Custodia and Vantage Bank Successfully Tokenize U.S. Dollar Demand Deposits on Ethereum
Custodia Bank and Vantage Bank have completed a groundbreaking initiative by bringing U.S. dollar demand deposits to the Ethereum blockchain through tokenization.
The two banks successfully issued and redeemed Custodia’s Avit stablecoins on the Ethereum mainnet, marking a significant step toward integrating blockchain technology with traditional banking services.
As part of the process, they executed a series of eight regulated test transactions, covering the minting, transferring, and redeeming of Avit tokens. These transactions adhered to full U.S. banking compliance, including regulations under the Bank Secrecy Act (BSA), Anti-Money Laundering (AML) guidelines, and the Office of Foreign Assets Control (OFAC) requirements.
In this collaboration, Vantage Bank managed fiat reserves and traditional financial operations, including Fedwire and ACH transactions, while Custodia was responsible for blockchain-related tasks such as token issuance, custody, and reconciliation through its Avit Management System.
This milestone highlights the growing adoption of blockchain in the regulated banking sector, paving the way for further financial innovation in digital asset infrastructure.
