BNY Mellon starts providing its customers with cryptocurrency custody services

The bank first unveiled plans to custody digital assets in February 2021

11.10.2022 - 14:55

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What’s new? The oldest bank in the US, Bank of New York Mellon (BNY Mellon), began providing BTC and ETH custody and transfer services for some customers. Representatives of the bank noted that it uses a single platform to handle cryptocurrencies and traditional financial assets. BNY had previously received permission to do so from New York's financial regulator.

BNY press release

What is known about the initiative? In a conversation with the Wall Street Journal, bank representatives noted that BNY was the first of eight systemically important US banks to provide cryptocurrency services to customers. BNY first unveiled plans to custody digital assets for institutional customers in February 2021.

The bank is considering expanding access to cryptocurrency services once regulatory approvals are received. BNY officials said it uses software from Fireblocks to store the keys needed to access and transfer digital assets.

The press release also cites a recent bank survey that found that most institutional investors (91%) are interested in investing in tokenized assets. 41% of respondents hold cryptocurrency in their portfolios, with another 15% planning to add it to their portfolios over the next two to five years.

According to The Block, financial holding company JPMorgan and financial conglomerate Citi are also exploring cryptocurrency custody services. Last year, the US Office of the Comptroller of the Currency (OCC) allowed national savings banks and federal savings associations to offer cryptocurrency services.

What is known about BNY? The bank provides custody and wealth management services to individuals and institutions in 35 countries. As of June 30, 2022, it has $44,9 trillion in assets. In March, Circle selected BNY as the custodian of its USD Coin stablecoin (USDC) reserves.

In February, BNY Mellon began partnering with blockchain analytics company Chainalysis to create software that tracks cryptocurrency transactions. Know Your Transaction will be able to identify and block unauthorized fund transfers.

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