United Kingdom cryptocurrency custodian Copper announced support for United States dollar transfers through Signature Bank’s Signet blockchain payment platform.
According to an announcement on July 20, the integration of Signature Bank’s Signet will allow Copper’s customers to instantly pay and settle transactions in U.S. dollars and other fiat currencies.
The integration will “vastly reduce the time and other issues that asset managers face in transferring traditional currencies” between bank accounts and trading environments. Crypto exchanges Bitstamp, Huobi, Kraken, OKCoin and LMAX are already integrated with both Signet and Copper.
The collaboration is part of a broader trend
Copper CEO Dmitry Tokarev believes that a crypto firm like his using the blockchain service offered by a traditional bank is a sign of how significantly the technology developed over the last few years.
He said, “Over the course of 2020 [...] the maturation of the crypto market has significantly accelerated. The industry has seen increased interest from more traditional hedge funds and asset managers taking crypto positions as a hedge against the weaker market and the risk of hyperinflation, while central banks are turning to digital currencies and blockchain as a potential foundation for the next generation of financial services.”
Tokarev also said that — if the current pace of development in the blockchain industry were to be maintained after the pandemic — the key would be a focus on collaboration between financial institutions. Copper’s integration with Signature Bank’s Signet, he claims, is an example of this trend that he hopes will be replicated by other companies in the space.
New York State’s Department of Financial Services authorized Signature Bank’s blockchain platform at the end of 2018.
Banks use blockchain
The use of blockchain technology with the traditional banking sector has been increasing apace. Just last week, multinational banking giant Banco Santander and four Spanish banks successfully finalized a proof-of-concept for payments using smart contracts. The initiative was coordinated by the manager of the payment system IberPay.
Tokarev explained that blockchain services offered by traditional financial institutions have some advantages over those created by technology firms:
“Established traditional institutions have proven and recognised track records, and can therefore operate within defined and often regulated markets. It is in the interests of clients, banks and crypto asset infrastructure providers alike to be collaborating on many different levels for this emerging shared space to mature effectively and responsibly.”