Some 650 banks in the United States will offer bitcoin (BTC) purchases to more than 24 million customers in that country, the magazine reported Forbes this June 30, 2021.
According to the media, this is possible due to an agreement between the enterprise payment provider NCR and the digital asset management firm New York Digital Investment Group (NYDIG). Although the date on which the plan will take effect has not yet been determined.
The U.S.-based magazine provided details of this agreement that will allow community banks, including First Citizens Bank and credit unions, such as Bay Federal Credit Union offer customers cryptocurrency trading through apps created by payment provider NCR.
In phase one of the partnership, NYDIG will allow NCR’s banking clients to buy, sell and trade bitcoin and other cryptocurrencies from their mobile app. In the second part of the plan customers they will be able to see NCR eventually guard their own assets.
Forbes noted that this is NCR’s latest effort to capitalize on the demand it is seeing from banks and credit unions tired of seeing cryptocurrency purchases made from their accounts to external exchanges. By providing these customers with a way to buy bitcoin, and eventually spend it, within their existing accounts, traditional financial institutions are part of a growing tide of entities in direct competition with cryptocurrency exchanges.
We strongly believe in the benefits of cryptography and strategic application. And that’s true for our banking relationships, as demonstrated by NYDIG, and in all retailers, as well as restaurants and the like.
Douglas Brown, president of digital banking, NCR.
In this way, participating banks will be able to bypass regulatory steps involved in holding cryptocurrencies for their clients directly. Instead, they will rely on NYDIG escrow services and generate revenue by charging transaction fees (among other services).
“I think you’ll see cheaper transaction fees through banks than you have on the market today. But banks can determine what they want that transaction fee to be, ” said NYDIG’s head of banking solutions Patrick Sells.
NCR and NYDIG on the cryptocurrency path
Forbes magazine revealed that NCR corporation shares have risen 238% since March 2020, when the quarantine began, and are now trading at $ 45.44.
The firm generated $ 6.2 billion in transaction revenue (non-cryptocurrencies) in 2021. In addition, NCR serves 180,000 restaurants, retail chains and more, including the Fifth Group restaurants in Georgia and Metropolitan in all 9 hotels in Ohio, all of which eventually they could be opened to bitcoin payments if everything proceeds according to the plan.
For its part, NYDIG until February 2021 held USD 4 billion in cryptocurrencies, including at least 30,000 bitcoins, valued at $ 1 billionowned by its parent company, Stone Ridge Holdings Group. Just a month later, assets under management had grown to over $ 6 billion, and the firm has since quietly amassed banking infrastructure partnerships that allow them to offer bitcoin services to roughly 70% of U.S. banks.
Banks in favor of cryptocurrencies
Since 2015, the Bank for International Settlements (BIS) has recommended that central banks do not fight the expansion of cryptocurrencies, as reported by CriptoNoticias.
The international body recognized the undoubted potential of blockchain technology that supports Bitcoin to facilitate retail payments, which seemed to generate greater interest from financial institutions. Bitcoin showed the great advantage of allowing its users to transact anywhere in the world in a fast, economical and reliable way.
Idea that coincided five years later the Office of the Comptroller of the Currency (OCC, for its acronym in English) that regulates the banks of the United States opened the doors to that nation’s financial institutions to provide services with cryptocurrencies, as reported by this media.
The OCC, which was led until January of this year by former Coinbase executive Brian Brooks, recognizes that as financial markets become increasingly digital, there is a growing need for banks and other service providers reap the benefits of technology.