You Can Now Keep Your Bitcoins In A Bank

[Rossy Akbar]

Really excited to heard that  your bank country has announce that accepting bitcoin, but the problem is in my country, it was really hard for the country bank in here accepting bitcoin, I don't know why, maybe they just think that cryptocurrencies just usable for the crime which is not true. I really hope that my country will follow the rules as your country did.

[ophyrim]

Crypto receipts!

This is the most perfect thing I have ever read about the blockchain:

Citi has developed an instrument it is calling a digital asset receipt. It works much like an American depositary receipt, which have been around for decades to give US investors a way to own foreign stocks that don’t otherwise trade on US exchanges. The foreign stock is held by a bank, which then issues the depositary receipt.

In this case, the cryptocurrency would be held by a custodian, with the so-called DAR issued by Citigroup, the people said. The bank would alert the Depository Trust & Clearing Corp., a Wall Street middleman that provides clearing and settlement services, that it issued a receipt, one of the people said. That lends an important layer of legitimacy and gives investors a way to track the investment within a system that they’re already familiar with, the person added.

I want to cry. I want to give those paragraphs a hug. I have written, more than once, about the complexities and inefficiencies of having pretty much all U.S. stocks held by DTCC. “It’s enough to make you wish for a blockchain,” I once wrote. A secure, open, permissionless, immutable record of who owns what, one that doesn’t require investors to trust either a bank or a central Wall Street intermediary or to rely on those intermediaries’ old-fashioned systems: That is a core dream of the blockchain, a central appeal of cryptocurrencies.

And then here is Citigroup Inc. looking at investor demand and concluding: Yes, sure, Bitcoin is great, but what Bitcoin investors really want is to hold Bitcoins in the form of receipts issued by a giant bank and registered at DTCC. That’s where the real innovation is! That’s what the people want! “Take this blockchain away from me,” they cry, “and give me the old system that I know!”

A claim that you sometimes hear is that the blockchain will revolutionize back-office processes — settlement, custody, etc. — in the financial system. But look at the actual experience of cryptocurrency custody. The main story of institutional investment in cryptocurrency these days is a story of custody, broadly speaking: Large institutional investors want to get access to Bitcoin, but they do not want to own actual Bitcoins, themselves, on the actual Bitcoin blockchain. They want Bitcoin exchange-traded funds, or Bitcoin futures, or Bitcoins held in custody by regulated crypto exchanges or traditional big banks, or, sure, crypto depository receipts, why not. Everywhere there is a blockchain, a trusted central intermediary — often a bank or other old-school Wall Street middleman! — springs up to make it useful. Does that tell you anything about the prospects for blockchains to replace central intermediaries?

I confess, though, that it goes the other way too: “Two financial technology companies won New York state approval to issue cryptocurrencies pegged to the U.S. dollar,” the Gemini dollar and the Paxos Standard, “creating more regulated and transparent competitors to Tether and other so-called stable coins,” which are in turn competitors to … the dollar. If you want to hold your Bitcoins through a bank, you can, but on the other hand if you want to hold your dollars through a blockchain, you can do that too.

https://www.bloomberg.com/view/articles/2018-09-10/keep-your-bitcoins-in-the-bank

....

Summary: Citibank has created something they call a "digital asset receipt(DAR)" which could allow purchasers of bitcoin to have banks hold their coins. The details aren't clear. There isn't much information posted here about minimum purchasing amounts or who digital asset receipts will be marketed to. Its nice to see innovation and new offerings for crypto enthusiasts. Although I have a feeling these digital asset receipts might come bundled with $100,000 dollar minimum investments and cater only to high(er) end demographics.

I would guess some would opt for DAR's if they could provide insurance on bitcoins and crypto up to limited amounts.

This is a good example of how the banks can become adapted to the new cryptocurrencies world. Of course, this is just the start. You are going to see some new fund which is going to invest your money to the crypto like top 10 biggest coinmarket or platforms coins etc...

[Buttermellow]

Yet, the risk is still there for we know that these banks could not take away the volatility of bitcoin market price. Maybe we could trust banks to hold for ou bitcoins compared to holding it with our very own digital wallet.

We need to see more update on this. I think this is great if there is truly a bank like this that promote cryptocurrency or bitcoin.

[Maricel2017]

That is a goof news that some banks are now have blockchain system to hold bitcoin by many people who are wanting to save for long term with insurance. I am hoping that here in my country banks will start to have this kind of system i am sure that many people will be more happy if this will happen.

[The Sceptical Chymist]

Meh.  This might appeal to institutional investors and wealthy individuals who don't want to store bitcoin in a traditional wallet, but I don't think the average person would have much use for a product like this.  It also seems to me that a bitcoin ETF would serve much the same function and would be even more accessible to the average person interested in owning bitcoin than this bank receipt thing would. 

