These banks are betting on cryptocurrencies

Initially all reluctant vis-à-vis cryptocurrencies, more and more large international banks have finally decided to start in this field.

Faced with the rise of cryptocurrencies, and the interest of individuals and more recently by investors, major banks are looking to make their mark in this area.

In this area, American banks have a definite advantage, as the cryptocurrency ecosystem in the United States remains more developed and mature than the European ecosystem. For example, according to American giant Fidelity, approximately 80 million Americans own or own investments in digital currencies.

This Thursday, popular American bank Goldman Sachs became the first bank to offer a secured loan in Bitcoin, allowing borrowers to use bitcoin as collateral for a cash loan. It also became the first global bank in March to trade bitcoin options over-the-counter with Galaxy Digital, an asset manager focused on crypto.

But Goldman Sachs isn’t the only American bank to ride this trend. Some also want to allow their customers to diversify their portfolios, by exposing them to cryptocurrencies. Over the past year, giants Morgan Stanley, JP Morgan Chase and Well Fargo have allowed their wealthy clients to have exposure to these assets.

Similarly, faced with the rise of cryptocurrency trading platforms, and in particular giants like Robinhood and Revolut, American banks have decided to improve their trading services. Since March 2021, Golman Sachs has, for example, been offering bitcoin futures and undeliverable futures, allowing clients to comment on the future price of Bitcoin. Two other American banks will soon offer this type of service: Bank of America and Citigroup.

In Europe, more cautious initiatives

In Europe, initiatives remain more cautious, at a time when European institutions are considering regulating the cryptocurrency sector. It seems, at this stage, that Germany has an early start. In late February, Germany’s second largest bank, Commerzbank, applied for a license from the German regulator, allowing it to offer cryptocurrency exchange and custody services. If it gets such a license, it will be the first major German bank to start the venture. 25 German banking establishments seek to date, to obtain such a goblet.

For its part, Germany’s largest bank, Deutsche Bank, is preparing to launch a cryptocurrency custody service. The announcement was made over a year ago. Contacted BFM Crypto, Deutsche Bank declined to comment on the launch date. Last week, Portuguese bank Bison Bank became the first bank in the country to offer cryptocurrency-related services.

Only one bank in France

In France, large banks remain cautious in terms of cryptocurrencies. If BNP Paribas or Société Générale make partnerships in blockchain and cryptocurrencies, everyone will remain on their watch. Banque Delubac & Cie became the first bank in France to take registration as a digital asset service provider (PSAN) with AMF at the end of March. While the bank announced that its offer would be available at the end of April, it seems to have been somewhat delayed.

“We will be launching the offer soon, it is a very flexible environment, which is rapidly changing. We plan several launches in the next few months with services that will expand as we go,” BFM Crypto explained. Edodie Trevillot, the bank’s compliance manager.

The bank is expected to officially launch its services in mid-May, including cryptocurrency buy-sell and its protection offerings. After that, it will think about developing its online banking platform, with a product offer of wider tokens. The bank ensures that the offer is for all customers, from individuals to institutions.

In Europe, Switzerland is an exception, along with the attractive cryptocurrency tax system. In early September, giant BBVA announced the launch of a cryptocurrency wallet. For its part, Axa Switzerland accepts the payment of insurance premiums in bitcoin.

“While Swiss banks have been wary of offering cryptocurrency investment opportunities, more than half of the banks surveyed (55%) now plan to launch a cryptoasset investment offering within next three years, ”said a recent EY report.

Clearly banks are entering into cryptocurrencies, and although cryptocurrencies are more interested in individuals and investors, services are limited to professional and wealthy customers.

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