US banking industry will open Bitcoin transactions within this year, and cryptophobia will soon be cured

According to a report by CNBC on Wednesday, cryptocurrency custody company NYDIG has partnered with fintech powerhouse Fidelity National Information Services (FIS) to provide a technical framework for cryptocurrency trading services for U.S. banks. NYDIG President Yan Zhao said that after launching the initial Bitcoin trading service, NYDIG plans to offer other derivative services, including debit card rewards paid in Bitcoin and a new type of bank account that is insured by the FDIC and pays interest in Bitcoin. (Note: FDIC stands for Federal Deposit Insurance Corporation, a company founded by the U.S. federal government to provide deposit insurance for commercial bank savings customers.)

Patrick Sells, head of banking solutions at NYDIG, told CNBC that hundreds of banks have signed up for the service plan, most of which are small financial institutions such as Suncrest, a community bank in California that currently has seven branches. The company is also in talks with several other major banks in the United States to convince them to participate in the program. The head also said that once small banks begin to get considerable returns from cryptocurrency trading business, giants such as Bank of America and JPMorgan Chase may compromise and get involved. Among them, Bank of America is one of the most staunch anti-cryptocurrency banks in the United States, and its management often questions the value of Bitcoin and other cryptocurrencies.

So far, Bitcoin investors have generally relied on applications from a new generation of financial technology companies, such as the popular trading platform Robinhood, payment giants PayPal and Square, or cryptocurrency-centric companies such as Coinbase. On the other hand, banking giants have always stayed away from Bitcoin, and only recently announced plans to allow some high-net-worth users to access cryptocurrency trading. Banks participating in the service plan provided by NYDIG and FIS will be able to provide cryptocurrency trading to customers directly from their existing accounts. This change will greatly reverse the passive situation of the banking industry in the crypto market, and we may see the first head-on confrontation between traditional banking and emerging exchanges.

Yan Zhao, president of NYDIG, said: "It's not just that banks think their customers want bitcoin, banks are actually seeing money flowing out to exchanges like the Coinbases and Krakens."

Fidelity National Information will provide banks with access to services such as chatbots or Apple Pay. FIS is also a heavyweight in the payments industry, having acquired the underlying payment platform Worldpay for $35 billion two years ago, the largest acquisition in the industry to date.

According to NYDIG's survey, more people will own bitcoin if investors trade it directly through their existing banks, and the service can also avoid the embarrassing situation of waiting three to five business days for remittances to fund accounts on other exchanges.

Image source: Internet

AuthorChen Zou