Citi is seen on the floor of the New York Stock Exchange on March 3, 2025.
Citi is aiming to launch a service for the custody of crypto assets in 2026, an executive at the bank told CNBC, as Wall Street giants expand their footprint in the digital currency space.
Biswarup Chatterjee, global head of partnerships and innovation in the services business at Citi said the bank has been developing a crypto custody service for the last two-to-three years and is making progress.
"We have various kinds of explorations ... and we're hoping that in the next few quarters, we can come to market with a credible custody solution that we can offer to our asset managers and other clients," Chatterjee said.
For a long time, traditional financial instutions have stayed away from cryptocurrencies like bitcoin and ether . However, President Donald Trump's administration has built a more favorable regulatory environment for digital assets in the U.S. as new laws such as the GENIUS Act has looked to regulate specific areas including stablecoins. This has enabled traditional financial institutions to launch products and services to do with digital assets.
In the world of crypto, custody comes in many forms including a digital asset exchange holding digital coins or the institution itself doing self-custody. Custodian services enable a bank to hold assets on behalf of its clients. This could for example, include shares in companies. There are also companies that have sprung up specifically related to crypto custody.
Chatterjee said the upcoming custody service would involve Citi holding the native cryptocurrency.
There are risks with all forms of custody such as cyberattacks that lead to theft of assets. Banks may offer an alternative because they are heavily regualted and have a history in the custody of assets.
For Citi, Chatterjee said the lender is looking at both an in-house 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 that are targeted towards certain assets and certain segment of our clients, whereas may we may use a ... third party, lightweight, nimble solution for other kind of assets," Chatterjee told CNBC.
"So we're not currently ruling out anything."
Not all Wall Street banks are convinced on the custody strategy. JPMorgan CEO Jamie Dimon said this year that while the bank will let clients buy cryptocurrencies, it will not custody the asset.