Bitcoin Custodial Services

By Kjlimo | MontyBitcoin | 21 Aug 2020


This week I learned about bitcoin custodial services. Why would you need custodial services? Custodial services protect your investment with insurance and allow you to sleep at night knowing your investments aren't stored under your mattress, but securely with an institution with protocols in place to protect you.

Many of us have a custodian for our 401(k) investments, or personal investments. Examples include Fidelity, JP Morgan, Goldman Sachs, etc. None of us hold on to stocks individually; we let a custodian take care of that. I assume these companies offer their custodial services because they make money when shares are traded. However, these fees may be more explicit as time goes on or for larger funds depending on how fee structures are broken down.  

For bitcoin, I only found three custodians in the marketplace: CoinbaseGemini and Kingdom Trust.   

Coinbase has a minimum of $500,000 to utilize their custodial services, so I don't have any details on their fees.  

Gemini is very straightforward with only two fees. There is an annual 40 basis point fee for custodial services and a $125 withdrawal fee.  

Kingdom Trust looks very similar to a self directed IRA fee structure and can be seen easily on their website:   https://www.kingdomtrust.com/bin/uploads/2018/01/Standard-Fee-Schedule.pdf      

I plan to utilize Gemini for my next project as a secure area to store some bitcoin for a longer period of time. Stay tuned!  

Monty

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