• Hashnote Harbor will enable yields of up to 40% thanks to a suite of derivative strategies.

• Participants can also request customized structures to target specific yields or create bespoke hedges for their assets.

U.S.-regulated cryptocurrency custody firm Anchorage Digital is offering clients yields of up to 40% in partnership with Hashnote, a digital asset manager built with the support of trading giants Cumberland and DRW.

Hashnote Harbor, announced on Monday by the companies, delivers those returns through a suite of derivatives strategies without the underlying assets ever leaving the custody of Anchorage Digital, according to a press release. Participants can request customized structures to target specific yields or create bespoke hedges for their assets, it said.

The tie-up should appeal to institutional investors looking for a range of digital asset yield-generating options without so much in the way of credit, custodial, or protocol risk.

“Getting some of the benefits of traditional finance into the crypto ecosystem means the best of both worlds: the decentralization ethos and the broad adoption of the assets,” Anchorage co-founder Nathan McCauley said in an interview. “There are hard-won and wise ways to set things up that traditional capital markets have been figuring out for the last seven or eight decades.”

Both firms have well-established U.S. regulatory profiles: Anchorage qualifies as a crypto bank with a federal bank charter from the Office of Comptroller of the Currency (OCC); Hashnote is registered with the Commodity Futures Trading Commission (CFTC) as a Commodity Pool Operator (CPO).

McCauley takes a philosophical view of the dichotomy between state-regulated crypto custodians and those supervised at the federal level.

“It's almost an American tradition at this point to say that there's more than one way to do it,” he said. “You see this in a variety of angles, whether it's policing, elections, banking, all of these are kind of intertwined where you're under a dual sovereign situation, and in many ways it’s like an instantiation of the crypto ethos of decentralization. And I actually think it's quite beautiful that there's not just one way that you can answer a particular question.”