Traditional banks have begun entering the cryptocurrency space thanks to the massive demand for crypto-related products by their customers. Citigroup could be the next to join the market after admitting high demand from its clients.
Citigroup could soon offer cryptocurrency services
Citigroup, one of the leading investment banks in the United States, has revealed that it is considering offering crypto-related services to its customers. According to the bank, they need to respond to the high demand for crypto services from their customers.
The bank’s global head of foreign exchange, Itay Tuchman, told the Financial Times earlier today that Citigroup is already exploring the possibility of providing cryptocurrency services to its clients. The bank is planning to offer trading, financing, and custody services. However, Tuchman admitted that Citigroup would not rush into launching any service that would get them in trouble with the regulators.
“We shouldn’t do anything that’s not safe and sound. We will jump in when we are confident that we can build something that benefits clients and that regulators can support,” Tuchman added. He revealed that the genesis of the move is the increase in the number of clients inquiring about Bitcoin. Tuchman stated that its clients began asking about cryptocurrency services in August 2020 when Bitcoin’s price rose by 33%, from $9,000 to $12,000 within a few weeks. Since then, the number of people asking about Bitcoin has increased, he added.
Traditional banks trooping into the cryptocurrency space
Despite the massive demand and the rally that saw Bitcoin reach a high above $64,000, Tuchman said Citigroup is in no hurry to jump on the cryptocurrency bandwagon yet. He said the bank intends to play the long game with cryptocurrencies as it believes they would be around for a long time. “I don’t have any FOMO [fear of missing out] because I believe that crypto is here to stay and that we are just at the very beginning of the market. This isn’t a space race. There is room for more than just one flag,” Tuchman added.
The crypto market has seen an influx of traditional banks in varying capacities over the past year. In the United States, investment banks such as JPMorgan, Morgan Stanley and Goldman Sachs are all involved in the crypto market in varying degrees. Other banks such as BNY Mellon are also getting involved in the emerging industry.