| | |

Custodia Bank Goes Live: Merging Digital Assets with US Dollar Payments

Bitcoin Suisse Club Return 50X in 5 Hours Min 0.005 btc
77x bitcoin

Banco Custodia is now available, a financial institution that aims to link digital assets to the payment system in US dollars. Last month, Custody began serving external business clients in select US states, offering US dollar deposits and government money market fund services, with bitcoin custody pending launch. The launch comes after overcoming regulatory pressures and challenges with the Federal Reserve Board.

Banco Custodia launches services

Many advocates of cryptocurrency and restricted banking await the arrival of Custodia Bank, a technological and customer-focused financial institution. “We are grateful to our partners, who appreciate our approach to complying with banking laws and regulations; to Wyoming for its favorable laws; to our team and investors; and to the law-abiding digital asset industry,” said CEO Caitlin Long. Custodia says the bank’s regional bank risk management program, along with its dedication to complying with regulations, sets it apart from its competitors.

Services now available include US dollar deposits and US government money market fund services, tailored for US based corporate clients. This includes digital asset companies, fintechs, banks, corporate treasurers, trusts, pension funds and emerging companies. The bank’s strategy is to eventually serve clients around the world, providing greater regulatory clarity and minimizing transactional risk with its unique booking model.

Custody operates under the legal and regulatory framework of the first special purpose depository institution (SPDI) in the United States. This approach allows the bank to offer a complete suite of financial services for US dollars and digital assets. Demand deposit accounts are protected by a 100% reserve requirement, and the bank offers API solutions for programmable accounts, payments, settlement and futures custody products, reveals the Custody website.

Banco Custodia’s trajectory so far has been marked by challenges. In December, they informed the US Federal Reserve of their intention to complete a specific to-do list, and they did so, even though it was no longer necessary. Independent assessments, new partnerships and the development of new services to meet the needs of the market were part of the process, detailed Custodia on Friday.

In January 2023, the Federal Reserve Board rejected Custody’s application to become a member of the system, citing “significant security and soundness risks” related to cryptoassets and an insufficient risk management framework. The denial reflected broader regulatory skepticism towards digital assets and restricted banking techniques. However, Custodia’s perseverance and alignment with Wyoming’s innovative legal framework for SPDIs has enabled them to overcome these challenges and emerge as a regulated bank.

Similar Posts

Leave a Reply

Your email address will not be published. Required fields are marked *