July 27, 2020 · 2 min read
What are major banks doing with blockchain?
The recent rally in the price of bitcoin has arguably been driven by the US Treasury's Office of the Comptroller of the Currency saying last week that banks can custody crypto assets. It is widely believed many of the major investment banks have been preparing to hold their high net worth and institutional client's crypto assets, like they custody much of their other investments. This certainty for wealthier individuals and institutions should be a big deal for the crypto market.
One area that Novum Insights believes is likely to be an indicator of willingness to custody crypto assets is adoption of blockchain more generally. For this reason we are preparing a blockchain in investment banking market readiness report for September. This graphic below (which will be updated for the full report) looks at the different major blockchain associations banks are members of, and while it is only a small indicator, and other areas such as engagement with Ripple and R3 Corda are also important, things are going to get very interesting as many of the banks in this list also wade further in-depth into crypto. Also it should be noted Goldman Sachs, for instance, is a big adopter of blockchain through its investment in major blockchain company Circle, for instance, so worthwhile only treating the graphic as an indicator of how active groups are in cross-industry bodies like WeTrade and Marco Polo Trade Finance.
It will also be interesting to see which banks have their own proprietary custodial solutions for digital assets and which will have to leverage vendors and more established specialised players such as Bitgo, Gemini, and others.