| Yaz Sheikh

Key highlights:

  • Institutional players are becoming increasingly involved in cryptocurrency and blockchain, giving digital assets further legitimacy
  • Top-tier banks are working on their own cryptocurrency solutions
  • In this article, we are featuring 7 banks that are working on crypto solutions like custody and trading

Top banks have entered the cryptocurrency arena

What a difference a year can make. In 2020, Bitcoin managed to surge by an extraordinary 340%, causing many banks across the globe to soften their view on cryptocurrencies and start offering cryptocurrency services to their clients.

This week, The US Office of the Comptroller (OCC), an independent US Treasury branch that supervises all national banks, published Interpretive Letter 1174, which clarifies that banks in the United States are allowed to use stablecoins to perform certain bank functions such as payment activities.

You can find out more about this new Interpretive Letter here.

This Interpretive Letter comes a few months after their previous letter, which stated that US banks were cleared to provide cryptocurrency custody services for their clients.

Banks are not just engaging with cryptocurrency and blockchain in the United States – this is a truly global phenomenon and we’re now seeing banks from Europe, Asia and other markets work on their own cryptocurrency solutions.

Following is a list of 7 banks that are working on cryptocurrency-related services such as custody and trading.

1. Standard Chartered

Standard Chartered’s fintech investment arm SC Ventures announced that they are teaming up with Nothern Trust to launch a UK-based institutional-grade cryptocurrency custodian unit. The firm is expected to operate in London during 2021 and will be called Zodia Custody.

It is currently waiting for regulatory approval by the FCA but, once approved, it will provide cryptocurrency custody services for Bitcoin and Ethereum. Other altcoins are likely to follow.

The service will be geared toward institutional investors and will allow them to invest in the cryptocurrency sector.

2. Bank of America

Over two years ago, Bank of America filed a patent with the US Patent and Trademark Office to offer cryptocurrency custody towards large-scale institutional investors, as well as retail traders. The system they have applied for is similar to the one that Xapo uses by storing customers’ BTC and cryptocurrency in a ‘secure digital vault.’

Bank of America stated that their primary purpose for creating the crypto vault is to allow large enterprises to store vast amounts of wealth in cryptocurrency without worrying about the security of their holdings.

Interestingly, the patent is still yet to be granted, but looking through the patent number, we can see that the examiner and the bank are still hashing things out. Nevertheless, this shows that the top-tier banks are looking to enter the Crypto Custody space.

3. DBS Bank Of Singapore

In October 2020, they announced that they would be offering trading, STOs, and custody. It launched the DBS Digital Exchange, which is 10% owned by the Singapore SGX stock exchange, to facilitate spot exchanges between fiat and cryptocurrency.

Their cryptocurrency custody service is bank and institutional-grade and will be air-gapped cold storage.

4. Silvergate Bank

Silvergate has seen long-standing interest in Bitcoin over the years. In early 2020, the bank applied for a New York trust license to be able to provide custody and settlement for crypto. Silvergate went public in November 2019, trading under the symbol SI with $2.3 billion in total assets, a significant portion of which comes from clients in the cryptocurrency industry.

By the end of the first quarter of 2020, they announced that they had added over 46 crypto customers to their custody service, increasing their total cryptocurrency customer base to 850. 540 of these are institutions.

They also have a SIlvergate Exchange Network (SEN) that allows commercial customers to move US Dollars between different cryptocurrency exchanges instantly.

5. ING Bank

In December 2019, Reuters released an exclusive article stating that ING was working on digital assets custody technology.

A year later, the Netherlands-based bank’s blockchain lead, Herve Francois, revealed that they had joined the Pyctor Network of Financial Institutions, which will help with the security of storing the digital assets. The project involves layers of security to make banks feel comfortable handling and storing cryptocurrencies for their clients. Pyctor also is working with banks such as Citibank, State Street, and UBS.

6. BBVA – Spanish Bank

BBVA is the second-largest bank in Spain with over $840 billion in assets. In December, they announced that they had already started to roll out trials for its first commercial service for trading and custody of digital assets.

Interestingly, the service will be offered through BBVA Switzerland – likely because of the comprehensive rules around digital assets in the country. They expect to start their service in 2021 by first offering their clients the ability to trade and store Bitcoin at the bank, with all the guarantees of any other banking service.

7. KB Kookmin Bank

One of the largest banks in South Korea, KB Kookmin Bank, applied for the KBDAC (Digital Asset Custody) trademark in January and partnered with Hashed and Cumberland Korea, a cryptocurrency trading platform, to start the process of entering into the cryptocurrency custody space.



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