A survey of commercial banks conducted by the Federal Reserve in May shows only small pockets of interest in blockchain and digital assets. When asked about the relative priority of distributed ledger technology (DLT) and digital assets over the next two years, 56% said it was of low or no priority, and 27% ranked it as moderate importance to high.

However, these numbers can be slightly misleading. The response to the same question showed that 37% of domestic institutions see DLTs and digital assets as a medium to high priority over the next 24 months, compared to only 15% for foreign banks. Over a period of two to five years, the national figure increases to 50% compared to 29.5% for American branches of foreign banks.

It is conceivable that these branches of foreign banks are unaware of what their parent banks are planning. After all, they are unlikely to be at the forefront of innovation.

Additionally, the Fed acknowledged that most respondents who provided verbatim comments said they were awaiting regulatory guidance or were currently unsure of their plans.

Wealth custody and management perform poorly

Despite headlines of Goldman Sachs, JP Morgan and Citibank diving into blockchain and digital assets, most banks seem disinterested on the wealth management side. Forty-six percent of national banks have no plans for wealth management products, or it’s not on the radar. Regarding market making and brokerage, the figure rises to 61% and 57% for custody for those who do not have a project.

The category that ranked strongest was wholesale payment or settlement, where 35% are planning small or large (mostly small) investments versus 45% with no plans.

When asked about the use of DLT or digital assets for liquidity management, no national bank ranked it as very important within two years, with 62.2% giving it a rating of one out of five. Over a period of two to five years, 20% consider it somewhat or very important.