Why do crypto companies still need banks?

The bills are in ordinary money

A crypto company may hold much of its treasury in tokens. But crypto is still rarely used to pay for everyday things. In its 2021 annual report, Silvergate, then a US bank that served many crypto firms, wrote that use of digital currency by consumers as a form of payment is limited.³

Payroll and many other bills typically move between bank accounts. In the US, the Federal Reserve gives the direct deposit of payroll and tax refunds as typical examples of payments on the ACH network, which links banks.¹

Who keeps money at a bank

Banks that served the crypto industry before 2023 held money for many kinds of crypto business. New York's bank regulator listed the crypto depositors at Signature Bank:⁴

• Crypto exchanges, stablecoin issuers and custody firms.⁴
• Miners and crypto lenders.⁴
• Operating accounts for crypto businesses: the accounts they use for everyday spending.⁴

The regulator noted that Signature itself did not hold, custody or trade crypto.⁴ It held dollars for crypto companies.

Banks are the door to the payment systems

In the US, many large, urgent payments move over Fedwire, a system run by the Federal Reserve Banks. A Fedwire payment is final and can't be reversed once processed.² Only banks and certain other institutions that hold an account at a Federal Reserve Bank can use it directly.²

Two other payment systems also work through banks:^1,6

• ACH lets banks send each other batches of electronic payments, such as payroll.¹
• FedNow, live since July 2023, lets people and businesses send instant payments through their bank accounts at any hour, every day.⁶

Payment services that don't give customers a bank account, such as many money transfer services, still rely on banks to actually move the funds across borders, said a 2016 report by the central banks' Committee on Payments and Market Infrastructures (CPMI).⁷

Some firms want direct access. In May 2026, the Federal Reserve Board asked for public comments on a limited "payment account" for eligible institutions. It said many requests for access come from institutions that are not federally insured.⁸ The proposed account would not get credit from the Fed and would earn no interest on its balance.⁸ Check the Fed's website for its current status.⁸

Stablecoin reserves sit in banks too

A stablecoin issuer may keep part of its reserves as cash in bank deposits.^5,9 In February 2023, the three US federal bank regulators named deposits that are stablecoin reserves as a kind of crypto-related deposit that can leave quickly.⁵ They withdrew that statement in 2025, as lesson 6 explains.^10,11

The risk was real. When Silicon Valley Bank failed in March 2023, Circle, the issuer of the USDC stablecoin, announced that it could not withdraw $3.3 billion of USDC reserves from the bank, about 8% of the total, according to a 2025 note by Federal Reserve staff.¹² Circle also kept accounts for USDC payments at Signature Bank.⁹

The crypto banks' 24/7 networks

Some banks built payment networks for crypto firms. Silvergate's SEN let exchanges and investors move dollars between their accounts at the bank 24 hours a day, 7 days a week.^3,13 Silvergate contrasted this with wires and ACH payments, which it said can take from several hours to several days.³

Signature Bank had a similar platform, Signet, for its own customers.¹⁴ In March 2023, Silvergate began winding down and Signature was closed, as lesson 4 explains.^15,16