The cryptocurrency scene in the United States is experiencing a resurgence with the return of President Donald Trump. His pro-crypto stance and efforts to establish clear regulations are igniting excitement on Wall Street and attracting the interest of major financial institutions.
According to crypto reporter Yueqi Yang, U.S. banks are increasingly getting involved in the crypto services sector, taking advantage of regulatory changes under President Trump’s administration. One key area of focus for these banks is cryptocurrency custody services.
Citigroup, a financial giant with $2.4 trillion in assets, is reportedly exploring the addition of crypto custody services. The bank recently announced a successful proof of concept project demonstrating its ability to issue and store tokenized private equity funds on a blockchain network. This move by Citigroup aligns with the trend of major financial players entering the digital asset custody space.
Other prominent banks, such as BNY Mellon, Standard Chartered, HSBC, Crédit Agricole, and Banco Santander, are also expanding their custody services to include digital assets like Bitcoin and Ethereum. State Street, managing a whopping $44.3 trillion, has partnered with Taurus to provide crypto custody and tokenization services for institutional investors.
Despite the growing interest from banks in offering crypto services, regulatory hurdles remain a challenge. Many banks are still awaiting approval from regulatory bodies like the Federal Reserve and the New York Department of Financial Services before they can fully enter the crypto trading market.
Federal Reserve Chair Jerome Powell has expressed support for U.S. banks serving crypto clients as long as they implement proper risk management protocols. However, concerns about “debanking” related to new technologies have raised alarms within the industry. Powell has pledged to collaborate with Congress to address this issue and create a more supportive regulatory environment for banks looking to offer crypto services.
In light of these developments, more banks are considering entering the crypto space. E-Trade, backed by Morgan Stanley, has hinted at offering crypto services, while Goldman Sachs has expressed interest in digital asset operations pending regulatory clarity.
Overall, the growing involvement of U.S. banks in the crypto services sector signals a significant shift in the financial landscape. With President Trump’s support for cryptocurrencies and efforts to streamline regulations, the future looks bright for the integration of digital assets into traditional financial institutions.