Benefits of a Crypto-Friendly Bank Solution

Many regions are slowly embracing cryptocurrency. Some countries have legalized cryptocurrency and allow payments in Bitcoin, Ethereum, and other currencies. Ever wonder where the infrastructure is for crypto banking? The traditional banking system does not support crypto transactions. This is why technologists are involved in creating cryptographic banking systems. Interested? It is optional to create everything from scratch. Get crypto banking solutions from blockchain developers and tailor them to your needs. Let's learn more about crypto banking and how it can benefit customers today.

What is crypto banking?

The crypto banking system is where digital or virtual currencies can be deposited, borrowed, traded, and repaid via a secure blockchain. Crypto banks offer financial services similar to traditional banks. Crypto banks can offer virtual services through a Defi platform, but that is the difference. Decentralized finance is a term that stands for decentralized financial institutions. It is a system that aims to increase the transparency and clarity of blockchain transactions.

Customers and users can create accounts at the crypto bank to deposit cryptocurrency. Users can trade, lend, borrow, and withdraw cryptocurrency through the bank's Defi platform. To store and transfer virtual currency, every user receives an online wallet. Banks offer two types of crypto wallets:

• Custodial wallet: Thecrypto bank holds the private keys, but the user can still access the wallet and use it.
• Non-custodial wallet: The wallet is only for the users. Only the user has access to the public and private keys. These wallets can be used as extensions.
• Non-custodial wallets are safer because you completely control the wallet and crypto assets.

How does a crypto bank setup work?

• The crypto-friendly bank willprovide a private key that the user must use to initiate the transaction. This is similar to the passcode or PIN.
• The user can then continue with the transaction (depositing, trading, or withdrawing cryptocurrency).
• The traffic volume can affect the time it takes to complete the transaction. The transaction occurs between users (or another party), and the bank acts as a service provider.
• To complete the transaction, the users must exchange crypto and theirpublic keys (send crypto to another wallet).
• You don't need to rely on anyone or any establishment to make a cryptocurrency transaction. Although there is no intermediary fee, you might have to pay a transaction fee to use the blockchain platform.

When borrowing money from the Defi platform, crypto banks will allow you to use crypto assets as collateral. It is a quick and easy way to trade intelligent contracts. You can fill out a few pieces of paperwork or wait days to receive the loan amount.

Crypto Banking Solutions: The Advantages

These are just a few reasons that crypto banking is so popular:

Contract Management

Intelligent contracts are different from traditional contracts. They have built-in regulations that automate their flow on the blockchain. This automation reduces the workload of financial institutions and encourages more transactions.

KYC and authentication

Cryptographic platforms take the necessary precautions to protect anonymity and ensure authenticity. KYC (anti-money laundering) and AML investigations protect user information and lower the risk of fraudulent transactions.

Geographical restrictions are not applicable.

Cryptographic banking services can be used to remove time and border restrictions. Last-minute payments to another country are not a problem with crypto banking services. You can also save money by not paying currency conversions or additional fees. Send cryptocurrency directly from your wallet to any person in the world.

banking is popular because it allows customers to use their cryptocurrency balances like fiat. The platform allows customers to use their crypto debit cards for payments and make fiat withdrawals at crypto ATMs. Instead of holding crypto assets as investments, they can be used to make seamless payments for routine activities.

Services Offered By Crypto Bank

Three areas are essential for a service provider if you want to open your cryptocurrency bank:

Payments and settlements

A crypto banking solution is a payment and settlement platform that uses blockchain technology. Customers can transfer funds to the platform in real-time, 24 hours a day, seven days a week, for almost no fee. To facilitate cryptographic settlement with existing banking infrastructure, a crypto bank can provide its native token.

Unlike traditional banking systems, cryptographic banking solutions can cheaply transfer funds across different geopolitical locations.

Custodial services

Many investors and users are new to crypto. Crypto banks can lease top-notch custodial service providers and offer them to their customers.

Lending services

Platform users can earn interest using crypto lending and borrowing services offered by a cryptocurrency bank. Platform users can borrow from or lend assets to others with a set amount of collateral, which can all be controlled by smart contracts. The entire process is pre-programmed into the smart contract and cannot be changed. There are also meagre fees.

Cryptographic banking solutions are a must-have:

• Crypto Interest Accounts

To start your cryptocurrency bank, you must offer your users a crypto-interest account. In simple terms, this is a decentralized savings account. Most crypto banks offer interest rates between 7 and 10% for platform users.

• Crypto-Checking Accounts

You can reward the user for making eligible purchases by opening a crypto checking account. Although these accounts don't have monthly fees, the user is eligible for an award if he purchases at any point of sale, online or offline. In the example of Quantic debit cards, 1.5% of transaction amounts are converted into bitcoin and added to the crypto checking account.

• Cryptocurrency debit card

The crypto debit card can be linked to the user's crypto interest or checking account. It can be loaded with fiat as well as crypto. The crypto banking service provider must partner with multiple merchants to create a unique point of sale for customers.

• User-controlled wallet

Platform users should first contact a cryptocurrency wallet. It is where users can store and trade their crypto assets. It should have a list of well-curated coins that allow users to trade in or out of certain currencies at any time. Customers can also use the balance in fiat to buy crypto.

To start your cryptocurrency bank, you must open SWIFT IBAN and SEPA IBAN accounts. This is essential to allow payment for customers within the European Union and around the globe.

PerfectionGeeks Technologies: Why Choose Us?

Building crypto-friendly banking solutions is optional. This process can be costly, time-consuming, and stressful. Perfection Geeks service providers can reduce costs and save time while developing the crypto banking platform. Customers can receive more services in a shorter time and without spending more. You can also have your business developed while the service provider takes care of maintenance and upgrades.

Last Words

The current market is very much in demand for crypto banking solutions. Some countries that have adopted crypto-banking include Japan, Canada, and Switzerland. Crypto banks and Defi platforms are needed to facilitate quicker, easier, and more secure transactions among users anywhere in the world, as cryptocurrency is becoming more popular daily. Do you want to start a cryptocurrency bank? Contact us and join our team for the best crypto banking solution.