St. Cloud Financial Credit Union (SCFCU) is stepping into the digital asset and cryptocurrency industry to help prevent members from drifting to national crypto platforms, and also to boost revenue.
The credit union in March quietly launched its CU-Digital Asset Vault, a service that allows members to hold and manage cryptocurrencies like Bitcoin, Ethereum, and USDC directly within SCFCU’s core banking system. Ordinarily, people choose to store digital assets on third-party exchanges like Coinbase connected to the internet. The rollout comes as digital assets continue gaining traction among institutional players, especially mega banks like Minneapolis-based U.S. Bank.
Founded in the 1930s by postal workers, SCFCU now manages roughly $430 million in assets and serves about 28,000 members. Its leadership sees digital assets as the next evolution of financial services.
“We see these as money markets,” CEO Jed Meyer says. “Back in 2010, I thought it was funny money. But over time, we started asking: Where might this go, and should we be paying attention?”
The short answer is yes.
The exchange-traded fund (ETF) market is experiencing record growth and increasing in both popularity and total assets. ETFs are regulated financial products traded on stock exchanges that typically have annual fees, while digital assets are the cryptocurrencies held directly in a digital wallet. In 2025, U.S. ETFs saw a record $1.48 trillion in inflows.
What is a Digital Asset Vault?
Essentially, the digital asset vault allows SCFCU’s members to hold and manage digital assets—like Bitcoin—while keeping the credit union (instead of a third party) in control of data, governance, and member relationships. Those assets remain on its blockchain, a decentralized digital ledger that records transactions across a distributed network.
The credit union also holds the keys required to access those assets.
Each wallet is secured by a long private key—often up to 100 characters—which functions like a password. Losing that key typically means losing access to the funds permanently. SCFCU’s vault stores and secures those keys, in separate secure environments, on behalf of members.
Coin2Core, a third-party platform that integrates directly with the credit union’s core banking system, powers the digital asset vault. It allows members and staff to view digital asset balances alongside traditional accounts—checking, savings, and loans—in one unified dashboard.
“It’s not a separate app or wallet,” says executive vice president Chase Larson. “It’s fully integrated. Instead of sending members to Coinbase or another app, we can hold those assets for them.”
A Business Model for the Future
While the technology seems complex, and took over three years to develop, the business case is straightforward: Keep members engaged and generate fee-based revenue.
The launch positions SCFCU as the first known credit union in Minnesota to offer a core-integrated digital asset vault, partly due to regulatory nuance. Federally chartered credit unions are currently restricted from acting as digital asset custodians, while some state-chartered institutions—like those in Minnesota—have more flexibility.
In 2023, SCFCU members transferred about $1 million to crypto exchanges. That figure jumped to $5 million in 2024 and $15 million in 2025.
“That really surprised me,” Meyer says.
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University of St. Thomas Opus College of Business assistant professor Jiang Zhang says that gives SCFCU a unique window of opportunity.
“They are ahead of the curve,” Zhang explains. “Smaller community institutions typically haven’t entered this space yet because of regulatory uncertainty and the risks involved.”
If credit unions can figure out the cost, this business model has great potential, he adds.
SCFCU currently charges a vault fee of 0.2% of total digital asset value per month, with a $5 minimum and $20 maximum. The credit union also expects to generate revenue from transactions, lending, and advisory services tied to digital assets.
For now, the institution is waiving vault fees for the first 90 days for members, with promotional offers extending to the public through April and May, Larson says.
Customer retention is also a key part of SCFCU’s plan with digital assets. “With the customer retention and pro-crypto [federal] administration, if the whole finance industry is going to incorporate cryptos as one of the standard investment recommendations, then over the long term, you can have a great potential in other services as long as you can retain the customer base,” Zhang says.
Early Buy In
SCFCU has already opened more than 70 digital asset vaults since launching last month. The credit union holds governance over approximately 12 Bitcoin ($877K), 10,000 USDC ($10K), and several Ethereum ($6K) coins on behalf of members, according to Larson.
The effort builds on a broader digital strategy. In 2024, SCFCU acquired fintech firm DaLand, which helped develop the vault technology.
Looking ahead, SCFCU plans to allow its members to buy and sell digital assets directly within their accounts instead of using centralized exchanges like Coinbase or Binance.