Crypto infrastructure company EctoLabs confirmed today that it is building a trading and custody channel for institutions only, with closed testing planned for the fourth quarter. The company also said the channel will have no retail entry point and a minimum allocation of $50m.
That is a deliberate trade-off. For several years the growth logic across most crypto platforms has been to push the threshold down — smaller minimum trades, faster onboarding, more listings. EctoLabs has gone the other way.
Institutions were never asking for cheaper fees
Founder Chen An told us the company assumed price was the lever too, at first. "We spent a year driving fees down and then realised they were not even looking at that line."
On his account, three things actually block large allocators, and none of them is price.
The first is segregation of custody. Most platforms hold client assets in the same set of addresses as their own funds, distinguishing ownership on an internal ledger. For an institution that has to answer to a board and an external auditor, that structure does not survive due diligence: if the platform fails, whether client assets are legally the client’s is not a clean answer.
The second is settlement finality. In a retail context, nobody minds the gap between a fill and actual delivery. An institution running billions has to know the exact moment a trade becomes irrevocable, because that determines how the day’s exposure is booked.
The third is reporting. "They want the kind of statement an auditor will sign," Chen said. "Not a button that downloads a CSV."
We spent a year driving fees down and then realised they were not even looking at that line.— Chen An, founder of EctoLabs
Why the floor sits at $50m
A $50m minimum sits at the high end for the sector. Chen explained that the figure is not there to filter clients but to match the company’s own capacity: onboarding each institution requires a broadly fixed amount of compliance, operations and relationship staffing, and a lower floor would dilute service quality quickly.
The company currently runs about sixty people, a third of them in compliance and risk — an unusual ratio in crypto, where firms of that size typically concentrate headcount in engineering and growth.
- Product: institutions-only trading and custody channel, no retail access
- Minimum: $50m allocation
- Timing: closed testing in Q4, with a single-digit number of clients
- Team: around sixty people, roughly a third in compliance and risk
Who has been asking
The company confirmed that it has been approached over the past two months by leading trading platforms and large allocators, but declined to name any of them, and would not confirm whether those approaches reached substantive negotiation.
Chen was notably restrained about it: "Somebody asking is not somebody doing. In this industry, asking costs nothing." He added that the company will not use the names of potential partners in its marketing — "we will talk about it once something is signed."
We understand the waiting list for closed testing is longer than the number of places available, though the company would not give a figure. On current capacity, applicants beyond the first cohort are unlikely to be onboarded before next year.
What has not been disclosed
Two key pieces are missing from this announcement: the custody partner, and which licences the company holds or has applied for, in which jurisdictions. Chen said both will be published before closed testing begins — "it is not the sort of thing to talk about before you have it."
Until those land, the practical reach of the channel remains unknown. For a business of this kind, which jurisdictions the licences cover determines directly which clients can open an account at all.
The first cohort in closed testing is a single-digit number of clients, and the company would not name them. Chen said a public launch date depends on how testing goes: "We have not set a release date. We have set a pass mark."
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