Bitcoin News Today: Regulatory Thaw Lets U.S. Bank Reenter Bitcoin Custody Arena

U.S. Bancorp has restarted its cryptocurrency custody services after a four-year pause, signaling a shift in the banking sector's approach to digital assets. The firm, which is the fifth-largest bank in the U.S. by total assets under management, now offers custody for Bitcoin and supports exchange-traded funds (ETFs). These services target institutional investment managers with registered or private funds seeking secure, regulated access to digital assets. U.S. Bank previously introduced digital asset custody in 2021 but halted the service in 2022 due to regulatory challenges, notably the SEC’s Staff Accounting Bulletin No. 121, which required institutions to recognize crypto assets on balance sheets, creating financial burdens [1].

The return to cryptocurrency custody services is attributed to regulatory changes under the current U.S. administration. In particular, the rescission of a 2022 advisory from the SEC, which had labeled participation in crypto custody services as potentially illicit, played a pivotal role in the decision [2]. This regulatory shift has enabled U.S. Bancorp to reintroduce services that now include Bitcoin ETFs, aligning with the growing institutional demand for secure and diversified investment options.

U.S. Bank is collaborating with NYDIG, a vertically integrated Bitcoin financial services and power infrastructure firm, to manage the custody operations. NYDIG will serve as the sub-custodian, enabling U.S. Bank to provide institutional-grade custody solutions [1]. The partnership is designed to bridge the gap between traditional finance and digital assets, offering clients access to Bitcoin with the security standards expected in regulated financial institutions. This move also aligns with U.S. Bank's broader digital innovation strategy, which aims to explore how digital assets can better serve its clients.

U.S. Bank’s decision is part of a broader trend among major financial institutions to reintroduce or expand cryptocurrency services. Competitors like Bank of New York Mellon Corp. and Fidelity Investments already offer similar services, while Citigroup is also reportedly exploring the space [2]. The competitive landscape is expected to intensify as institutional demand for Bitcoin ETFs grows, driven by regulatory clarity and market confidence.

The regulatory environment has seen significant developments that support this resurgence. The Federal Reserve ended a supervisory program monitoring banks engaged in crypto since 2023, reducing oversight that had been criticized as overly burdensome [3]. This easing of regulations, combined with the U.S. government’s push to become a global leader in cryptocurrency adoption, has created a more favorable climate for traditional financial institutions to engage with digital assets.

The U.S. banking sector’s renewed interest in cryptocurrency custody reflects broader efforts to align with global market trends and foster innovation in digital finance. As the regulatory landscape continues to evolve, U.S. Bancorp’s reentry into the crypto custody space could set a precedent for further expansion of digital asset services across the industry.

Source:

[1] U.S. Bank Resumes Bitcoin Cryptocurrency Custody Services for Institutional Investment Managers (https://ir.usbank.com/news-events/news/news-details/2025/U-S--Bank-Resumes-Bitcoin-Cryptocurrency-Custody-Services-for-Institutional-Investment-Managers/default.aspx)

[2] US Bancorp to offer Bitcoin Custody Services Again as Regulatory Environment Shifts (https://finance.yahoo.com/news/us-bancorp-offer-bitcoin-custody-171201540.html)

[3] US Bank Resumes Bitcoin Custody Amid Eased Rules (https://www.mitrade.com/insights/news/live-news/article-3-1093920-20250904)