650 US banks will soon be able to offer Bitcoin purchases to their total of 24 million customers. This will be made possible through a collaboration between payments giant NCR and crypto-custodian NYDIG. Are we in for mass adoption?
Demand for cryptocurrencies has surged over the past year. Many banks want to meet customer demand, but also avoid capital migration to external exchanges. Rather than lose those assets to third-party cryptocurrency exchanges - or send awkward notices to their customers telling them they won't tolerate the purchases - they want to offer crypto services themselves, Forbes writes.
"Many banks have seen their depositors move money for cryptocurrencies to external exchanges like Coinbase. So they're excited to now have that option for themselves and their customers." - Yan Zhao, Stone Ridge Co-Founder and NYDIG President
To that end, a partnership was formed between two leaders in their respective sectors. National Cash Register (NCR) Corporation was able to establish itself in the payment solutions space over a hundred years ago, while NYDIG is a young crypto subsidiary of billionaire asset manager Stone Ridge Asset Management.
Partnership between NYDIG and NCR
The first phase of the partnership will allow NCR's banking customers to purchase Bitcoin and other cryptocurrencies through its mobile app. While the buyer will feel like they are interacting directly with their bank, in the background, the actual assets will be held on NYDIG's backend.
When a bank's customer wants to buy Bitcoin, the cryptocurrency is sourced from various regulated OTC desks and exchanges and sold at a slight premium. NYDIG receives a fee from the bank in return. The project was touted back in May when the crypto custodian partnered with FIS.
Payment giant's broad network
Founded in 1884 as the National Cash Register, NCR employs 34,000 people and operates in 160 countries, providing everything from digital banking services to ATMs and point-of-sale. With a 45% market share, they are the world's largest provider of point-of-sale software for grocery and retail stores. In total, NCR serves over 180,000 restaurants, various retail and hotel chains. If all goes according to plan, they will all eventually be open to Bitcoin payments - not just banks.
In fact, according to NCR Digital Banking President Douglas Brown, the payments giant firmly believes in the benefits of cryptocurrencies as well as its applications. The company is also exploring other applications of blockchain technology to enable complicated transactions with many counterparties.
