Citigroup Explores Stablecoin, Crypto ETF Custody Services
- Citigroup plans to develop a stablecoin and crypto ETF custody.
- Targets high-quality assets custody with regulatory backing.
- Expects to impact stablecoin transaction volumes and Ethereum traffic.
Citigroup is exploring custody services for stablecoins and crypto ETFs, aiming to enhance blockchain-based payment systems, with plans to potentially issue a Citigroup-backed stablecoin.
This move could shift institutional digital assets onto regulated banking systems, intensifying custody service competition and promoting stablecoin use in cross-border payments.
Citigroup, led by CEO Jane Fraser and Biswarup Chatterjee, is assessing stablecoin and crypto ETF custody expansion for its blockchain-based payment systems.
This effort could reshape cross-border payment landscapes and influence stablecoin utilization in financial markets, elevating institutional integration and competitive dynamics.
Citi Eyes Regulated Stablecoin Custody Services
Citigroup is exploring the custody of stablecoins and crypto ETFs, driven by institutional momentum and increasing regulatory clarity. Significant focus is placed on reserve assets like US Treasuries that back regulated stablecoins.
Global Head of Partnerships and Innovation Biswarup Chatterjee stated custody services for stablecoins are a primary venture. “Providing custody services for those high-quality assets backing stablecoins is the first option we are looking at,” Chatterjee said.
Competition Heats Up in Crypto Custody Market
The move could intensify competition in the crypto custody market, currently dominated by Coinbase and crypto-native entities. Institutional payment methods may advance, enhancing cross-border transaction efficiencies.
Entering this arena allows regulatory-compliant innovation in stablecoin transactions, potentially impacting Total Value Locked in compliant assets and increasing Ethereum-based settlement traffic.
Citi’s Historical Predecessors in Digital Custody
Past bank entries into digital custody, such as BNY Mellon and State Street, set precedents but lacked Citi’s payment goals. They established grounds for increased spot ETF and stablecoin adoption.
Given historical trends, Citi’s move could enhance institutional stablecoin use and spur growth in Ethereum networks, propelling regulated financial adoption amid evolving compliance standards.
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