What are Crypto Friendly Banks?
2 months ago

In the ever-evolving world of finance, the integration of cryptocurrencies into traditional banking systems has become increasingly prevalent. Crypto-friendly banks bridge the gap between conventional financial services and the dynamic realm of digital assets. This article explains what is meant by the term crypto-friendly banks and attempts to offer insights that inform your financial decisions.

What are Crypto Friendly Banks?

The term ‘crypto-friendly bank’ means different things to different people. We define it as any bank that supports any type of activity in any way related to cryptocurrencies (i.e. the actual tokens). We do not include banks that are open to using distributed ledger technology but refuse to touch any public tokens. Now, our decision allows for several types of ‘friendliness’. For example, some banks might allow fiat payments to/from crypto exchanges (many won’t), and some banks might custody crypto (very few do), some banks might let you fund an account and/or make payments via stablecoins (very few), and some banks might let you borrow against your crypto (maybe just one bank does this). Further, the breadth of support varies by country, with the US and the UK recently becoming challenging places for banks to be supportive of clients involved in crypto. (For the US, try reading up on “Operation Choke Point 2.0,”)_.

Banks Doing Anything Crypto-Related in 2024:

  • Customers Bank is a traditional US bank that banks select crypto companies, having picked up a lot of business when other US banks either dropped the sector or closed entirely (see below) because of Operations Chokepoint 2.0 (see above)
  • Equibank is an offshore bank based in the country of Domenica that provides banking to corporations and high net worth individuals, including those active in crypto.
  • Deltec bank is an offshore bank that counts Bitfinex and Tether as clients, if not also shareholders. They specialize in large business accounts and are less accessible to small businesses and consumers.
  • Jewel is a Bermuda bank that is just forming and targeting large international crypto institutions for custody and asset management. Despite 4+ years in the making, they are not yet open for business.
  • Medici Bank is based in the US and, due to regulatory pressures, no longer banks crypto companies but, notably, they received regulator permission to offer loans against crypto collateral and, most recently, to offer crypto custody services. Working with Gemini Trust and others, they can have USDC and USDT converted into USD fiat to earn interest (and to lend against BTC and ETH).
  • Western Digital is a traditional US bank that banks some crypto corporations, having picked up a lot of business from other US banks that either dropped the sector or closed entirely (see below)
  • SEBA is a Swiss bank that support both traditional and crypto clients, primarily from Switzerland and the EU.

In Memoriam: Silvergate Bank and Signature Bank were two relatively large banks in the US that closed due to the regulatory environment in the US; they are no longer active. Farmington State Bank was a small US bank that was forced to stop any crypto related business when it was discovered they had taken an investment from FTX, the fraudulent operations run by mastermind scammer Sam Bankman Fried.

As the demand for crypto-friendly banking services continues to soar, it’s essential to choose the right institution that aligns with your financial goals and values.