The Bank of New York Mellon on Wall Street, New York.
Scott Mlyn | CNBC
Bank of New York Mellon, the country’s oldest bank, said on Thursday that it will start financing bitcoins and other digital currencies.
The custody bank will allow digital currencies to pass through the same financial network it currently uses for more traditional holdings, such as U.S. Treasury bonds and stocks, after months of review of its prototype digital asset structure.
“BNY Mellon is proud to be the first global bank to announce plans to provide an integrated service for digital assets,” said Roman Regelman, CEO of asset services and head of digital for BNY Mellon, in a press release.
“The growing customer demand for digital assets, the maturity of advanced solutions and improved regulatory clarity present a tremendous opportunity for us to extend our current service offerings to this emerging field,” he added.
The executive of BNY Mellon added that, pending product reviews and approvals, the bank should start offering services to its customers later this year. The Wall Street Journal first published the bank’s cryptocurrency ad.
BNY Mellon’s shares rose 2% in the premarket after the news.
The move represents a significant step for the country’s most prominent custodian banks, which specialize in protecting the financial assets of their clients’ companies and individuals.
In the past, major custodian banks have expressed concern about the potential regulatory or legal risks involved in the cryptocurrency market. 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.
Bitcoin, which got off to a robust start in 2021, rose 7.7% around $ 48,250 at 8:30 am in New York, according to Coin Metrics. The digital currency has risen more than 60% since the beginning of the year.
Individual investors and companies have become more comfortable with digital currencies, as prominent business leaders, including Tesla CEO Elon Musk, invest in a handful of assets.
Tesla disclosed earlier this month that it bought $ 1.5 billion in bitcoins for “more flexibility to further diversify and maximize the return on our cash”.
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