Prominent US cryptocurrency exchange Bittrex will offer USD trading pairs to customers in select states now that it has found a banking partner, the firm announced on Thursday.
Bloomberg reports that the Seattle-based exchange has signed a banking agreement with New York-based financial institution Signature Bank that will allow it to begin accepting USD deposits and listing cryptocurrencies for trading directly against the dollar.
Since its founding in 2013, Bittrex has served as a “crypto-to-crypto” exchange, facilitating trading between different cryptocurrencies but not against fiat currencies. The venue has listed USDT, a dollar-pegged “stablecoin” created by blockchain startup Tether, but this token cannot currently be reliably redeemed for physical greenbacks.
The exchange currently ranks as the world’s 18th-largest cryptocurrency exchange, with a daily volume of approximately $100 million. This will likely increase, now that the platform has become one of a small group of venues to support fiat-to-crypto trading.
“It’s been a long path,” Bittrex CEO Bill Shihara told the publication. “It’s not just about banks being able to trust Bittrex. It’s about banks being able to trust crypto in general. And I think it’s really showing that crypto is turning the corner in terms of mainstream acceptance.”
Finding a banking partner has long been a struggle for cryptocurrency exchanges, as most institutions are hesitant to service companies involved in an industry that is often perceived (perhaps incorrectly) as a haven for money laundering and other illicit activities.
Bitfinex is said to have kept its fiat-to-cryptocurrency trading pairs afloat by using a string of third-party accounts after Wells Fargo severed its banking agreement last year, though the firm reportedly found a permanent solution in Puerto Rico-based Noble Bank.
Even Coinbase, one of the most respected names in the industry, has largely been forced to rely on smaller banks willing to take a risk on companies in the nascent-but-booming industry. The company made headlines earlier this year when its UK subsidiary signed an agreement with Barclays.
“They really do look and pore through the entire business,” said Shihara, a former security engineering manager at Amazon, of banks. “They want to make sure that we’ve got robust AML/KYC processes, that we’ve got the right controls on our finances. They do background checks and everything. They really look at our business soup to nuts.”
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Last modified: May 20, 2020 8:43 PM UTC