Unknown US Bank to Allow Bitcoin Custody Service for Institutional Clients

The fifth-largest US Bank is now offering a bitcoin and crypto custody service to fund managers. This comes as more institutions are trying to meet client demand for cryptocurrencies.

Several of Coins to Serviced

CNBC first reported the news that US Bank partnered up with New York Digital Investment Group to offer crypto services for Bitcoin Cash, Litecoin and Litecoin. In the near future, support for other cryptocurrencies such as Ether (Ethereum), will be available.

This new initiative follows a year-old paper by the Office of the Comptroller of the Currency, an independent bureau of the United States Department of Treasury. It allows national banks to offer custody of crypto assets.

Gunjan Kedia is a senior executive in the US Bank’s wealth Management Division. She surveyed their largest clients to determine their interest on cryptocurrencies. Her results showed surging interest in digital asset services.

Customers also wanted the bank “to move quickly” because other financial institutions already offered crypto services like custody and Bitcoin trading money. Kedia discovered that many clients have Bitcoin positions and other cryptocurrencies.

“Our clients are getting very serious about the potential of cryptocurrency as a diversified asset class. I don’t believe there’s a single asset manager that isn’t thinking about it right now.” – Kedia told CNBC in an interview

Demand for Crypto is Higher Than Ever

The US Bank stated that crypto custody would be available to institutional managers who have private funds in the US and Cayman Islands. The Securities and Exchange Commission (SEC), has yet to approve a Bitcoin ETF. Kedia said that clients have requested custody contracts to be signed in the event that a crypto ETF is approved by the Securities and Exchange Commission (SEC).

There have been critics to the boom in digital assets and blockchain technology within traditional financial systems. However, institutional investors are beginning to see the potential benefits of blockchain technology for their businesses. Arab Bank Switzerland is an example of this. It recently allowed its clients to store and stake XTZ, Tezos’s native utility token, and then trade it.

Bank of America, a financial giant, has recognized the potential of cryptocurrency. The multinational published a report titled

Digital Assets Primer: Only the first inning,” outlining that digital assets and the decentralized finance space have grown to the point of being “too large to ignore.

Featured Image Courtesy of USBank