Citigroup is weighing a push into digital assets that would see the banking group hold the reserves behind U.S.-dollar-pegged stablecoins and safeguard the digital tokens that back exchange-traded funds tied to cryptocurrencies, a senior executive told Reuters. The initiative could also extend to instant payment and conversion services using stablecoins, broadening the bank’s existing treasury and cash-management operations. The plan follows legislation enacted earlier this year that permits wider use of stablecoins—cryptocurrency tokens that must be fully backed by highly liquid assets such as cash or U.S. Treasuries. Citi’s services division, which manages payment flows for large corporates, says traditional custodians are well placed to hold those reserves. About $250 billion worth of stablecoins are outstanding, according to a McKinsey estimate. Citigroup is also studying custody for the digital assets underpinning spot crypto ETFs. The market has expanded quickly since the U.S. Securities and Exchange Commission approved such products last year; BlackRock’s iShares Bitcoin Trust alone has grown to roughly $90 billion in market capitalization. Crypto exchange Coinbase currently handles custody for more than 80 percent of ETF issuers, leaving room for new entrants. With about $2.57 trillion in assets, Citigroup would be one of the largest traditional financial institutions to enter institutional crypto infrastructure. The bank is still evaluating compliance, anti-money-laundering and cyber-security requirements and has not ruled out issuing its own stablecoin, the executive said.