Credit Unions and Crypto: Is This The Future of Banking?
Cryptocurrency and blockchain seem to be everywhere nowadays. When Bitcoin first hit the scene in 2009, I’m sure there were a lot of us who thought at the time that the idea of investing in digital currency was ridiculous. Today, there are hundreds of different cryptocurrencies IRL, including ones originally made as a joke (see Dogecoin), and the banking industry is taking a closer look into its potential future.
A few companies have embraced cryptocurrency, integrating it into their services. PayPal, for example, started allowing its users to purchase cryptocurrency in October of 2020 and has recently increased the amount of Bitcoin a user can buy per week. Traditional financial institutions, like credit unions, have not been as quick to jump onto the digital currency trend, but is doing so a good idea? Will credit unions need to implement cryptocurrency policies and procedures into their everyday operations in the future?
Given crypto’s current popularity, it’s possible Bitcoin and the like will become one of the main payment methods in the future.
Given crypto’s current popularity, it’s possible Bitcoin and the like will become one of the main payment methods in the future. However, there is still some debate about that. When he spoke during a congressional hearing, Federal Reserve Chairman Jerome Powell said that he remains skeptical that crypto-assets will ever become a main payments vehicle in the United States. At the same time, he told the committee that he believed a digital currency issued by the Fed would be a more viable option then having multiple cryptocurrencies.
Powell wasn’t the only one who had something to say about the future of crypto in America. According to Credit Union Times, during NAFCU’s CEOs and Senior Executive Conference in May, NCUA Board Member Rodney Hood said he sees a promising future for credit unions and cryptocurrencies, but there’s no rush to get to that future.
Perhaps for now, it’s best credit unions don’t rush into the cryptocurrency game. This technology is new in the grand scheme of things, and the very idea of digital currency already has proven that it’s useful in territories not everyone is familiar with just yet, including nefarious deeds. If cryptocurrency is part of credit unions’ future and banking in general, copious work remains to determine how this technology would be implemented in everyday banking operations.
Leave your comments below! We’d love to hear from you.
