US Bancorp, the seventh-largest bank in the U.S., has resumed Bitcoin custody services for institutional investment managers following a three-year hiatus due to regulatory constraints.
Resumption of Bitcoin Custody Services
US Bancorp has officially resumed Bitcoin custody services aimed at institutional investment managers. This move marks the end of a three-year halt influenced by changes in U.S. regulatory conditions. The bank initially launched this service in 2021 but paused it in 2022.
Partnership with NYDIG
The partnership with NYDIG is a pivotal element, as they serve as a strategic partner and sub-custodian. The current focus includes Bitcoin custody and Bitcoin ETF products, with potential expansion to other digital assets like ETH.
Market Impact and Institutional Interest
Institutional interest in Bitcoin custody services is expected to rise, with US Bancorp facilitating easier access to storage solutions. The bank aims to cater to a market segment focused on Bitcoin ETFs and institutional funds, fostering greater engagement. Regulatory adjustments, particularly the withdrawal of SEC’s SAB 121, played a critical role. As Stephen Philipson, Vice Chair of U.S. Bank Wealth, Corporate, Commercial, and Institutional Banking stated, "We’re proud that we were one of the first banks to offer cryptocurrency custody for fund and institutional custody clients back in 2021, and we’re excited to resume the service this year."
The resumption of Bitcoin custody services by US Bancorp underscores the bank's strategic positioning in the digital finance space. As compliance standards evolve, a broader range of digital assets like ETH may be considered, enhancing the bank's influence in the market.
