It’s fair to say that many high net worth individuals (HNWI) and corporations have at least looked at the possibility of investing in cryptocurrency over the past year or two. There’s also a pretty good chance that those who have looked have realized just how complicated the process is, especially when trying to move crypto to fiat and vice versa.
A fragmented financial system is a problem consistently reported by those involved in the financial industry. The problem is, the financial industry has not evolved, due in part to banks’ overreliance on legacy IT infrastructures.
As it stands, this overreliance within the banking sector prohibits their clients’ ability to manage their finances within a single banking relationship. When you add crypto and digital asset services into the equation, the system becomes even more complex, with more financial relationships required. However, it’s not only traditional finance that has issues.
Most crypto exchanges face well-publicized issues with regulation and licensing, which is possibly a factor preventing some prominent financial institutions getting involved and bringing the mainstream acceptance that the industry needs to move to the next level. Many have complained about the complexity, expense and security issues they face when they look at investing in the crypto space.
Some traditional banking functions are being met in the crypto ecosystem. For example, itBit and Coinbase offer custody services, while Wirex provides debit cards so that clients can spend their crypto. However, again, these are separate entities that require separate financial relationships further compounding the problem of fragmentation.
In light of these issues in traditional banking and crypto industries, new banks are forming to mend the fractured ecosystem by using blockchain technologies. For example, EQIBank is taking advantage of a gap in the market by integrating all national currency, crypto, and digital asset services in a fully licensed and regulated banking ecosystem, meaning that the myriad financial relationships HNWIs and corporations must have to meet their banking needs can be reduced to just one.
Jason Blick, CEO of EQIBank, commented –
“There is a lot of market speculation about the delivery of a new generation of bank – one that can bridge the worlds of crypto and national currencies. However, EQIBank is the only licensed, regulated bank that is operational and ready to receive applications for accounts.”
“Securing a banking license is a rare occurrence; regulators receive hundreds of applications every year, but between 2010 and 2015 only three new banks opened in the US. This is why we are so proud to have been granted a full banking license and look forward to bringing progressive banking services across the globe.”
The financial sector has always been seen as being ripe for disruption, especially in light of the last financial crisis, and whether you’re looking at separate entities supplying crypto ‘banking’ services or banks moving into the crypto space, the disruption looks like it has begun.
Chronic crypto nut and freelance writer/editor for longer than I care to remember. Have finally found a home here at Crypto Disrupt.