If you wish to start trading cryptocurrencies via an online banking platform, it’s as easy as opening an account with a regular online bank. You just have to find the bank that has already incorporated blockchain technology. Also, you will have to complete an online form and send supporting documents to activate the account and credit card. It is essential to open a cryptocurrency account when it comes to American banks in the name of a company or an LLC (LLC). Once the cryptocurrency account is opened, the user will be able to buy or sell encrypted currencies.
What Is Crypto Banking and How Does It Work?
Crypto banks are using blockchain as a means to improve their traditional banking services. Blockchain-based banking platforms can issue its entire balance sheet in cryptocurrencies. Any asset and the financial instrument can be “tokenized” and released in the form of tokens on a blockchain.
Banking assets have been replaced with smart contracts that are executed automatically following predefined conditions since an asset is a contract. It allows the bank to be more efficient, transparent, and less expensive.
A crypto-banking is a banking establishment offering both conventional financial products in fiat currency (euro, dollar, etc.) and cryptocurrencies. For example, the clients of a crypto-bank can both pay in dollars and bitcoins via their account.
As the name says, it’s a virtual bank offering different types of financial products, such as OTC crypto exchange to the fiat money.
The crypto banks are aimed not only at professionals but also at individuals. The same goes for institutional investors wishing to enter the cryptocurrency market.
Investing in Cryptocurrencies Through Online Banking
The trading of cryptocurrencies is done on a decentralized banking platform. You will need to use digital wallets to secure and store your cryptocurrencies. The main difference between the traditional money and cryptocurrency is that crypto is a global currency, decentralized since used only in digital form. With a little bit of research, you will easily find a virtual bank that accepts cryptocurrencies.
Crypto is out of the control of governments, meaning it’s immune to the traditional ways of control. Both are mediums of exchange that can be used to transfer value and can be used to buy or sell products and services.
Major Companies That Accept Cryptocurrencies
- Microsoft – one of the first companies that are accepting cryptocurrencies from 2014.
- Lolli – you can get free bitcoin by purchasing at the store you choose, such as Walmart, Gap, Best Buy, Old Navy, Hilton, and many others.
- Overstock – not limited only to bitcoin but accepts various kinds of cryptocurrency.
- Namecheap is an internet company that offers easy domain registration services.
- Newegg – the company is well known for selling all types of computer hardware and purchasing mining software for cryptocurrencies.
OTC Crypto to Fiat Exchange
If you are thinking of opening a crypto banking account, you are undoubtedly thinking of a crypto trading exchange. In that case, go for the bank that offers OTC transactions. An OTC market offers excellent flexibility. Unlike a regulated market, contracts are not standardized. From the moment you find a counterparty for your transaction, you are therefore free to establish the conditions that you wish. An OTC market also allows for reduced transaction costs without an intermediary between the buyer and the seller.
Another big advantage of an OTC market is the anonymity of transactions. There is no order book and centralization of orders. For an individual, this advantage may seem minor, but it can allow an institution to remain discreet on trading or investment strategy.
Money sent internationally is counted in billions on an annual level. The process is traditionally expensive, slow, and full of bureaucracy. That’s why sending money abroad is an area that is about to change, and we already encounter banks using blockchain technology for remittances. Cryptocurrency, especially bitcoin, provides an alternative way to receive and send money internationally. Thus, mainstream banks are reluctant to the idea of using cryptocurrency due to the lack of regulations.
Nowadays, we are witnessing the massive digitalization of banking services. If you want to improve your business operations and take your trading to the next level, it’s time to consider adopting this innovative financial solution taking into account many advantages of crypto banking such as efficiency, transparency, and enhanced security.
- Difference between Cryptocurrency and Initial Coin Offering
- Centralized vs Decentralized Blockchain: How DasCoin Works
- 10 Security Tips to Make Safe Trading on Cryptocurrency Exchanges
- 5 Ways To Eliminate Investment Mistakes When Trading Cryptocurrencies
- How Ethereum Works