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Bank of America Joins Marco Polo Blockchain Network Powered by R3 Corda

Bank of America has joined the Marco Polo Network, powered by R3 Corda’s distributed ledger technology to solve the challenges of the global trade participants.

The Marco Polo Network made the announcement on Sept. 19, stating that the multinational investment bank and financial services company is looking to provide transformative solutions for their global customers.

Launched in 2017, the Marco Polo Network aims to provide an “open enterprise platform for trade and working capital finance to banks” and corporates and a blockchain-powered solution for a better security system of the exchange of data and assets between participants.

Geoff Brady, the Head of Global Trade and Supply Chain Finance in Global Transactions at Bank of America stated:

“Joining the Marco Polo Network supports our strategic objective of turning technology advances into trade solutions that address client needs. We look forward to exploring how the new technology can generate greater transparency for our clients throughout the transaction lifecycle, making traditionally paper-based, opaque processes easier and more efficient.”

David E. Rutter, the CEO at R3, mentioned that the Marco Polo network’s existing pool of banks had been further strengthened by the addition of Bank of America to the network.

Daniel Cotti, the Managing Director at the Marco Polo Network, mentioned that the network was looking to expand its presence in North America and added that they are looking forward to working with Bank of America.

Bank of America Announces Blockchain Job Openings

Bank of America, the second-largest bank in the United States recently announced various blockchain job openings, and this is a perfect indicator that the bank seeks to embrace blockchain technology in its operations.

For instance, six positions substantially mention blockchain as one of the requirements. Expressly, one is for the treasury product manager role, whereby the successful candidate will be required to offer product development and innovation by leveraging blockchain in the provision of an automated, cohesive, and integrated client experience.

The others are two for banking regulatory domain architects and three for enterprise payment technology senior architects. Bank of America is considerably making incredible steps in adopting blockchain and cryptocurrencies.

For instance, based on a recent Linkedin ad that was closed, the bank revealed exceptional plans of utilizing Ripple’s distributed ledger payment system in some aspects. Additionally, the treasury product manager post suggests that the holder will lead the product management team mandated with the Ripple Project.

Read Related: Bank of America Joins Marco Polo Blockchain Network Powered by R3 Corda

As reported by Blockchain.News last month, India’s demand for blockchain developers has risen by 700%. This has been prompted by the actuality that India has emerged to be one of the significant players in the blockchain space. This trend has been instigated as many new blockchain firms have set foot in India as they seek to offer blockchain services and solutions.

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Bank of America Considers Bitcoin and Crypto Transactions to be Equivalent to Cash

Bank of America is considering Bitcoin, Ethereum, and other altcoins to be cash equivalent, and will treat crypto-related transactions as cash advances.

An image posted on social network Reddit showed a possible change in credit card terms and conditions of Bank of America regarding cryptocurrencies such as Bitcoin (BTC).

Bitcoin, Ethereum, Litecoin, and other cryptocurrencies were mentioned to be treated as “cash advance,” according to the image of the letter that was posted briefly before it was taken down on Twitter.

Source: Reddit user

Some members of the crypto community speculated that it might be due to the fact that Bank of America could increase the fees related to the types of transactions referred to in the letter. Cash advances transactions have one of the highest fee rates, around 5 percent.

JPMorgan banks crypto firms

However, the Bank of America is not the first to start to embrace cryptocurrencies, as JPMorgan Chase, the largest bank in the United States, has accepted crypto exchanges Gemini and Coinbase as banking clients.

This is a sign that Bitcoin and other cryptocurrencies are being embraced in the American financial landscape and Wall Street.

The bank gave Coinbase and Gemini accounts the green light in April, and transactions are just kick-starting. Reportedly, JPMorgan Chase is offering cash-management services to the exchanges, as well as dealing with dollar-based transactions for their US-based clients.

The bank will also leverage on an electronic funds-transfer system dubbed the Automated Clearing House network to process withdrawals, deposits, and wire transfers. This development will ease transfer handling because most of Gemini and Coinbase customers link their traditional bank accounts to those provided by the exchanges. Nevertheless, the bank will not carry-out any cryptocurrency-based transactions.

