While the world of cryptocurrency is growing at an impressive and steady pace, traditional banks are not yet fully on-board in adopting a digital money marketplace.
This is expected to change soon.
Right now, major regulatory agencies such as the Office of the Comptroller of Currency (OCC) are working non-stop to change the perceptions held by traditional financial institutions. The world of crypto could usher in a new era of innovation for institutions like banks, and the OCC and others are working hard at conveying this message.
The Solution Is Involvement
It is important for those banking groups wanting to stay ahead of the times to find new ways of embracing crypto technology. This means treating digital currencies as a friend instead of financial risk.
In this too, the OCC is playing an important role.
The organization recently issued an entire series of interpretive explanations indicating how banks and other traditional financial institutions can become involved in the cryptocurrency market.
In layman’s terms, these letters explain how blockchain networks are essentially no different from Fedwire, ACH, and SWIFT.
The bottom line is that for banks, digital currencies could enhance and even upgrade financial services. It’s now only a matter of recognizing and fully embracing the many potential benefits of a digital money workspace.
Room For Custodianship
A definite way in which banks and other financial saving institutions can become involved in the world of crypto is by offering custody services to users.
This could mean banks holding the cryptocurrency itself in a safe and secure way, or even safeguarding keys and personal digital wallets on behalf of their clients.
Room For Expertise
Banks could also help less experienced investors to come on board the crypto market. This can be achieved in a variety of ways, including the development of crypto tools for customers and pointing them in the direction of trusted cryptocurrency coin reviews.
Many investors would prefer to hold their digital assets within the oversight of a trusted bank or institution instead of having to rely on random third-party vendors.
Lightening The Security Load
Even though cryptocurrencies can absolutely be managed in a risk-free manner, many token-holders remain fearful and even hesitant regarding issues of safety and security (largely due to a lack of education and information).
Banks can play a huge role in mitigating such security fears and concerns. Bringing crypto into the space of bank supervision can go a long way toward changing the way security issues are viewed and perceived.
Banks can potentially speed up their payment processes with the help of public blockchains.
This is because blockchain tech provides a cheaper and speedier alternative to traditional clearing houses.
Banks are forever competing to bring to their customers the next big thing in terms of financial services, and crypto should not be overlooked within this context.
Financial institutions often bemoan the fact that specific guidance around the regulation of digital assets is sparse. This is beginning to change, which will likely bring about a change in attitude towards cryptocurrencies and security.