Forty-four percent of surveyed bank executives plan to offer encryption services in 2022


A recent survey by Us Bankers found that 44% of participating financial institution executives plan to offer cryptocurrency services to retail customers by the end of this year.· This will double the number of lenders offering blockchain-based services in 2021.Despite the brutal experience cryptocurrencies have had over the past few weeks — more than $1 trillion in value has been wiped from portfolios — an unexpected segment of the market seems optimistic about the future of blockchain-based funds.The US Banker released its latest batch of projections for 2022, and its survey of 175 bank executives from regional and global financial institutions yielded some surprising results.Before we look at the details of the research, it’s worth noting that The American Banker is highly regarded as a reliable source of content related to banking regulation, technology and innovation.According to the survey results, blockchain and cryptocurrencies are a major focus for the investment community and will receive a lot of media attention in 2021.This is true when you consider the hundreds of millions of dollars pouring into irreplaceable tokens (NFT).Given the huge inflows, banks can’t afford to ignore cryptocurrencies, or customers’ requests for crypto services.Here are the survey’s key findings: 44% of bank executives expect to offer some form of encryption support to customers by the end of the year.That’s more than double the number of people who will provide those services in 2021.Sixty percent of wealth management advisers surveyed expect their clients to increase their cryptocurrency holdings or start investing in these digital assets in 2022.A third of wealth managers want to actively manage their clients’ crypto portfolios, up from 13 per cent who currently offer the service.Interestingly, the study found that banking executives believe how consumers transfer money and the various payment methods available to them will also be a focus this year.Anyone knows that banks compete aggressively to retain customers and gain more “wallet share” by offering different types of services.These include car bill payments, direct deposits, low-cost funds transfers and bank-branded debit or credit cards.Crypto projects not only automate all these services, but are now cheaper than banks, and blockchain-based funds transfers can be settled in seconds instead of days.In addition, several credit cards offer crypto rewards in the form of a percentage of the card balance in the user’s preferred cryptocurrency.Banks that adopt only some of these products will clearly differentiate themselves from rivals – the findings suggest banks are seeking a competitive advantage.Specifically with regard to bank-branded cards, only 40% of banks expect to increase their investment in traditional cards with loyalty and rewards features over the next three years.The researchers believe this may reflect other competitive threats to credit cards, such as digital payment methods such as PayPal and Venmo.Interestingly, 25% of loan executives surveyed see the Fed as a competitive threat to their consumer banking business.The report specifically named “FedNow,” the Fed’s real-time payments service, as an alternative to traditional bank wire or automated clearing house (ACH) transfers and as a possible central bank digital currency created by the Fed.The Fed is the main lender to banks and regulates commercial finance — it is unusual to describe it as a direct competitor to banks.While no one can predict the future of any financial activity, the fact that global banks and lenders are seriously considering expanding their cryptocurrency and blockchain options this year cannot be ignored.The adoption of digital currencies by large financial interests will create a bright future for cryptocurrencies.

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