Crypto adoption: Result of COVID-19 as a catalyst?

Billionaire hedge fund manager Paul Tudor Jones was reportedly looking to buy Bitcoin to hedge against inflation as central banks across the world are printing money to relieve economies affected by the coronavirus pandemic.

Jones is one of Wall Street’s most seasoned and successful hedge fund managers, CEO and founder of Tudor Investment Corp, a hedge fund that managed $8.4 billion assets under management as of March 30, based on data from the Securities and Exchange Commission.

Jones compared Bitcoin to gold by saying that the digital currency reminds him of the role that gold played in the 1970s. Jones was well known for his correct prediction of the 1987 market crash and shorted Japanese equities several years later before Japan’s economy crashed.

Bitcoin’s Market Cap is Now Bigger than Bank of America After BTC Price Hit $12K

Bitcoin has just surged to $12,000, breaking resistance, with another $6 billion entering the cryptocurrency market just recently. Bitcoin is currently up 60 percent on the year, while other cryptocurrencies outperformed the world’s largest cryptocurrency with over 80 percent gains across the board.

If the Bitcoin price resistance is at $12,000, a strong push toward $14,000 and a retest is expected.

Bitcoin’s current market capitalization is now bigger than Bank of America, just slightly over $226 billion, according to CoinMarketCap’s data. Bank of America’s market cap is currently at $224.96 billion, according to Yahoo Finance.

Bitcoin’s all-time high price was at $20,089 in December 2017, and at press time, Bitcoin’s price is trading at $12,319 on Binance, just 38 percent below Bitcoin’s ATH.

Bank of America has also recently reportedly been treating Bitcoin, Ethereum, and other cryptocurrencies to be cash equivalent. The bank is also treating crypto-related transactions as cash advances.

An image posted on social network Reddit showed a possible change in credit card terms and conditions of Bank of America regarding cryptocurrencies such as Bitcoin (BTC).

Bitcoin is better than gold

Wall Street veteran and billionaire Michael Novogratz has made the statement that “Bitcoin is a better long-term bet than gold,” in his recent appearance on Bloomberg Television.

Novogratz, who is also the founder of Galaxy Digital Holdings said that although gold has been climbing to record highs, Bitcoin is still more worthy as an investment as it is more difficult to purchase than the yellow metal. The billionaire revealed that 25 percent of his net worth is in Bitcoin.

Billionaire Paul Tudor Jones also previously bet on Bitcoin and compared the cryptocurrency to gold. Jones said in an investor letter, called The Great Monetary Inflation, “The best profit-maximizing strategy is to own the fastest horse. If I am forced to forecast, my bet is it will be Bitcoin.” As money-printing will push traditional investors to gold, he believes that the world will then “crave new safe assets,” which may be beneficial to Bitcoin. Recently, he commented:

“My bet on #bitcoin as a safe haven against the deteriorating dollar is doing incredibly well. My only regret is not buying more. I believe this rise in price we’re seeing is far from over. In fact, it’s just getting started!”

CBDCs Are Bad News to European Banks, says Bank of America Analysts

Although Central Bank Digital Currencies (CBDCs) are important, they could hurt banks. Bank of America analysts Alastair Ryan and Philip Middleton have explained how the pursuits to launch CBDCs could have a damaging impact on already-depressed European banks.

The European Central bank (ECB) is one of the few aggressive monetary institutions that have considered issuing a CBDC in Europe. The ECB recently announced its decision to carry out a pilot test of its CBDC in mid-2012. Apart from that, the Bank of England has also expressed positive comments on such engagements. Two Euro Area banks of the Eurostoxx Index are also positive towards CBDCs this year.

The Bank of America analysts said that they understand some of the reasons behind the push for CBDCs. They mentioned that the Coronavirus pandemic has hastened the declining use of physical cash.

They further stated that pursuits of the private institutions to launch digital currencies, led by Facebook’s Libra cryptocurrency, have awakened Central Banks in Europe and around the world. Moreover, they revealed another reason, which is the fact that the European card payment market is dominated by non-European companies Visa and Mastercard.

