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Crypto friendly banks

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Banks have been subjected to the risk of inflation in the market. There have been many banks that faced downfall in history and are still facing them. In all such scenarios, some banks are considering the usability of crypto assets. It was a fact that people were thinking BTC would end the need for banks, but their codependence makes the future more forward. With this dependency, it will be easier for users to use any asset most reliable to their needs.

Let’s understand more details about crypto-friendly banks and the leading banks in this domain. 

What are crypto-friendly banks?

Financial institutions that have policies to support crypto transactions and activities related to it are crypto-friendly banks. These banks allow their users to buy, sell, and hold the currency, facilitate transactions with crypto exchanges, and provide other crypto-related services. Some of these banks collaborate with cryptocurrency companies and offer their products.

Not all banks are crypto-friendly; some even restrict any transaction associated with Bitcoin or crypto-related activities. In this brief article, we will gather the necessities regarding some of these crypto-friendly banks and the ideology they hold towards their functions.

Top 3 crypto-friendly banks

With the above understanding of crypto-friendly banks, let’s move ahead towards these various banks and the features they behold for the digital world. 

Revolut is one of the top crypto-friendly banks; it launched as a startup in 2017 and debuted its innings in the USA in 2020. This crypto-friendly bank has grown significantly in the European financial market as it is used as a creative approach to banking services. Revolut is a secured platform as it is insured with FDIC, supporting more than 50 cryptocurrencies. 

There is a facility for users to transfer the crypto to other Revolut accounts directly and to divert their ETH currency to third-party validators for stacking. The crypto cards provided by this bank allow you to pay for any goods or services, and to reward the user, they give 1% as cashback.

Significant features of Revolut are:

  1. Its user-friendly interface simplifies cryptocurrency’s buying and selling process, making it compatible with new and experienced users.

  2. Supports multiple crypto assets, allowing users to trade in various currencies.

  3. Flexible regarding the crypto purchase, this can be done manually or by setting up an auto-exchange for specific rates.

  4. Collection bundles of multiple tokens are introduced in sectors like DeFi and blockchain.

  5. Users can utilize their crypto daily through its crypto cards by making payments in crypto-converted fiat currency.

It is one of the oldest US-based banks of 1828, launched under the parent organization Provident Bancorp. It provides all the security to the emerging businesses as the deposits are FDIC and DIF insured. BankProv provides crypto-based lending services, separating their platforms from the competitors. 

With their extensive suites of API tooling, businesses associated with crypto can streamline their products and services. Its enhanced privacy, security, and compliance have made it a trusted partner for institutions that require crypto banking solutions. Some of its features include:

  1. BankProv provides a seamless and integrated solution for users to buy, sell, and securely store crypto assets in a digital wallet.

  2. Users can convert their crypto assets into fiat currency to spend their crypto holdings conveniently.

  3. Competitive interest rates on crypto lending allow the clients to generate some passive income over their holdings.

  4. Crypto-centric services are credible as they hold a great place in the traditional banking sector.

  • JPMorgan Chase

One of the largest banks in the US, JPMorgan Chase, does not allow you to make direct crypto trades in the application, but users can trade stocks invested in the blockchain and funds with crypto security. You can use any reliable cryptocurrency exchange to deposit from your account to the investing platform.

With its wealth management, one can choose a self-directed investment account. JPMorgan offers the facility to work with a team of personal advisors or have one-on-one sessions with a dedicated advisor. This consumer and commercial banking subsidiary is popular in the US as it comes as a savior during significant bank failures. Some of the qualities that make it a crypto-friendly bank are:

  1. Provides crypto-friendly banking services to selected exchanges and digital asset firms.

  2. Its advanced risk management system navigates the regulatory landscape and provides a secure environment to perform crypto activities.

  3. JPMorgan’s international-grade research provides you with market analytics to make informed investment decisions.

  4. Seamless connectivity and real-time execution for the trade as this bank is integrated with major exchanges.

Pros and cons of crypto-friendly banks

From financial institutions to crypto-friendly banks, there are always some kinds of benefits and flaws a system has to offer. These banks also have the same balance of pros and cons. Let’s see through some of these over here:

Pros

  1. Operating with a crypto-friendly bank is similar to the experience of traditional banking systems. Hence, it makes it easy for new users to understand the crypto environment.

  2. With a crypto-friendly bank, the market becomes more manageable and releases profits whenever an individual wants to off-ramp from it.

  3. Crypto businesses need the presence of traditional finances for the cost of insurance and operations. Crypto payment banks provide all such required features to comply with this interaction.

  4. The crypto market is always in active mode; hence, it is convenient if you can operate your account on the go. Most crypto-friendly banks provide intuitive mobile apps to their users, making it easy for them to access the market in real time and make calculative decisions.

Cons

  1. These banks are highly exposed to volatile digital assets, which can cause strains on their reserves and will eventually lead to the bank’s failure, similar to the Silvergate and Signature Bank.
  2. Crypto-friendly banks charge a premium sum over crypto-related services, which tends to be more expensive than wallet transactions.

  3. As per the current market scenario, the functionality of crypto-friendly banks is limited to trading and HODLing. This keeps the customers limited to specific services. 

What does the future hold for crypto-friendly banks?

When there will be growth and adoption of crypto in the financial market, crypto-friendly banks will flourish. Demand for crypto-friendly banks will rise when more people accept it as a currency of daily transactions. This also depends on the regulatory features of different countries as their crypto landscape is constantly evolving.

With a saturation amongst the traditional banks and their provided features, more and more banks are abiding by the idea of offering crypto-related services. Hence, crypto-friendly banks will bring a new outlook in this ever-changing economy.

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