Despite the fact that crypto is more widely accepted than ever, determining the best bank account for cryptocurrency entrepreneurs and investors is still an elusive goal.
In fact, if you read the headlines of most crypto publications, you’d think it was getting harder to open accounts. But, that’s not entirely accurate.
KEY TAKEAWAYS
- Non-residents can open cryptocurrency bank accounts offshore
- Many factors need to be considered when finding the best cryptocurrency bank account
- There are three main hurdles non-residents need to overcome to open a cryptocurrency account
- Most important step when opening accounts for cryptocurrency is to choose the right country and bank
If you know where to look and how to prepare yourself, opening a bank account for crypto-related entities and individuals can be relatively straightforward. If you know what you’re looking for.
For most, the best bank account for cryptocurrency involves a traditional bank account that accepts crypto as a source of wealth (or income) for individuals or businesses. Allows transfers to and from crypto exchanges, and in some cases even allow you to directly convert crypto into fiat.
In today’s article, we’re pulling back the curtain on banking for cryptocurrency. We’re going to share the three challenges every crypto client faces when opening an account. And, four key cryptocurrency banking jurisdictions you can consider. Plus, we’ll tell you how to get started opening crypto bank accounts today.
Feel free to use the table of contents to jump ahead to the sections most relevant to you.
Table of Contents
- Why Open a Bank Account for Crypto?
- Crypto Bank Account Hurdles
- Cryptocurrency-Friendly Jurisdictions
- How to Open the Best Bank Accounts for Cryptocurrencies
- Ready to Open Bank Accounts for Cryptocurrencies?
Why Open a Bank Account for Crypto?
Given that a cryptocurrency bank account is often seen as the antithesis to a traditional account and fiat, it might be surprising to some readers that crypto investors, entrepreneurs, and even crypto-related projects would even want to open traditional bank accounts.
But, the reality is having a traditional bank account is often a requirement to support operations and customers, cover expenses, pay employees, and for living in today’s world. After all, you can’t pay for your kid’s private school in crypto (not yet, anyway).
That doesn’t mean that any bank will do. Unlike opening a traditional fiat bank account, opening an account for cryptocurrency can mean a lot of different things.
With this in mind, it’s worth noting that some banks are tailoring their own products and services for crypto customers, from direct investments and crypto lending, to supporting the crypto startup ecosystem and providing their own platforms for trading.
But in this article, we’ll be focusing on identifying the best bank account for cryptocurrency, ideally one that offers the following:
- Accepts crypto as a source of wealth
- Accepts crypto as a source of income
- Opens accounts for crypto-related businesses
- Opens accounts for customers that want to invest in crypto
- Allows transfers to and from crypto exchanges
- Allows conversion between crypto and fiat
Now, not every individual or business is going to require all of the above features. But, banks that offer these features are, by default, more familiar with the crypto space, know the nuances of onboarding crypto customers, and are less likely to terminate bank accounts.
Crypto Bank Account Hurdles
Whether you’re interested in opening an account for a business or as an individual, opening an account tied to crypto can feel like you’re waging war. Fortunately, with a bit of preparation, this is a war you can win.
We’ve narrowed down three main hurdles that you need to overcome to find (and open) the best bank for cryptocurrency. If you can overcome these challenges, you’ll be much closer to successfully opening an account for cryptocurrency.
1. Bank Regulation Issues
The biggest hurdle that you’ll need to overcome when determining the best bank for cryptocurrency will often boil down to the country you want to open an account in. More specifically, the banking regulations in the country and whether they allow banks to accept crypto-related customers.
Certain countries have made major strides encouraging crypto innovation, banking, and related services (see our comments on Bermuda below), while others have lagged.
In all cases, to ensure a long-lasting and reliable banking relationship, make sure the bank is operating in an environment where crypto-related activities are welcome — or, at least understood.
Additionally, the bank and your banker’s sophistication and experience with crypto customers matter. For example, if your banker was working at a call center three years ago, it’s unlikely that they understand the nuances of vetting and onboarding crypto customers. Likewise, if the compliance department is unfamiliar with crypto, that could be problematic later on.
