After the unfortunate shutdown of crypto-friendly banks like Silvergate and Signature Bank earlier this year, the cryptocurrency community has been longing for dependable banking services.
Traditional banks still hold reservations about cryptocurrencies as assets, and some have gone so far as to close accounts when customers deposit funds into cryptocurrency exchanges.
Financial institutions are gradually embracing blockchain technology and the crypto industry, despite their initial reservations. Conversely, crypto companies require reliable banking systems that cater to their unique requirements and securely hold their fiat currency assets.
However, one might argue that the entire purpose of Bitcoin (BTC) was to eliminate the need for banks. While this notion may resonate with Bitcoin enthusiasts, the truth is that cryptocurrencies and traditional financial services are likely to coexist in the foreseeable future.
The presence of crypto-friendly banks is valuable as they facilitate the smooth conversion of digital assets into fiat currency when individuals decide to leave the market.
What is a Crypto-Friendly Bank?
Crypto-friendly banks, as the name suggests, are financial institutions that exhibit a greater level of acceptance and support towards digital currencies and crypto-related businesses.
These banks often offer specialized services such as crypto trading facilities and seamless integration with popular cryptocurrency exchanges like Binance orCoinbase.
But that’s only the beginning. Forward-thinking banks are going above and beyond in the crypto space by providing insurance services specifically designed for crypto businesses.
Additionally, there are Bitcoin-friendly banks that have introduced credit and debit cards allowing users to earn cashback rewards when making purchases with BTC.
Why Should You Use a Crypto-Friendly Bank?
Before delving into our selection of the top crypto-friendly banks available, let’s take a quick look at their advantages and disadvantages.
Pros:
- Simplified crypto experience: Cryptocurrency can be complex for newcomers, but crypto-friendly banks provide a familiar banking system that makes it easier to engage with the crypto space, even for those less familiar with self-custody.
- Convenient off-ramping: Traditional banks often impose restrictions when withdrawing fiat currency from a cryptocurrency exchange. Crypto-friendly banks facilitate a smoother process for exiting the market and converting profits or losses into traditional currency.
- Support for crypto businesses: Crypto companies rely on traditional financial services for insurance and operational expenses. The best crypto-friendly banks offer comprehensive support to blockchain and fintech firms, helping them maintain compliance in the traditional finance world.
- Mobile apps: With the crypto market operating around the clock, accessing your account on the go is crucial. Most crypto-friendly banks provide user-friendly mobile apps for Android and iOS, allowing real-time market tracking and quick transactions.
Cons:
- Historical reliability concerns: Crypto-friendly banks are often exposed to volatile digital assets, which can strain their reserves and lead to bankruptcies and insolvencies, as witnessed with Silvergate and Signature Bank.
- High fees on crypto transactions: Crypto-friendly banks offer convenience, but their services come at a premium. Transaction fees and overall costs tend to be higher compared to using personal crypto wallets.
- Limited functionality compared to DeFi: Crypto-friendly bank accounts generally offer limited functionality beyond cryptocurrency trading and holding. Decentralized finance (DeFi) platforms provide a broader range of options, including staking, yield farming, and lending, empowering users with more versatile ways to utilize their funds.
Best Crypto-Friendly Bank
If you’re searching for the top crypto-friendly bank to join in 2023, you’ve come to the right spot! This list provides a comprehensive overview of the best banks for cryptocurrency, covering a range of areas including traditional banking, business banking, and personal accounts.
1. Revolut
It’s no surprise that Revolut takes the top spot on the list, given its reputation as a pioneer in modern financial services since its launch in 2015. Revolut continues to excel in its support and offerings for cryptocurrencies.
One notable aspect is that Revolut is FDIC-insured, providing an added layer of security. Moreover, their trading platform supports over 50 cryptocurrencies, including popular ones like Bitcoin, Ethereum (ETH), and Solana (SOL).
Revolut users can conveniently send cryptocurrencies directly to other Revolut bank accounts and even delegate their Ether to third-party staking validators, expanding their earning potential.
Notably, customers in eligible countries have the ability to settle bills using crypto through their Revolut credit cards. The Revolut mobile app seamlessly converts selected crypto assets into their fiat currency equivalent for payment completion.
