Wall Street Giants State Street And Citi Enter Crypto Custody Race

Two of the world’s largest custodian banks, State Avenue and Citi, announce their entry into the crypto custody market.

With $46.6 trillion and $25 trillion in belongings underneath custody respectively, State Avenue and Citi are all set to reshape the crypto custody market.

This was potential after the repeal of SAB 121, a 2022 US Securities and Alternate Fee (SEC) rule that successfully barred banks from offering crypto custody providers.

Launched in 2022, SAB 121 imposed stringent necessities on banks offering crypto custody providers, successfully locking them out of the market.

Banks are constructing the infrastructure to include #Crypto into their backend fee methods
-Citi
-State road
Representatives confirms banks ARE eager about utilizing these applied sciences #XDC #XRP #XLM pic.twitter.com/r7uNEDSflL

— Cypress Demanincor (@CDemanincor) October 4, 2023

SEC Revoked SAB 121 Final Month

The SEC formally revoked its controversial crypto accounting steering on 23 January 2025, which compelled monetary establishments to account for crypto belongings as liabilities on their steadiness sheets.

In an open statement, the regulator referred to the passing of Employees Accounting Bulletin 122, which primarily overrides the sooner steering underneath SAB 121. It’s nearly thrown a wedge into the already break up argument for the earlier directive.

“This employees accounting bulletin (SAB) rescinds the interpretive steering in Part FF of Matter 5 within the Employees Accounting Bulletin Collection entitled Accounting for Obligations to Safeguard Crypto-Belongings an Entity Holds for its Platform Customers (‘Matter 5.FF’),” mentioned SEC.

The SEC added, nevertheless, that entities do not need to cease disclosing the obligations and dangers of safeguarding crypto belongings.

Discover: US Crypto Space Relieved as SEC Rolls Back Sab 121

State Avenue Entered Crypto Area In 2024

Final yr, State Avenue introduced its entry within the cryptocurrency area. The corporate revealed a strategic partnership with a outstanding participant within the crypto trade, Switzerland’s Taurus.

By aligning with a key participant within the crypto trade, State Avenue is positioning itself as a pacesetter within the digital asset custody market.

Commenting on the partnership, Donna Milrod, State Avenue’s Chief Product Officer and Head of State Avenue Digital mentioned, “The collaboration with Taurus underscores our ongoing dedication to additional establishing ourselves as leaders on this rising asset class, and this necessary announcement solely enhances our ambition to ship to our shoppers an incredible digital asset expertise.”

Discover: State Street Confirms Partnership With Swiss Crypto Company Taurus

Citi’s journey into the crypto area has been comparatively quiet in comparison with a few of its friends. Nonetheless, the financial institution has been actively experimenting with blockchain-based initiatives over time. Notably, Citi partnered with Singaporean startup BondbloX for tokenized bond custody and explored digital asset custody by a collaboration with Metaco—a agency later acquired by Ripple.