Crypto custody firm NYDIG has stated that US bank customers will be able to buy, sell and hold bitcoin through existing accounts later this year, as revealed by CNBC.
NYDIG has partnered with Fidelity National Information Services, the fintech giant, to help US banks offer bitcoin in the near future, the two firms announced.
Patrick Sells, NYDIG’s head of bank solutions, said that hundreds of banks have already enrolled in the program.
Most of the banks to have enrolled for far are smaller banks, although NYDIG is also in discussions with some of the biggest US banks. Sells commented:
“What we’re doing is making it simple for everyday Americans and corporations to be able to buy bitcoin through their existing bank relationships […] If I’m using my mobile application to do all of my banking, now I have the ability to buy, sell and hold bitcoin.”
Bitcoin users, traders and investors currently rely on crypto exchanges like Binance, broker apps like Robinhood, or payment providers like PayPal and Square.
Banks have avoided entering the crypto retail market, having only recently announced plans to allow certain wealth management clients to wager on bitcoin.
However, Yan Zhao, president of NYDIG, has said that banks have seen the amount of money going into Binance, Coinbase and other cryptocurrency exchanges, and now want a piece of the pie.
“This is not just the banks thinking that their clients want bitcoin, they’re saying `We need to do this, because we see the data,’” Zhao said. “They’re seeing deposits going to the Coinbases and Galaxies and Krakens of the world.”
It’s possible that as more and more smaller banks offer bitcoin and other cryptocurrencies, JPMorgan Chase, Bank of America and other giants could be pressured into doing the same. This prediction was made by Fidelity National Informations head of digital banking, Rob Lee.
Morgan Stanley was the first bank to offer its clients bitcoin funds in March, quickly followed by Goldman Sachs. According to reports, JPMorgan is in discussion with NYDIG over its own product.
However, thus far these services have only been offered to extremely wealthy individuals and family offices. Now, according to Zhao, customers at enrolled banks will be able to invest in Bitcoin from just $1:
“Most people can’t invest in things that institutional investors get to invest in,” Zhao said. “With bitcoin available through your bank to be purchased with as little as $1, now you have an attractive asset that’s available to be owned by anyone in any amount. We think that’s huge for economic empowerment.”
Under the partnership, NYDIG will oversee bitcoin custody and trade execution, while Fidelity National Information will take care of the link to lenders. Fidelity is a vendor to banks with close to 300 million checking accounts.
Sells said that the banks will decide how much they charge their customers for bitcoin trading. They will also retain most of that fee revenue.
NYDIG is also planning other services for the future, including debit card rewards paid in Bitcoin, and a bank account that pays interest in Bitcoin.