- Hundreds of banks in the United States will soon offer Bitcoin services for their clients.
- NYDIG and Fidelity National Information Services have partnered with the new service offering.
- Customers of US banks will be able to buy, hold and sell BTC through their existing accounts.
Crypto custody firm NYDIG has partnered with fintech company Fidelity National Information Services (FIS) to enable hundreds of banks in the United States to offer Bitcoin-related services in the coming months.
Cutting into the market share of crypto exchanges
The two firms will provide a framework for US banks to offer crypto trading services to their customers. Patrick Sells, bank solutions chief at NYDIG, stated that hundreds of banks have already signed up for the program, with the majority being smaller financial institutions.
Sells said the firm is currently discussing with the largest US banks to participate in the program. As smaller banks begin offering crypto trading to retail customers, major institutions such as Bank of America and JPMorgan may then be incentivized to come on board.
According to a survey commissioned by NYDIG, more people would own Bitcoin if they could do so through their existing banks, enabling them to view their financial assets through one account. Customers would prefer to avoid the need to sign up with a separate institution and fund the account with a money transfer that could take days. He explained:
What we’re doing is making it simple for everyday Americans and corporations to be able to buy Bitcoin through their existing bank relationships. If I’m using my mobile application to do all of my banking, now I have the ability to buy, sell and hold Bitcoin.
NYDIG, a subsidiary of investment firm Stone Ridge and with over $6 billion in assets under management, will manage the Bitcoin transactions side of the offering. FIS will utilize its Digital One Mobile tool to enable the digital experience aspect.
Undoubtedly, demand for Bitcoin has grown in the past few months, as banks rush to offer clients exposure to the leading cryptocurrency. So far, most crypto-related services have only been made available to wealthy clients, including the latest offering by Goldman Sachs. The investment banking giant is preparing to offer its private wealth management clients – with at least $25 million of assets under management – investments in cryptocurrencies.
Cryptocurrency exchanges, such as Coinbase, have benefited from the rise in crypto demand from retail customers as the leading cryptocurrency rallied to all-time highs this year. After going public last month, Coinbase may see some competition as US banks begin to offer BTC services. Yan Zhao, president of NYDIG, said:
This is not just the banks thinking that their clients want Bitcoin. They’re saying, ‘We need to do this because we see the data.’ They’re seeing deposits going to the Coinbases and Galaxies and Krakens of the world.