Bank of New York Mellon Corp., the country’s oldest bank, is making the leap into the cryptocurrency market.
The custodian bank said on Thursday that it will hold, transfer and issue bitcoins and other cryptocurrencies on behalf of its asset management clients. Over time, BNY Mellon will allow these digital assets to pass through the same pipeline used by other more traditional holdings of managers – from treasuries to technology stocks – using a platform that is now in prototype. The bank is already discussing plans with customers to incorporate their digital currencies.
“Digital assets are becoming part of the mainstream,” said Roman Regelman, chief executive of digital business and asset maintenance at BNY Mellon.
It is a big step for Wall Street’s administrative banks, whose concerns about regulatory, legal and stability risks have made them reluctant to come into direct contact with the crypto markets. But as prices for bitcoin and other digital assets continued to rise, they became more popular with asset managers, hedge funds and other institutional investors.
And the top executives at these companies have started asking BNY Mellon and his colleagues to treat digital assets the same way they would treat their other holdings, Regelman said.