Cryptocurrency
Citigroup is the Latest Bank to Offer Crypto Custody: Here’s How it Will Affect the Market via @CryptoCoinsNews
As reported by CryptoCoinsNews, “Through the launch of a product called Digital Asset Receipt (DAR), Citigroup will enable institutional investors to invest in cryptocurrencies in a fully insured and regulated manner. “Conceptually, a DAR is similar to exchange-traded funds (ETFs) as investors do not actually have to own the stock or asset that is represented by DAR. […]
As reported by CryptoCoinsNews, “Through the launch of a product called Digital Asset Receipt (DAR), Citigroup will enable institutional investors to invest in cryptocurrencies in a fully insured and regulated manner.
“Conceptually, a DAR is similar to exchange-traded funds (ETFs) as investors do not actually have to own the stock or asset that is represented by DAR. For example, Citigroup has been offering DARs based on foreign stocks which US-based investors cannot purchase.
“By owning DARs issued by Citibank, investors in the US essentially possess instruments that represent the value of the stocks or assets that are owned by Citibank on behalf of its consumers.
“With Bitcoin, Citibank would issue DARs which its clients will be able to purchase equipped with insurance, protection, transaction monitoring, and other systems that are required by the financial regulators of the US. By investing in DARs, institutions will be able to hold instruments that represent the value of Bitcoin. …
“… Citigroup is still in an early stage in issuing DARs based on Bitcoin. Analysts have stated that the emergence of a wide range of institutional products like Coinbase Custody, Goldman Sachs custody, and Citigroup DARs will improve the liquidity and infrastructure of the global crypto market.
“Most major banks based in the US including Goldman Sachs, JPMorgan, Citigroup, and Morgan Stanley are cautious in dealing digital assets and issuing publicly tradable instruments on top of cryptocurrencies due to the regulatory uncertainty in the region.
“Goldman Sachs and Citigroup are said to be the first banks to offer crypto custody solutions in the near future, but representatives from both banks have emphasized that the two financial institutions are early in their process of entering the cryptocurrency market.
“Hence, whether it is Bitcoin ETFs, ETNs, or custody solutions, the earliest period in which publicly tradable instruments will be released to the public would be in 2019.”