In recent years it has been observed how the way banks compete within the digitals platform has evolved as users increasingly demand more efficient and modern services, which has led to the creation of new banks and financial services, something that has also been driven by the acceptance of cryptocurrencies in the financial sector and the risen of blockchain technology. However, when using cryptocurrencies, many users wonder what type of bank is the most “friendly” to cryptocurrencies. This article will mention the central banks that work with cryptocurrencies and some points to consider a bank as “friendly” for cryptocurrencies.
Types of cryptocurrency “friendly” banks
It is essential to highlight that a bank is considered “friendly” for cryptocurrencies; when such an entity can provide services and operations related to cryptocurrencies efficiently, standing out for its security, ease, and transparency in its operations, besides complying with the different local regulations and laws. Following are some types of banks considered “friendly” for cryptocurrencies:
Cryptographic banks
These types of banks are specifically designed to operate with cryptocurrencies and offer services related to cryptocurrencies; these banks can provide digital wallet services, facilitate the exchange of cryptocurrencies and allow their users to manage their digital assets securely and efficiently. It is important to note that this kind of bank is only dedicated to the cryptocurrency industry, and its infrastructure is limited to that sector.
Online banks or Neo-banks with cryptocurrency integration
Online banks or neo-banks are financial institutions that operate mainly 100% online; most of these banks offer cryptocurrency on their platforms (cryptocurrency wallet, exchanger, etc.) and other complementary high-value-added services; a characteristic of neo-banks is that they rely on new technologies, besides having the advantage of not being limited by the policies or legacy systems of their traditional banking competitors.
It is important to note that some neo-banks have their banking license, while others have partnered with some traditional banks to provide financial services; these banks operate digitally with their banking licenses under the electronic banking system.
Traditional banks with cryptocurrency services
While the adoption of cryptocurrencies in traditional banks is currently very restricted, some banks have offered cryptocurrency-related services to their customers; these services may include opening accounts for cryptocurrency exchanges, cryptocurrency transactions, and even custody of some digital assets. However, the availability of these services remains limited and varies according to each country, region, or financial institution.
Factors to consider when assessing whether a bank is “friendly” to cryptocurrencies
Cryptocurrencies of choice
Although the cryptocurrency market is very diverse (there are over 7000 cryptocurrencies globally), it is essential that the bank only works with reputable cryptocurrencies, as this will allow its operations to be more secure and reliable; for example, if the bank uses Bitcoin (a cryptocurrency that has been in the industry for several years, has a good reputation, and is backed 100% by blockchain technology), then it will be more reliable, in comparison with a bank that operates with newly created cryptocurrencies, little known, or that are not backed by blockchain technology.
Customer service
Another point to consider is the customer service offered by such banks or neo-bank; for example, we can see the online reviews or opinions about this entity, besides evaluating the “quality level” and the “time” of response in their respective digital channels, another factor that can be considered is whether the entity provides support in our native language.
Regulation
It is essential to verify whether the bank has the required permits or is regulated by the competent financial authorities in your jurisdiction, as regulation provides an additional “layer of protection” and ensures some oversight and control.
Security
Another point to consider is the security measures implemented by the bank or neo-bank to protect the data and assets of its users; some examples of this are the implementation of two-step authentication, identity verification, and data encryption, among others.
What do you think about this topic? Would you like to learn more about “friendly” banks for cryptocurrencies?
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