Caitlin Long's digital asset bank Custodia raises $7 million

State-chartered digital asset bank Custodia, formerly known as Avanti, has raised $7 million, according to a filing submitted to the Securities and Exchange Commission. 

The startup, which was founded in 2020 by Wall Street veteran Caitlin Long, raised a $37 million Series A round in March of last year. Its backers include Binance.US, Coinbase Ventures and Lemniscap. 

The startup’s total funding now amounts to $51 million. 

The company declined to respond to multiple requests for comment. Investors in the round were not disclosed in the filing. 

The date of the first sale for this equity round took place in early October and the firm has a total of 36 investors, according to the filing. 

The path to launching a digital bank

Custodia is designed to provide real-time settlement finality for U.S.-dollar payments in digital asset transactions, according to the company website. 

Custodia states on its website that being referred to as a “crypto bank” is a misnomer because it will not take cryptocurrency deposits on its balance sheets. It will instead provide custody services for digital assets. 

In 2020, the startup secured a bank charter from the state of Wyoming to make these banking services possible. The charter means that the firm must comply with regulations such as the Bank Secrecy Act, anti-money laundering laws as well as other rules and regulations. 

The funds raised from Custodia in its Series A round were leveraged to provide the capital needed to launch the bank as required by regulators. 

The bank aimed to launch in the second quarter of this year where it would provide U.S.-dollar deposit accounts for business customers, according to a February release. However, the bank isn’t yet in operation.