However, Ryan and Middleton said that CBDCs not only are going to replace all banknotes and physical cash in people’s wallets but also present significant risks of financial stability thus challenging countries’ monetary sovereignty (ability to control monetary policy and provide services as lender of last resort) as well as posing a challenge to the European Central Bank itself.

The analysts identified another worry associated with the CBDC as such government-issued digital currencies would cut the link between banks and customers. The analysts said: “If current accounts become less important, banks could become providers of balance sheet capital only. This leaves fee income highly vulnerable.”

Lastly, the analysts mentioned that CBDCs engagements would also be deflationary as there would be no deposits put in banks and therefore banks would have no business to issue loans, and thus would not be making profits majorly generated from loan servicing.

Most Central Banks have joined the bandwagon as they don’t want to be left out of the digital craze. Over 80% of the world’s Central Banks are examining the potentials of CBDCs. However, financial experts and analysts have argued that Central Bankers should carefully consider the benefits and risks of the CBDCs. The US Federal Reserve has taken a cautious approach and has yet to decide to launch a digital currency. Besides the benefits of CBDCs, some operational issues and sensitive public policy matters require careful assessments, including the impact on financial stability and monetary policy and the risks of cyber-attacks.

Bank of America Establishes Cryptocurrency Research Team

The Bank of America, one of the leading banking institutions in the United States, has reportedly established a digital currency research team as the red hot ecosystem continues to gain traction amongst all classes of investors.

According to a Bloomberg report, the Bank’s crypto research team will be led by Alkesh Shah, an industry veteran with previous experiences from Morgan Stanley and Lehman Brothers Holdings Inc. Other members of the team include Mamta Jain and Andrew Moss.

The Bank of America’s crypto research team comes off to understand the ecosystem bot in terms of pricing performance and regulatory concerns. Drawing on the history of the success of its prior research units, the industry relevance of the new crypto research team is billed to be unleashed, as confirmed by the bank’s officials.

“Cryptocurrencies and digital assets constitute one of the fastest-growing emerging technology ecosystems,” Candace Browning, head of global research for Bank of America, said in the memo. “We are uniquely positioned to provide thought leadership due to our strong industry research analysis, market-leading global payments platform, and our blockchain expertise.”

While the bank did not specify in detail the exact roles of the new team, research in the crypto-ecosystem is vital to investors in helping to navigate the highly volatile industry. With banks like Morgan Stanley, Goldman Sachs, and JPMorgan now offering a form of crypto services, the new research entity may pave the way for Bank of America to tag along and take a more proactive role in the Bitcoin ecosystem.

The year-on-year performance of Bitcoin and the entire digital currency ecosystem has attracted a number of Wall Street investors. As Bitcoin price has once surged to an all-time high (ATH) above $64,000, the potential of the premier cryptocurrency as a viable store of value was unleashed. This prompted the major US banking institutions to explore avenues to bring crypto-related products to their clients.

Bank of America Opens Bitcoin Future Trading to Clients

Bank of America (BofA) has established trading of Bitcoin futures for some of its clients.

Despite its quite conservative approach in response to cryptocurrencies, the second-largest bank in the United States has now given the green light to some of its clients to access such digital assets due to the amount of margin required to trade the futures.

While some of the bank’s clients are now setting up Bitcoin futures accounts, which are settled in cash, one or two clients may have already begun trading.

In 2018, BofA used to block their clients and financial advisers from trading in Bitcoin-related investments, but such a policy has now changed. The bank will use CME futures, which was established in 2017 and has become one of the biggest Bitcoin futures trading platforms.

The bank has been wary of crypto assets for some time. In March, one of the bank’s analysts stated that Bitcoin cryptocurrency has not been compelling as an inflation hedge.

However, earlier this month, BofA formed a new team to research cryptocurrencies. According to an internal memo dated July 8, the bank established a crypto research team to look into the institutional interest in crypto tokens.

“Cryptocurrencies and digital assets constitute one of the fastest-growing emerging technology ecosystems,” Candace Browning, Head of BofA Global Research, addressed the memo to employees and partners at Merrill Lynch Wealth Management division of Bank of America.

