When Will Banks Finally Be Crypto Friendly?

If you've ever wondered which banks are Bitcoin-friendly, you're not alone. Despite some US banks allowing users to buy Bitcoin through their bank accounts, most don't allow their customers to purchase or exchange any type of cryptocurrency. But now that the federal government has passed new legislation on digital currencies, that may soon change.

Because of the growing mainstream popularity of cryptocurrency, most major banks will have no choice but to expand their services; they have to set aside their fears and meet their customers' demands.

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Why Don't Most Banks Accept Bitcoin and Crypto?

Until very recently, there was no federal guidance on how banks should handle cryptocurrencies. All national banks are regulated by the Office of the Comptroller of Currency (OCC), which can impose severe financial and reputational consequences on banks that violate its regulations. Because the OCC has been relatively quiet on the topic of cryptocurrencies, many banks have avoided alternative currencies because of the uncertainty that surrounds regulation.

As of today, the list of Bitcoin-friendly banks is pretty short. Many major US banks – including Bank of America and CapitalOne – currently prohibit their clients from using credit cards, ACH, or wire transfers to buy cryptocurrencies.

The truth is, many banks don’t offer digital currency services because they believe that prices are too volatile and the market too insecure. But, as many experts know, Bitcoin's price fluctuations and fraud risks are largely overstated thanks to the inbuilt security of blockchain technology, which prevents money from being created from thin air and makes it very difficult for money laundering or theft..  

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How will banks and cryptocurrencies eventually integrate? 

The good news is, the seeds of this change are already growing. Banks in the US might soon have a different attitude towards Bitcoin and other cryptocurrencies. National banks may now offer custody services for cryptocurrencies. Banks can also store wallet codes for digital currencies in addition to buying, selling, and storing them in their traditional bank accounts. Banks have realized that cryptocurrency will play a significant role in future financial services as cryptocurrency ownership rates rise. Additionally, banks recognize that cryptocurrency is profitable and want to increase their profits.  

Banks may now feel more comfortable processing Bitcoin and crypto transactions after the court ruling establishing that they could do so. This opens up the possibility for Bitcoin and other alternative currencies to become more popular and widely accepted.

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Which Banks are Currently Bitcoin or CryptoFriendly?  

USAA

USAA was the first major US bank to invest in a cryptocurrency exchange and offers a wide range of financial services, including bank accounts, insurance policies, and investment options.

It's simple to check your Coinbase transactions from your USAA account whether you're logged in online or on USAA's mobile app. USAA members may also purchase Bitcoin with USAA debit cards, bank transfers, and bank wires. This bank is a great choice for cryptocurrency enthusiasts looking for more than a traditional bank that accepts Bitcoin payments.

SIMPLE BANK

A digital-only bank, Simple Bank provides FDIC insurance while remaining entirely digital.

Users can use any cryptocurrency exchange to buy and sell Bitcoin with Simple Bank using their bank account or debit card. The main appeal of Simple Bank is its seamless integration of financial accounting tools with online budgeting services. If users want to keep track of their financial expenditures and plan their budget, they should choose Simple.

ALLY BANK

Ally Bank is a virtual-only financial institution that provides 24/7 customer support to ensure users get the financial assistance they require.

Ally does not charge bank maintenance fees and provides a 1% annual percentage yield on all deposits. Ally customers can purchase cryptocurrency with an Ally Bank debit card, bank transfer, or bank wire. Users can connect their Coinbase account to their Ally Bank account to make these payments. Crypto investors should consider Ally if they want a bank that supports cryptocurrencies and provides a nice return on their investment.

CHIME BANK

Chime Bank doesn't allow you to use their debit card or bank wires to purchase Bitcoin—however, their customers can pay people directly with Bitcoin using a third-party app called Paxful if they know their recipient's email address, phone number, or username. People who want a less expensive bank that doesn't offer as many cryptocurrency features as the other banks on our list may like Chime.

WELLS FARGO

Banks like Wells Fargo are ready to profit from cryptocurrency by providing services to those who benefit most from it. In 2021, Wells Fargo expanded its cryptocurrency offerings only to its wealthier clients.

It appears that other banks might focus on larger cryptocurrency portfolios, which would benefit the firm's financial operations. Due to this, Wells Fargo has decided not to allow all clients to invest in cryptocurrency; they believe that they’re protecting themselves from risk and safeguarding their customers if Bitcoin crashes. Theoretically, wealthy customers can bounce back faster (and assist Wells Fargo in doing the same).

JPMORGAN CHASE

JPMorgan Chase is a worldwide investment bank leading the way for cryptocurrency in finance.

From corporations to individuals, JPMorgan provides all the major banking services, including checking and savings accounts, credit cards, mortgages, and more (including crypto through Coinbase).In 2021, JPMorgan created the JPM Coin, a cryptocurrency that facilitates international transactions. The firm also created a Bitcoin fund for wealthy clients as well as a Bitcoin fund accessible to their other clients.

Sprocket

Sprocket is a new hybrid banking-crypto platform that enables people to achieve economic freedom via traditional online banking services such as card and direct deposit as well as innovative crypto investing, trading, staking, and  a high-yield savings account. Sprocket pairs the best of old-school banking with new blockchain technology.