Citigroup may be rethinking its relationship with Swiss-based crypto custodian Metaco. The bank is currently in “informal talks” with “other providers”, an article by Bloomberg (paywalled) reveals. If Citigroup jumps ship, it will be the end of a short-lived partnership with Metaco that began only in June last year.
Metaco was recently bought out for US$250 million by payment settlement systems provider Ripple in May. The latter is currently embroiled in the US Securities and Exchange Commission’s (SEC) crackdown on blockchain firms deemed to be selling unregistered securities. Bloomberg does not confirm whether Citigroup’s change of heart has to do with Ripple’s controversy.
Citigroup’s process of finding a suitable crypto custodian is just one in a string of developments that has come to underline how custody has become, in Bloomberg’s words, “a hot topic in the crypto industry”. The current focus on regulation is partly motivated by the failure of many high-profile blockchain platforms last year, including FTX.