Since one of the major operative outcomes of digital currency use is the removal of the ‘middle man’, it’s of little surprise that banking institutions, for the most part, have been sour on the idea of adopting cryptocurrencies and supporting their use by customers. At least one bank, however, has decided to plunge head first into the business of trading on virtual coin and that bank is the German-based WertpapierhandelsBank AG (VPE).
Yesterday WertpapierhandelsBank AG announced that they have partnered with solarisBank in order to create a digital wallet and virtual exchange. The bank has not yet released details on just which digital currencies will be carryable within their wallet, but their press releases have focused on the popularity of Bitcoin, Ethereum, and Litecoin. This is an incredibly important step and will be very beneficial to banking customers. Cryptocurrency users in other countries have had much less success using their bank accounts to trade in digital currencies. For example, just two weeks ago we reported that Canadian banks have begun banning the purchase of cryptocurrencies. The adoption of this type of service by the banking industry will only allow them to be involved, and profit from, a currency trend that appears to be more inevitable than not.
That being said, the lack of enthusiasm in the banking industry on the topic of digital currencies goes well beyond the major banks of Canada. Some of the best evidence of this comes from the mouths of attendees of the most recent World Economic Forum in Davos. A former French Finance Minister was quoted as saying,
“The anonymity and lack of transparency and the way in which it conceals and protects money laundering and financing of terrorism is just unacceptable. It needs to be taken into account but then there will be innovations coming out of these movements.”
This kind of talk is not unique within the mainstream banking industry and it is, without a doubt, absolutely unfounded. Research, like that conducted by Rémi Quirion, Chief Scientist of Quebec, clearly shows that assertions regarding the degree to which digital currencies are used for nefarious transactions are wildly overstated. There seems to be a belief that just because transactions are anonymous, they must only be used for illegal activities. In truth, the majority of cryptocurrency transactions are legitimate commercial or investment agreements.
Fortunately, the WertpapierhandelsBank AG is not the only mainstream banking entity that is entering this side of the business. It appears that Swiss banks may soon begin facilitating cryptocurrency transactions and it has been reported that Barclays is seriously researching the idea of adding cryptocurrency trading functionality to their trading platform.