While speaking to Bloomberg, the Commonwealth Bank of Australia (CBA) CEO shared that as much as banks face risks in participating in Bitcoin and cryptocurrency, there are “bigger risks in not participating.”
The CEO also touched on Central Bank Digital Currencies (CBDCs). He mentioned that he is hopeful that Australia will soon take part in the development of its CBDCs.
Crypto Fear Of Missing Out (FOMO) by Banks
While on an interview with Bloomberg TV, the CBA CEO, Matt Comyn, shared that the most significant risk banks would make with crypto today is “missing out.” He explained that crypto is “ very volatile and speculative.” However, banks must incorporate it to fulfill their customer demand.
Failure for such incorporation would mean that the banks get entirely left out of the market. “We see risks in participating, “ Comyn shared while on the Thursday interview, adding, “we see bigger risks in not participating.”
The nature of volatility of crypto for the longest time has been a significant issue for many banking giants. However, more and more banks are expanding their services to crypto, perhaps due to FOMO.
Banks such as DBS Holdings and JP Morgan have embraced crypto with wide arms to tend to the ever-growing demand. Financial institutions have also dipped their toes in the crypto world by contributing to fundraising rounds held by crypto companies. Companies such as Gemini, FTX, BlockFi, and Chainalysis have raised millions this year as more firms continue to embrace crypto.
Comyn also talked about how the bank believes that crypto is here to stay. In addition to this, he emphasized on the importance of learning the technology since it is not going away any time soon. Understanding it would help the bank provide customers with “the right disclosures around risks.”
The CEO also talked about inflation which he believes is yet to get higher than it has been in many years.
More on Commonwealth Bank of Australia
Matt Comyn’s statements come a day after the CBA bought a stake in Gemini, a US-based crypto exchange. The crypto exchange currently has a valuation of around $7.1 million after raising $400 million in its first funding round. As a result of the Gemini x Commonwealth Bank partnership, CAB will act as a custodian for Gemini users.
The Commonwealth Bank had also announced earlier this month that they would be rolling out an app in partnership with Gemini. Through this app, users will be able to hold, buy and sell crypto assets directly. The app users will have access to up to 10 crypto assets. These ten crypto coins include Litecoin, Bitcoin Cash, Ethereum, and Bitcoin.
The bank announced that the app’s pilot would roll out in the coming weeks. Additionally, the bank announced that their 6.6 million app users would soon enjoy progressively added features in 2022.
The Commonwealth Bank of Australia is an Australian multinational bank. It has banks across the UK, the US, Asia, and New Zealand.