Citigroup Considers Launching Custody Services for Stablecoins and Crypto ETFs

2 min

Citigroup is evaluating the launch of custody services for stablecoins and digital assets related to cryptocurrency exchange-traded funds (ETFs), as stated by Biswarup Chatterjee, Citi's global head of partnerships and innovation.

This initiative positions Citi in competition with Coinbase, which currently manages custody for over 80% of US-listed crypto ETFs. The move follows the signing of the GENIUS Act, establishing federal requirements for stablecoin issuers to maintain high-quality reserves.

“Providing custody services for those high-quality assets backing stablecoins is the first option we are looking at,” said Chatterjee.

In addition to custody services, Citi is exploring stablecoins for real-time cross-border transactions, already facilitating blockchain-based US dollar transfers across major financial hubs.

Institutional Interest in Stablecoins and ETFs

Citi's plans align with a broader trend in the US financial sector responding to favorable regulatory developments concerning stablecoins and crypto ETF products:

Stablecoin circulation exceeds $280 billion
Spot Bitcoin ETFs have gained popularity; BlackRock's iShares Bitcoin Trust holds around $100 billion
The ETF market demands compliant custodians for backing digital currencies

While Citi considers issuing its own stablecoin, the immediate focus is on custody, payments, and settlement services meeting institutional standards.