In any case, I wouldn't be interested in buying a product from a bank that's not actually bitcoin.  If I want to own bitcoin, I'll just buy it and store it on my PC or phone--which is exactly what I do right now.  I don't need a bank keeping tabs on what I'm doing with my money more so than they already do.

We're going to see more of these kinds of things as crypto becomes more mainstream and attracts more investors.  I can understand why they might be useful to a certain population of people.  If a hedge fund wants to invest in bitcoin, it probably wants to do so with a huge amount of money.  If they were to buy it on an exchange like Coinbase, they wouldn't be able to do it without moving the market significantly.  Same goes for when they want to sell it.  And even if they bought it in a private transaction and off-blockchain, they'd still have to worry about getting hacked and they'd have to figure out a way to sell it without driving the market down.  Things like futures, ETFs, and the banking depository note mentioned in the OP article make it much easier for them to invest in bitcoin without actually having to own it like most people do.

[Cryptomilz]

One way or the other these banks want control. Of what use are ETFs if banks now give some sort of paper guarantees while they hold on to the intangible? This for me is a trap and it's the wealthy individuals that might fall for it as they it would be a more secure means of acquiring some BTC

[Nhor1011]

    Once banks has a control your bitcoin or altcoins it is good for security reason but i think only wealthy people will use it. For me it is still better to keep my digital coins to my own digital wallet because i can manage it anytime and can use anytime if needed. We all know digital currency are very volatile. It is easy to buy and sell if you hold your coins into your very own personal digital wallets than a bank.

[omorfi]

If we keep our bitcoins in Citibank's Digital Asset Receipt thing, will we be able to generate passive income? Any kind of lending or parking profit share available in Citibank ?

[bangkit tri]

    Once banks has a control your bitcoin or altcoins it is good for security reason but i think only wealthy people will use it. For me it is still better to keep my digital coins to my own digital wallet because i can manage it anytime and can use anytime if needed. We all know digital currency are very volatile. It is easy to buy and sell if you hold your coins into your very own personal digital wallets than a bank.

for local banks in my country no one has provided, indeed because government has not legalized bitcoin. Of course with the wallet, we feel like we have a private bank, and i feel safe if we don't make mistakes

[centimentalking]

Crypto receipts!

This is the most perfect thing I have ever read about the blockchain:

Citi has developed an instrument it is calling a digital asset receipt. It works much like an American depositary receipt, which have been around for decades to give US investors a way to own foreign stocks that don’t otherwise trade on US exchanges. The foreign stock is held by a bank, which then issues the depositary receipt.

In this case, the cryptocurrency would be held by a custodian, with the so-called DAR issued by Citigroup, the people said. The bank would alert the Depository Trust & Clearing Corp., a Wall Street middleman that provides clearing and settlement services, that it issued a receipt, one of the people said. That lends an important layer of legitimacy and gives investors a way to track the investment within a system that they’re already familiar with, the person added.

I want to cry. I want to give those paragraphs a hug. I have written, more than once, about the complexities and inefficiencies of having pretty much all U.S. stocks held by DTCC. “It’s enough to make you wish for a blockchain,” I once wrote. A secure, open, permissionless, immutable record of who owns what, one that doesn’t require investors to trust either a bank or a central Wall Street intermediary or to rely on those intermediaries’ old-fashioned systems: That is a core dream of the blockchain, a central appeal of cryptocurrencies.

And then here is Citigroup Inc. looking at investor demand and concluding: Yes, sure, Bitcoin is great, but what Bitcoin investors really want is to hold Bitcoins in the form of receipts issued by a giant bank and registered at DTCC. That’s where the real innovation is! That’s what the people want! “Take this blockchain away from me,” they cry, “and give me the old system that I know!”

A claim that you sometimes hear is that the blockchain will revolutionize back-office processes — settlement, custody, etc. — in the financial system. But look at the actual experience of cryptocurrency custody. The main story of institutional investment in cryptocurrency these days is a story of custody, broadly speaking: Large institutional investors want to get access to Bitcoin, but they do not want to own actual Bitcoins, themselves, on the actual Bitcoin blockchain. They want Bitcoin exchange-traded funds, or Bitcoin futures, or Bitcoins held in custody by regulated crypto exchanges or traditional big banks, or, sure, crypto depository receipts, why not. Everywhere there is a blockchain, a trusted central intermediary — often a bank or other old-school Wall Street middleman! — springs up to make it useful. Does that tell you anything about the prospects for blockchains to replace central intermediaries?

