Jason Simon explains the importance of BBVA’s entrance into cryptocurrency custody

BBVA began, just a few months ago, to deploy evidence of what will be its first commercial service for the purchase and sale and custody of digital assets, including cryptocurrency. The new service, offered through BBVA Switzerland, is designed to allow customers to manage cryptocurrency transactions and make deposits with digital assets, such as Bitcoin, and it marks a substantial step forward for the integration of digital currency into traditional banking channels. Jason Simon, a FinTech and cryptocurrency expert, provides insight into why BBVA’s decision can alter the financial scene.

BBVA’s subsidiary in Switzerland began to launch a new service for the purchase, sale and custody of digital assets starting this past January. The global financial institution has been exploring blockchain technology in very different areas for more than five years, focusing on international payments, corporate financing and capital markets. The evolution of blockchain technology, together with an increasing demand for services linked to cryptocurrencies, led BBVA to determine that this is the right time to explore its first offering aimed at managing digital assets.

Today paying with digital currency is possible in many establishments, as well as through a number of eCommerce retailers. There are ATMs where fiat can be exchanged for virtual currencies and there are even debit cards that allow for their use in the same manner as cards issued by Visa or MasterCard. Asserts Simon, “The inclusion of digital currency in mainstream finance was inevitable from the time it was first introduced. Although there is still some resistance and regulations still need to be resolved, the entrance of BBVA into the digital currency space is an indication of what’s to come.”

In addition, BBVA’s initiative comes when, in different countries, important steps are being taken towards proposing new regulations on how these digital asset markets can operate. This new service will allow the banking giant to respond to the growing demand by high-knowledge investors who were already trading these digital currencies through other platforms, including FinTech solutions and online trading platforms. In addition, it represents a novel market offering that will allow BBVA’s clients to invest and merge traditional financial assets with digital assets in the same investment portfolio.

BBVA now offers its customers the ability to buy and sell cryptocurrency, as well as to use the bank as a custodial service for the assets. It affords all the guarantees of any other financial service, with a system to operate transparently and easily. Initially, BBVA will specifically manage Bitcoin (BTC) transactions and accounts, as it is the most accepted cryptocurrency, but has plans to expand the offer to other digital assets, such as Ethereum (ETH), Bitcoin Cash (BCH) and others that are deemed to be in accordance with established financial guidelines. In any case, BBVA will not offer investment advice on this type of asset.

Other banks and financial institutions have recently shown more interest in providing custodial solutions for cryptocurrencies, including several in the US. Adds Simon, “As of July of last year, the Office of the Comptroller of the Currency in the US has stated that nationally chartered banks can provide cryptocurrency custody services. This had a profound impression on the cryptocurrency ecosystem and its position on the international financial stage, and the results of that have been witnessed in recent activity.”

Some of the global financial giants that are now offering cryptocurrency custody solutions, besides BBVA, include Bank of New York Mellon, Deutsche Bank, Banca Generali and many more. “What we’re seeing is just the beginning of cryptocurrency adoption,” explains Simon. “There is still a lot more that lies ahead and, within the next few years, digital currency is going to find mainstream financial access that puts it on the same level as the US dollar or the euro.”

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