Bitcoin News Today: Citigroup Launches Institutional-Grade Stablecoin and Crypto ETF Custody Services

Citigroup is expanding its digital asset capabilities by introducing institutional-grade custody services for regulated stablecoins and crypto-ETF-linked assets, signaling a strategic pivot into the growing blockchain-based financial infrastructure market [1]. The bank is leveraging recent U.S. legislative developments that define stablecoin reserves, such as cash or U.S. Treasuries, to position itself in the custody space. This move aligns with heightened institutional interest in stablecoins and digital assets, particularly following the approval of spot bitcoin ETFs by the U.S. Securities and Exchange Commission (SEC) last year [1].

Biswarup Chatterjee, Citigroup’s global head of partnerships and innovation, highlighted that the bank is prioritizing custody for the high-quality reserves backing stablecoins. This focus reflects the evolving regulatory framework and the demand for secure, institutional-grade solutions to support the infrastructure needs of digital assets [1]. Citigroup also aims to facilitate custody for crypto ETFs, where institutions require safe storage of the equivalent digital assets to back fund offerings. With the Ishares Bitcoin Trust leading the ETF space with around $90 billion in market capitalization, the demand for secure custodial services is expected to rise [1].

In the payments sector, Citigroup is developing tools to enable instant blockchain-based transactions using stablecoins, extending its existing tokenized dollar transfer capabilities across key financial hubs like New York and London [1]. While the bank is considering the potential launch of its own stablecoin, it has stressed the necessity of full compliance with anti-money laundering and cross-border regulations. Analysts note that Citigroup’s entry into the custody market could be a pivotal moment for institutional blockchain infrastructure, addressing long-standing operational and regulatory concerns [2].

The bank’s approach emphasizes institutional-grade security over yield-generating services, appealing to large investors such as pension funds and family offices [2]. This strategy positions Citigroup as a reliable custodial provider for those seeking exposure to crypto via ETFs without direct ownership of the underlying assets. The firm’s offerings are expected to bridge the gap between traditional finance and the blockchain ecosystem, enhancing interoperability and broadening the adoption of digital assets [1].

By targeting regulated stablecoins and crypto ETF-linked assets, Citigroup is responding to a rapidly maturing market with an estimated $252 billion in stablecoin volume [1]. As legislative efforts such as the GENIUS Act and the BITCOIN Act continue to shape the industry, Citigroup is positioning itself to serve institutional clients in a landscape where regulatory clarity is improving [3].

Source:

[1] Citigroup Targets Regulated Stablecoin Boom With Institutional-Grade Custody – Featured Bitcoin News, https://news.bitcoin.com/citigroup-targets-regulated-stablecoin-boom-with-institutional-grade-custody/

[2] Bitcoin News Today: Citigroup Explores Stablecoin Custody and Crypto ETF Infrastructure Growth, https://www.ainvest.com/news/bitcoin-news-today-citigroup-explores-stablecoin-custody-crypto-etf-infrastructure-growth-2508/

[3] Research, https://www.blockscholes.com/research