Which Major Banks Are Betting On Bitcoin?

Bitcoin and other cryptocurrencies have been gaining popularity since they enable flawless peer-to-peer money transfers without intermediaries. In a fast-changing digital environment, banks are embracing cryptocurrency and blockchain technology to increase their productivity, lower expenses, offer better security and transparency, and cater to the changing needs of their clients. While some banks are still resistant to bitcoin, 55% of the world's top 100 banks are investing in the crypto and blockchain space. Here are some of the leading banks that have invested in bitcoin and blockchain technology.

Banks that accept Bitcoin

Bitcoin and other cryptocurrencies have influenced a fast-changing digital environment, and banks are embracing this change to increase their productivity, lower expenses, offer better security and transparency, and cater to the changing needs of their clients.

While many banks are still resistant to Bitcoin, some banks have started to accept and invest in Bitcoin. Here are some of the banks that have embraced Bitcoin:

• Chime Bank is a San Francisco-based company founded in 2013 that offers no monthly, overdraft, or minimum balance fees. Although Chime Bank officially states that Bitcoin purchases are not allowed with their VISA debit card, customers can use a platform like Paxful to move money and pay friends directly with their username, phone number, or email.
• Wirex is a London-based company founded in 2014 that offers a crypto-friendly business account. The Wirex app is accessible on iOS and Android devices and allows customers to seamlessly buy, store, and exchange digital and traditional currencies anytime.
• Ally Bank is an online-only bank with 24/7 support and an online chat feature with short wait times. Customers can easily link their bank account to Coinbase and buy desired coins with their debit card.
• Fidor has teamed up with Kraken to operate a fully functioning altcoin bank.
• Change is a crowd-funded blockchain project (ICO) that offers a wallet for altcoin storage, an altcoin spending card, and a marketplace that aggregates the best investment and insurance opportunities.
• Worldcore provides multi-currency accounts accessed via debit and virtual cards.
• Bankera is the operational arm of SpectroCoin and seeks to be a fully-functional bank that offers payment accounts, interbank foreign exchange rates, debit cards, lending, and payment processing.
• USAA allows Coinbase users to check their Bitcoin balances from their apps and has invested in the exchange.
• Goldman Sachs launched an altcoin trading desk and has offered altcoin products since 2018.
• National Bank of Canada still allows Bitcoin purchases, unlike major banks in the U.S., the U.K., and Australia, which have banned credit card purchases for altcoins.
• Simple Bank collaborates with most Bitcoin exchanges and permits direct buy-sell transactions for Bitcoin.
• Standard Chartered is one of the largest British multinational banks and financial services companies, managing about $789 billion in assets. Blockdata estimates that Standard Chartered has made a total of $380 million in blockchain investments, more than any other major bank.
• Bank of New York Mellon is the oldest U.S. bank and has made blockchain investments totaling an estimated $321 million.
• Citigroup is one of the largest U.S. banks and has invested an estimated $279 million in at least 14 different cryptocurrency projects.
• Morgan Stanley is one of the largest U.S. investment banks and has made three major cryptocurrency investments totaling an estimated $234 million.
• JPMorgan Chase is the largest U.S. bank and has made a total of $206 million in cryptocurrency investments.
• Goldman Sachs has been researching blockchain technology and cryptocurrencies for years, opening a trading desk for cryptocurrencies in 2018 and widening its product selection to include Bitcoin futures and non-deliverable forwards in 2021.

This list is not exhaustive, and the number of banks accepting Bitcoin is slowly increasing.

Banks that ban Bitcoin purchasing

Bitcoin and other cryptocurrencies have become increasingly popular since their creation in 2009. However, not all banks are ready to accept them. While some US banks allow customers to purchase Bitcoins through their bank account, most US banks do not allow customers to purchase or exchange any type of cryptocurrency.

