Avanti Becomes Second Crypto Bank in US

By Jeff Benson

Avanti, which will compete with Kraken Financial, plans to provide digital asset custody services—and create its own digital asset.

In brief

• Avanti was granted a bank charter in Wyoming.
• Kraken received a bank charter from the state in September.
• In 2019, Wyoming passed new blockchain laws to attract digital asset firms.

Avanti has received a bank charter from the Wyoming State Banking Board, one month after exchange Kraken became the first crypto company to receive a bank charter in Wyoming—or the US for that matter.

Avanti Financial Group, founded by former Morgan Stanley managing director Caitlin Long, applied for a bank charter to become a special-purpose depository institution this summer.

AVANTI IS OFFICIALLY A BANK! Our charter & business plan were approved 8-0 today, incl. #Avit (a tokenized US dollar, which we announced we'll issue initially on #Liquid (#Bitcoin sidechain) & #Ethereum. Open for commercial customers early Q1. More here:https://t.co/CgNazN08zV

— Avanti Bank & Trust (@AvantiBT) October 28, 2020

The charter allows it to provide specified banking services, including digital asset custody, and it plans to start opening commercial accounts next year.

“We will provide products and services that do not exist in the market today,” said Long in a press release. “Currently the only type of U.S. financial institution that can provide final and simultaneous settlement of trades between digital assets and the U.S. dollar—because it is the only type currently approved to handle both within the same legal entity—is a Wyoming special-purpose depository institution like Avanti.”

One product it’s looking at in particular is its own tokenized dollar, the Avit, which it plans to issue on Bitcoin sidechain Liquid as well as Ethereum.

Long has been working toward this moment for some time. Early in 2019, the Wyoming legislature passed a slate of blockchain-friendly bills designed to make the western state a haven for crypto asset companies. As a member of the Wyoming Blockchain Task Force, Long played a major role in drafting and lobbying for the legislation.

Avanti is nominally in competition with Kraken Financial, which received its charter in September—with Long's endorsement. Both banks plan to begin operating in early 2021.

Article produced by Jeff Benson

https://decrypt.co/46561/avanti-becomes-second-crypto-bank-us