Crypto Safekeeping Likely to Drive Bank-Fintech Partnerships

The Trump administration’s green light for national banks to offer custody services for cryptocurrency will likely drive a new wave of financial technology partnerships to tackle significant cybersecurity and operational challenges.

In a recent letter, the Office of the Comptroller of the Currency called virtual currency custody, including safekeeping, settlement and reporting, a modern form of “traditional banking activities.” The agency’s July 22 announcement is the latest move by acting Comptroller of the Currency Brian Brooks, formerly top lawyer at Coinbase Inc., to help the crypto industry integrate into banking’s mainstream.

Collaborations are most likely to occur via partnerships or…