Wall Street Embrace Bitcoin

Pressure is mounting on Wall Street banks to accept Bitcoin as a legitimate asset class. Leading banks in the US embrace Bitcoin, which is a major stamp of legitimacy for the nascent asset class.

In March, Goldman Sachs restarted its Bitcoin trading desk after a three-year pause and started offering Bitcoin futures and non-deliverable forwards for its clients. The bank’s decision to relaunch its crypto trading desk comes when interest in Bitcoin by institutions continues growing.

In March, Morgan Stanley investment bank became the first major US financial institution to enable wealthy management clients to access Bitcoin funds.

JPMorgan Chase also announced in April that it was preparing to allow some of its clients to invest in actively managed crypto funds.

Then, in early May, crypto custody firm NYDIG partnered with Fintech giant Fidelity National Information Services to enable US banks to provide Bitcoin trading services to their clients. Hundreds of banks enrol in the program to allow their customers to buy, hold, and sell Bitcoin through their existing accounts.

On May 18, Wells Fargo, the fourth-largest bank in the US, announced that it would introduce professionally managed crypto funds to more wealthy clients. The bank stated that the risks associated with cryptocurrencies meant that it would favour “qualified investors.”

Banks are now seeking to trade Bitcoin services because they see their clients sending dollars to Kraken, Coinbase, and other crypto exchanges.

Bank of America Believes Bitcoin Could Mean More Money for Salvadorans

Bank of America, a leading US-based multinational investment bank, acknowledged that Bitcoin (BTC) could trigger a progressive digitalisation of the financial system, translating to more money for workers in El Salvador.

Per the announcement:

“Bank of America reports Bitcoin could mean more money for workers, a progressive digitalization of the financial system, greater consumer choice, and an increase of foreign direct investment for El Salvador.”

In June, El Salvador became the first country to adopt BTC as legal tender. This development was seen as a stepping stone towards generating jobs in a nation where 70% of the population works in the informal economy and does not hold a bank account.

Moreover, it could prompt financial inclusion by offering access to investments, savings, credit, and secure transactions.

Africa is also not being left behind in the Bitcoin bandwagon because it recorded the largest P2P volume growth. This trend was being caused by African youths taking up the mantle of bettering their lives and their families through Bitcoin.

Bitcoin leaves exchanges in droves

According to on-chain metrics provider Santiment:

“Bitcoin’s exchange action was a primary initiator of the breakout we saw this week. BTC’s price has hit $42.5K, and there were huge exchange activity swings favoring coins moving off of exchanges Monday, Wednesday, & Thursday to push prices upwards.”

These statistics show that BTC rose to $42.5K as many coins were exiting exchanges, given that this signifies a holding culture.

However, the leading cryptocurrency had retracted to the $40.3K level during intraday trading, according to CoinMarketCap.

Bitcoin’s recent surge made the futures markets heat up because funding rates flipped positive across various major exchanges. Furthermore, social and trading volumes went through the roof after hitting a 5-week high.

Bitcoin’s address activity also hit a record high in the last three weeks by surging by 44.1%.

Bank of America Initiates Research on Digital Assets & Crypto

Bank of America (BoA) follows the trend of cryptocurrency in response to the increasing user transaction demand and institutions’ interest. Bank of America announced to initiate research on this powerful digital asset system.

According to a Bloomberg report on Monday, Candace Browning, head of global research at Bank of America Securities, said in an interview that the cryptocurrency ecosystem is now mainstream and growing.

“This isn’t just Bitcoin anymore, this is digital assets and it’s creating a whole ecosystem of new companies, new opportunities, and new applications.”

This is the first time the Bank of America has established a digital currency research team led by Alkesh Shah as the red hot ecosystem continues to gain traction amongst all classes of investors in July this year.

The official report released on Monday by Bank of America Securities, a subsidiary of Bank of America, pointed out that the market value of the entire cryptocurrency industry has reached 2.15 trillion U.S. dollars. Such a large number makes people have to start to pay attention.

Anto Paroian, Chief Operating Officer at crypto/digital assets hedge fund ARK36, said Bank of America’s announcement of the launch of its digital assets research coverage is a significant bullish signal for the markets.

