Caitlin Long's Custodia Bank Launches Bitcoin Custody Platform Amid Regulatory Challenges

Custodia Bank, a cryptocurrency-friendly financial institution founded by prominent Bitcoin advocate Caitlin Long, has officially launched its Bitcoin custody platform, marking a significant step in the digital asset industry. The announcement was made via X (formerly Twitter) on November 7, 2023.

Custodia Bank’s new Bitcoin custody service is specifically tailored to serve businesses such as fiduciaries, investment advisers, fund managers, and corporate treasurers. The launch follows the recent approval granted by the Wyoming Division of Banking, which has paved the way for Custodia Bank to offer its cryptocurrency custody services.

The bank underlined the fact that its platform is a non-lending institution, emphasizing that it was created by Bitcoin enthusiasts. It provides segregated custody accounts on a custom-built Bitcoin custody platform. Notably, Custodia Bank offers integrated services for both Bitcoin custody and U.S. dollars on a single platform, with the aim of streamlining operations and reducing associated risks. In their announcement, Custodia Bank expressed their gratitude for the support and user feedback they have received, particularly since the Bitcoin custody platform was developed in-house.

Custodia Bank’s journey to approval by the Wyoming Division of Banking was not without its share of regulatory challenges. Earlier in the year, in January 2023, the Federal Reserve Board rejected the bank’s application to become a member of the Federal Reserve System. The decision was based on concerns about the bank’s high concentration of activities related to the cryptocurrency industry, which the Fed deemed inconsistent with the required factors under the law. Subsequently, the Federal Reserve denied Custodia’s request for a reconsideration of its membership application.

Despite these regulatory hurdles, Custodia Bank officially commenced operations in August 2023, although some elements of its proposed business model remain restricted by the Federal Reserve. Established in 2020, Custodia Bank has positioned itself as a bridge between digital assets and the U.S. dollar payments system, functioning as both a digital asset custodian and a financial institution. The firm was previously known as Avanti Financial Group and is headquartered in Cheyenne, Wyoming.

As of the time of this report, Custodia Bank had not responded to Cointelegraph’s request for comment, but the successful launch of its Bitcoin custody platform represents a significant milestone for the institution and the broader cryptocurrency industry.

By Urik

My professional background is in public relations and I am the founder of Cryptochating. My journey into blockchain technology started four years ago, and I haven't looked back since then. The future of decentralized technology is incredibly fascinating to me, and I am passionate about communicating how it will change the world.

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