Financial institutions have joined the party; they also want to hold Bitcoin.

[CTO114]

With the just trending news that Deutsche bank has officially launched Bitcoin's custody for paying clients is surely ushering us into more interesting times. But it poses a very interesting question to Bitcoin. With Bitcoin's designed to give people control over their money,  why are some of the biggest financial institutions bringing themselves forward to hold Bitcoin on behalf of their clients?

Let's be really honest, not everyone wants to live up to the responsibility of managing private keys. As we've seen with institutions, they want some level of convenience, regulatory compliance and professional security infrastructure. They would rather contract a bank or firm to handle such responsibilities. This is not to say that self custody has become unpopular, what we're seeing is institutions starting to take the move of creating more convenience.

The interesting contradiction is that one of Bitcoin's functions is to remove the need for trust in financial intermediaries, now the so called financial institutions want to build a business portfolio of now helping people hold Bitcoin. Very amusing and interesting.

Now looking at both cases, with self custody, you get control, but that control also comes with interesting responsibilities. Then comes Bank custody, you trust others with your money, but you're also getting some level of convenience.

Obviously either one works for different individuals based on individual preference. However let's not move away from what makes Bitcoin unique and different and that's the situation where banks have less of a say in holding money and the fact that we may not rely on Banks anymore.

So Banks now want to hold Bitcoin, interesting!

[DubemIfedigbo001]

So Banks now want to hold Bitcoin, interesting!

This is not new, banks are moving into Bitcoin custody now as well as other cryptocurrency so they'll not be outdated and lose their clients to exchanges. There are many of them like Revolut, JPMorgan Chase e.t.c which offer Bitcoin custody to their clients. Some big banks now have the flexibility of holding fiat and offering Bitcoin custody services to their clients, while others partner with  exchanges to offer such Bitcoin exposure to their clients.

Custodial services aren't the best way to hold Bitcoin. Self-custody remains the best. #NOT YOUR KEYS NOT YOUR COINS

[Chinesebaby]

Now looking at both cases, with self custody, you get control, but that control also comes with interesting responsibilities. Then comes Bank custody, you trust others with your money, but you're also getting some level of convenience.

Obviously either one works for different individuals based on individual preference. However let's not move away from what makes Bitcoin unique and different and that's the situation where banks have less of a say in holding money and the fact that we may not rely on Banks anymore.

So Banks now want to hold Bitcoin, interesting!

I wouldn't say this is a nice initiative or neither a bad one, but one question I will love to also the banks is that what measures have they put in place to ensure that users Bitcoin don't get stolen by insider employees who are working in that bank?  Because the chances of an employee stealing a customers Bitcoin in this type of institution is very high. Because unlike traditional banks where each transactions are been tied to a particular individual, account, name and personal details. When it comes to Bitcoin, it's very not easy to trace the owner of a Bitcoin address of a non custodial wallet.

So submitting your wallet seed phrase to a bank, simply because you are scared of the responsibility that comes with keeping it safe, clearly shows that you are not worthy of owning a Bitcoin. Because this is a stupid idea. It is better you just focus on keeping your money in the bank.

[Bitcoin_Arena]

What convenience is there if a bank or financial institution is going to block or freeze your assets at any time they want?
People are just being gullible. There is no point in leaving the traditional banking and financial system if you are going to "buy" bitcoin and let some other bank keep it for you.

I think it's just a lazy mindset. Financial institutions fuck up big time, the latest being the https://en.wikipedia.org/wiki/2026_Paraguay_banking_crisis

While those financial institutions enjoy the actual benefits of Bitcoin, they fool people by investing through them. I can never be fooled to that extent  

[un_rank]

Let's be really honest, not everyone wants to live up to the responsibility of managing private keys. As we've seen with institutions, they want some level of convenience, regulatory compliance and professional security infrastructure.

You do not have to. Recovery phrases are the standard way to back up your wallet now. Writing down a couple of words and storing that safely is convenient with no technical skills needed.

Bitcoin has a reliable security structure. If you keep your seed phrase safe and keep your wallet on a device that is not compromised, you will be secure.

- Jay -

[BABY SHOES]

People who do not want to self-custody means they are no longer able to with their own responsibility then his other option is to have to bank that offers storage in the bank to their clients... Because like you said This is according to their individual references so not everyone believes in themselves to save his seed phrase.

For us it was a bad idea... we should still be able to control our own coins, so why do we need a bank to handle it?

I thought so... people have started to worry about this new incident, then they prefer other centralized services for the safety of their assets, because it is certain that banks offer this with a guarantee that the assets will be safe or the compensation they offer to their clients so many are tempted.

[Alphakilo]

So Banks now want to hold Bitcoin, interesting!

This is not new, banks are moving into Bitcoin custody now as well as other cryptocurrency so they'll not be outdated and lose their clients to exchanges. There are many of them like Revolut, JPMorgan Chase e.t.c which offer Bitcoin custody to their clients. Some big banks now have the flexibility of holding fiat and offering Bitcoin custody services to their clients, while others partner with  exchanges to offer such Bitcoin exposure to their clients.

Custodial services aren't the best way to hold Bitcoin. Self-custody remains the best. #NOT YOUR KEYS NOT YOUR COINS

The point exactly why these banking institutions are going into Bitcoin and crypto holdings from my perspective is simply not to lose their customers and also remain relevant.
ETF came to broaden the scope of ownership and adoption, countries opted for reserve cryptocurrency banks and banks now are trying to do same since they discover convenience and compliance is easy for massive adoption and a bit of control.
These banks however can't print new Bitcoin and that remains a fact, and individuals that value self soverignty and control won't go to them for such service.

[CucakRowo]

Joining the party?? lol

Better you could call it as what they once labeled as dangerous, they are now selling as a product.

They collect fees, provide regulatory approval and possess authority to freeze asset and file report upon request, none of which has anything to do with our Bitcoin. Actual difference remains just as it was before. Institutions want service that can be reflected on balance sheet and insured.

Anyway, I actually place more importance on censorship resistant aspect. That is why I still prefer that we keep our own keys ourselves.

[lionheart78]

It is to be observed that, now that the government has clear regulations about Bitcoin, institutions are now taking notice of the opportunities they missed years ago.  For any legal company that wants to venture into Bitcoin or cryptocurrency, they need a clear stance from the government and laws and regulations laid out so that their engagement with Bitcoin has no loopholes or legal breaches that can compromise their company.  Now that these needed regulations is laid out clearly, institutions and company can engage with Bitcoin with ease of mind.