Cryptocurrency hardware wallet manufacturer Ledger is one of the most well-recognized brands in the entire industry. Its offerings allow users to store their cryptocurrencies safely in lieu of centralized wallets owned by cryptocurrency exchanges and service providers. Now, the Paris-based company has now opened a new office in Hong Kong — as it expects Asia to become a key growth market.
Benjamin Soong, Regional Head of Ledger Hong Kong, said that the Asia Pacific region was expected to become a key driver for future growth. He pointed out that Korea and China, the world’s two largest cryptocurrency markets, are located in Asia. There was a significant amount of demand for digital currencies in the world’s most populous country until a string of regulations and legislation effectively prohibited citizens from holding and using digital currency.
The Asia Pacific region is also home to many cryptocurrency exchanges. Thus, Ledger believes that there is a significant market yet to be tapped. Soong said the demand for custodial and security services was high in the region, as well, due to cryptocurrency exchanges taking enhanced steps to improve the security of user holdings after the dollar equivalent of cryptocurrency coins and tokens lost to attackers was the highest in 2018 — even though the market performed worse than the previous year.
Banks, financial institutions, fund houses, and wealth businesses were surprised by the cryptocurrency bull market of 2017. After the bull run, many of them looked to maximize future investment opportunities in the cryptocurrency market. The price correction last year provided a perfect time for them to enter the digital currency industry. However, larger financial institutions have remained cautious about the security of their digital assets.
Ledger has entered into a joint venture with Nomura and Global Advisors with the aim of solving custodial problems encountered by these financial institutions. The new venture, named Komainu, offers crypto asset custody and security solutions. Nomura, one of the world’s largest banks, has already announced its own digital custody asset division. Had Ledger not stepped in, it would be only a matter of time before other banks in Singapore, Japan, Korea, and Hong Kong would also follow Nomura.
Benjamin Soong said that cryptocurrency is an entirely new asset class and its security presents an unforeseen challenge. Trezor is the nearest market competitor challenging Ledger for a market share in this industry. In 2017 and 2018, these two hardware wallet manufacturers were involved in an intense battle to sell their range of hardware products to retail investors. From 2019 onwards, this fight is likely to shift to the custody of digital tokens from institutional investors.
Will Ledger and Trezor be the preferred choice for custody of institutional cryptocurrency holdings or will a newer alternative emerge? Let us know your thoughts in the comments below!