Cryptocurrency
The Banking Industry Cashes in on the Crypto Craze
Reported by News BTC, “In the infancy stages of cryptocurrency development, banks were outwardly hostile towards digital currency. However, the widespread adoption of blockchain-based technology for processing financial transactions quicker, safer, and more efficiently has led to a rethinking of traditional thought processes among notable banking giants. A caveat is in order, however many banks […]
Reported by News BTC, “In the infancy stages of cryptocurrency development, banks were outwardly hostile towards digital currency. However, the widespread adoption of blockchain-based technology for processing financial transactions quicker, safer, and more efficiently has led to a rethinking of traditional thought processes among notable banking giants. A caveat is in order, however many banks remain opposed to the purchase of cryptocurrency with bank-issued credit cards.
“Established banking institutions have policies in place proscribing the use of bank-issued credit cards for cryptocurrency purchases. For the most part, this practice is limited to US-based banking institutions. While crypto certainly has a large and growing fan base, it remains an extremely volatile asset class, and is not recommended as a store of value. Several high-profile incidents of theft from crypto exchanges over the years have not helped the cause; they have exacerbated the skepticism of established financial enterprises and the monetary authorities.
“One need only examine the price fluctuations in Bitcoin, and altcoin over the course of 2018 and 2019 for indications of this asset class’ volatility. For example, Bitcoin was priced at $6700 per unit in September 2018, and was trading at around $8400 per unit in September 2019. In between, there have been dramatic price fluctuations, with the world’s #1 cryptocurrency dropping under $3500 per unit, before hitting highs of over $12,500 per unit in July 2019.
“While banks and regulators eschew the dramatic volatility of BTC, it is this very feature that is so enticing to speculators, traders, and casual investors of this contrarian asset category. Such is the interest in crypto, that many individuals are now trading price movements via CFDs at established brokerages. CFD trading is derivatives trading where traders buy contracts on BTC and other cryptos based on expectations of future price movements This has facilitated greater public interest in Bitcoin and altcoin, and banks are now reassessing their approach to this lucrative industry.”
Continue to read the full story at News BTC.
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