Sources familiar with the matter said Citigroup is reviewing its digital asset custody partnership with Swiss fintech firm Metaco and has started informal talks with other providers, Bloomberg reported.
Ripple Labs bought Metaco last month for $250 million. Citi announced its partnership with Metaco in June last year.
The entry of traditional finance companies into the digital assets sector has created opportunities for new ventures in the sector, especially in the field of custody. But several companies have ended their partnerships with cryptocurrency custodians this year, citing the challenges small firms face in a space where technological change is fast.
It's unclear whether Citi's review of the partnership is linked to Ripple's acquisition of Metaco. While announcing the deal, Ripple said that Metaco will operate as an independent brand and will be led by chief executive officer Adrien Treccani.
Ripple's acquisition of Metaco was part of its strategy to go beyond payments, giving customers the ability to tokenize, pay and store any asset. Tokenization refers to the practice of creating digital representations of assets using blockchain technology.
When Citi announced its partnership with Metaco last June, it said that companies would explore ways to store assets like traditional securities.
*Not investment advice.
