The year 2021 saw hundreds of traditional financial entities entering the crypto industry and using
Bitcoin. Either to speculate, invest or look for profitable opportunities at a safe distance, many banks and investment firms are looking closely at the world of digital assets.
Also, industry-leading companies both in the technology segment and FinTech joined the ranks of crypto enthusiasts, including companies like
MicroStrategy,
Tesla,
PayPal,
Visa, and others.
In this article, you will find out an overview of the banks around the world that already use Bitcoin and other cryptocurrencies because you’ll find the reasons why it’s a good idea to
purchase bitcoin.
Why Are Many Banks So Reluctant to Accept Bitcoin and Other Digital Assets?
It is crucial to understand that cryptocurrencies are a disruptive factor to the traditional financial system. Hence, many institutions and government agencies (e.g., central banks) are not fond of alternative forms of money, as they do not follow the same principles as them.
Also, the volatility that is naturally associated with cryptocurrency does not comply with most banks' policies in terms of stability and financial control. This way, a bank may not consider a crypto asset valuable as it may not have enough future value to ensure it.
However, there has been a recent wave of change among many banks, as some institutions started accepting Bitcoin, Ethereum, and other major digital assets. Plus, the number of digital currency purchases was heavily affected by the introduction of major credit card networks to the crypto industry.
Plus, many government figures around the world are outspoken enthusiasts of
all cryptocurrencies, which is helping to strengthen the debate around the validity and even the superiority of cryptocurrencies when compared to other forms of money or financial securities.
For instance,
the US Congress is now considering different manners to regulate Bitcoin sales. People such as representative
Paul Gosar and Senator
Cynthia Lummis are examples of pro-Bitcoin figures in the US political scene.
So far, some banks already allow customers to use Bitcoin and other cryptocurrencies through their systems, which includes entities like:
- Chime Bank (California, USA)
- Wirex (London, UK)
- Ally (Utah, USA)
- Fidor Bank (Munich, Germany)
- USAA (Texas, USA)
You Can't Stop Cryptocurrency - Major Crypto Revolution Among US Banks
Undoubtedly, many industry-leading banks and financial institutions have already surrendered to cryptocurrency and blockchain technology. Thus, big players like Goldman Sachs, JP Morgan, and others now offer cryptocurrency-related options to their investors, who are increasingly pushing for more novelties.
Similarly, an unprecedented partnership between the payment company NCR and the well-known
New York Digital Investment Group resulted in a promise of a colossal wave of Bitcoin acceptance among US banks.
According to
Forbes, 650 US financial institutions came together to test the new service, which will affect the lives of approximately 24 million customers. Hence, customers of these banks will be able to use their bank applications to make crypto transactions, which is a crucial step towards crypto mass adoption.
Also, developers are working on alternative ways for customers to create an account on a crypto exchange and start trading digital assets from there. Thus, the idea is to prevent customers from having to create an external account to transact cryptocurrencies in their bank accounts.
Subsequently, banks that adopt the new service will rely on
NYDIG's technology, so that they do not have to deal with the bureaucracy of making the custody of cryptocurrencies. This way, a customer's buy or sell order is issued by the bank, which sends it to one of NYDIG's intelligent systems that have custody of these coins.
This way, banks can charge a monthly fee for transactions and make them a fraction of what they would be. In this sense, the expectation is that transaction fees for cryptocurrencies will become cheaper after the introduction of these new possibilities.
Now, the next steps include making everyday transactions faster and cheaper by using cryptocurrencies.
Currently, processing a Bitcoin trade takes about 10 minutes on its network. By connecting card machines to banks with the NYDIG system, companies should reduce this time for retail cryptocurrency usage.
It is expected that up to 20,000 restaurants will be connected in this second phase of the project and that more than 800,000 ATMs - the American 24h Bank - will enable the withdrawal of cryptocurrencies in cash.
Final Thoughts
Although many crypto enthusiasts are not fond of the growing adoption of cryptocurrencies by banks, it is impossible to think of a crypto mass adoption without going through some degree of centralization throughout the transition process.
Of course, it is critical to keep the decentralized aspect of cryptocurrencies as much as possible so that the very philosophy of usage that comes from its roots (e.g., Satoshi's whitepaper) remains everlasting.
However, it is impossible to deny that the adoption of cryptocurrencies by banks is a big step in the popularization and acceptance of digital assets by the masses.
