Citibank to Launch Crypto Custody Services in 2026 After 3 Years of Preparation
Citigroup plans to launch crypto custody providers in 2026, after creating the providing for 2 to three years, in accordance to international head of partnerships and innovation Biswarup Chatterjee, who told CNBC.
The financial institution is exploring each in-house know-how options and potential third-party partnerships, with Chatterjee stating “we’re hoping that in the subsequent few quarters, we will come to market with a reputable custody resolution” for asset managers and different purchasers.
Wall Street Coming to Crypto? Citi Said Yes
The upcoming service would contain Citi holding native cryptocurrencies on behalf of purchasers.
Chatterjee stated the financial institution might deploy totally in-house designed options for sure belongings and shopper segments, whereas utilizing third-party light-weight options for different asset varieties.
The financial institution is “not at present ruling out something” relating to its custody technique.
Citi’s transfer contrasts with JPMorgan’s stance, which is that whereas its financial institution will permit purchasers to purchase cryptocurrencies, it won’t but maintain custody of the belongings.
JUST IN: JPMorgan confirms on CNBC that they may permit purchasers to commerce #Bitcoin and crypto however not but launch custody providers
pic.twitter.com/N2oYWPwwhL
— Bitcoin Magazine (@BitcoinMagazine) October 13, 2025
However, JPMorgan has additionally expressed curiosity in altering that subsequent yr.
The custody plans construct on Citi’s broader digital asset ambitions introduced all through 2025.
CEO Jane Fraser confirmed in July that Citi is “wanting on the issuance of a Citi stablecoin” whereas creating tokenized deposit providers for company purchasers looking for 24/7 settlement capabilities.
The financial institution already affords blockchain-based greenback transfers between New York, London, and Hong Kong places of work, working across the clock.
Chatterjee stated discussions with purchasers are underway to determine use instances for sending stablecoins between accounts or immediately changing them into {dollars} for funds.
Wall Street Consortium Eyes G7 Stablecoin as Competition Intensifies
Earlier this month, 9 international banking giants, together with Goldman Sachs, Deutsche Bank, Bank of America, Banco Santander, BNP Paribas, Citigroup, MUFG Bank, TD Bank Group, and UBS, announced plans to develop a collectively backed stablecoin centered on G7 currencies.
Nine banks, together with Goldman Sachs and Citigroup, unite to launch G7-backed stablecoin as market may hit $50T in funds by 2030 and $1.2T by 2028.#Banks #Stablecoinhttps://t.co/oqPhgT5v9w
— Cryptonews.com (@cryptonews) October 10, 2025
The consortium will discover issuing reserve-backed digital cost belongings accessible on public blockchains, with every unit pegged one-to-one in opposition to conventional fiat foreign money.
The coalition confirmed it’s already in contact with regulators throughout related markets.
Notably, earlier this yr, JPMorgan, Bank of America, Citigroup, and Wells Fargo reportedly held exploratory discussions about this shared stablecoin enterprise. However, these talks remained conceptual till the affirmation this month.
The banking giants are speeding in because the enterprise mannequin is proving terribly profitable for present issuers who earn substantial yields on Treasury securities and money equivalents backing their tokens.
Given this adoption trajectory, Bloomberg Intelligence projects stablecoins may course of greater than $50 trillion in annual funds by 2030.
However, whereas banks appear geared in the direction of adoption, it may also be out of, as Standard Chartered warned earlier this month that stablecoin adoption may drain greater than $1 trillion from rising market banks by 2028.
The menace prompted the Bank of England to initially propose ownership caps between £10,000 and £20,000 for retail prospects.
However, following criticism, regulators are now preparing to allow exemptions for companies like crypto exchanges, which require massive holdings for liquidity and settlement functions.
Citi Balances Stablecoin Opportunities Against Deposit Flight Fears
Citi’s aggressive digital asset enlargement comes regardless of (*3*), who cautioned in August that stablecoin curiosity funds may set off Eighties-style deposit flight from conventional banks.
Ghose drew parallels to when cash market funds skyrocketed from $4 billion to $235 billion in seven years, draining deposits from banks whose charges have been tightly regulated.
Between 1981 and 1982, withdrawals exceeded new deposits by $32 billion as shoppers chased greater returns.
Major U.S. banking teams, together with the American Bankers Association and the Bank Policy Institute, urged Congress to shut what they known as a “loophole” in the GENIUS Act, which permits crypto exchanges and affiliated companies to supply yields on third-party stablecoins.
The teams cited Treasury estimates that yield-bearing stablecoins may set off up to $6.6 trillion in deposit outflows, basically altering how banks fund loans and handle liquidity.
However, crypto business teams pushed again, with Coinbase Chief Legal Officer Paul Grewal dismissing the banking foyer’s efforts as an “unrestrained effort to keep away from competitors.“
Coinbase Research notably launched a dedicated report to the “banking menace” narrative, claiming it discovered no significant correlation between stablecoin adoption and deposit flight for group banks over the previous 5 years.
For Citit, Fraser framed their strategy as responding to shopper wants and the broader shift towards always-on prompt settlement, stating that “digital belongings are the subsequent evolution in the broader digitization of funds, financing, and liquidity.”
With $2.57 trillion in belongings below custody, Citi’s 2026 launch could be the starting of a strategic adoption of crypto on Wall Street.
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