Custodia Bank is a Wyoming-chartered Special Purpose Depository Institution (SPDI) founded in 2020 by Caitlin Long. Based in Cheyenne, it was previously known as Avanti Bank. The institution is designed to bridge the gap between digital asset ecosystems and the U.S. banking system, operating with full regulatory compliance under Wyoming’s crypto-friendly legal framework. As an SPDI, it must maintain 100% cash reserves for all fiat deposits and follow specially crafted bailment laws that ensure digital assets remain the property of the depositor—preventing rehypothecation or misuse by the institution.
Custodia provides U.S.-based business clients—including fintechs, corporate treasurers, digital asset firms, and institutional investors—with crypto custody, programmable payments, and digital asset services using segregated UTXO-based accounts. Their custody model offers enhanced property rights and transparency compared to traditional omnibus custody approaches used by most asset custodians. The bank follows strict AML/KYC and BSA compliance while operating under a state banking charter that aims to enable access to the Federal Reserve payment system, reducing costs and eliminating intermediaries for settlement.
In early 2023, Custodia’s application for a Federal Reserve master account was denied, with concerns cited over operational risks and its crypto-focused business model. This denial prevents Custodia from directly accessing Fedwire, ACH, and other core banking services without relying on intermediary banks. Custodia filed a lawsuit challenging the decision, arguing regulatory bias and delays.
Despite these regulatory challenges, Custodia achieved a milestone in 2025 by partnering with Vantage Bank to tokenize U.S. dollar demand deposits on a public blockchain using Avit™ stablecoins. The initiative demonstrated how digital assets can function within a compliant, regulated banking environment.
Although still building toward full operations, Custodia continues to pursue its vision of secure, transparent digital asset banking for institutions, combining programmable money with strong legal protections.
