BNY Mellon Moves Toward Offering Crypto Custody Services
Bank of New York Mellon, one of the oldest banks in the U.S., moved last week toward potentially offering custody services for crypto assets like bitcoin and ethereum to exchange-traded fund (ETF) clients, Bloomberg reported.
The SEC also granted BNY Mellon an exemption from Accounting Standard Bulletin 121 (SAB 121), which requires crypto asset custodians to include crypto assets under their custody on their balance sheet. BNY Mellon submitted an alternative plan to the SEC to provide custody of bitcoin and ethereum in a way that protects client funds in the event of bank insolvency, which allowed for the SAB 121 exemption.
Since its introduction in April 2022, SAB 121 has sparked controversy in the US crypto industry and has been heavily criticized for making it impractical for financial institutions to offer custody of crypto assets.
With the exemption granted to BNY Mellon, this could pave the way for other major US banks to follow suit and launch their own crypto asset custody services.