I confess, though, that it goes the other way too: “Two financial technology companies won New York state approval to issue cryptocurrencies pegged to the U.S. dollar,” the Gemini dollar and the Paxos Standard, “creating more regulated and transparent competitors to Tether and other so-called stable coins,” which are in turn competitors to … the dollar. If you want to hold your Bitcoins through a bank, you can, but on the other hand if you want to hold your dollars through a blockchain, you can do that too.

https://www.bloomberg.com/view/articles/2018-09-10/keep-your-bitcoins-in-the-bank

....

Summary: Citibank has created something they call a "digital asset receipt(DAR)" which could allow purchasers of bitcoin to have banks hold their coins. The details aren't clear. There isn't much information posted here about minimum purchasing amounts or who digital asset receipts will be marketed to. Its nice to see innovation and new offerings for crypto enthusiasts. Although I have a feeling these digital asset receipts might come bundled with $100,000 dollar minimum investments and cater only to high(er) end demographics.

I would guess some would opt for DAR's if they could provide insurance on bitcoins and crypto up to limited amounts.

Glad to hear. Its such an amazing news for bitcoin users and those want highly security to secure there coins. I think with this bitcoin will be rise more people aware about bitcoin and the crypto currency spared everywhere.

[jonatuzc]

I would prefer to keep my bitcoins like the Winklevoss brothers: print the private key on paper and cut it into several pieces. Then put the pieces in the cells of different banks throughout the country.

Sounds like a good way but quite funny. And one thing you also need to know is that you don’t have as much as Bitcoin as they have. So they can do that and you can’t do it.

And by the way, they are billionaires and owns an amount of Bitcoin that is also worth billions of dollars or haven’t you heard the story? They bought $11 million worth of bitcoin in 2010 when it was being sold at $120. So those guys can do anything.

[Supercrypt]

One way or the other these banks want control. Of what use are ETFs if banks now give some sort of paper guarantees while they hold on to the intangible? This for me is a trap and it's the wealthy individuals that might fall for it as they it would be a more secure means of acquiring some BTC

That is pretty much what they are just after as they simply cannot imagine the way they would be able to wrap their head around the idea of losing control of the way people get to spend. I even wonder why anyone would want to make use of banks when it comes to keeping their bitcoin when most definitely it is something they can simply just put in their own wallet and maybe except for few people who may not really have the idea on how things work or will I say novice to activities revolving round the blockchain technology. I have my wallet and that is my bank, I do not need a third party to get that done.

    Once banks has a control your bitcoin or altcoins it is good for security reason but i think only wealthy people will use it.

That is the thing and it is that control they are so much after. Yeah, it is a decentralized space, but using a bank would be more like using an exchange and one way or the other, your account is always going to be tied to some form of banking policies and regulations at the end of the day. Why would I ever want to use a bank when I have tasted freedom from the bank shackles? For any sane person in this sphere, I really do not think how such persons would pretty much just stick with the mind of having to use a bank when the decentralized space gives you the chance to be your own bank.

[Rejevunator]

Crypto receipts!

This is the most perfect thing I have ever read about the blockchain:

Citi has developed an instrument it is calling a digital asset receipt. It works much like an American depositary receipt, which have been around for decades to give US investors a way to own foreign stocks that don’t otherwise trade on US exchanges. The foreign stock is held by a bank, which then issues the depositary receipt.

In this case, the cryptocurrency would be held by a custodian, with the so-called DAR issued by Citigroup, the people said. The bank would alert the Depository Trust & Clearing Corp., a Wall Street middleman that provides clearing and settlement services, that it issued a receipt, one of the people said. That lends an important layer of legitimacy and gives investors a way to track the investment within a system that they’re already familiar with, the person added.

I want to cry. I want to give those paragraphs a hug. I have written, more than once, about the complexities and inefficiencies of having pretty much all U.S. stocks held by DTCC. “It’s enough to make you wish for a blockchain,” I once wrote. A secure, open, permissionless, immutable record of who owns what, one that doesn’t require investors to trust either a bank or a central Wall Street intermediary or to rely on those intermediaries’ old-fashioned systems: That is a core dream of the blockchain, a central appeal of cryptocurrencies.

And then here is Citigroup Inc. looking at investor demand and concluding: Yes, sure, Bitcoin is great, but what Bitcoin investors really want is to hold Bitcoins in the form of receipts issued by a giant bank and registered at DTCC. That’s where the real innovation is! That’s what the people want! “Take this blockchain away from me,” they cry, “and give me the old system that I know!”

