US Bank has announced that its cryptocurrency custody service is now available to fund managers. The offering will help investment managers to store private keys for bitcoin, bitcoin cash and litecoin with the help of sub-custodian NYDIG.

According to the announcement, “The services are intended for institutional investment managers with private funds in the US or Cayman Islands who would like a safekeeping solution for bitcoin – with additional coin support coming soon.”

“NYDIG, a leading technology and financial services company dedicated to Bitcoin, is the first crypto sub-custodian announced in the bank’s network of providers,” it adds. New York Digital Investment Group (NYDIG) is the bitcoin investment arm of Stone Ridge Asset Management.

Gunjan Kedia, Vice-chair of U.S. Bank Wealth Management and Investment Services, commented, “Investor interest in cryptocurrency and demand from our fund services clients have grown strongly over the last few years. Our fund and institutional custody clients have accelerated their plans to offer cryptocurrency and, in response, we made it a priority to accelerate our ability to offer custody services.”

After a key regulator released a paper last year, saying that national banks could custody crypto assets, Gunjan Kedia surveyed the firm’s biggest clients in order to determine if their interest was genuine. She found that interest in crypto was not limited to niche players, and that clients wanted the bank to move quickly.

“What we were hearing across the board, is that while every currency might not survive – there may not be room for thousands of coins— there’s something about the potential of this asset class and the underlying technology that would be prudent for us to stand up support for it,” she said.

“Some investment clients already have positions in bitcoin, while others are waiting for custody services to begin,” she said. “U.S. Bank is one of the first institutions to have a live custody product available.”

The price of bitcoin surged to an all-time high of about $64,000 in April before losing half its value the next month. But it has proven to be resilient and has also weathered China’s move to ban the digital currency last month.

“There is irony in the fact that while bitcoin was created to cut out financial middlemen, swaths of the old financial order are being recreated to cater to digital currencies. After all, fund managers could choose to store their own cryptocurrency keys. But managers want the imprimatur of established names like U.S. Bank to help allay concerns from their own clients,” Kedia said.

“In order to onboard a manager into the crypto product, U.S. Bank has to trace the origin of the client’s funds in the industry’s standard anti-money laundering and “Know Your Client” checks,” she added.

The product is only for institutional managers with private funds in the U.S. or Cayman Islands, according to the bank. But if and when the U.S. Securities and Exchange Commission approves a bitcoin ETF, demand is expected to rise. “We have a lot of funds who are hoping to invest in ETFs,” Kedia said. “Some literally want custody contracts signed the day the SEC approves an ETF.”