A British “neobank” called Revolut is working on letting its customers convert and hold bitcoin and other cryptocurrencies directly in their accounts.
Revolut is technically not a bank because it doesn’t have a banking license from the UK’s financial regulator, but it offers many of the same features as a bank, such as checking accounts (known as “current accounts” in the UK). Revolut, which is currently available to citizens of dozens of European countries, says it’s “actively exploring” applying for a banking license.
The firm will let users buy, sell, and hold three cryptocurrencies: bitcoin, litecoin, and ethereum. Users will also be able to transfer cryptocurrencies to other Revolut account holders. The big thing here is Revolut’s promise to allow “instant” conversion of fiat money to cryptocurrencies within its app, potentially removing the currently troublesome process of signing up on crypto exchanges, or peer-to-peer platforms, or going to a bitcoin ATM, to acquire or dispose of funds.
The firm won’t perform the crypto conversions itself. Instead it will work with several of “the most trusted” cryptocurrency exchanges to perform the conversion, says Lewis Tuff, Revolut’s lead engineer. Tuff says his firm is aiming for the lowest spreads and fees for “seamless” conversions. It’s planning to release the feature this month, although it has not fixed a date, Tuff says.
Revolut says it’s introducing crypto holdings because of “huge demand” from its users. It claims 855,000 customers who have transferred over $4 billion within the app since it launched in 2015. The firm has 3,000 customers signed up to test the crypto feature, and Tuff says the firm gets hundreds of Twitter “favorites” an hour whenever the crypto feature is mentioned.
The Revolut feature is the latest cryptocurrency-related innovation among Britain’s so-called “neobanks,” upstarts offering digital-only financial services, some of whom have acquired banking licenses. One of those is Monzo, whose API is being used by an app called Dust to lets users automatically turn spare change into bitcoin. Both the Revolut and Dust approaches promise to greatly reduce the considerable friction in acquiring cryptocurrency—and to bring the likes of bitcoin and ether closer to the mainstream.