Custodia Bank on Friday announced it is now accepting U.S. dollar deposits and U.S. government money market fund services.
“We are opening slowly & carefully,” the bank said in a post on the X platform on Friday. The bank said it began serving customers last month.
The Cheyenne, Wyoming-based firm said it is initially serving U.S. business customers only and is not yet authorized to operate in all 50 U.S. states.
“We got our bank regulator’s approval to take customer funds,” Custodia CEO Caitlin Long told Decrypt on Friday. “The bar is very high for banks to launch, and we cleared it.”
The crypto-focused bank is awaiting final regulatory clearance to launch its bitcoin custody service, which Long told Decrypt is on the firm’s six-to-12 month roadmap.
Long, a former managing director at Morgan Stanley, founded Custodia under the name Avanti Financial Group in 2020. The bank was among the first to be granted a special-purpose depository institution charter under Wyoming’s crypto-friendly law, passed in 2019.
“[S]pecial thanks go to our team, our investors and all our partners — especially in the face of regulatory pressure on the #digitalasset industry,” the bank said.
The firm’s official launch comes as the crypto space has faced heightened scrutiny and skepticism from regulators and lawmakers following a year of high-profile scandals that have rocked the digital-asset sector.
Custodia on Friday, touted its “regional bank-style” risk management program, emphasizing it “took the hard path” of becoming a regulated bank.
Meanwhile, Custodia continues to pursue its lawsuit against both the Federal Reserve and the Federal Reserve Bank of Kansas City over an “unlawful delay” to its request to join the central bank’s payments system. That access, Custodia claims, is vital to its ability to operate effectively and efficiently.
The Fed in January rejected Custodia’s application to become a member of the Federal Reserve System, citing significant safety and soundness risks. Hours after the Fed’s denial, the Kansas City Fed announced its decision to reject the bank’s separate request for a Fed master account.