State-Chartered Banks in Texas to Provide Crypto Custody

Jafrin  |  Jun 11, 2021

State-chartered banks in Texas can now provide crypto custody services to their customers, according to a notice from the Texas Department of Banking.

State-Chartered Banks Can Store Cryptos on Behalf of Clients

The Texas Department of Banking issued a notice on June 10 that state-chartered banks may store cryptocurrencies on behalf of their clients, in accordance with the "adequate protocols in place" and that banks are complying with existing legal frameworks

According to the notice, the custody services offered by state-chartered banks would depend on each bank’s “expertise, risk appetite, and business model.”

For instance, the banks could offer either fiduciary and non-fiduciary custody services that could range from safely storing copies of a customer’s private keys to directly controlling the digital assets, including holding private keys, on behalf of its customers.

Furthermore, they could even settle trades between cryptocurrencies and the U.S. dollar and even create their own stablecoins.

"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" reads the notice.

Texas Anticipating Biggest Renewable-Based Crypto Mining

Manhattan Solar Partners, LLC has announced plans to construct the biggest renewable-powered cryptocurrency mining data center in Texas.

A joint venture with BIT5IVE, LLC and GMine LLC, Manhattan Solar Partners aims to bring international focus to Texas as a global crypto mining center.

BIT5IVE is a builder of class A crypto mining centers that provide advanced hardware solutions while GMine is a project to explore the capabilities of renewable power in crypto mining.

Besides focusing on sustainable solutions to cryptocurrency mining, the data center will also create around 700 jobs for the local economy and expected to begin its construction in Q3 of 2021 and go live in Q4 2021.

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