Bloomberg media recently reported that Seattle-based crypto exchange Bittrex has signed a banking agreement that will allow corporate investors to exchange certain cryptocurrency for fiat.
Bittrex, which handles more than 200 cryptocurrencies and is said to have more than 3 mln clients around the world, will collaborate with New-York based Signature Bank to launch fiat exchanging for Bitcoin (BTC), Tether and TrueUSD.
Talking about the new banking money bargain, Bittrex CEO Bill Shihara said, “They really do look and pore through the entire business. They want to make sure that we’ve got robust AML/KYC (anti-money laundering/know your customer) processes, that we’ve got the right controls on our finances. They do background checks and everything. They really look at our business soup to nuts.”
Shihara noted that the deal indicates a more extensive trend as far as collaboration between the traditional fund area and the crypto circle is concerned. He said, “It’s not just about banks being able to trust Bittrex. It’s about banks being able to trust crypto in general. And I think it’s really showing that crypto is turning the corner in terms of mainstream acceptance.”
Due to regulatory reasons, the service will at first be available only to corporate clients in the states of Washington, California, New York and Montana. Bloomberg also reported that Bittrex is plans to roll out crypto-fiat exchanging to retail clients also. At press time Bittrex’s 24 hour exchange volume was over $98 mln.
Currently, crypto trades need to work with correspondent banks to offer crypto-fiat services on their platforms. Major US crypto trader Coinbase, for instance, has inked partnership deals with Cross River Bank, Metropolitan Bank and Silvergate Bank, and most recently with UK’s Barclays bank.
The World Street Journal has reported recently that Coinbase is currently hoping to secure a federal banking charter, which would end the requirement for them to find banking partners to support its activities.
Fears from banks about regulatory compliance mean crypto exchanges’ reliance on their collaboration can be fraught with inconveniences. A series of suspensions and restrictions on exchanges bank accounts has occurred in the recent years. This week, Poland’s biggest crypto trade BitBay was compelled to end its activities in the country after local banks stopped to handling transactions for the exchange.