To this end, before opening an account and making any sizable deposits, first, strive to understand the country’s stance on cryptocurrency-related banking. We share several examples for you below.
2. Country Related Issues
This obstacle isn’t referring to the country where you bank. Instead, it refers to your country of residence and where your company is incorporated. For example, where you or your business pay taxes can determine the best bank account for cryptocurrency for you.
While your country of residency is important, this isn’t exclusive to crypto banking. In fact, your country of residence can impact whether or not a bank perceives you as a high-risk or low-risk, regardless of your income. To learn more about this you can read our article on the Unlucky Passport Club, which applies to residency as well.
Similarly, the country where your business is incorporated and operates tells the bank which laws and regulations your business needs to abide by, what licenses (if any) your business is required to hold, and the bank should assess your business.
And yes, the bank will want to know that your business is legally allowed to operate. They also want to know the business is in good standing. And, they’ll want to know that it is following any relevant laws. So make sure you understand all of the relevant regulations, laws, and requirements in your own country before you start trying to open an account elsewhere.
3. Prove Source of Funds
After you’ve determined which countries are most optimal for banking, and understand the risks related to your country of incorporation, operations, and residency, your next challenge is proving your source of funds.
For some, proving their source of funds can be one of the most challenging aspects of finding the best bank account for cryptocurrency. But, with some direction, it’s a manageable task.
In reality, this isn’t an “obstacle.” It’s a normal part of banking and something that everyone faces when opening accounts anywhere. And depending on who you are, where you live, or how you generate income, this process can be more or less complex.
That said, being able to prove the source of funds via cryptocurrency can be more difficult. This is due to the nature of cryptocurrency and the anonymity associated with it. Likewise, a lack of paper trail or audited financials like you would expect from a company can make tracing income more challenging.
Overcoming this obstacle is something everyone has to do. But the requirements can differ widely from bank to bank. Likewise, your situation and risk profile will influence what documents are required and the depth of the due diligence process. We talk about how GlobalBanks Insiders overcome this obstacle later in the article.
Cryptocurrency-Friendly Jurisdictions
As discussed above, determining which country to bank in is an important step in opening the best bank account for cryptocurrency-related customers. And while it’s an important first step for all types of businesses, the stakes are higher when dealing with crypto.
Changes to local regulations can impact transfers being delayed, mountains of paperwork, funds being frozen, or account termination. And in addition to being incredibly frustrating, this costs you time and money.
So, picking the right country for your banking activities is key. And, the “right” country often means a jurisdiction that has proven to be tolerant and supportive of cryptocurrency-related projects and has crypto-related legislation.
There are a few countries that have made headlines in recent years, making big crypto-related promises. Unfortunately, few have actually followed through. Let’s take a look at those that could be worth considering.
Crypto Banking in the United States
While the US typically plays the antagonist in most crypto-related stories, banking is one area where the country is showing promise.
You see, US banking is quite complex, with overlapping state and federal laws, regulatory bodies, and banks. And it’s within this cluster of opaque regulation and innovation that some of the greatest advancements in crypto banking are emerging.
In fact, many believe that the best bank for cryptocurrency businesses is in the US. Of course, there are other factors that play into this as well.
If you’re interested in opening bank accounts for crypto-related businesses, several US banks offer specialized services. Of course, if you need help identifying those banks, bankers, and opening accounts, GlobalBanks would be happy to help.
Crypto Banking in Switzerland
Switzerland has been at the forefront of crypto banking since the beginning. There are a number of reasons for this, but one that is unique to Switzerland (and similar jurisdictions) is their familiarity with complex sources of income.
In other words, Swiss bankers and compliance officers don’t shy away from crypto-related customers or individuals with crypto-sourced income. Bankers and compliance teams here are more sophisticated, better equipped, and motivated to take on new customers in the crypto space, as long as they’re profitable for the bank.
If you have a crypto business that is high-risk, then some banks may offset this risk by requiring that you maintain a higher minimum deposit, invest a certain amount of funds, pay higher fees, limit incoming or outgoing transfers. Of course, they could also subject you or your business to various forms of enhanced due diligence.
In fact, some banks in Switzerland offer access to crypto exchanges, trading, structured cryptocurrency investment products, and fiat conversions.
