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Why Fintech and Neobanks Should Consider Offering Crypto Investments

Banking CIO Outlook | Tuesday, August 17, 2021

A cryptocurrency exchange allows fintech and neobanks to diversify their revenue streams. Fintech firms can either package it as a premium product and charge consumers a monthly fee, or they can profit from the spread between purchasing and selling multiple cryptocurrencies.

FREMONT, CA: Daily Bitcoin transactions surpassed 400,000 in the first quarter of 2021 alone, China conducted its second trial of its digital currency, and the global market size is now expected to reach $1087 million by 2026.

Cryptocurrencies are becoming increasingly popular. What advantages do fintech companies gain from allowing their consumers to trade cryptocurrency? Let's take a closer look.

Neobanks and fintech firms are well-positioned to meet that demand. Fintech businesses such as Revolut, Square, and Paypal are already enabling bitcoin investing through their apps. Here are three major reasons:

Adding a New Revenue Stream

It is a well-known truth that many fintech companies struggle to make a profit, particularly European fintech with low interchange.

A cryptocurrency exchange allows fintech and neobanks to diversify their revenue streams. Fintech firms can either package it as a premium product and charge consumers a monthly fee, or they can profit from the spread between purchasing and selling multiple cryptocurrencies.

Attracting New Customers

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The number of crypto-curious people in the world is expanding – as previously stated, adoption is up 43 percent year on year. Many retail investors want to get started with bitcoin investment and will most likely choose a fintech company that satisfies their requirements. If that financial company offers cryptocurrency trading, that is more likely to be the one they choose.

Offering a crypto exchange is a means to reach out to a new audience while maintaining a competitive advantage and distinguishing out in the constantly saturated neobank market.

Making the Brand Fit for Future

Cryptocurrencies will be around for a long time. They are anticipated to play a significant role in the future of monetary policy, money management, and cross-border transactions as both an asset and a currency.

Fintech firms and neobanks are already claiming to be the future of banking, the democratization of finance, and the best method to meet client expectations. As a result, it only seems logical to follow through on that branding with bitcoin and decentralized finance.

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