Bitcoin is continuing to find its way into many sectors including tourism, online shopping, hotels and restaurants, supply chain, online casinos, and charity. There is also a growing dire need for Bitcoin in banks.
Since Bitcoin has proved itself to be a bit stable and profitable, the cryptocurrency is being used in a variety of ways. With massive gains it has registered ever since the Covid-19 pandemic started especially on March 13, 2021, it only makes sense venture capitalists want to invest in BTC and businessmen want to receive Bitcoin payments for products and services.
The banking industry is feeling pressure from the massive number of investors that have adopted Bitcoin, and the industry is being forced to think of incorporating cryptocurrency in their banking systems if it still wants to outcompete other fintech competitors that are emerging with new disruptive technologies such as blockchain, artificial intelligence, smart contracts and internet of things. Most banks including Signature Bank, Citi, US Bancorp, Fifth Third Bank, Wells Fargo, etc., are using blockchain, the underpinning technology behind cryptocurrency.
As pressure is mounting on Wall Street banking institutions to accept BTC as a legal asset class, Asset management corporation Morgan Stanley seems ready to provide its wealthy customers access to Bitcoin. The US bank is set to roll out access to three funds to enable the possession and ownership of Bitcoin.
Recently, the very own employees of the globe's largest investment bank by revenue JPMorgan Chase, tasked the bank to allow them to get involved in BTC, and the bank officials including co-president Daniel Pinto responded to be open-minded about BTC. The critical mass of customers, investors and asset managers associated with JPMorgan wants the bank to trade BTC.
Goldman Sachs is also open to cryptocurrency. In a meeting with one of the founders of cryptocurrency companies, Sachs found out that its high time banks started contenting with Bitcoin since its adoption is gaining much momentum among institutional investors and financial technology competitors. Failure to do that the banking sector poses a high risk of being left behind or abandoned.
The reason is simple. The banks are attracted to Bitcoin's automatic refresh system that helps to solve the problem of double transactions. The Bitcoin network also has the private and public key verification feature which can be used by banks to combat identity theft and also be deployed to take the edge off the computational requirements for banking institutions.
Secondly, Bitcoin enables businesses and clients to conduct payments or transactions directly from peer-to-peer (P2P) minus the need for a merchant or a teller or any other third-party intermediary. Besides, the BTC transaction fees are very cheap (about $0.0002), so banking institutions can benefit from using Bitcoin to complete domestic and transborder payments that would cost them much.
For instance, international wire transfers cost about 1% to10% of the total amount of money to be sent. Banks also pay taxes and make cross-border payments not just for their clients but for their own businesses. If they start using Bitcoin, they will benefit from the cheap fees the cryptocurrency offers.