US Bancorp restarts its Bitcoin custody business, regulatory easing and the ETF craze may trigger institutional demand.

US Bancorp, the fifth largest bank in the United States, announced the restart of its encryption custody business after a four-year hiatus, focusing on Bitcoin (BTC) and Bitcoin ETF. This move comes at a time when the regulatory environment in the U.S. is loosening and institutional demand is rapidly rising, which may become an important catalyst for institutional funds entering the digital asset market.

Restart Bitcoin Custody: Targeting Institutional ETF Demand

Stephen Philipson, the Vice Chairman of a U.S. bank, stated that the purpose of restarting operations is to provide institutional fund managers with safe and compliant Bitcoin and ETF custody services.

Target Audience: Institutional investors with registered or private funds

Strategic Focus: Support secure custody and management of Bitcoin ETF

Background: The bank launched its digital asset custody service for the first time in 2021, but due to the SEC Staff Accounting Bulletin No. 121, it faced excessive financial burdens and suspended the service the following year.

Regulatory easing paves the way for a restart

In August of this year, the Federal Reserve ended its special regulatory program for banks involved in crypto businesses, which had been in place since 2023, and withdrew guidance discouraging banks from participating in crypto and stablecoin activities.

Impact: Seen by the industry as an important victory against the "de-banking of Crypto Assets".

Market reaction: Large financial institutions accelerate their return to the digital asset space.

Strengthening Infrastructure in Collaboration with NYDIG

U.S. Bank will partner with NYDIG (New York Digital Investment Group) to provide Bitcoin financial services and infrastructure support.

Tejas Shah, CEO of NYDIG, stated that the collaboration will bridge the gap between traditional finance and the modern digital economy.

Security Assurance: Ensure that institutional clients receive asset protection that meets the standards of regulated financial institutions.

Institutional competition intensifies

The return of American banks signifies that competition in the digital asset custody space will further intensify with other large banks like BNY Mellon and State Street.

Market Trend: As the demand for Bitcoin ETFs rises, regulated custodial services become a key threshold for institutional entry.

Potential impact: More institutional funds may enter the Bitcoin market through ETF and custody services, driving price and liquidity.

Conclusion

U.S. banks are restarting Bitcoin custody services against the backdrop of regulatory easing and the ETF boom, partnering with NYDIG to provide institutional-grade security, showing that traditional finance is accelerating its embrace of digital assets. As more large banks enter the competition, the influx of institutional funds into the Bitcoin market may significantly increase.