You might have heard about blockchain and cryptocurrencies, but are you aware of crypto banks? It might be a new concept for many of us, but it is certainly going to become as popular as the traditional banking systems. Hiring a crypto bank development company can help an institution to start a crypto bank effortlessly.
In the first instance, blockchain technology seems to be a bit complex, but it has certainly helped crypto investors to store their digital assets on a globally distributed ledger. DLT (distributed Ledger System) has ended the dependency on banking authorities that are driven by the rules and regulations defined by local governments. With the growing popularity of blockchain, people are becoming more and more interested in knowing how to build a digital crypto bank.
Understanding The Concept of Crypto Banking
The best part of entering the crypto world is that anyone can start a bank. However, it is always beneficial to seek the help of a crypto bank development company that has a proven record of providing a wide range of blockchain solutions.
Crypto banking is an evolving concept but it is a bit similar to traditional banking. It is an act of managing digital currency with the help of applications that enable users to buy, sell, store, and lend their digital assets.
All crypto holders have wallets, but crypto banks help them to have a prepaid debit card along with a crypto wallet.
Tips For Creating A Crypto Bank
If you want to know how to build a digital crypto bank, then you must also be familiar with several processes and procedures involved in banking.
Let’s understand the steps involved in building a crypto bank:
Strategic planning :-
- As a bank owner, the first thing you need to do is understand how banks work, and then explore the areas of improvement.
- Remember, your crypto bank must align with FinTech capabilities, legal compliance, and overall infrastructure capabilities. Therefore, it would be better to rely on a crypto bank development company having rich knowledge of banking procedures and blockchain technology.
- Prepare a plan regarding the range of products and services your crypto bank is about to offer. Decisions concerned with the regulatory framework must also be taken carefully.
- Every bank must be capable of catering to the needs of its customers. Therefore, it would be necessary to understand the expectations of crypto users and prepare the banking platform accordingly.
- There can be some market risks, cyber security concerns, as well as governance and regulatory complexities in crypto banking. Your strategic planning must include implementable risk management policies.
- While discussing how to build a digital crypto bank, one must not forget that the purpose of starting a bank is not only facilitating the customers; revenue generation is a crucial part of the banking business. Look at the bank from a profit-making perspective.
Ensuring Total Security
- Unlike the common databases, blockchains are considered to be fully secure, but we cannot deny the fact that blockchains are vulnerable to cyber attacks too. The incidences of DAO attacks compel us to think about the possible risk areas.
- Hiring a reliable crypto bank development company can help you to develop a secure technical infrastructure that has the potential of holding the assets and keeping the cyber risks at bay.
- There must be provisions to regulate the process of settling crypto transactions. Lending can be risky if you are not sure if the amount will be recovered safely. Therefore, there must be some rules and regulations for lending and recovery of crypto assets.
- Banks often become a target of fraudulent activities, and awareness is the only remedy. It is essential to identify the loopholes in the banking system and find remedial solutions. Ensure that your bank keeps evolving.
- The rate of exchange of cryptocurrencies is another most important factor that requires proper attention. The volatility of cryptocurrencies might increase the complexities of maintaining liquidity.
- Learning the technical aspects of how to build a digital crypto bank is not sufficient if you don’t know have a deep accounting knowledge for running a crypto bank competently.
Launch your own Digital Crypto Bank
Preparing A Robust Technical Infrastructure
- If you want to build a blockchain-enabled payment platform, you cannot do it without seeking the help of a crypto bank development company that has already been working in this field.
- A Crypto bank must be capable of offering fully managed custody services to the individual as well as the crypto traders.
- Before you start hovering over how to build a digital crypto bank, you must first understand DeFi protocols that make it easier to lend cryptocurrencies without involving third-party institutions. In all such cases, the lending and recovery processes are driven by Smart Contracts. Thus, you would have to hire blockchain experts for handling such technical requirements.
How can a Crypto Bank Development Company help?
Blockchain technologists having a deep knowledge of banking systems can help in creating a crypto bank with greater ease. They know how to build a digital crypto bank flawlessly.
Here are the key areas that they focus on :
- Understanding the purpose of starting a bank and performing viability analysis.
- Knowing what kind of digital assets are to be stored and what kind of industries the bank is going to serve and support.
- Carrying out assessment of risk factors, and finding solutions.
- Understanding the cybersecurity and financial risks pertaining to digital assets.
- Making decisions about the operating model and governance structure, and working accordingly.
- Development of accounting policies to avoid business loss.
- Development of technical infrastructure, including Smart Contracts.
- Providing break-free customer support.
Crypto banks are based on blockchain technology. Therefore, you must find blockchain experts who are also well versed with the banking systems before taking a plunge into crypto banking.
Antier Solutions has a team of industry experts and they can help you to start your crypto bank project that can fulfill the diverse needs of the crypto community. We are a distinctive crypto bank development company that can provide trustworthy solutions to overcome emerging risks and discrepancies during the development of a crypto bank for you. We provide a white label crypto bank solution and specialize in building a custom banking platform from the ground up.
Schedule a free demo of our white label crypto banking solution or connect with our subject matter experts to share your business needs.