What Are The Chances Of “The Bitcoin Effect” Winning Traditional Banks Over?

The intrinsic value inherent in Bitcoin has been converting skeptics and making onlookers come onboard to participate in the network, hence the phenomenal growth of the network which has been noted to be faster than even the growth of the internet. 

Bitcoin is proving itself as a disruptive force; dominating the financial market. This effect has been evident in the number of former naysayers who have had a change of stance on cryptocurrency. 

Billionaire CEO of MicroStrategy, Michael Saylor, Tesla, and SpaceX CEO, Elon Musk, and billionaire hedge fund manager Mark Cuban are a few former skeptics who have had a turnaround. Saylor, who was not always a Bitcoiner, has gone on to have his company publicly hold Bitcoin on its balance sheet. Similarly, Musk who at one point in 2019 described Bitcoin as “not quite right” for Tesla adopted it in 2021. For Tudor, his stance around December 2019, was that there was “no chance” Bitcoin could become a reliable currency, today, he sees it as “a store of value like gold.” 

The list of converts is long and varied and is reaching new horizons by the day. Soon, banks may also be pulled in if recent events play out well. A case in point is the change of stance of investment bank JPMorgan. The bank, which formerly had an anti-Bitcoin policy even from its management, has in 2021 began facilitating access to cryptocurrency trades for its clients.

For a while, the eyes of the Bitcoin community have been on the financial sector. Key players in the cryptocurrency world including Binance’s CEO, Changpeng Zhao, have previously warned that the financial sector would pay a huge price if they ignore the Bitcoin adoption. He also expressed confidence that with time, banks will come around to serving and adopting Bitcoin; this seems to be happening already.

The Bitcoin effect seems to already be in play on banks as more of them are taking Bitcoin seriously. 

The setback for them now is the regulatory uncertainty that will not allow them direct exposure to cryptocurrency. Not only that, several governments have made strong policies against Bitcoin that have restricted banks from interacting with it. Examples include India and Nigeria, whose Central Banks issued bans on banks from facilitating cryptocurrency-related transactions. China too has had a long history of opposing Bitcoin. They recently cracked down on Bitcoin miners and have gone on to make it extremely difficult to trade the cryptocurrency in the country.

Should the regulatory uncertainty in government jurisdictions globally become more crypto-friendly, Bitcoin will likely have a massive influx of banks adopting it.

As crypto personality Joseph Young recently puts it, “…It’s inevitable. All major financial institutions will eventually serve Bitcoin, Ethereum, and the crypto sector. Slowly but surely.”