Traditional Financial Institutions Rush to Seize Market Share! Fifth Largest Bank in the U.S., "Bank of America," Launches Cryptocurrency Custody Services

The Bank of America has announced the official launch of its cryptocurrency custody service in collaboration with New York Digital Investment Group (NYDIG), providing custody for Bitcoin, Litecoin, and Bitcoin Cash, with plans to add Ethereum and other cryptocurrencies in the future.

US Bancorp

Established during the Civil War in 1863, US Bancorp ranks among the top 10 in assets under custody exceeding $8.6 trillion, making it the fifth-largest banking institution in the U.S. However, its collaboration with NYDIG to launch cryptocurrency custody services is only available to fund managers in the U.S. or the Cayman Islands.

According to a press release, Gunjan Kedia, Vice Chairman of the Bank's Wealth Management and Investment Services division, stated:

Interest in cryptocurrencies among investors, as well as the demand from fund clients, has significantly increased in recent years. Given the complex and evolving regulatory environment, users require high-quality products that adhere to risk management standards. We are pleased to offer institutional clients custody services based on NYDIG's expertise.

In an interview with CNBC, Kedia also emphasized that users today place great importance on the potential of cryptocurrencies as a diversified asset class. She also believes that every asset management company is currently considering integrating cryptocurrency custody services into their business.

NYDIG expressed on Twitter:

As the fifth-largest bank in the U.S., this move is a significant indication that banks and users are beginning to accept Bitcoin as a legitimate asset class.

NYDIG is proud to help power the launch of @usbank's #Bitcoin custody service. As the nation's fifth-largest retail bank, this move is a significant sign that banks and customers alike are beginning to accept bitcoin as a legitimate asset class. https://t.co/JipaV9RMHd

— NYDIG (@NYDIG_BTC) October 5, 2021

Cryptocurrency Assets Hold Potential, but Most Are Bubbles

Last year, the Office of the Comptroller of the Currency (OCC) issued a public letter clarifying the rights and legality for national banks and federal savings associations to provide cryptocurrency custody services to customers.

Subsequently, US Bancorp immediately conducted a survey among users, who showed a broad interest. Kedia stated:

The consistent response we hear is that almost all cryptocurrencies are unlikely to survive and there is little room for accommodating thousands of tokens. However, given the potential of cryptocurrency assets and their technological foundation, it is still worth cautiously considering and supporting them.