Cathay United Bank Launches Virtual Asset Custody Service, Targeting High-Net-Worth Clients in Initial Phase

Cathay United Bank Announces Approval for Virtual Asset Custody Services

Cathay United Bank announced on Thursday that it has received approval from the Financial Supervisory Commission (FSC) to become one of the first financial institutions to pilot the “Virtual Asset Custody Business,” targeting high-net-worth clients with virtual asset custody services.

In its press release, Cathay United Bank stated that unlike most market models where custody functions are provided by Virtual Asset Service Providers (VASPs) or only serve corporate clients, this pilot program aims to “offer virtual asset custody services for high-net-worth individual clients by leveraging rigorous cybersecurity protections and risk management mechanisms, providing clients with a convenient and secure custody solution.”

The pilot program for virtual asset custody at Cathay United Bank focuses on three key highlights: establishing a multi-layered cybersecurity defense; implementing stringent financial transaction standards to launch reliable virtual asset custody services; and proactively developing digital finance talent and organizational upgrades. The bank emphasized that it is designed around “private key management” as the core, utilizing institutional-grade cold wallets and establishing a multi-layer authorization signing process to perfect various risk control mechanisms.

To implement anti-money laundering measures, Cathay United Bank has introduced advanced on-chain cash flow analysis tools. Looking ahead, the bank stated that this virtual asset custody business will serve as a starting point for continuously exploring virtual asset applications.

In November of last year, the FSC launched a themed pilot program for “Virtual Asset Custody Business,” allowing financial institutions to apply. Besides Cathay United Bank, CTBC Bank, KGI Bank, and Union Bank have also received approval from the FSC to pilot this business.

According to reports from the Central News Agency, Wang Yun-Chung, Deputy Director of the Banking Bureau of the FSC, pointed out in June that the pilot program for virtual asset custody services lasts for six months, after which operators must report to the FSC on the results of the implementation. As for whether this service can be officially launched, Wang indicated that after the pilot, necessary legal amendments will be made for formal application as soon as possible.