Explained: crypto-friendly banks, what they are, the services they provide and some examples

The fiat banking system is known for adapting to changing times – maybe not quickly, but surely. This was seen when credit cards entered the scene and proved to be their ultimate cash cow. Then came Internet adoption with online banking, followed by entire banking portals and mobile apps.

And it looks like the next step in their evolution is the inclusion of cryptocurrency. In this article, we learn what crypto-friendly banks mean, their services, and even some famous examples of such banks. Let’s start.

What are crypto-friendly banks?

Crypto-friendly banks are nothing but traditional banks that have started offering certain crypto-related services. In most cases, increased customer demand for crypto services is pushing conventional banks into the digital asset space. This can be explained by the example of JPMorgan Chase in America, one of the largest banks in the United States, which started providing services such as crypto security deposits and more due to customer demands .

For banks, including crypto services is a step in the right direction. This would make crypto trading, holding, and investing a breeze, given that these services will be available to customers on the same user-friendly dashboards they use for banking. The greatly reduced learning curve would also bring more people into crypto. Crypto-friendly banks are also an indication that major institutions embrace crypto as an integral part of humanity’s future.

Crypto-friendly banks vs crypto banks

It is quite easy for anyone to confuse crypto-friendly banks with crypto banks. However, they are two very different entities. Crypto-friendly banks are traditional banks that have expanded their scope to include certain crypto services. In contrast, crypto banks are entirely designed for crypto users and offer various crypto services.

Morgan Stanley is a common example of a crypto-friendly bank. The investment banking giant has opened up crypto services to clients worth over $2 million. These elite customers can now buy, store, and even earn interest or invest in cryptocurrency funds with Morgan Stanley. Other crypto-friendly banks include Goldman Sachs, Bank of New York Mellon, Vast Bank, BankProv, USAA, etc.

On the other hand, a famous example of a crypto bank might be Juno. It is a digital bank that prides itself on being the gateway to Web3 and the world of crypto. It is known worldwide for its low transaction fees and high returns, with rates of up to 6% on Ethereum and Bitcoin. Other crypto banks include Ally Bank, Nuri, Revolut, etc.

Services offered by crypto-friendly banks:

Child care services – This refers to the storage of tokens and other digital assets. Instead of keeping a hardware wallet, you can rely on your bank to protect your digital assets like you do with your fiat currency.

Payment processing – We are already working as a global village where sometimes payments across countries are done via crypto to reduce hassle and increase speed. With your traditional bank offering crypto payment processing, you would have a much easier time delivering work and getting paid. This is also useful for businesses looking to accept crypto payments on their website or mobile app.

Lending and Borrowing – These are the simplest banking services but in terms of crypto. The tokens you hold can be loaned out to others for an interest rate through your bank, and you can also use your tokens as collateral to borrow a loan. Some banks will also offer crypto debit and credit cards as well as a checking account for digital assets.

Conclusion

Just a few years ago, the idea of ​​traditional banks offering crypto services was unheard of. Therefore, with so many big names in the financial industry rushing to join the digital asset bandwagon, the future of the crypto industry looks bright.