According to a report from NYDIG, US banks will allow customers to buy Bitcoin before the end of 2021. This is a surprisingly new development as Banks and other lending institutions in the US once viewed Bitcoin as “evil.” NYDIG will be partnering with Fidelity National Information Services (FIS) to make it possible for the US banks to enable direct crypto transactions.
At the moment, hundreds of banks have agreed to the development. Although, majority of the banks that signed up are small institutions. The NYDIG is already in talks with larger US banks to join the movement.
NYDIG’s goal is to get major banks to accept the idea. Should the big players get involved in the crypto adoption, more and more institutions will be willing to sign up. The established lending institutions may well be willing to come on board to benefit from this new model. This however depends on the success of early adopters.
Why are the Banks Interested?
The collaboration implies that customers will be able to take lesser steps to purchase Bitcoin directly from the bank accounts without the need for an exchange. This may lead to aggressive competition between the lending institutions and already existing crypto platforms. Robinhood for example reportedly had 9.5 million different customers who traded cryptocurrency on its platform during Q1 2021.
The US Banks are not ignorant to the large revenue these platforms raise consistently as well as the huge cash flow rate to and from exchanges. The president of NYDIG, Yan Zhao, affirmed that the banks are not simply delving into the crypto space because they want to give their users a better and easier trading experience, but because they have identified the crypto space as a reservoir of gems they can tap from.
At the moment, lenders like Goldman Sachs and Morgan Stanley offer Bitcoin funds to institutions and elite clients. This new development however will make Bitcoin and crypto assets easily accessible for all.