While most banks did not initially approve of cryptocurrencies, they are now among the frontrunners in the Bitcoin ecosystem. Many local and international banks have already adopted crypto, offering various Bitcoin investment options and financial services. That has convinced many investors, including individuals and companies, to start investing in crypto. You can easily begin bitcoin trading by visiting quantum-ai.trading and conducting extensive research or making investments in it.
Crypto-friendly banks use Bitcoin in several ways, bridging the gap between conventional financial systems and the digital economy. However, Bitcoin remains a new frontier that impacts the banking sector differently. Besides, streamlining the traditional banking operations to accommodate crypto transactions requires changes.
The basics of Bitcoin banking
Bitcoin banking mainly refers to managing digital currencies or virtual assets through a bank. Crypto banks operate similarly to traditional banks, with many of them being extensions of the conventional banking systems. While the crypto revolution has inspired the proliferation of several new banks that deal strictly in crypto, many old banks have integrated crypto services alongside their ordinary operations.
JPMorgan, Goldman Sachs, Ally Bank, and Wirex are excellent examples of the most popular banks today that support crypto and offer the management of digital currencies. While Bitcoin banking services vary from bank to bank, the following are the introductory provisions of every ideal Bitcoin-friendly bank.
Crypto trading and investments
The first step to Bitcoin banking is to own the tokens. That is why Bitcoin-friendly banks offer crypto exchange services, allowing you to buy Bitcoin directly with cash using a debit card or credit card. the banks also allow their customers to sell Bitcoin for cash or other cryptocurrencies.
Apart from buying Bitcoin directly, crypto-friendly banks also offer other options for investing in crypto, including Exchange Traded Funds (ETFs) and futures. Those options allow you to gain exposure to Bitcoin without holding the coins. Instead, they track the underlying assets’ performance, allowing investors to profit whenever prices surge.
Crypto interest accounts and checking accounts
Bitcoin-friendly banks also offer crypto interest accounts, a digital version of an ordinary savings account. However, account holders earn interest on their crypto holdings with the bank. The interest rates vary from bank to bank but are usually higher than traditional savings accounts. Most banks offer a 10% interest on Bitcoin savings.
Some banks also offer crypto checking accounts to give customers more control and autonomy over their funds. The checking accounts usually have no monthly fees. Many crypto-friendly banks offer Bitcoin debit cards for point-of-sale purchases in-store and online. Using the cards can also enable you to earn interest.
Crypto custodial services
Like crypto exchanges, Bitcoin banking allows you to store your digital assets with a bank. Several banks that support crypto also provide convenient custodial and non-custodial crypto wallets. Banks retain control of your private keys and coins in custodial wallets. However, non-custodial wallets give you total control over your private keys and funds.
Bitcoin payment processing
Bitcoin allows you to send and receive Bitcoin directly through your wallet. However, you may not always be able to process payments independently, for example, due to the lack of internet connection or other hindrances. Thus, Bitcoin banking also enables you to designate the service provider to process payments on your behalf. The transactions may involve sending or receiving Bitcoin and cashing out from Bitcoin to fiat. Besides, you may also hire a bank to manage your Bitcoin investments. However, always remember that the services attract transaction fees, mainly based on transaction volumes and frequency.
Bitcoin banking enables you to invest in crypto and manage digital assets conveniently and securely. Nevertheless, do a little research to choose the best Bitcoin-friendly bank.