State Street and Citi have considered offering cryptocurrency custody services. The Information reported that the banks are looking to offer safekeeping services to large fund managers, institutional investors and traders.
State Street will launch crypto custody next year, according to a bank executive quoted in the article. This institution is one the world’s biggest custody banks, with traditional assets including stocks and bonds.
The report states that BNY Mellon is expanding its offering to encompass a wider range of tokens. BNY Mellon already offers custody services for Bitcoins (BTC) as well as Ethereums (ETH).
This involvement does not only apply to banks. Coinbase has also been reported to be in talks with banks about crypto trading and collaborations.
Citi expanding into crypto
Citi, which is the third largest US Bank by assets, has also explored its entry in the crypto-custody space.
According to sources cited in the report, the banking giant is considering a dual approach—developing its own custody services while also forging partnerships with external firms.
This news follows Citi’s successful Completing the Work Proof of Concept (PoC), on Tokenizing Private funds, in partnership with Wellington Management & WisdomTree. Avalanche Spruce Institutional Test Subnet and ABN AMRO were used to simulate the traditional investor role.
Citi stated that its experiment aimed to tackle the inefficiencies found within private markets. It did this by placing a Wellington private equity fund on a blockchain and embedding rules for fund distribution into smart contracts.
DTCC Digital Assets was also used as a collateral to test the pilot’s use of tokens from private funds in loan contracts.
The expected move
Galaxy Digital’s head of research, Alex Thorn, predicted that large banks like Citi would begin moving into crypto services due to the rising institutional interest in digital assets and the crypto-friendly regulatory environment under the current administration.
In the firm’s 2025 predictions, Thorn You can also read about the importance of this in our article The top four custody institutions would be adding crypto-related service this year.
Thorn mentions four different banks, but only JPMorgan is yet to offer crypto-custody services.
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