Many major US banks, such as Bank of America, Capital One, JPMorgan Chase, TD Bank, PNC Bank, and Citigroup, explicitly ban their clients from using their credit cards, ACH, wire transfers, or other lines of credit to purchase cryptocurrencies. These banks impose bans to protect themselves and their customers before diving into the possibilities of cryptocurrency. They also see Bitcoin prices as volatile and insecure. Because cryptocurrency is decentralised and untethered to a government, banks are unsure of its consistent valuation.

Some banks have also been accused of actively blocking Bitcoin-related transactions. For example, Wells Fargo has been named in a lawsuit where it was alleged that the bank sought to block transfer wires to the bitcoin exchange Bitfinex. Customers have reported that TD Bank has stated that its policy is not to associate with Bitcoin or to permit its subscribers to engage in the said business. The bank has been accused of stopping Bitcoin purchasing transactions and closing accounts suspected of being linked to Bitcoin.

Despite the resistance from many banks, the number of Bitcoin-friendly banks is growing, and the landscape of crypto is constantly changing.

Banks with the biggest crypto investments

Several banks are investing in cryptocurrencies and blockchain technology to increase productivity, reduce costs, improve security and transparency, and meet the evolving needs of their customers. According to Blockdata, 55% of the world's top 100 banks by assets under management have already invested in crypto and blockchain companies. Here are some of the banks with the biggest crypto investments:

Standard Chartered

Standard Chartered, a London-based multinational bank, has made investments of $380 million in blockchain and cryptocurrency companies, including Ripple Labs Inc., Cobalt, Dianrong, Metaco SA, and LinkLogis Inc. The bank has also launched a joint venture with BC Technology Group Co. Ltd. to establish a cryptocurrency brokerage and exchange in Europe and the UK.

BNY Mellon

BNY Mellon, the oldest US bank with $470 billion in assets under management, has made blockchain investments totalling $321 million. The bank has financed projects such as Fireblocks, HQLAx, R3, and Fnality International. In February, BNY Mellon announced it would start financing Bitcoin and other cryptocurrencies, integrating them into its custodian bank network.

Citigroup

Citigroup, one of the largest US banks with $2.26 trillion in assets under management, has invested approximately $279 million in at least 14 cryptocurrency projects. These include BUCK, Chain, SETL, Axoni, Cobalt, Digital Asset, HQLAx, R3, Komgo, and Symbiont. Citigroup introduced its digital currency, Citicoin, in 2015, and has been actively researching blockchain and cryptocurrency technology.

Morgan Stanley

Morgan Stanley, a leading US investment bank, has made three significant cryptocurrency investments totalling $234 million. The bank was the first major US investment bank to offer wealthy clients access to Bitcoin investment funds, although it restricted this service to clients with at least $2 million in assets and a high-risk tolerance.

JPMorgan Chase

JPMorgan Chase, the largest US bank with $3.39 trillion in assets under management, has made cryptocurrency investments totalling an estimated $206 million. The bank has backed companies such as Axoni, ConsenSys, Digital Asset, R3, and HQLAx. JPMorgan Chase launched its cryptocurrency, JPM Coin, in 2019, to facilitate fast payments between institutional clients.

Goldman Sachs

Goldman Sachs has been researching blockchain and cryptocurrency technology for several years. The bank opened a cryptocurrency trading desk in 2018 and expanded its offerings to include Bitcoin futures and non-deliverable forwards in 2021. Goldman Sachs has made eight investments in the crypto and blockchain space, totalling approximately $698 million.

Banks that are creating crypto payments systems

Blockchain technology has disrupted the financial sector, and blockchain payment solutions have improved, leading to efficient and transparent payment processes. Blockchain payments are low-cost, secure, and processed quickly, and they facilitate money transfer regardless of the distance between the sender and receiver.

