BNY Mellon joins State Street in backing a crypto exchange as digital assets continue to surge in popularity

• Bank of New York Mellon has joined State Street and a group of banks backing crypto exchange Pure Digital.
• Its first trade is now imminent and will involve bitcoin, founder Campbell Adams told the Financial Times.
• As institutional interest nudges banks into crypto, different approaches to the asset class are being tested.

Bank of New York Mellon has joined State Street and a group of banks backing Pure Digital, a crypto exchange catering to institutional traders.

"As more top-tier banks join our initiative, we move closer to having an efficient wholesale crypto market which will ultimately lead to a more stable and mature asset class," said Pure Digital CEO Lauren Kiley in a statement.

In April, Pure Digital was publicly backed by State Street with plans to go live sometime in mid-2021. Its first trade is now imminent - "within a week" - and will involve bitcoin, founder Campbell Adams told the Financial Times.

BNY Mellon and State Street are deliberating whether to trade on Pure Digital or just act as technology partners, according to the FT.

Wary of the risky new asset class, banks at first hesitated as crypto exchanges like Coinbase and Binance built businesses on whirlwind trading activity.

Now, as institutional interest nudges banks into crypto, different approaches are being tested. BNY Mellon and State Street both set up digital-asset units in the past few months. Goldman Sachs has announced plans to offer crypto to private wealth clients later this year.

A recent survey by Fidelity found that seven in 10 institutional investors plan to invest in crypto in the future, but are unnerved by volatility.

BNY Mellon's announcement comes a day after bitcoin fell below the $30,000 price support threshold, though it was up above $31,000 on Wednesday.