BY DAYO ADESULU
As soon as scores of banks managers in the United States of America discovered that many bank account holders are moving funds from their accounts to cryptocurrency exchanges, the banks have now allowed customers to buy, sell and hold Bitcoins via existing bank accounts.
It was gathered that the partnership between fintech giant Fidelity National Information Services (FIS) and the New York Digital Investment Group (NYDIG), the bitcoin investment arm of $10 billion New York-based Stone Ridge Asset Management made this development possible.
CNBC reports Wednesday that the initiative would see bank account holders being able to buy, hold and sell bitcoin through their existing accounts.
Fidelity and New York Digital Investment Group explained that the collaboration is to enable U.S. banks to offer bitcoin in the coming months.
Head of bank solutions at NYDIG, Patrick Sells, said that hundreds of U.S banks are already enrolled in the program.
He added that the firm is in talks with some of the biggest banks in the country about offering the bitcoin service, he said most banks that have enrolled are smaller banks. He was quoted as saying:
”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,” said Sells.
On her part, the president of NYDIG, Yan Zhao, said: ”The U.S banks used to steer clear of bitcoin but they are now asking about providing crypto investment services because they can see their customers moving money out of their bank accounts to crypto exchanges.”
She continues: ”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.
”Most people can’t invest in things that institutional investors get to invest in. With bitcoin available through your bank to be purchased with as little as $1, now you have an attractive asset that’s available to be owned by anyone in any amount. We think that’s huge for economic empowerment.
”FIS will handle the link to lenders while NYDIG, not banks, will take care of bitcoin custody and trade execution, the publication noted. Zhao explained that the cryptocurrency will not be FDIC-insured. Sells further shared that NYDIG plans to provide other services, including debit card rewards paid in bitcoin, and a new type of bank account that is FDIC insured, but pays interest in bitcoin.”
”Rob Lee, head of digital banking at FIS, expects major banks like JPMorgan Chase and Bank of America to come under pressure to offer crypto investments to retail banking customers when they see hundreds of smaller banks provide the crypto service.
Lee said: ”Some major investment banks have already begun providing wealthy clients access to bitcoin investments. Morgan Stanley announced in March that it will begin offering bitcoin funds to wealthy clients. Goldman Sachs then said that it will offer a full spectrum of bitcoin investments. JPMorgan is also reportedly looking at its own product in conjunction with NYDIG.”