A claim that you sometimes hear is that the blockchain will revolutionize back-office processes — settlement, custody, etc. — in the financial system. But look at the actual experience of cryptocurrency custody. The main story of institutional investment in cryptocurrency these days is a story of custody, broadly speaking: Large institutional investors want to get access to Bitcoin, but they do not want to own actual Bitcoins, themselves, on the actual Bitcoin blockchain. They want Bitcoin exchange-traded funds, or Bitcoin futures, or Bitcoins held in custody by regulated crypto exchanges or traditional big banks, or, sure, crypto depository receipts, why not. Everywhere there is a blockchain, a trusted central intermediary — often a bank or other old-school Wall Street middleman! — springs up to make it useful. Does that tell you anything about the prospects for blockchains to replace central intermediaries?

I confess, though, that it goes the other way too: “Two financial technology companies won New York state approval to issue cryptocurrencies pegged to the U.S. dollar,” the Gemini dollar and the Paxos Standard, “creating more regulated and transparent competitors to Tether and other so-called stable coins,” which are in turn competitors to … the dollar. If you want to hold your Bitcoins through a bank, you can, but on the other hand if you want to hold your dollars through a blockchain, you can do that too.

https://www.bloomberg.com/view/articles/2018-09-10/keep-your-bitcoins-in-the-bank

....

Summary: Citibank has created something they call a "digital asset receipt(DAR)" which could allow purchasers of bitcoin to have banks hold their coins. The details aren't clear. There isn't much information posted here about minimum purchasing amounts or who digital asset receipts will be marketed to. Its nice to see innovation and new offerings for crypto enthusiasts. Although I have a feeling these digital asset receipts might come bundled with $100,000 dollar minimum investments and cater only to high(er) end demographics.

I would guess some would opt for DAR's if they could provide insurance on bitcoins and crypto up to limited amounts.

If banks is storing crypto currency which mean there government are also there to support bitcoin and give permission to use it in public. I wish our government also support bitcoin and lift the ban.

[celot]

Any bank have accepted saving bitcoin or altcoin ? Could you tell me which one bank have support for saving bitcoin or altcoin, I think bank is more againt for bitcoin and crryptocurrency.

[Kittygalore]

It is good really if the banks are accepting the cryptocurrency ,so it will add the popularity of cryptos that it will be accepted by banks a deposit or any kind of bank transactions , it will add the goals of bitcoin and cryptos to be accepted by this finance institutions.

Yes it probably will. This will add the popularity for sure. We can say that more people will trust it with this kind of thing. This is a positive response, but if we look on the other side, we can say that it does not satisfy the bitcoin's characteristics in which it can stand alone and can be use without other factors.

[nisya]

So Citibank has started to be the pioneer in the cryptocurrency section, and I think it will attract their customer to buy bitcoin and another coin. It is good news for the crypto user because we can buy bitcoin with the banks. But I wonder what the details to do these because I think for myself, it is better to save my coins in my wallet so I can take control for that coins. I think this could help new people to buy crypto with Citibank. And perhaps, this will makes the crypto grow fast in the future.

[boyshx]

There is also not much clarification about how the bitcoin will be held ? I mean bitcoin can be held in the private wallets or public ledger but how Citi will do it for the people ? I mean they are going to provide the digital receipt and stuff like that, however, how the holding process of bitcoin will happen. Will bitcoin be held by citi in their own hand cooked wallet ? Isn't that the question one should get in our mind before getting started with such great project. Off course this is something new and can be game changer for only big investors and billion dollar clubs who want to hold huge money in their banks. You know the stocks, bonds etc. This will be another asset in the real world now, crypto bonds I guess.

[horrifiedx1]

It is good really if the banks are accepting the cryptocurrency ,so it will add the popularity of cryptos that it will be accepted by banks a deposit or any kind of bank transactions , it will add the goals of bitcoin and cryptos to be accepted by this finance institutions.

Yes it probably will. This will add the popularity for sure. We can say that more people will trust it with this kind of thing. This is a positive response, but if we look on the other side, we can say that it does not satisfy the bitcoin's characteristics in which it can stand alone and can be use without other factors.

right, we ourselves as a bank. and with a wallet we can store assets safely, provided they are used according to right steps. but on the one hand trust is also important for the development of BTC

[nak02]

Great news! But is there a tax just like in fiat to remain still your bitcoins in their banks? and also it just like in fiat that it will grow if you put your bitcoins there?

[arnaudel98]

Really excited to heard that  your bank country has announce that accepting bitcoin, but the problem is in my country, it was really hard for the country bank in here accepting bitcoin, I don't know why, maybe they just think that cryptocurrencies just usable for the crime which is not true. I really hope that my country will follow the rules as your country did.

Amazing news i so happy that bitcoin is growing now and i hope more people will be aware about bitcoin and cryptocurrency. Let the people store there bitcoin on banks but i won't do that.