Banks, venture capital, and Bitcoin are stuck in a "chicken and egg" cycle

Banks are reluctant to accept regulation

Many experts (especially more experienced venture capitalists) are quick to warn that banks are trying to understand Bitcoin. They point out that while many are not currently involved in the Bitcoin ecosystem, they are aware that more and more merchants are active in the space and realize that Bitcoin has great potential and may bring long-term business.

Wells Fargo said the bank is "learning more about virtual currencies and their potential returns and risks."

However, other commentators believe that banks’ reluctance to get involved in Bitcoin is due to regulatory factors.

However, more than one smaller bank has issued a statement, including the Peninsula Credit Union, headquartered in Washington, which publicly supports this view and said that if a Bitcoin company comes to approach them for work, they will consider cooperation. CEO Jim Morrell made it clear that his company will not accept Bitcoin companies. The reason is simple. They do not cooperate with any cash service companies because they must follow a lot of principles to avoid cooperation that may incur risks.

"It's not a concern about increasing workload, but is this an area we are pursuing at this point? We have not received clear directives from the board at this point."

Seeking asylum abroad

Although the latest news does not prove this, there is a common view that foreign banks are more conducive to Bitcoin businesses. Based on his own past experience, Pierce also believes the same.

Silbert added that while he is confident about his investment in this emerging market, some startups are concerned about staying the course. "A lot of these companies have one and only one partnership, and they are always worried that one day they might get a call and that one partnership will fly away." Silbert further pointed out: "Any Bitcoin company that has an advantage and moves abroad may only be temporary. I suspect that some of these companies have partnerships with banks, and the bank's executives either don't know that these companies are involved in the Bitcoin field, or don't even know what Bitcoin is. Frankly, this happens all the time in the United States."

Let time prove

Despite the challenges facing U.S. bitcoin startups, venture capitalists believe that the U.S. bitcoin banking crisis is only temporary.

Pierce is equally optimistic, believing that persistence is the only way out: “If you approach hundreds of banks, you’ll always find some that are willing to try, but many people only approach a few and then give up.” Lukasiewicz agrees, saying that establishing partnerships with banks depends on hard work and luck.

Looking back, he had faced such a test before. Endurance is the guarantee of success, and only the strongest companies survived. He recalled: "At every step of the way, someone told me that so-and-so gave up halfway. I have heard this many times. You will find that they attend various meetings and try their best to raise funds. However, after hitting a wall again and again, they begin to realize how difficult it is to cooperate with banks. Then they will say, 'This is simply impossible, let's move on to the next thing'."

Silbert believes that this bottleneck will not last long. He emphasized that the major banks and investors he has contacted are increasingly interested in Bitcoin business, and he even began to describe the possible beauty of the future: banks will compete to become partners of Bitcoin companies.

However, the question remains: when will this interest turn into action, and how many entrepreneurs will be able to wait and not give up halfway?

Lingham said: "In the short term, the threshold for seeking cooperative banks will still be very high, but in the medium term this difficulty will decrease, and in the long term, all banks will gradually accept Bitcoin because they have to do so. As for how short this short term is? It's not something I can guess."