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Citigroup to offer a new product for investing in crypto-currency

One of the largest international financial conglomerates will provide its investors with a new way of acquiring digital assets, without having to be their actual holder.

Founded in New York, the banking giant Citigroup, has developed a product that can reduce the risks of hedge funds and asset management companies when they invest in crypto currency. According to Business Insider, Citigroup’s depository receipts service team and the capital markets team worked together on the instrument. The product was called Digital Asset Receipt.

In the process of purchasing a digital currency, the bank issues a receipt to the client about the assets. In turn, the responsibility for the storage of assets will be borne by Citigroup. According to the representatives of the bank, this should give legitimacy to a new class of assets and will allow large investors to track their investments.

Digital Asset Receipt is created similarly to the American Depository Receipt (ADR), which allows investors in the US to own foreign shares that are not traded on domestic exchanges. Citizens and residents of the United States can invest in foreign shares, while the bank acts as a custodian, and investors receive a depositary receipt. Starting ADR about nine decades ago, Citigroup is now one of the largest issuers of American depositary receipts in the world.

However, there is no exact information as to when the new product will be launched. It also remains unclear how regulators will consider the instrument, especially after the bitcoin ETF has been repeatedly rejected by the Securities and Exchange Commission (SEC).

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