The announcement comes as certain cryptocurrencies such as Bitcoin and Dogecoin have been reaching record highs over the past two months. On a wave of popularity, Tesla announced that it bought $1.5 billion of Bitcoin and from now on will accept it as payment for its products.
Bank of New York Mellon, one of the oldest financial institutions in the US and one the oldest banks in the world, has announced that later this year it will open up for transfer, holding and issuing cryptocurrencies, thus allowing users to keep all their assets, including Bitcoin, in one place. According to BNY Mellon’s chief executive responsible for digital businesses, Roman Regelman, the bank has already started offering its clients the opportunity to deposit their crypto assets at the bank.
BNY Mellon said it will treat the new type of assets as any regular one, such as a treasury or a stock, although the financial institution will use a separate platform for these purposes. The bank has already developed a prototype of that platform.
A Bitcoin ATM is pictured in a bodega in the Manhattan borough of New York City, New York, U.S., February 9, 2021. REUTERS/Carlo Allegri
The classic financial institutions, such as banks, have so far been reluctant to include cryptocurrencies into the portfolio of their services, largely because of their volatile nature and the absence of government regulation. Still, some banks have already started offering to handle their clients’ digital assets, but BNY Mellon is to become the first of the big US banks to offer such services. Regelman said that in his opinion it will take around five years to fully incorporate crypto into the Wall Street routine.
Banks are not the only ones to be cautious about introducing cryptocurrencies into their fold, as Bitcoin, Ether and others remain rarely accepted by companies around the world. A recent announcement by Tesla that it will be accepting Bitcoin as a payment for its products became one of the rare breakthroughs for the currency’s real-world application as a payment method. The US company also stated that it bought some $1.5 billion of Bitcoin for its own treasury as the cryptocurrency continues to set all-time highs breaching the level of $48,400 on 11 February.