Now, it’s not surprising that one of the best banking jurisdictions in the world could also be home to the best bank for cryptocurrency. But making sure that Swiss banks are a good fit for you is also an important consideration.
In addition to making sure the bank has the services you need and will realistically accept you, you should also carefully examine the fees, maintenance costs, and ongoing account requirements before going through the account opening process.
Crypto Banking in Liechtenstein
Liechtenstein is another country that has been supportive of crypto from early on. Similar to Switzerland, Liechtenstein banks have experience with complex client profiles and sources of income.
Banks in Liechtenstein, as in other prominent banking hubs, understand that the biggest challenge with crypto-related customers is a matter of both accounting and compliance.
Thanks to their proactive approach, many believe that Liechtenstein is home to some of the best bank accounts for cryptocurrency. However, the minimum deposits are substantially higher than those you’ll find in the US and elsewhere.
As a result, some Liechtenstein banks are now leaders in cryptocurrency banking. This is true both for both individual, corporate, and private banking. And in all instances, Liechtenstein banks are best for wealth management and investment services. So, they’re ideal for those with crypto-sourced income looking to diversify.
Honorable Mention: Crypto Banking in Bermuda
While the other countries mentioned have seen a combination of industry and (to some degree) government support, Bermuda has benefited primarily from a top-down approach.
So far, specific banking legislation has been introduced to help spur banking services for crypto businesses. Insurance companies are being encouraged to cover the activities of crypto projects. And Bermuda has also been a leader in introducing regulations to support innovation within the crypto ecosystem. That’s much more than can be said for other countries.
As several top crypto experts have expressed, we’re excited to see how the banking landscape in Bermuda evolves to fill this need. However, so far, no domestic banks have stepped up to the plate.
How to Open the Best Bank Accounts for Cryptocurrencies
GlobalBanks Insiders can access our premium report, the Ultimate Guide to Banking for Cryptocurrency Entrepreneurs and Investors here. This is the most comprehensive guide available on finding and opening an account with the best bank for crypto-related businesses and individuals.
In it, we share real crypto banking suggestions in ten different countries, known to accept crypto-related businesses and individuals.
The report also outlines detailed account opening strategies and step-by-step directions to prove crypto sources of income. It also outlines how to tell if a bank is a good fit for you.
This report focuses on uncovering the best bank account for the following cryptocurrency-related profiles:
- Early cryptocurrency adopters
- Cryptocurrency traders
- Cryptocurrency miners
- Blackmarket cryptocurrency buyers
- Individuals engaged in cryptocurrency projects
- Cryptocurrency businesses & projects
- Businesses accepting cryptocurrency payments
- Businesses that have completed an ICO
To make sure you have everything you need before contacting the bank, this report also discusses important considerations, such as:
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- Crypto-related compliance issues
- Your crypto-related client profile
- Crypto source of wealth
- How to effectively track crypto-related activities
- How to approach the bank
- Tax issues you should consider
- Related costs of crypto banking
- Risks related to cryptocurrency banking
When you join GlobalBanks Insider, you get instant access to this detailed and actionable report. Plus, you’ll also receive many more benefits that will help you access the best banks to support your banking objectives.
Ready to Open Bank Accounts for Cryptocurrencies?
If you need help finding the best bank for cryptocurrency projects or for yourself, want to know which banks you should apply to, or just aren’t sure where to turn, we can help.
If you’re ready to take action and start opening international accounts now, you can access GlobalBanks IQ, our dedicated international banking intelligence platform.
GlobalBanks IQ gives you everything you need to start finding and opening accounts for you or your business today.
When you join GlobalBanks IQ, you immediately unlock the GlobalBanks Database of international banks — home to 250+ banks in 50+ countries.
And, you get access to our library of premium (members-only) reports. These include proven account opening strategies, country-specific banking options, and lists of banks for specific client types.
Plus, you unlock our account opening checklists, dedicated account opening alerts, and much more.
To get started, click here to see if GlobalBanks IQ is the right choice for you to start accessing the benefits of international banking today.
You can also view all of the account opening solutions offered by GlobalBanks on our products page.
