Overcoming Obstacles to Banking Virtual Currency Businesses

Reports that cryptocurrency businesses have had difficulties in getting banked have circulated in the popular press and industry lore for years. Coin Center partnered with law firm Arnold & Porter LLP to interview banks and companies of all sizes to document this difficulty. 

Digital currency businesses offer an alternative payment rail to traditional banks and financial institutions. In order to operate, though, these businesses themselves rely on banks to conduct fundamental payment, savings, foreign exchange and other financial functions. Banks, as heavily regulated entities, apply certain levels of scrutiny to their potential customers and it is common industry knowledge that certain types of businesses, such as money services businesses, have historically had difficulty establishing relationships with banks.

In the last several years digital currency businesseses have become more numerous and reports of their difficulties in establishing banking relationships have been the subject of both the popular press and industry lore. In order to examine this difficulty Arnold & Porter LLP and Coin Center collaborated to research and analyze the issue. This paper presents the methodology, findings and recommendations resulting from the research and analysis.

A direct download of this report is available here

Based in Washington, D.C., Coin Center is the leading non-profit research and advocacy center focused on the public policy issues facing cryptocurrency and decentralized computing technologies like Bitcoin and Ethereum. Our mission is to build a better understanding of these technologies and to promote a regulatory climate that preserves the freedom to innovate using permisionless blockchain technologies.