With Wall Street increasingly turning to the digital asset space, financial giant Citi plans to launch a custody service for cryptocurrencies in 2026.
Citi has been working in this area for the last two to three years and significant progress has been made, Biswarup Chatterjee, global head of partnerships and innovation in the bank's services unit, told CNBC.
“We are continuing to explore different types of assets. We expect to launch with a reliable custody solution that we can offer to our asset managers and other clients within the next few quarters.”
Traditional financial institutions, which for years avoided cryptocurrencies like Bitcoin and Ethereum, have begun to enter the arena after US President Donald Trump's administration established a more favorable regulatory framework for digital assets. New legislation like the GENIUS Act specifically targets specific areas, including stablecoins.
In the crypto world, custody services can take various forms, from digital asset exchanges holding user funds to institutions' self-custody systems. Citi's planned service will reportedly allow the bank to directly hold crypto assets.
Chatterjee said Citi is working on both a homegrown technological solution and evaluating third-party partnerships.
“For some asset types, we may have entirely in-house solutions, but for others, we may also use agile, third-party solutions. We are not ruling out any options at this time.”
As with all custody services, there are risks such as cyberattacks and asset theft. However, heavily regulated banks like Citi are considered a safer alternative due to their long history of asset protection.
Not every Wall Street bank is keen on this strategy. JPMorgan CEO Jamie Dimon stated that his bank would offer cryptocurrency purchases to its clients but would not store these assets.