Some banks have started to experiment with blockchain technology to improve the efficiency, transparency, and security of their services. Here are some examples of banks creating crypto payment systems:

• JPMorgan Chase launched its blockchain group, Onyx, in 2020, aiming to "transform the way money, information, and assets move around the world." Onyx uses distributed ledger technology to serve financial institutions and fintech companies, offering blockchain-based solutions for domestic and cross-border payments.
• Ally Bank is one of the most Bitcoin-friendly banks. Ally is an online-only bank with 24/7 support and an online chat feature with short wait times. Customers can easily link their bank account to Coinbase and buy coins with their debit card.
• The National Bank of Canada still allows bitcoin purchases, unlike major banks in the U.S., the UK, and Australia, which have banned credit card purchases for cryptocurrencies.
• Simple Bank is taking things a step further by allowing the commingling of exchange and wallet features. It collaborates with most bitcoin exchanges and permits direct buy-sell transactions for bitcoin.
• USAA allows Coinbase users to check their bitcoin balances from their apps and has invested in the exchange, marking the first major bank to invest in a crypto exchange.
• Goldman Sachs launched a cryptocurrency trading desk and has offered cryptocurrency products since 2018.
• The Royal Bank of Canada is considering how to best support clients in the cryptocurrency space, according to a spokesperson.

While these banks are embracing the crypto space, it is important to note that many banks still view bitcoin and other cryptocurrencies as industry disruptors or potential market anchors.

Banks that are embracing blockchain technology

Blockchain technology is increasingly being embraced by banks around the world. In fact, 55% of the world's top 100 banks by assets under management have already invested in blockchain and crypto companies, either directly or through subsidiaries. This equates to around 61 banks in total.

Some banks are creating their own blockchain-based systems, including digital currencies, to enable B2B cryptocurrency payments between their customers. Others are investing in blockchain companies. For example, Standard Chartered has made investments of $380 million, the largest amount of any major bank. Barclays, on the other hand, is the most active investor in blockchain companies, with 22 investments.

BNY Mellon

BNY Mellon, the oldest US bank, has made blockchain investments totalling an estimated $321 million. The bank's investments include projects such as Fireblocks, HQLAx, R3, and Fnality International.

Citigroup

Citigroup has invested an estimated $279 million in at least 14 different cryptocurrency projects, including BUCK, Chain, SETL, Axoni, Cobalt, Digital Asset, HQLAx, R3, Komgo, and Symbiont.

Morgan Stanley

Morgan Stanley has made three major cryptocurrency investments totalling an estimated $234 million. These investments are in NYDIG, R3, and Securitize.

Goldman Sachs

Goldman Sachs has been researching blockchain technology and cryptocurrencies for several years. The bank opened a trading desk for cryptocurrencies in 2018 and, in 2021, it widened its product selection to include Bitcoin futures and non-deliverable forwards. The bank has made eight investments in blockchain companies, totalling $698 million.

JPMorgan Chase

JPMorgan Chase has been called one of the most active institutions in the cryptocurrency and blockchain field. The bank's cryptocurrency, JPM Coin, was introduced in 2019 to enable fast payments between institutional clients. The bank has made eight investments in blockchain companies, totalling an estimated $206 million.

Silvergate Capital

Silvergate Capital is a smaller bank based in California with $5.6 billion in assets. The bank is famous for the Silvergate Exchange Network (SEN), a digital payments network that can instantly clear transactions in US dollars around the clock, 365 days a year.

Signature Bank

Signature Bank, based in New York City, has also jumped into the world of cryptocurrency with its Signet digital payments system. Like Silvergate's SEN, the platform allows commercial clients to instantaneously send and clear payments to one another.

Ally Bank

Ally Bank is an online-only bank that has been described as one of the most Bitcoin-friendly banks. Customers can easily link their bank account to Coinbase and buy their desired coins with their debit card.

Simple Bank

Simple Bank collaborates with most bitcoin exchanges and permits direct buy-sell transactions for bitcoin.

National Bank of Canada

The National Bank of Canada still allows bitcoin purchases, unlike many of the major banks in the US, the UK, and Australia.

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