SEC Rule Change Pushes U.S. Bancorp to Restart Crypto Custody

TLDR:

• U.S. Bancorp has restarted crypto custody services following an SEC rule change that eased capital restrictions for banks.
• The bank halted its crypto custody program in 2022 due to unclear regulatory guidance on handling digital assets.
• Institutional clients will once again be able to store Bitcoin, Ethereum, and other assets through U.S. Bancorp.
• Analysts say the move strengthens institutional access to crypto while offering secure custody under a regulated framework.

U.S. Bancorp is bringing back its crypto custody service after a regulatory shift cleared earlier hurdles. The bank had paused the program while waiting for clarity on how to handle digital assets under federal rules. That clarity came when the U.S. Securities and Exchange Commission introduced updated guidance for custodians. 

Now, the bank is returning to the business with a framework it says meets compliance standards. Investors view this as a fresh opening for traditional institutions in the crypto market.

U.S. Bancorp Crypto Custody Returns Under New SEC Rules

According to a Bloomberg report, U.S. Bancorp confirmed it will restart its crypto custody operations. The decision comes after the SEC’s new rules allowed banks to hold crypto without facing strict capital requirements.

The bank had suspended the service in 2022 after concerns over regulatory interpretation. Executives at the time said the framework was too unclear to move forward responsibly. That pause left institutional clients without one of the largest U.S. banks offering crypto storage.

Now, with regulators easing restrictions, U.S. Bancorp is signaling readiness to expand in the digital asset space. The company is working with approved custodians and auditors to manage compliance obligations. Clients will again be able to store assets like Bitcoin and Ethereum through the bank.

The custody restart also reflects growing demand from institutional investors. With the SEC removing barriers, more banks are expected to return to crypto services. This development could reshape how large investors handle asset security in the United States.

Crypto Price Stability and Institutional Access

U.S. Bancorp’s move has raised attention in the crypto market. Analysts note that institutional custody could reduce concerns about asset safety. It also makes entry into digital markets easier for firms that avoid direct wallet management.

Price reaction across major coins was muted at the time of the announcement. Bitcoin traded steadily near recent levels, while Ethereum also showed little movement. Traders suggested the market had already priced in expectations of traditional banks rejoining custody.

Still, industry watchers believe institutional custody can improve overall trust in digital assets. The involvement of large banks may bring new clients who were hesitant about direct crypto exposure. Reliable custody solutions also reduce risks tied to hacks or mismanagement by smaller providers.

The report added that U.S. Bancorp plans to gradually expand services. The focus will remain on regulated custody before exploring broader crypto offerings. For now, the bank’s return signals that regulatory clarity is opening doors for traditional finance to re-enter the crypto arena.

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