Robin Vince, CEO of the oldest continuously operating bank in the world, BNY Mellon, revealed during Friday’s earnings call that his organization is committed to continuing exploration of digital assets, albeit with caution. The chief executive identified cryptocurrencies as the bank’s “longer-term game”.
BNY Mellon is primarily interested in the “broader opportunities offered by digital assets”
Robin Vince, CEO of BNY Mellon, reiterated his view that digital assets should remain a priority for his bank. Vince, however, also said that the focus will not be so much on the cryptocurrencies themselves, but more on “the larger opportunity that exists through digital assets and distributed ledger technology.”
Mellon’s CEO also expressed his belief that the calamities that have rocked the entire crypto industry throughout 2022, perhaps the most significant being the recent FTX collapse– only underscore “the need for trusted regulated providers in the digital asset space.” BNY Mellon officially enters the digital asset custody business with the launch of its dedicated platform last October.
On the call, Vince also said he doesn’t believe cryptocurrencies will become a major source of revenue for the bank in the near future. According to the CEO, they expect digital assets to be negligible from a revenue standpoint for perhaps another five full years. While calling cryptocurrencies the bank’s “longer-term game”, Vince acknowledged that ignoring digital assets “would be like being the custodian of 50 years ago and sticking to paper and not to adopt a computer”, but also added that any investment made in the sector is done both carefully and deliberately.
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Large institutions are increasingly interested in digital assets
Despite the “crypto winter”, 2022 has proven that many large traditional financial institutions share Vince’s view that it is unwise to neglect digital assets and have started to engage with the sector. BlackRock and Fidelity are perhaps the two most notable institutions to take an interest in cryptocurrencies, primarily Bitcoin.
Already in April 2021 it was reported that BlackRock Quietly Trades BTC Futuresand in May, its CEO Larry Fink, previously a skeptic of digital assets, revealed to shareholders that BlackRock is studying cryptocurrencies. In August 2022, BlackRock entered into a historic agreement with Coinbase and began offering direct Bitcoin spot exposure to institutional investors.
Loyalty, on the other hand, has a history with Bitcoin dating back to at least 2014. However, it also made leaps forward when it comes to digital assets compared to the previous year. In September, Fidelity announced its intention to start offering cryptocurrency to its 34 million retail customers and maintained its supply of Bitcoin in its 401(k) despite under pressure from a group of U.S. senators three times in 2022.
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About the Author
Tim Fries is the co-founder of The Tokenist. He has a B.Sc. in Mechanical Engineering from the University of Michigan and an MBA from the University of Chicago Booth School of Business. Tim was a senior partner on the investment team in the US Private Equity division of RW Baird and is also a co-founder of Protective Technologies Capital, an investment firm specializing in detection, protection and control solutions.