Why crypto firms want to become banks (Tearsheet)

What could possibly go wrong?...

"Cryptocurrency exchange Coinbase and payments firm Ivy Koin reportedly met with FDIC officials in “recent weeks” about possibilities to obtain banking licenses. Since cryptocurrency business models are already modeled on crypto-fiat exchange, remittance, merchant payment processing, personal and business value storage, ATMs, and even escrow and lending, there’s a good business case for bringing all these services together under one umbrella, said Robert Musiala, counsel with law firm BakerHostetler.

A banking license would give crypto firms FDIC insurance for funds invested and offer a platform to sell other products to customers. Cryptocurrency firms that become banks also need to meet customer and anti-money-laundering requirements that would enable firms to accept large crypto payments. Here are three implications of crypto firms’ pursuit of banking licenses."

Why crypto firms want to become banks