- Avanti, the first regulated crypto bank in the U.S., set to launch in Wyoming
- The bank would partner with Blockstream and focus on BTC and other digital assets
The Cowboy State of Wyoming may soon host Avanti, the first regulated crypto bank in the US.
Wall Street and blockchain veteran Caitlin Long announced on Monday the creation of “Avanti,” a new regulated bank that will help “BIG institutional money” enter the cryptocurrency and digital asset markets. She said the bank hoped to open its doors to the crypto world by 2021.
“Avanti plans to serve as a compliant bridge to the US dollar payments system and a custodian of digital assets that can meet the strictest level of institutional custody standards,” the company announced on its webpage. Long cited on Twitter that “a custodian doesn’t yet exist” that meets high fiduciary standards for institutional investors that want to enter crypto markets.
"For various regulatory reasons, existing US banks & trust companies can’t provide optimal services to #crypto," she tweeted. "Avanti plans to break that logjam & thereby help keep the US from falling behind other countries whose regulated banks are already serving institutions in this mkt."
A regulated bank with a special purpose
Avanti would operate as a Special Purpose Depository Institution (SPDI), a designation which the Wyoming Legislature enacted last year that would allow new crypto startups to act as custody banks. Long pointed to the strict regulation requirements of SPDIs and high capital needs as a reasons why they will be the first company to attempt to create a crypto bank in the state.
Furthermore, Long said that Wyoming’s “bailment” laws will allow her bank to act as a “valet or coat check” service, meaning consumers give temporary possession of their digital assets to service providers but retain the legal title. This means service providers can’t lend out their assets, and consumers would receive their assets back immediately if the bank goes bust.
Know your customers
A partnership with Blockstream will focus on Bitcoin applications, software and hardware, according to Coindesk. But Long clarified on Twitter that Avanti will also provide services for other cryptocurrencies and digital assets. She also said the company will comply with all federal know-your-customer (KYC), anti-money laundering (AML), counter terrorist financing laws.
Avanti is currently working on filing its charter application and is slated to open its doors early next year.