There is a constant back and forth within cryptocurrency. Many feel we will arrive at a point where governments outright ban it. The chorus appears to grow when the bear hits. FUD reigns supreme making it a believable talk track.

However, contained in there are seeds which tell the opposite story. It might be a ratio of 10 to 1, but we can find the sprouts which are going to carry the industry forward.

Center to this battle is the United States. It is the largest economy, most advanced financial system, and one of the richest countries in the world. For this reason, as this it goes regarding crypto, so will the rest of its allies.

One of the keys, for those outside the US, is to understand the difference between the Federal government and the states. Due to the framework of the country, the states can, at times, wield a lot of power. While it was watered down over the last couple centuries, something like cryptocurrency can really become a major pushback against the Feds.

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Louisiana Authorizes Banks To Custodian Cryptocurrency

We can now add the state of Louisiana to the growing list that enacted some form of pro-cryptocurrency laws. This is simply another step forward in a long march that is erecting more barriers for the Federal Government.

...Governor of Louisiana John Bel Edwards signed, allowing financial institutions in Louisiana to custody Bitcoin (BTC) and other digital assets for customers...

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While this might not seem beneficial, especially to those who adhere to the long standing cryptocurrency view of "not your keys, not your crypto", this is actually a good sign.

We all know the banking industry is very powerful. This means that any blowback against cryptocurrency could potentially affect them if there is skin in the game. Cryptocurrency has the ability to make much of banking redundant. However, since most people do not realize this, they are apt to take banks up that offer these services.

By allowing customers to custody digital assets with the bank, there is now a potential revenue stream for these entities. Banks do not like to give up money making ventures. Holding digital assets is likely going to generate them some serious sums of cash.

Ironically, this puts the goals of cryptocurrency and banks in alignment, at least to a degree.

The Feds could push back against this but, in the US, many of the banking laws are on the state level.

Citigroup To Develop Digital Asset Custody Platform

If the events taking place in a small state like Louisiana isn't of interest, perhaps one of the largest investment banks in the world tells a better story.

Citigroup is a behemoth. There is no other way to describe the size of this entity. When it comes to monetary assets, this tops many countries.

When a company of this nature decides to enter the mix, it is worthy of paying attention.

Citigroup, which has more than $27 trillion of assets under custody, has chosen Metaco to develop its digital asset custody platform rather than building on its own.

We are familiar with names such as Blackrock and Fidelity. When it comes to AUM, Citi dwarfs them, outpacing by a rate o 4 to 1. Therefore, this move could be enormous.

What is the reason for this?

"We are witnessing the increasing digitization of traditional investment assets along with new native digital assets," Okan Pekin, global head of securities services at Citi, said in a statement. "We are innovating and developing new capabilities to support digital asset classes that are becoming increasingly relevant to our clients."

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It seems that Citigroup sees the writing on the wall. All assets will eventually be tokenized. We are at the start of the tokenization of everything. When one of the largest financial institutions in the world realizes this, again, we have to pay attention.

Investing Billions

We are seeing tens of billions of dollars flowing into cryptocurrency investment. By this, we are not referring to people buying cryptocurrency. Instead, this is referring to Venture Capital and monies laid out by corporations such as Citi.

Here is the multi-billion dollar question: do you think these companies would be shelling out this money if there was nothing to this? Would they put forth so much capital if the belief was this would be banned?

Obviously not.

These entities are politically connected. They invest large sums into their lobbying groups. When it comes to this field, banking is second only to Big Pharma. In short, they carry a lot of weight.

Of course, many see this is a corruption of the tenets of cryptocurrency. Certainly, that is hard to dispute. However, to think the larger players weren't going to try and hijack things was a bit misguided. They are not about to sit back and allow their multi-trillion industry just disappear.

That said, cryptocurrency is an evolution. We are starting with a great deal of ignorance along with a high difficulty of use. For this reason, having entities such as this entering the market will help bridge the gaps. If people feel comfortable with their bank or other financial institutions, they can utilize that to engage in the world of digital assets. Ultimately, it keeps feeding the same trough.

At the same time, there are now some powerful allies standing between cryptocurrency and governments. It is one thing to have a Coinbase fighting in Washington. However, it becomes a different matter when the likes of Citi and JPMorgan are taking a pro-crypto stance.

Certainly, we have to fully acknowledge their intentions and realize how they are not pure. Nevertheless, as long as we understand the danger of the big dog, it is helpful to have some strength on our side.

Moves like this show how the field is shifting for the different players. There is still a lot of anti-crypto sentiment among politicians and regulators. However, with some major players aligning on the cryptocurrency side, the battle is getting tougher for them.

For this reason, a bill signed into law by a Governor of a small state is an important event. It can open the door to some major players becoming allies.

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