What sets Revolut apart is its crypto card, allowing customers to make purchases using cryptocurrencies and even earn up to 1% cashback in supported cryptocurrencies.
Furthermore, Revolut has plans to launch its own cryptocurrency, Revcoin, later this year, expanding its crypto ecosystem.
Nevertheless, it’s important to note that Revolut’s crypto services come with a downside – the fees can be quite expensive. For the average user, any crypto-related transaction is subject to a 1.99% fee, which may deter cost-conscious individuals from utilizing these services.
2. Juno
Juno, a fintech company, aims to seamlessly merge cryptocurrency and traditional finance by providing a comprehensive checking account solution. With Juno, users not only have a fully functional bank account for fiat currencies like USD but also have integration with crypto wallets.
By directly connecting their wallets to the Juno app, users can swiftly off-ramp their crypto assets and transfer them to an FDIC-insured account within seconds.
The Juno app supports a wide variety of crypto assets, including popular stablecoins like USDC. Users have the flexibility to fund their checking account with USDC on multiple blockchains such as Polygon, Arbitrum, and Optimism.
One standout feature that positions Juno as one of the best crypto-friendly banks is its automatic conversion option. Users have the ability to convert a portion of their incoming paychecks into cryptocurrency effortlessly.
Furthermore, Juno offers a crypto debit card that empowers customers to use their digital assets for payments or cash withdrawals at ATMs, just like a regular debit card. To add more value, users can earn up to 5% cash back on purchases made using the Juno debit card.
3. Ally
Ally Bank stands out as a traditional bank that is actively embracing crypto, even though it doesn’t directly facilitate cryptocurrency trading. Instead, the bank offers the opportunity for customers to invest in crypto-exposure funds such as the Grayscale Bitcoin Trust.
While Ally Bank doesn’t provide direct buying and selling of cryptocurrencies, it has established a partnership with Coinbase, a renowned cryptocurrency exchange.
Through this collaboration, customers can seamlessly integrate their Ally Bank accounts with Coinbase, gaining access to Coinbase’s user-friendly cryptocurrency trading platform.
This integration simplifies the process of connecting with the crypto market and allows users to leverage Coinbase’s intuitive platform for their crypto transactions.
4. BankProv
BankProv is a well-established U.S. bank with a long history spanning over 200 years in traditional banking. While many banks on this list primarily focus on serving personal users, BankProv takes a different approach by aiming to strengthen and support crypto businesses.
One key advantage of banking with BankProv is the peace of mind it offers to crypto startups. All deposits are fully insured by FDIC and DIF, providing emerging businesses with the necessary security to pursue their ambitions in the crypto industry.
Setting itself apart from competitors, BankProv offers comprehensive crypto-backed lending services. Account holders have the opportunity to leverage their crypto assets and earn interest by lending out their funds to other traders.
Moreover, BankProv provides an extensive suite of API tools designed to streamline products and services for crypto businesses. These tools assist in optimizing operations, enabling crypto-oriented businesses to enhance efficiency and provide a smoother customer experience.
5. Wirex
Wirex sets itself apart from other contenders in the “best crypto-friendly banks” category with its unique approach. Unlike other platforms that transitioned from traditional banks to embrace cryptocurrencies, Wirex was built from the ground up with the aim of becoming the world’s leading crypto bank.
The platform offers a comprehensive range of crypto products and services. Serving as a complete trading platform, Wirex supports over 37 digital currencies, providing users with extensive options.
Additionally, Wirex features a cross-chain bridge that enables users to seamlessly transfer tokens across different blockchain networks, enhancing flexibility and accessibility.
Wirex’s crypto debit card offers exceptional advantages, including an impressive 8% cash back on purchases made with cryptocurrency. This generous cashback program provides users with valuable rewards for using their crypto assets.
Furthermore, Wirex offers staking services, allowing users to earn rewards by staking their cryptocurrencies. The platform also includes a crypto wallet that supports NFTs and enables users to interact with decentralized finance (DeFi) dApps, expanding their engagement with the crypto ecosystem.
6. USAA
USAA, like other U.S. banks, does not facilitate direct cryptocurrency purchases for its customers. However, if you have a USAA bank account, you can link it to your Coinbase cryptocurrency account.
While you cannot buy cryptocurrencies directly through your USAA account, once the link is established, you gain the ability to track your Bitcoin wallet on Coinbase. This means you can view your balances and monitor transactions at Coinbase through your USAA account.
