Citi joins BoA, Goldman Sachs, and JPMorgan Chase in digital asset space

Rick Steves

Citigroup is reportedly launching its digital asset division as the cryptocurrency space shows no signs of slowing down and financial institutions may be feeling their own version of FOMO (fear of missing out).

The banking group has announced it is creating one hundred jobs focused on digital assets at its institutional division.

The crypto asset team will delve into blockchain and digital currencies in order to prepare the ground for their own digital asset products and services.

Puneet Singhvi, Citi’s head of blockchain and digital assets at its global markets operation, has been appointed the team leader as Citi joins a wider number of traditional banks wanting in on crypto.

The digital asset team, comprising a mix of internal and external hires, will be spread across offices in Singapore, New York, London, and Tel Aviv. The hiring is expected to finish by the end of 2022.

“Prior to offering any products and services, we are studying these markets, as well as the evolving regulatory landscape and associated risks, in order to meet our own regulatory frameworks and supervisory expectations”, said a Citi spokesperson.

Citi’s institutional crypto team will look into product development and project management as well as outlining strategies to pursue digital asset opportunities.

Citi is the latest bank to join the crypto asset craze, with Bank of America having announced cryptocurrency research coverage this. Goldman Sachs launched a crypto-trading team, JPMorgan Chase offered wealth management clients access to cryptocurrency funds, and Singapore’s DBS Group has made efforts to lead the way in crypto in Asia.

JP Morgan and Wells Fargo have partnered with NYDIG to offer custodial services for two passive bitcoin funds they plan to offer to their respective clients. The two megabanks have quietly registered their crypto trusts with the U.S. Securities and Exchange Commission on Thursday.

JPMorgan Chase has already begun giving its wealthy clients access to six cryptocurrency investment funds. However, it was not the only financial institution exploring the potential of cryptocurrency as part of its efforts to modernize their legacy investment vehicles.

Goldman Sachs has also reopened a trading desk to make markets in cryptocurrencies back in March. The investment bank had announced similar plans back in 2018 before ditching the idea of a trading desk dedicated to crypto assets, citing regulatory uncertainty.

Having worked out security issues such as how it would custody the assets, the New York-based bank now is using its own money to trade with clients in a variety of non-deliverable forwards linked to the price of Bitcoin.

Elsewhere, Morgan Stanley also got involved in cryptocurrencies, launching access to three funds that enable ownership of bitcoin. The bank’s wealthier clients with “an aggressive risk tolerance” and have at least $2 million in assets can invest up to 2.5% of their net wealth in bitcoin funds.

BNY Mellon also revealed plans in February to provide its clients with ‘an integrated service’ for digital assets, which covers classic cryptocurrencies and could be extended to stablecoins.

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