Banks and giant investment firms are no longer oblivious to the growth of digital currencies. In fact, several banks have decided to hop aboard the crypto train. Interestingly, major players like Goldman Sachs, Citi, and JP Morgan are open to crypto custody in the foreseeable future.
What Services Can You Expect?
The new dynamic change may be sooner than most people realize. It is only a matter of time before Goldman Sachs and JP Morgan move past the initial request for information and embraces the digital asset. However, the path to streamline digital currency will be tumultuous and require careful consideration.
The next course of action for Goldman Sachs and Morgan Stanley would be to create a broad strategy to roll out digital currency through stablecoins. Although there have been several mishaps from the OCC, financial analytics expect major changes in the crypto realm.
The entrance of JP Morgan and Goldman Sachs into the crypto market also opens new windows of opportunities for digital currency. With JP Morgan-backed stablecoins, customers will likely show more interest in the digital asset.
The new regulatory approval serves as an invite to prominent and risk-averse financial banks to be part of the crypto world. It may not happen overnight, but the new changes are already in motion and have the power to change the course of the future for cryptocurrencies.
Goldman Sachs is interested to offer brokerage services in relation to crypto. But one insider claims that Goldman Sachs is looking at cryptocurrency rather than prime brokerage. It is vital to note that Coinbase and BitGoalso have crypto-based prime brokerage plans, and it may not be ideal for Goldman Sachs to offer the same services. On the other hand, JP Morgan wants investors to think of its coins as tokenization of valuable customer deposits.
How Stablecoins Differ from Price-elastic Coins
According to the U.S. Federal Regulator and OCC, banks now have the freedom to conduct payments through stablecoins. In fact, these cryptocurrencies make sense because they can minimize the price volatility and make the digital asset stable.
Besides, stablecoins can integrate into a cryptocurrency, exchange-traded commodity, or fiat money. However, banks that decide to be part of INVN should be aware of the fraud risks, compliance standards, and operational complexities beforehand.
Final Thoughts
As PayPal affirms the roll out of crypto payments in 2021, the skepticism around digital currency is starting to fade. However, there is a good chance that cryptocurrency payments will get saturated in a competitive financial world.
Despite competitive drive and legal hurdles, JP Morgan has managed to make it clear that crypto payments will not change how they operate in the financial markets. As more major banks and investment firms enter the picture, the next decade will determine the tide of cryptocurrency. In hindsight, more risk-averse investors will be encouraged to invest in the crypto market.
REFERENCES:
- https://nairametrics.com/2020/09/23/ousd-stablecoin-that-pays-you-interests-like-a-bank-does/
- https://cointelegraph.com/news/jpmorgan-chase-execs-weigh-in-on-stablecoin-regulation-crypto-competition
- https://www.coindesk.com/goldman-sachs-to-enter-crypto-market-soon-with-custody-play-source
- https://www.bloomberg.com/news/articles/2021-01-16/goldman-sachs-explores-entering-crypto-market-coindesk-reports
- https://finance.yahoo.com/news/goldman-sachs-enter-crypto-market-214659079.html
- https://news.bitcoin.com/demand-crypto-soars-bitcoin-funds-records-goldman-sachs/