Wells Fargo is apparently preparing for Bitcoin and other cryptocurrencies, Darrell Cronk, president of the bank’s investment institution, said Business Insider that a research department “plans to evaluate an actively managed cryptocurrency strategy and integrate it into its platform for qualified investors”.
He noted that efforts to provide such a product have been in the works for months and are expected to start in the middle of next month.
While the product would apparently offer exposure to many cryptocurrencies, Cronk highlighted the declining supply momentum of a deflationary asset like Bitcoin, particularly as a reason his team is interested in offering it.
“Every time you reduce supply, the price should go up, even if demand remains constant,” said Cronk Business Insiderand provides a fundamental explanation of Bitcoin’s value proposition over inflationary assets like the dollar. “Over time, people become familiar with these [cryptocurrencies] and when they get more mainstream I think that of course it will go up. We’ve seen this happen pretty consistently over the past decade, but we’ve seen it accelerate during the pandemic as the platforms became more digitized. “
Offering a bitcoin exposure would be a pretty dramatic face for Wells Fargo as it didn’t allow bank customers to conduct cryptocurrency transactions until July 2019.
However, this would also correspond to a growing trend among Wells Fargo’s competitors. Goldman Sachs and JPMorgan Chase & Co. are reportedly trying to offer similar products that customers can use to learn about Bitcoin as well.