The Federal Reserve's decision enables banks to provide custody for Bitcoin and other digital assets, fostering competition with specialized crypto custodians.
The Federal Reserve has approved US banks to offer custody services for Bitcoin and other crypto assets, reducing regulatory friction and allowing banks to compete with existing custodians. This change, supported by the OCC and FDIC, enables banks to hold digital assets for customers, aligning with rising institutional demand for secure custody solutions. Banks must adhere to risk-management, cybersecurity, and fiduciary standards, as well as comply with AML and KYC regulations.