U.S. Bank Resumes Bitcoin Custody Services for Institutional Clients

Background and Service Resumption

U.S. Bancorp, the parent company of U.S. Bank, has announced the resumption of its Bitcoin custody services for institutional investment managers, marking a significant development in the integration of digital assets within traditional banking frameworks. This service, initially launched in 2021 and paused in 2022 due to regulatory challenges, is now being reintroduced with expanded offerings, including support for Bitcoin exchange-traded funds (ETFs).

Custody Service Details and Partnerships

The reinstated custody service is tailored for institutional investment managers overseeing registered or private funds who require secure storage solutions for Bitcoin. U.S. Bank has partnered with NYDIG, a vertically integrated Bitcoin financial services firm, which will act as the sub-custodian, ensuring the safekeeping of the digital assets. Stephen Philipson, Vice Chair of U.S. Bank Wealth, Corporate, Commercial, and Institutional Banking, emphasized the bank’s commitment to innovation and excitement in resuming this service.

Regulatory Landscape and SEC Rescission

The initial suspension of the Bitcoin custody service in early 2022 was largely a result of the U.S. Securities and Exchange Commission’s (SEC) Staff Accounting Bulletin No. 121 (SAB 121), which required banks to treat custodial digital assets as on-balance-sheet liabilities. This significantly increased capital requirements and operational complexities. However, in early 2025, the SEC rescinded SAB 121, restoring regulatory clarity and enabling banks to provide digital asset custody services more feasibly.

U.S. Bank’s move reflects a broader industry trend, with other major financial institutions like Citigroup exploring or developing digital asset custody services for crypto-related investment products. The shift highlights the growing acceptance and integration of cryptocurrencies into mainstream finance.

Bottom Line

The reintroduction of Bitcoin custody services by U.S. Bank, with added support for Bitcoin ETFs, marks a significant step in bridging traditional finance and the digital asset market. As regulations shift and institutional interest grows, the role of digital assets in banking is poised to expand.