“it shows that the narrative of institutions buying into the digital asset space is alive and can still serve as a potential uptrend catalyst. In other words, we can still expect ‘explosive’ news around this subject from big market players similar to those we saw in Q1 2021; BoA is yet another mainstream financial institution to publicly hail digital assets as a new asset class. Their comment about the industry being “too large to ignore” should give investors confidence that digital assets are here to stay – and that they are a force to be reckoned with.”

According to data from Coinmarketcap, the current global crypto market cap already reached $2.18 trillion. BoA stated that the current entire digital asset ecosystem will not only include bitcoin and other cryptocurrencies but will also include more digital assets and emphasized that:

“Bitcoin is important with a market value of ~$900bn, but the digital asset ecosystem is so much more: tokens that act like operating systems, decentralized applications (DApps) without middlemen, stablecoins pegged to fiat currencies, central bank digital currencies (CBDCs ) to replace national currencies, and non-fungible tokens (NFTs) enabling connections between creators and fans.”

Analysts from Bank of America believe that digital assets based on cryptocurrencies will become a new asset class in the future.

The statistics in the report show that as of June 2021, 221 million users worldwide have traded cryptocurrencies or used blockchain applications, compared with 66 million in May 2020.

In the first half of 2021 alone, global investment in blockchain/ distributed ledger technology (DLT) and cryptocurrency companies has exceeded 17 billion U.S. dollars, a five-fold increase from 2019.

In addition, the research report also reminded the risk of regulatory uncertainties in the cryptocurrency field.

Bank of America Says Binance to Benefit from Increased Supply of Its Own Stablecoin

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Bank of America (BAC) has talked about the recent decision by the Binance exchange to convert all existing user balances and future deposits of three stablecoins USD coin (USDC), trueUSD (TUSD) and pax dollar (USDP) into its native Binance USD (BUSD).

On Friday, the bank released its research report pointing out that while Binance’s move may generate limited additional revenue in the short term for the exchange, it could have wider implications in the long term.

The bank said the automatic conversion may increase the supply of BUSD by as much as $908 million, as 1% ($10 million) of USDP’s supply and 2% ($898 million) of USDC’s supply are held on Binance.

The Bank of America acknowledged that the fact that BUSD holds a market capitalization of 19 billion indicates that the stablecoin is not being used regularly throughout the broader crypto ecosystem and therefore, lacks utility.

However, the bank sees the potential for a larger increase in BUSD supply over the long-term as customers become more familiar with the stablecoin and its applications across the ecosystem adding more support for it in an attempt to attract more users.

According to the Bank of America, Binance will benefit from this increasing supply because it is able to invest the additional reserves that will back the stablecoin in cash equivalents like U.S. Treasury and overnight loans secured by Treasury to earn interest income.

On the other hand, the bank said although the implications for USDC are limited, there is the potential for the stablecoin to increase its market share relative to Tether (USDT). This is because Binance users may be more likely to convert BUSD into USDC than into USDT when withdrawing funds.

Tether (USDT), the largest stablecoin by market cap, was excluded from the automatic conversion. USDC stablecoin has a market capitalization of just under US$52 billion, followed by BUSD at US$19.5 billion.

The market leader Tether (USDT), has a market capitalization of US$67 billion, and will still be tradeable on Binance.

Questioning Binance’s Move

Bank of America joins other stakeholders who have recently raised questions about Binance’s decision to stop supporting USDC and other stablecoins on its platform.

On Monday, Binance announced that it would convert customers’ holdings in three rival stablecoins — USDC, Pax Dollar (USDP) and True USD (TUSD) — into BUSD on September 29. As a result, it would remove spot, future, and margin trading with USDC, USDP, and TUSD pairs.

Binance said the decision was designed to “enhance liquidity and capital-efficiency for users.” However, the news was met with skepticism, as some users faulted the decision to convert rival stablecoins into Binance stablecoin.

Concerns have been raised about a possible monopolistic behavior of Binance’s move to sideline other stablecoins in order to promote its own.

But, Circle CEO, Jeremy Allaire, recently backed Binance’s decision, saying that the new change will help USDC become the market’s preferred stablecoin rail for moving funds between centralized exchanges (CEXs) and decentralized Exchanges (DEXs).