Global Reach for a Global Mission: Custody & Clearing Services
Part III of our Strategy Series with Ethos Chief Global Strategist, Stephen Corliss
Today the Ethos Investment Committee is excited to announce that Ethos will be expanding the initial focus of our Global Strategic Partner Program to include market participants offering Custody & Clearing Services across Europe, Africa, South America, Asia & Australia – to provide essential crypto, traditional and fiat asset custody services to our global user community as part of Ethos’ mission to unlock the New Economy on a global scale.
As many of you are aware, Ethos is on track to deliver our first release, the Universal Wallet, in Q1 2018. We are very excited for this release as our wallet will create the foundation for a new financial ecosystem powered by the ETHOS token. The initial phase of this overall mission focuses on delivering a global multi-asset wealth management solution that seamlessly connects consumers with investment advisors, wealth managers, broker dealers, custodians, digital asset exchanges, merchants and developers — to make wealth management accessible to all.
In support of the existing efforts that are well underway with regards to our US Custody partner contract negotiations, the Ethos Investment Committee is expanding our global selection process for providers of Custody and Clearing Technology and/or Services internationally. Broadening our search internationally is an essential component of the overall program as it allows Ethos to locate valuable partners able to provide diverse asset servicing capabilities to serve the Ethos member community in those regions who need it most.
Partners through this program will also be expected to enhance, support or advance Ethos’ own transformative “Cognitive Advisor” offering, while providing our retail and business users with new dynamic and secure hybrid capabilities spanning cryptocurrencies, traditional and fiat assets covering global markets. Ethos will also be collaborating with key Custodian partners to help define and build both the legal and technology requirements for crypto asset custody to meet the demands of the Ethos Community.
We’re excited to continue to progress these efforts forward on all fronts as we move closer to delivering a transformative new financial ecosystem — powered by cutting edge tech, a functional token, and innovative partnerships.
Why is this important to the Ethos Platform?
As a financial ecosystem, Ethos must build an infrastructure that supports the critical aspects of a capital market system. Rather than build this structure with a top-down approach, we have chosen a bottom-up approach that begins at the foundation, with you, the retail consumer. From an investment perspective, the next layer in the stack after the portfolio construction and management layer is the safekeeping layer, which are processes performed by Qualified Custodians and/or Clearing Firms.
What is a Custodian or Clearing Firm?
A custodian bank, or simply custodian, is a specialized financial institution responsible for safeguarding a firm’s or individual’s financial assets and is not typically engaged in “traditional” commercial or consumer/retail banking such as mortgage or personal lending, branch banking, personal accounts, automated teller machines (ATMs) and so forth. The role of a custodian in such a case would be to:
- Hold in safekeeping assets/securities such as stocks, bonds, commodities such as precious metals and currency (cash), domestic and foreign
- Arrange settlement of any purchases and sales and deliveries in/out of such securities and currency
- Collect information on and income from such assets (dividends in the case of stocks/equities and coupons (interest payments) in the case of bonds) and administer related tax withholding documents and foreign tax reclamation
- Administer voluntary and involuntary corporate actions on securities held such as stock dividends, stock splits, business combinations (mergers), tender offers, bond calls, etc.
- Provide information on the securities and their issuers such as annual general meetings and related proxies
- Maintain currency/cash bank accounts, administer deposits and withdrawals and manage other cash transactions
- Perform foreign exchange transactions
- Often perform additional services for particular clients such as mutual funds; examples include fund accounting, administration, legal, compliance and tax support services
Chief Global Strategist
Ethos is a people-powered blockchain platform harnessing the power of design, technology and social intelligence to create breakthrough solutions that enable everyone to participate in the New Economy — putting the power back in the hands of the people, where it belongs.