650 U.S. community banks and credit unions serving some 24 million users will be able to offer the ability to buy, sell and hold bitcoin.
Enterprise payments firm NCR has partnered with institutional bitcoin solutions provider NYDIG to allow 650 U.S. banks and credit unions to potentially offer bitcoin purchasing services to an estimated 24 million total end users, reported Forbes.
“We’re firm believers in the benefits of crypto and the strategic application,” the NCR president of digital banking, Douglas Brown, told Forbes. “And that’s true for our banking relationships, as evidenced by NYDIG, and across retailers as well as restaurants and the like.”
The partnership was born from banks’ desires to capture fees incumbent on bitcoin trading, as they currently watch from the sidelines as clients send money from their checking and savings accounts to bitcoin exchanges.
“A lot of these banks have seen that one of the biggest outflows from their depositors is moving money from the bank to exchanges like Coinbase,” NYDIG President Yan Zhao told Forbes. “And so that’s part of why banks are so excited to have this capability for themselves and for their consumers.”
NCR’s position as a leading provider of payment and point-of-sale solutions will be joined by NYDIG’s enterprise-grade BTC trading and custody solutions. And this partnership will reportedly have two phases.
In phase one, NYDIG’s bitcoin-focused services will allow NCR’s banking client users to buy, sell and trade BTC from their regular mobile banking apps. The idea is to provide clients with an abstracted interface that feels like purchasing bitcoin from one’s own bank. But NYDIG will be making the bridge on the backend with over-the-counter desks and exchanges to execute the trade and custody the bitcoin on cold storage wallets.
However, it is unclear whether clients would be allowed to withdraw their BTC into their own wallets. If not, although NYDIG would supposedly assure security of the assets under its custody, clients would have their hands tied with the introduction of a third-party vulnerability. Additionally, they would be unable to enjoy Bitcoin’s true value proposition — that of self-sovereign, unstoppable, decentralized money.
Phase two of the partnership could bring NCR deeper into the Bitcoin ecosystem. Besides possibly venturing into BTC custody itself, NCR is reportedly working with 200,000 restaurants and other retail clients to help them accept bitcoin. In addition, the company also plans to bring bitcoin purchasing services to its 800,000 ATMs in the future.
NCR, founded in 1884 as the National Cash Register, works with the financial sector by providing digital banking services, multi-vendor ATM software and point-of-sale software to retail stores globally.
NYDIG, on the other hand, provides bitcoin investment and technology solutions to banks, corporations, institutions and high-net-worth individuals. Earlier this week, the bitcoin-focused firm announced a similar partnership to offer over 18.3 million banking end-users the ability to buy, sell and hold BTC. And in May, NYDIG announced a collaboration with FIS to bring bitcoin services to hundreds of U.S. banks in the coming months.