This feature alone distinguishes USAA as one of the more crypto-friendly banks, and there is a possibility that it may eventually become one of the first banks to enable actual cryptocurrency transactions in the future.
What Makes a Bank Crypto-Friendly?
A bank can be considered crypto-friendly if it exhibits certain characteristics and offers specific services tailored to cryptocurrency users. Here are some factors that contribute to a bank being labeled as crypto-friendly:
- Support for cryptocurrency transactions: A crypto-friendly bank allows customers to buy, sell, and hold cryptocurrencies directly through their banking platform or through partnerships with reputable cryptocurrency exchanges.
- Integration with crypto wallets and exchanges: The bank facilitates seamless integration with popular crypto wallets or exchanges, enabling customers to easily link their accounts, view crypto balances, and monitor transactions.
- Security measures: A crypto-friendly bank prioritizes robust security protocols to protect customer assets, including strong encryption, multi-factor authentication, and cold storage solutions for cryptocurrencies.
- Regulatory compliance: Crypto-friendly banks adhere to relevant regulations, such as anti-money laundering (AML) and know-your-customer (KYC) requirements, ensuring a compliant environment for cryptocurrency transactions.
- Insurance coverage: Some crypto-friendly banks provide insurance coverage for cryptocurrency holdings, offering an additional layer of protection for customers’ digital assets.
- Additional services: These banks may offer additional services tailored to cryptocurrency users, such as crypto-backed lending, interest-bearing accounts for cryptocurrencies, or integration with decentralized finance (DeFi) platforms.
Differences Between Traditional and Crypto-Friendly Banks
Traditional banks and crypto-friendly banks have some key distinctions in terms of their approach to cryptocurrencies:
- Crypto transactions: Crypto-friendly banks facilitate the direct buying, selling, and holding of cryptocurrencies, while traditional banks typically do not provide these services or have limited involvement with cryptocurrencies.
- Integration with crypto platforms: Crypto-friendly banks offer integration with crypto wallets and exchanges, allowing customers to manage their crypto assets within the banking platform. Traditional banks do not have such integrations.
- Regulatory compliance: Crypto-friendly banks prioritize compliance with crypto-specific regulations, such as AML and KYC requirements for cryptocurrency transactions. Traditional banks adhere to traditional financial regulations.
- Insurance coverage: Some crypto-friendly banks provide insurance coverage for cryptocurrency holdings, which is not typically offered by traditional banks.
- Additional services: Crypto-friendly banks often provide specialized services such as crypto-backed lending or yield-earning accounts. These services are not typically available in traditional banks.
What Banks Are Crypto-Friendly in the USA?
Several banks in the USA are known for their crypto-friendly approach. Among the top choices for crypto-friendly banks available to US citizens are BankProv, Ally Bank, Revolut, and USAA.
These banks provide enhanced accessibility to invest in popular cryptocurrencies such as Bitcoin and Ethereum, while also simplifying the process of creating accounts on leading exchanges like Coinbase.
FAQ’s
Can Banks Hold Cryptocurrency?
While some banks may offer custodial services for cryptocurrencies, allowing them to hold digital assets on behalf of customers, it is important to note that not all banks provide this service. The availability of cryptocurrency custody services may vary depending on the bank and the jurisdiction.
Is Bank of America Crypto-Friendly?
At present, Bank of America does not offer direct cryptocurrency trading services to its clients. However, the bank does not prohibit its account holders from purchasing Bitcoin or other cryptocurrencies through licensed cryptocurrency exchanges operating in the United States.
Is Chase Crypto-Friendly?
While Chase does not offer its own cryptocurrency trading options, customers can link their Chase bank accounts to major exchange platforms like Coinbase and Gemini. This allows them to engage in buying and selling cryptocurrencies through these platforms.
Chase’s wealth management clients have the opportunity to access six crypto funds, including the Bitcoin Cash Trust, Grayscale Bitcoin Trust, Ethereum Trust, Ethereum Classic Trust, Osprey Bitcoin Trust, and NYDIG (available exclusively to private banking clients).
In addition to external cryptocurrency investments, Chase has introduced its own digital currency called JPM Coin. This proprietary coin enables users to make instant payments within the Chase network.
