650 U.S. banks will soon be able to offer bitcoin purchases to an estimated 24 million total customers
They’re called cryptocurrencies for a reason. The word “crypt” is short for “cryptographic,” which is a fancy way of saying, “it’s secret.” When you hear or read about what a cryptocurrency is, it’s usually because some company has developed a new way to store money. Most of the time, that money is stored in digital form.
Dishonestly claimed the banking sector was nearly exclusive to the big three in the US, we wanted to investigate if the banking sector was really only dominated by the big three. After all, where is the other half of the bank’s customers located? What major banks did we miss?
Since the passing of the 2014 Bitcoin Act, which allowed US-based banks to offer Bitcoin to their customers, the number of US-based Bitcoin banks has greatly increased. On May 6, 2018, the number of bitcoin banks increased to 650 with Wells Fargo being the last to join the Bitcoin bandwagon. With this number also comes a total of 24 million clients.
In an effort to compete directly with cryptocurrency exchanges, payments giant NCR has announced a partnership with wealth management firm NYDIG that will allow 650 banks to offer bitcoin purchases to their customers. This is an important step towards mass adoption, as these banks have a combined customer base of over 24 million and do not have to comply with regulatory requirements.
Source – Twitter
Through this partnership, NYDIG becomes the new custodian for these banks, which can now offer services related to cryptocurrencies. It also eliminates the need for third-party exchanges, and allows customers to spend money directly from their bank to buy bitcoins.
The agreement covered banks in North Carolina and other credit unions in California. The corporate giant also said its customers have repeatedly complained about the inability to make purchases directly through personal bank accounts. Atlanta-based NCR has perfectly responded to user demand for cryptocurrency services and has strengthened its banking relationship by allowing customers to make purchases from their existing accounts. Commenting on the partnership, NCR President Douglas Brown said:
We strongly believe in the benefits of cryptocurrencies and their strategic use, said Douglas Brown, president of NCR Digital Banking. This includes our banking relationships as evidenced by the NYDIG, retail, restaurants, etc.
This NCR deal is not the first to encourage mass adoption of crypto-currencies. In May, they struck a deal with crypto payment provider Flexa to use cryptocurrencies to pay for gas and other goods. NYDIG has confidence in this partnership because it fully understands that clients are moving their money from banks to external exchanges. The NYDIG president told Forbes:
Many of these banks have discovered that one of the biggest outflows of money from their depositors is the transfer of money from the bank to exchanges like Coinbase. That’s why banks are so happy to have this opportunity for themselves and their customers.
The approach to implementing this agreement between NYDIG and NCR begins with allowing customers to trade BTC and other cryptocurrencies through a mobile app. For everyday purchases, the company will buy from the OTC desks and exchanges, and the customer will think they are dealing with a bank.
The other approach currently proposed is a one user per month model. This subscription-based model depends on how the bank charges transaction fees. Patrick Sells, head of banking solutions at NYDIG, estimates that this model will be cheaper than most of the current market rates.
The 135-year-old organization posted $6.2 billion in revenue last year, none of which came from transactions in cryptocurrencies. So we can expect this partnership to explode and create a better platform for banks to help their customers. The company also added that it is considering launching a new digital asset storage project.
Kartikeya Gutta, born and raised in India, is a cryptocurrency journalist and freelance writer for the website itsBlockchain. It covers various aspects of the industry through in-depth analysis and research. His passion for blockchain and the crypto-ecosystem is largely because he believes it can truly change the world and help millions of people.
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Sign up to be notified of the latest posts.On October 2nd, a group of over 650 U.S. banks will be allowed to begin offering bitcoin purchases to active accounts for a period of roughly four months. The banks that have been approved to participate in the Federal Deposit Insurance Corporation’s pilot program include the nation’s six largest banks: Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, Bank of America, and Wells Fargo.. Read more about is cryptocurrency legal and let us know what you think.
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