grade Security

This is pretty obvious. A qualified crypto custody provider protects your assets against security breaches, fraud, and operational failures. 

• Hardware Security Modules (HSMs) to ensure offline crypto storage
• Multi-Party Computational (MPC) Wallets to protect keys against single points of failure.
• Multi-signature approval
• Biometric verification
• Separation of custodian and operational funds

The collapse of crypto firms in recent years has made it clear that third-party security breaches aren’t the only threats to digital assets. Operational failures are just as responsible. Qualified crypto custodians like BitGo impose human governance and control separation controls, protecting your assets.

4. Cost-Efficiency

Leveraging crypto custodians shouldn’t break your bank. Get detailed quotes from different custodians and compare them. Assess features and security measures. Remember that an overly expensive custodian doesn’t immediately guarantee robust security measures. 

Work with a custodian that has a transparent pricing model.

5. Scalability and Multi-Asset Support

As digital assets become popular, institutional portfolios are expanding. Tokenized securities, stablecoins, and staking products are also gaining dominance.

This is why it’s important to choose a scalable crypto custodian. They must be able to handle new forms of tokenized assets while ensuring regulatory compliance. Moreover, multi-asset support will make sure you don’t have to switch custodians after a short while. 

6. Regulatory Compliance 

A qualified crypto custodian not only safeguards your assets but also ensures compliance with industry regulations and standards. 

For instance, compliance with regulations like Know Your Customer (KYC) and Anti-Money Laundering (AML) is absolutely necessary. Moreover, if the custodian offers cold wallets, it should be up-to-date on the latest cybersecurity measures. 

Custodians should also separate an investor’s funds from their holdings. This will prevent the mingling of funds and mitigate operational risks.