Bitcoin in Brief Thursday: Main Street Adopts Bitcoin Ahead of Wall Street – Bitcoin News
In today’s edition of Bitcoin in Brief we feature stories that show how fast and nimble banks that support cryptocurrency-based businesses are benefiting at the expense of the larger players that have yet to enter the market, how more financial institutions want to join and how crypto ventures are making it easier for them.
Also Read: Indian Government Considering 18% Retroactive Tax on Crypto Trading, Mining
Small Banks Love Bitcoin
With major US banks too afraid to serve all American bitcoin users and businesses, smaller banks are picking up the slack and making a fortune doing so. New York-based Metropolitan Bank for example was able to build up deposits from crypto business without building costly new branches, and more than triple yearly fee income in 2017, largely from crypto transactions.
And San Diego-based Silvergate Bank nearly doubled its assets to $1.9 billion in 2017, mainly because of 250 cryptocurrency-related businesses the privately-held company now serves. Silvergate Chief Executive Alan Lane told to the Wall Street Journal that “At what point as a banker do you pull your head out of the sand? Every banker should be learning about the technology.”
Deutsche Börse “Deep at Work” With Bitcoin
Deutsche Börse AG, which operates the Frankfurt Stock Exchange, is actively examining its options for launching cryptocurrency derivatives. This was revealed in London on Wednesday by Jeffrey Tessler, CEO of the post-trade services provider owned by Deutsche Börse Clearstream and member of the group’s executive board, responsible for Clients, Products & Core Markets, at an event organized by the Association for Financial Markets in Europe.
“Before we move forward with anything like Bitcoin we want to make sure we understand the underlying transaction which isn’t the easiest thing to do,” explained Tessler. “We are deep at work with it,” however, “not at the same stage” [as the CME]. “We want to understand the volatility and make sure clients are in line and make sure regulators are in line.”
Huobi Pro Launches Crypto Market Index
Huobi Pro has announced on Wednesday the launch of a new benchmark called the Huobi Main Force Index. The company explains that it will select 10 top traded digital assets with high market capitalization and strong liquidity that reflect the market performance of Huobi Pro, in terms of USDT. The assets will be divided into four categories: Coins, Platforms, Applications and Physical Assets tokens, depending on the transaction volume value of the previous quarter. Huobi further states that the main force index will be published by Bloomberg and other communication organizations later on, and users may view the index by logging in on their devices.
“The goal here is to provide a complete and organized tool which will help enhance the overall knowledge of the blockchain industry. We are committed to bringing more insights and data so key stakeholders can make the most knowledgeable decisions when it comes to their investments,” said Leon Li, founder and CEO of Huobi Group.
US Megabanks Less Safe Than Crypto?
Americans now have a new reason to consider moving their money away from big banks to cryptocurrencies – the expected decision by banking regulators to water down the Volcker Rule, which restricts the ability of banks to engage in proprietary trading with depositor funds. This according to the latest analysis by Weiss Cryptocurrency Ratings. They explain that due to the rule changes, banks will now be able to gamble more freely in a scheme that gives them the quick profits but gives depositors the ultimate risks. In contrast, holders of cryptocurrencies are not exposed to those kinds of risks as they can control their money directly with no custody by third parties and no need to trust a central authority.
“With this rule change, the authorities will make it easier for megabanks to take big risks with other people’s money. But they are making the change precisely when global debt levels imply record risks,” the authors argue. “In the future, cryptocurrencies will do such a fundamentally better job as a safe depository of funds it’s difficult to envision a world in which this technology does not become a game-changer for money and banking.”
What do you think about today’s news updates? Share your thoughts in the comments section below.
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