- US Bank is launching its own crypto custody service for fund managers amid growing interest.
- The service is only offered in the US and Cayman Islands. Fintech firm NYDIG will act as the custodian.
- The announcement comes at a tense time for digital assets as regulators grapple with how to oversee the space.
US Bank, the fifth-largest retail bank in the US, is launching its own cryptocurrency custody service for fund managers amid growing pressure for traditional financial services to keep up with the rapidly growing digital asset space.
The bank, in an announcement Tuesday, said institutional investment managers with private funds in the US or the Cayman Islands can use the safekeeping solution for bitcoin with fintech firm NYDIG acting as the custodian. Other coins will also soon be considered, the bank said.
A cryptocurrency custody service is usually offered by a third party and typically used by large investors. US Bank said it’s providing the service now as institutional clients ramp up plans to offer cryptocurrencies.
US Bank joins other major banks in expanding cryptocurrency-related services. In July, JPMorgan Chase allowed all its wealth management clients access to crypto funds. A month after, Citigroup said announced it is considering trading bitcoin futures, following Goldman Sachs’s lead in May.
The announcement from US Bank, founded during the Civil War in 1863, comes at a tense time for digital assets as regulators around the world, including the US Securities and Exchange Commission, grapple with how to oversee the space.
Still, the entire industry, ballooning to $2.1 trillion, has seen rapid growth in the past years, despite wild price swings and regulatory clampdowns. Bank of America analysts began coverage of digital assets on Monday, saying the space is simply “too large to ignore.”