NYDIG is an American based intitutional financial services company planning to bring crypto services to hundreds of American banks by the end of 2021.
Banks are asking for bitcoin because they can see their customers sending dollars to Coinbase and other crypto exchanges.
Yan Zhao, president of NYDIG
The annoucement on 5th May, details a partnership with technology company Fidelity National Information Services (FIS) to bring Bitcoin custody and trading services to banks via the FIS Digital One Mobile user-friendly interface.
Founded in 2017, the company is a subsidiary of asset management firm Stone Ridge (currently valued at $10 billion). NYDIG has declared that the demand for crypto in bank accounts is growing – and that they’re prepared to answer it.
“As demand for bitcoin as a store of value continues to grow, FIS is focused on enabling our core banking clients to respond to growing market demand and better serve their customers,” said Rob Lee, head of Global Core Banking and Channels, FIS. “Unlocking these capabilities for financial institutions of all sizes levels the playing field for banking with bitcoin and can drive further innovation.”
Rob Lee, head of Global Core Banking and Channels
The Road Ahead for USA Crypto Banking
Smaller banks, such as California-based community bank Suncrest, have already agreed to try out the NYDIG platform.
According to Patrick Sells – the head of banking solutions at NYDIG – the service would help cut down on the number of apps and accounts needed to purchase crypto.
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.
Patrick Sells, head of banking solutions at NYDIG
Yan Zhao – the president of NYDIG – also added that although banks seeing their customers’ accounts emptied in favour of crypto exchanges may have been the catalyst behind the rising demand for crypto banking services, NYDIG also sees this as a way to help any interested parties invest in Bitcoin, no matter how low the sum.
Most people can’t invest in things that institutional investors get to invest in. 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.
Yan Zhao, the president of NYDIG
In practice, it looks like the banks involved in the project won’t handle the cryptocurrency themselves, just adding the option to their bundle of available services. Instead, FIS will use its vendor services to handle the link to lenders, with NYDIG managing the crypto side of things (custody and trade execution).
Banking Going Pro Crypto?
It seems not long ago Banks like Goldman Sachs and JPMorgan were dismissing crypto, even calling it a fraud – and now they have both recently started taking blockchain and crypto more seriously.
Below is a table of the recent cryptocurrency purchases by Institutions.
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