Texas says state-backed banks can offer custody services for bitcoin as long as they have the proper tools to manage risk
- The Texas Department of Banking greenlighted state-chartered banks to custody crypto assets in a notice on Thursday.
- Banks may custody crypto services as long as they effectively manage the risks, the department said.
- It's the latest crypto-friendly move out of the state.
The Texas Department of Banking greenlighted state-chartered banks to offer custody for crypto assets in a notice on Thursday.
The notice affirms that banks may provide customers with virtual currency custody services as long as the bank has "adequate protocols in place to effectively manage the risks and comply with applicable law."
The US's national banking regulator made a similar announcement last year, saying that national banks and federal savings associations can provide
The Texas banking department noted that the custody services a bank chooses to offer will hinge on the bank's expertise, risk appetite, and business model.
"For instance, the bank may choose to allow the customer to retain direct control over their own virtual currency and merely store copies of the customer's private keys associated with that virtual currency. Alternatively, the bank may cause the customer to transfer their virtual currency directly to the control of the bank, creating new private keys that are then held by the bank on behalf of the customer," the notice said.
The go-ahead from Texas is the latest crypto-friendly move out of the state.
Last month, members of the Texas House of Representatives passed a bill to recognize cryptocurrencies under commercial law. The bill is headed to the Texas Senate, and if passed, would be sent to Texas Governor Greg Abbott to be signed into law.
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