Caitlin Long, who helped the state of Wyoming introduce 13 blockchain laws, is capitalizing on its ongoing policies to create a first digital currency-native bank in the United States.
Avanti Bank was announced on Monday by the former Wall Street executive and bitcoin advocate who helped spearhead a variety of blockchain-enabling legislative measures in the US.
Long announced the new efforts in a series of 29 tweets. She said that a crucial element of US market architecture is missing - a the regulated financial lender that can function as a link to the central bank for payments and (offer) "custody for big institutional money."
Long disclosed on social media that Avanti is preparing for a long process of a charter application and aims to launch early next year. Long said initial funding had recently been finalized, which CoinDesk reported was in the amount of $1 million.
Long expressed her gratitude to Wyoming Governor Mark Gordon who made the new crypto undertaking possible, as the virtual currency bank takes advantage of the state's depository institution law.
Since the Wyoming Division of Banking has given the green light on the requirements of the application, it is now setting its eyes on special-purpose depository institution lending procedures, and on outlining how regulatory management and review are going to be carried out.
Based on CoinDesk report, Avanti will collaborate with digital currency startup Blockstream, with the company supplying the lender with technological support, particularly for the guardianship of crypto assets.
Avanti's objective is to serve as a compliant bridge to US currency payments system and a safe-keeper of electronic assets that can meet the "highest level of institutional custody standards."
Avanti already has eight products in the drawing boards, products that is yet to be unveiled in the US and out of which only the one of security tokens have been mentioned.
Long pointed out that this special-purpose depository policy has strict regulatory requirements. All deposits, this law states (and in Avanti's case, crypto deposits), must be 100 percent reserved.
Avanti will also be restricted from using deposits for any financial purpose of its own - a practice referred to as "rehypothecation." "Don't even think about trying to use Avanti for illegal purposes!" Long warns on Twitter, adding that Avanti will be "protocol neutral" and, as such, may ultimately support virtual assets beyond bitcoin.
Long believes that Blockstream is an important partner for serving leading institutional investors that mandate banks to provide services around bitcoin in US dollar markets.
