Cryptocurrency has been synonymous with change since joining the financial market in 2009 with the launch of Bitcoin. At the moment, there are more than 1,600 crypto assets and the entire crypto market is worth more than $294B. During the sector’s initial growth, financial institutions scoffed at digital currencies. Though, as of recent, it’s hard for those institutions to ignore them.

Now, crypto exchanges are dealing with huge amounts of money, with most of them making millions of dollars in profits. The growth in the cryptocurrency sector is creating friction with banks since the sector could prove a bank replacement. This friction is seeing many banks close accounts with cryptocurrency trading associations. However, things seem to be changing fast. Exchanges are now attempting to become banks, or even buy huge shares from banks and other financial institutions.

Coinbase & Binance Making Moves

A good example is Coinbase. It is the largest crypto exchange in the United States with over 20 million clients. There is rumor that Coinbase could be exploring a federal banking charter and other banking licenses while still meeting with banking regulators. In fact, Coinbase may have already met with officials from the Office of Comptroller of the Currency. If the exchange manages to get the federal banking charter, then it will offer banking services.

Binance, which is the largest crypto exchange in the world, recently purchased 5% of Founders Bank. With a base in Malta, Founders Bank will start utilizing crypto tokens according to a report from Binance.

Another crypto institution which is joining the banking sector is the Litecoin Foundation. Recently, they scooped up a 10% stake from WEG Bank AG of Germany. With additional moves, the cryptocurrency sector is likely to have a big influence in the banking sector. Exchanges like Binance and Coinbase, if they decide to open their own banks, will still have massive influence in the sector because of their huge number of customers.

Crypto And Banks

Much of the conflict between banks and the cryptocurrency sector seems to be fading away because of the continued growth of the sector. Some of the world’s largest banks, like Goldman Sachs, already have crypto trading desks with others are still looking on ways they can integrate the cryptocurrency sector in the banking industry in a safe way. Interesting times are ahead especially between the relationship of the two markets.