The first bullet, mentioning tokenized deposits, stood out to me. Perhaps this means US banks are looking at handling USDC deposits like Xapo Bank does? Possibly also banks feeling fomo, with...
Powerful interest groups are pushing the Securities and Exchange Commission to tweak accounting guidance that makes it more expensive for US banks to hold digital assets for their customers.
The groups have asked the SEC for the following key changes:
To exclude certain assets from what counts under the broad crypto umbrella. This includes any traditional assets recorded or transferred using blockchain networks — for instance, tokenized deposits — as well as any tokens underlying SEC-approved products, like spot-Bitcoin exchange traded funds.
To exempt regulated lenders from the current balance sheet requirement while maintaining the requirement that firms disclose their crypto activities in financial statements.
The first bullet, mentioning tokenized deposits, stood out to me. Perhaps this means US banks are looking at handling USDC deposits like Xapo Bank does?
The guidance in question — known as staff accounting bulletin No. 121 — has drawn pushback from banks since it was published in 2022. Lenders have said the bulletin effectively restricts them from scaling up services to hold digital assets on behalf of customers by making it too costly.
As a result, banks have been unable to crack into the crypto custodian business and recently missed out on providing that service for the newly-approved Bitcoin ETFs — an issue the trade groups raised in their letter. A majority of those ETF issuers picked Coinbase Global Inc. as their crypto custodian, with the rest using BitGo, Gemini or in the case of Fidelity, an in-house custody solution.
Possibly also banks feeling fomo, with Coinbase being the custody provider for 8 out 11 Bitcoin ETFs and crushing their earnings (*COINBASE 4Q REV. $953.8M, EST. $826.3M: BBG).
The first bullet, mentioning tokenized deposits, stood out to me. Perhaps this means US banks are looking at handling USDC deposits like Xapo Bank does?
Possibly also banks feeling fomo, with Coinbase being the custody provider for 8 out 11 Bitcoin ETFs and crushing their earnings (*COINBASE 4Q REV. $953.8M, EST. $826.3M: BBG).