Cryptocurrency companies have grown heavily over the last three years. Unfortunately, many regulators and financial enterprises don’t see them in the same category as banks or traditional payment processing ventures.
Banks Go Head to Head with Crypto Ventures
In a recent announcement, fTLD Registry Services, which provides domain registries to both banking and insurance companies, announced that any cryptocurrency company looking to register a .bank name for their website will be turned away. In other words, crypto companies are not banks, and will not be allowed to register their sites as such.
This has been an ongoing fight between crypto ventures and traditional financial institutions for some time. While they both offer relatively similar services and products (money, payment transfers, etc.) traditional institutions are bound by specific laws and regulations that require them to operate within a certain governmental scope. People who are customers of said companies are likely to experience credit checks and other privacy-invading tactics should they seek to set up accounts or get the financial items they need to survive.
Crypto companies, on the other hand, are much more lenient in whom they choose to work with. We’re very much in a time where anyone above a certain age can potentially open an account with these companies and begin trading, selling or receiving cryptocurrencies instantly. The idea of crypto is to remove financial power from banks and other established financial institutions while also placing power back into the people’s hands.
Banks have been a little worried about this as of late and are wondering if the sun is setting on their existence. While it’s not likely we’ll witness an end to standard banks anytime soon, many are looking at cryptocurrency as dangerous, and are working to rid the prowess of crypto sooner rather than later.
A .bank name costs in excess of about $1,000 a year. For a company to garner one of these highly coveted names, they must be a government-regulated bank or savings association. They must also provide financial services to customers. While most crypto companies do provide the latter, they are typically not registered through the required government agencies.
Why Can’t They Register?
Senior director of compliance and policy at fTLD Heather Diaz explains:
“The original purpose of the Service Provider category was to enable banking core processors to provide infrastructure (e.g. online banking services) using a .BANK URL or to provide DNS and/ or hosting that is compliant with fTLD’s Security Requirements… More recently, as the financial services arena has evolved, particularly as it relates to fintech companies offering financial products and services (e.g. P2P payment providers, cryptocurrency companies), we have found that some prospective Registrants were seeking domains to enhance their legitimacy to market to regulated entities and/ or consumers.”