Citi is seen on the floor of the New York Stock Exchange on March 3, 2025.
New York Stock Exchange
Citi aims to launch a crypto asset custody service in 2026, a bank executive told CNBC, as Wall Street giants expand their footprint in the digital currency space.
Biswarup Chatterjee, global head of services sector partnerships and innovation at Citi, said the bank has been developing a crypto custody service over the past two to three years and is making progress.
“We are doing different types of explorations… and we hope that over the next few quarters, we will be able to commercialize a credible custody solution that we can offer to our asset managers and other clients,” Chatterjee said.
For a long time, traditional financial institutions stayed away from cryptocurrencies like bitcoin And ether. However, President Donald Trump’s administration has established a more favorable regulatory environment for digital assets in the United States, as new laws such as the GENIUS Act have sought to regulate specific areas, including stablecoins. This has enabled traditional financial institutions to launch products and services related to digital assets.
In the crypto world, custody takes many forms, including a digital asset exchange holding digital coins or the institution itself providing self-custody. Custody services allow a bank to hold assets on behalf of its clients. This could for example include shares in companies. There are also companies specifically related to the custody of cryptocurrencies that have sprung up.
Chatterjee said the next custody service would involve Citi holding the native cryptocurrency.
There are risks with all forms of custody, such as cyberattacks that lead to asset theft. Banks can offer an alternative because they are heavily regulated and have a history of custody of assets.
For Citi, Chatterjee said the lender was considering both an internally developed technology solution for custody as well as potential partnerships with third parties.
“We may have certain solutions that are completely designed and built in-house and targeted to certain assets and certain segments of our customers, whereas what can we use a … third-party, lightweight, agile solution for other types of assets,” Chatterjee told CNBC.
“So we’re not ruling anything out at the moment.”
Not all Wall Street banks are convinced of the conservation strategy. JPMorgan CEO Jamie Dimon said this year that while the bank would let customers buy cryptocurrencies, it would not hold the asset.
Exploring stablecoins
American banks have launched various services this year that touch on cryptocurrencies but also rely on the underlying blockchain technology.
JPMorgan announced plans this year to create a deposit token intended to serve as a digital representation of a commercial bank deposit. This would allow money to be moved 24 hours a day, seven days a week.
These deposit tokens are built on the Ethereum network. Citi also has its own version called Citi Token Services which allows for cross-border money movements quickly and at any time of the day.
Banks see blockchain as a way to quickly move money in different currencies around the world, even when traditional bank tellers are closed.
The next potential product they are looking at is stablecoins. This type of digital coin is typically linked to a fiat currency like the US dollar and backed by real-world assets such as bonds, in order to maintain its value. The largest commercial stablecoins are those of Circle USDC and that of Tether USDT.
Citi’s Chatterjee said stablecoins could be attractive in parts of the world where the banking and payments system is less developed. As Citi’s clients expand in these countries and interact with suppliers and customers, a stablecoin-like product could be viable, he said.
“We recognize the fact that there are pockets in the world where our customers have a business need to be there and do business,” Chatterjee said.
The Citi executive added that the bank was still in the “early stages of stablecoin exploration.” Last week, stablecoin infrastructure company BVNK announced that it had received an investment from Citi, highlighting the bank’s interest in this sector.
Other Wall Street banks are also in the early stages of evaluating stablecoins. Bank of America CEO Brian Moynihan said in July that the lender was working on launching stablecoins. JPMorgan is also in the game.
Scott Lucas, global head of digital asset markets at JPMorgan, told CNBC on Monday that the company is also “exploring” digital currency.
“There is a real opportunity for us to think about how we can offer different services to our customers on the cash side, as well as meet customer demand to do things on stablecoins,” Lucas said. “And that strategy is still emerging, as you can understand, because it’s only been a few months since we’ve had clearer regulation on what the opportunity looks like.”
