Member Exclusive, Payments

What does the involvement of legacy financial institutions mean for crypto?

  • Established financial players are starting to accept cryptocurrencies as a legitimate asset class.
  • Does such institutional involvement contradict the basic thesis of crypto?
close

Email a Friend

What does the involvement of legacy financial institutions mean for crypto?

Welcome back to Payments, our bi-weekly newsletter about all things payments — from blockchain to BNPL to B2B. It’s inspired by our payments coverage as well as the top stories from around the payments space. Subscribe here.

As crypto continues to boom, legacy financial institutions are taking note, with American brick-and-mortar banks increasingly looking to offer crypto custodial accounts. U.S. Bank, the fifth-largest retail bank in the country, is the latest to offer crypto custody services to fund managers. Other major banks including BNY Mellon, State Street and Northern Trust have similarly announced plans to custody digital assets.

The trend indicates that established players are starting to accept cryptocurrencies as a legitimate asset class. While this may be seen as an encouraging step towards widespread crypto adoption, it begs the question of whether such institutional involvement contradicts the basic thesis of cryptocurrencies – with banks acting as custodians, is crypto’s decentralization under threat?

Our top stories

First-ever bitcoin ETF BITO launches
For the first time, investors can invest in bitcoin via an ETF, without having to buy the cryptocurrency on a crypto exchange. The ETF is intended to give exposure to investors who don’t want to go through the hassle of buying bitcoin directly.

With traditional banks acting as custodians, is crypto’s decentralized nature under threat?
Over $200 billion worth of bitcoins have been lost so far. Do people need a better way to secure their digital assets? “Not your keys, not your coins,” say crypto traditionalists, arguing the space is meant to be free of banks, with a fundamental ‘one’s own bank’ philosophy.


This content is available exclusively to Tearsheet Outlier members.

Tearsheet Outlier information and signup Missing out? Subscribe today and you’ll receive unlimited access to all Tearsheet content, original research, exclusive webinars and events, member-only newsletters from Tearsheet editors and reporters and much more. Join Outlier now — only $49/mo. Already an Outlier member? Sign in to your account

0 comments on “What does the involvement of legacy financial institutions mean for crypto?”

Member Exclusive, Payments

Payments Briefing: BNPL will soon play a much bigger role in credit scores

  • Credit bureaus in the US are working to implement standardized credit reporting plans on BNPL loans.
  • BNPL use may start to play a much bigger role in consumers’ credit ratings.
Ismail Umar | January 27, 2022
Member Exclusive, Payments

Payments Briefing: B2B payments are slowly catching up with B2C

  • This week, we look at how B2B transactions are going digital.
  • Bar Geron, co-founder and CEO of payments firm Balance, says that B2B ecommerce is following the same trends as B2C – just some years later.
Ismail Umar | January 20, 2022
Payments

With $1 billion funding round, Checkout.com gears up for Web3

  • London-based Checkout.com raised $1 billion dollars in its Series D round of funding, which saw the firm valued at $40 billion.
  • The firm has three major projects following the funding: a push for Web3, expansion into the US market, and additions of new solutions to its platform.
Subboh Jaffery | January 19, 2022
Member Exclusive, Payments

Payments Briefing: Behind Papaya’s bill payment technology

  • This week, we take a look at how Papaya uses AI to simplify bill payments for consumers and merchants.
  • We also explore PayPal’s entry into the stablecoin race, and how payments are increasingly becoming “invisible”.
Ismail Umar | January 13, 2022
Payments

Marcus by Goldman Sachs adds GM as second co-branded credit card

  • GM is going all digital by partnering with Marcus by Goldman Sachs and Mastercard to launch its new rewards card and loyalty program.
  • This represents Marcus' second big retail partnership after issuing the Apple Card in 2019.
Iulia Ciutina | January 13, 2022
More Articles