BNY Mellon offers Bitcoin services, a validation of crypto from a key bank in the financial system
The Bank of New York Mellon on Wall Street, New York.
Scott Mlyn | CNBC
The Bank of New York Mellon, the oldest bank in the country, announced Thursday that it would start funding Bitcoin and other digital currencies.
The custodian, after months of analyzing its prototype digital asset, will allow digital currencies to traverse the same financial network it currently uses for more traditional holdings like US Treasuries and stocks.
“BNY Mellon is proud to be the first global bank to announce plans for an integrated service for digital assets,” said Roman Regelman, CEO, Asset Service and Head of Digital at BNY Mellon, in a press release.
“The growing customer demand for digital assets, the maturity of advanced solutions and the improvement in regulatory clarity offer us a tremendous opportunity to expand our current service offering into this emerging area,” he said.
The managing director of BNY Mellon added that the bank should begin offering the services to its customers later this year, pending product analysis and approvals. The Wall Street Journal first reported on the bank’s cryptocurrency announcement.
BNY Mellon’s shares rose 2% after the news in premarket trading.
The move represents a significant step for the country’s best-known custodians who specialize in protecting the financial assets of client companies and individuals.
In the past, major custodians have raised concerns about the potential regulatory or legal risks associated with banking in the cryptocurrency market. As the prices of Bitcoin and other digital assets continued to rise, they have become increasingly popular with asset managers, hedge funds, and other institutional investors.
After a robust start into 2021, Bitcoin rose 7.7% to around $ 48,250 at 8:30 a.m. in New York, according to Coin Metrics. The digital currency has gained more than 60% since the beginning of the year.
Individual investors and companies are more comfortable with digital currencies as high-profile corporate leaders, including Tesla CEO Elon Musk, toss their weight behind a handful of assets.
Tesla announced earlier this month that it had purchased $ 1.5 billion worth of Bitcoin to “allow more flexibility in further diversifying and maximizing the returns on our cash.”
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