Strike brings custody in-house, drops third-party services.
Digital payment company Strike has transferred all its customers’ bitcoin (BTC) and U.S. dollar (USD) assets to its own internal infrastructure, according to a blog post by CEO and co-founder Jack Mallers on June 8.
Mallers explained that the move is part of a two-year plan to reduce counterparty risk while ensuring the performance and reliability of the firm’s products and services. The announcement comes in response to rumors of bankruptcy concerning Strike’s former custodian, Prime Trust, which has agreed to sell to digital asset custody rival BitGo. Swan Bitcoin, a fellow Bitcoin financial services firm, has also recently stopped using Prime Trust.
Read more: Crypto Custody Firm BitGo Reaches Preliminary Agreement to Buy Prime Trust: Sources
Strike declined to comment on the situation surrounding its former custodian, emphasizing that its plan to move custody in-house has been two years in the making. The company’s customer base, spread across more than 65 countries, will now have bitcoin and fiat custody directly with Strike.
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“I’m proud to announce Strike now owns and operates all of its own infrastructure for customers,” Mallers wrote. “Strike now custodies customer bitcoin and dollars, which means no custodial intermediaries between us and our users.”
Benefits of the transition
Mallers suggests that the transition to in-house custody will bring short and long-term benefits to users.
“Thanks to our infrastructure enhancements, we’ve started to roll out many fantastic new features and capabilities that are now live,” Mallers said.
Strike users can now send bitcoin directly to other users on a peer-to-peer basis, and they can choose to receive funds as cash or bitcoin. Bitcoin payments can be made directly on-chain or via the Bitcoin Lightning Network, a second-layer payment system for cheaper and faster bitcoin transactions.
Deposit limits have been increased and on-chain payments are now tiered, allowing users to pay higher fees for faster payments and lower fees for slower, less urgent transactions.
The 29-year-old CEO says his company has “serious ambitions” in the long-term, including global on/off ramps, instant withdrawals, new dollar cost averaging capabilities, continuing to improve limits, more cross-currency capabilities, and other features that the company hopes to bring soon.
