Documents from another US Bank WesBanco disclose that banks business models is in danger because of the emerging cryptocurrency markets.
Included in their year-end annual report WesBanco state that the arrival of new fintech products like cryptocurrencies will have a knock on negative impact for them and they could lose clients.
The report says:
‘Additionally, banks and other financial institutions may have products and services not offered by WesBanco such as new payment technologies and cryptocurrency, which may cause current and potential customers to choose those institutions.’
This statement mirrors the increasing number of fears from banks related to cryptocurrencies.
BIG PLAYERS HAVE IDENTIFIED THE RISKS!
Big players JP Morgan, Bank of America and Goldman Sachs are all wary of the Cryptocurrency and Blockchain technology risks.
GOLDMAN SACHS IN THE GAME
With ownership in cryptocurrency Fintech startups, such as Circle, it means that Goldman Sachs is in the game although they are well aware values could dip if flaws rear their ugly head in time.
The other big players, mentioned above, have preached caution as they believe Cryptocurrency could end up as troublesome technology that cuts out the middle man which includes banks. They do both agree that if cryptocurrencies increase they would have to spend money to remain a key player in the game.
BIGGER RISKS FOR SMALLER PLAYERS
Obviously the big boys have contingency plans but it’s not so easy for the likes of WesBanco who operate 174 branches in the Northeast and Midwest and manage around $10 billion in total assets. A mere blip in the banking world ocean when compared to something like the Bank of America’s $2.28 trillion. The big fish will survive but the smaller one, like WesBanco, could well get swallowed up.