CitiBank to Consider Cryptocurrency Services
According to the Financial Times, CitiBank is considering joining the cryptocurrency market after receiving a lot of interest from clients since August.
“In our opinion, there are many choices, and we are weighing our options to see where we can better serve our clients. According to Citi’s global foreign exchange manager, Itay Tuchman, this will not be a prop-trading (proprietary trading) attempt.
In other words, it has no intention of trading for its gain.
Cryptocurrency services are now available from a variety of institutions. The majority of the operations fall into three categories: serving wealthy customers, custody, and trading.
Goldman Sachs, Morgan Stanley, BBVA, and DBS Bank are examples of companies that offer clients investment opportunities.
BNY Mellon, Standard Chartered, which has partnered with Northern Trust, and ING via Pyctor, which has partnered with several top-five traditional custodians, including State Street, all want to provide custody services.
Trading is the third choice. Goldman Sachs recently reopened its trading desk, and today Bloomberg notes that it is now trading non-deliverable Bitcoin forwards with Cumberland TRW, which settle in cash.
It hedges positions using CME bitcoin futures and thus avoids dealing with Bitcoin’s physical custody.
Returning to Citi, “I don’t have any FOMO [fear of losing out] because I assume that crypto is here to stay and that the market is just getting started,” Tuchman said. “This isn’t a space race,” says the narrator. There is enough room for more than one flag.”
Citi is a shareholder in Cobalt FX, a company that offers a foreign exchange post-trade network that Citi uses.
Last year, the business expanded into digital properties.