Most American Banks Reluctant on Crypto Services as Demand Skyrockets

A survey by Cornerstone Consultants showed that 8 out of 10 American Banks aren’t interested in offering their customers crypto investment services—and only 2 percent said they were “highly” interested.

The wave of cryptocurrency excitement has characterized the past year with the price surges to all-time-highs across major cryptos. The most recent market move, the debut in IPO (valued at $85 billion) from Coinbase, has contributed to many skeptics and doubters to justify the bitcoin and cryptocurrencies. For banks, however, this is not convincing enough.

Banks and Cryptocurrencies

Currently, the two percent of banks interested in cryptocurrencies are a small group of major and minor players. Some of the smaller banks that made the news are Vast Bank, Quontic Bank, and First Boulevard.

Banks are putting up a resistance against offering cryptocurrencies to their customers because “cryptocurrencies are very risky and not worth it.” However, according to Patrick Sells, Head of Bank Solutions at NYDIG, the more significant risk is banks not providing cryptocurrencies. He supports this in his statement, emphasizing that providing crypto services reduces banks’ risk. 

Another way to look at it, according to one provider of crypto custody services, many American banks are concluding that they can’t compete with Coinbase’s robust retail customer/product experience and are focusing their efforts in the asset management and private client areas of their business.

However, they don’t realize that the company is extending its services into general banking services along with Square, PayPal, and other crypto exchanges. The move should be eye-opening into how much consumers are interested in banking services.

Rising Consumer Demand for Bitcoin

Bank executives like to believe that their companies are “customer-centered.” If that were accurate, banks would be rushing around and about launching crypto services. 

Except for consumers over 55, almost all populations in Bitcoin and cryptocurrencies have a high rising interest in investing.

Banks and credit unions seem to be ignoring market patterns and cryptocurrency attitudes. According to the Cornerstone Advisors survey in December 2020, 3,898 consumers in the United States owned Bitcoin (15% of US consumers) and some other form of cryptocurrency. Among consumers already holding cryptocurrencies, 60% said that if banks gave them the chance to invest in cryptocurrencies, they would — a further 32% said they might do so.

Only 4 percent of today’s crypto owners claim they won’t use their bank to invest in crypto, and they won’t move from the existing exchange. 68% of crypto owners have said that Bitcoin-based debit or credit card rewards are of interest.

With this, banks have to realize how much cryptocurrencies are growing and going mainstream. It’s a poor decision to refuse to play the game.

Contributed by The Daily Chain.