The Federal Reserve and Federal Deposit Insurance Corp. found issues with the firms' ability to compile data on how they would be unwound during a period of financial stress.
The results clear the way for bigger dividends and stock buybacks at big banks; State Street agreed to pay $88 million to settle claims it overcharged clients.
State Street, BNY Mellon, UBS and Credit Suisse are among the banks that have created a company to bring their idea of a utility settlement coin to life.
Some banks have backed away from the technology, but Northern Trust, State Street and JPMorgan Chase are among those actively working on blockchain projects.
The bank may end its venture with First Data to work on its own; State Street and BNY Mellon's fee revenue from investor clients and stock prices are down.
The custody bank was very profitable, and it raised its cost-saving forecast for year-end, but its nearly 3% increase in third-quarter noninterest expenses prompted an investor backlash.