What’s going on in banking 2021
J.P. Morgan has reportedly become the first major U.S. bank to give all its wealth clients access to crypto funds. Advisors in JPMorgan’s $630 billion wealth management division can now accept orders to buy and sell five crypto products including Grayscale’s Bitcoin Trust, Bitcoin Cash Trust, Ethereum Trust, Ethereum Classic products, and Osprey Funds’ Bitcoin Trust.
As Bitcoin and other cryptocurrencies are gaining traction among mainstream investors, this latest announcement represents a positive signal for this new asset class.
However, traditional banks are still wrestling with how best to cater to clients seeking exposure to cryptocurrencies. In fact, most of them do not offer direct cryptocurrencies trading option but only through financial products such as futures or funds.
According to the latest survey by Cornerstone Advisors with senior bank and credit union executives, almost 8 in 10 financial institutions have no interest in offering cryptocurrency investing services to their customers. Full survey here: https://lnkd.in/g7wq65S
Risk aversion and compliance most possibly are the two major factors that are holding banks back from offering cryptocurrency investing services. From the survey, it looks like traditional banks have a long list of reasons for avoiding cryptocurrency with only 2% of institutions very interested in providing crypto-related services.
On a separate December 2020 survey of 3,898 US consumers from Cornerstone Advisors, 60% of crypto owners would use their bank to invest in cryptocurrencies and another 32% said they might do so.
With such high loyalty from their existing customers, traditional banks have to realise that investing in cryptocurrencies is already becoming mainstream and their continued procrastinating of crypto adoption will eventually see them losing their customers to crypto exchanges and get left behind in this race.
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