Citigroup Aims to Offer Institutional Custody by 2026 Following Multi-Year Development Effort
Citigroup plans to launch a cryptocurrency custody service in 2026, joining a wave of major banks expanding into digital asset services as regulatory clarity improves under the Trump administration.
Biswarup Chatterjee, global head of partnerships and innovation in Citi's services business, told CNBC the bank has spent "two to three years" developing the custody offering and expects to bring a solution to market within the next few quarters.
"We have various kinds of explorations ... and we're hoping that in the next few quarters, we can come to market with a credible custody solution that we can offer to our asset managers and other clients," Chatterjee said.
The custody service would involve Citi holding native cryptocurrencies on behalf of clients, providing an alternative to exchange-based custody or self-custody arrangements. Banks can offer regulated custody backed by established infrastructure and security practices, though all custody methods face risks including cyberattacks.
Citi is evaluating both in-house technology development and partnerships with third-party providers for its custody platform. Chatterjee told CNBC the bank may use different approaches for different asset types and client segments, combining proprietary solutions with external platforms.
"We may have certain solutions that are completely designed and built in-house that are targeted towards certain assets and certain segment of our clients, whereas may we may use a ... third party, lightweight, nimble solution for other kind of assets," he said.
The custody push follows improved regulatory clarity in the United States, including legislation like the GENIUS Act establishing frameworks for stablecoin regulation. The more favorable environment has enabled traditional financial institutions to launch digital asset products after years of reluctance.
Not all major banks are pursuing crypto custody. JP Morgan CEO Jamie Dimon said earlier this year the bank will allow clients to purchase cryptocurrencies but will not provide custody services.
Citi is also exploring stablecoin offerings, with Chatterjee identifying potential use cases in regions with less developed banking and payment systems. As Citi's clients expand into those markets and interact with local suppliers and customers, stablecoin products could provide payment solutions where traditional banking infrastructure is limited.
"We do recognize the fact that there are these pockets in the world where you have a commercial need from our clients to be there and do business," Chatterjee told CNBC.
The bank remains in early stages of stablecoin development, though Citi Ventures' recent investment in stablecoin infrastructure provider BVNK signals strategic interest.
Citi already operates blockchain-based payment solutions including Citi Token Services, which enables cross-border money movement outside traditional banking hours.
The custody service development positions Citi to serve asset managers and institutional clients seeking regulated counterparties for digital asset holdings. As institutional adoption accelerates, demand for traditional bank custody has grown alongside specialized crypto custodians that emerged to serve the market.
Whether traditional banks can compete effectively with established crypto custodians like Coinbase Custody and BitGo remains to be seen. Banks offer regulatory credibility and established client relationships, though specialized providers have years of operational experience and purpose-built infrastructure.
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