Wall Street Giants Enter the Market: Traditional Banks Launch Bitcoin Collateralized Lending Business, Mainstream Recognition of Crypto Asset Financial Properties

MicroStrategy founder and executive chairman Michael Saylor recently revealed that six top Wall Street financial institutions—BNY Mellon, Wells Fargo, Bank of America, Charles Schwab, JPMorgan Chase, and Citigroup—have officially started Bitcoin-backed lending services. This marks Bitcoin's transition from a fringe alternative asset to a core application within the traditional financial system, with the collateralization of crypto assets gaining endorsement from the world's most influential financial institutions.
As the leader of the world's largest publicly traded Bitcoin holding company, Michael Saylor’s statements are highly industry indicative. The six institutions involved encompass top global custodian banks, retail banking giants, investment banking benchmarks, and wealth management leaders: BNY Mellon is the world's largest asset custodian, managing over $40 trillion; JPMorgan Chase ranks first among global investment banks, with investment banking revenue surpassing $30 billion in 2024; US Bank and Wells Fargo are the top two retail banks in the US, serving over 150 million individual clients combined; Charles Schwab is one of the largest retail brokerages globally, managing $7.4 trillion in client assets. Their collective action is not a mere trial but a systematic recognition of the value of crypto assets by traditional finance.
The implementation of Bitcoin-backed lending fundamentally addresses the core pain points for crypto asset holders: they can avoid selling Bitcoin to forgo long-term appreciation while gaining fiat liquidity through collateralization for business expansion, personal investments, or daily operations. Industry insiders reveal that such lending products typically set collateral ratios between 30%-50% (far higher than the 10%-20% common at crypto exchanges), with annual interest rates floating between 4.5%-7% depending on client qualification—significantly lower than informal crypto lending channels. For example, JPMorgan offers Bitcoin-backed loans to high-net-worth clients with single-credit limits up to $50 million, with collateral managed by BNY Mellon’s independent custody, fully compliant with SEC and OCC regulations.
Behind this trend lies a fundamental shift in Bitcoin’s asset nature. Before 2020, traditional financial institutions generally avoided crypto assets due to their volatility, unclear regulation, and money laundering risks. By Q3 2025, Bitcoin has maintained a position within the top ten least volatile global assets for 18 consecutive months—less volatile than the Nasdaq 100 index—and major economies like the US, EU, and Singapore have introduced clear crypto regulation frameworks. More importantly, institutional holdings of Bitcoin have increased from 12% in 2021 to 35% in 2025, with the total holdings of listed companies and asset managers like MicroStrategy, Tesla, and BlackRock exceeding 1.5 million BTC—accounting for 7.8% of circulating supply—creating genuine financing demand.
Michael Saylor further emphasized that traditional banks' entry into Bitcoin collateralized lending will create a positive cycle of “holding-collateral-appreciation”: institutional clients, after obtaining liquidity via loans, may reinvest part of the funds into the Bitcoin market, boosting demand; meanwhile, banks will generate stable income through custody, interest, and transaction settlements, further incentivizing their expansion into crypto assets. Data shows that in the first half of 2025, the global crypto collateralized lending market reached $120 billion, with traditional financial institutions increasing their share from 5% in 2024 to 28%, and it is expected to surpass 50% by the end of 2026.
It is also noteworthy that regulatory attitudes continue to loosen. In October 2025, the US Office of the Comptroller of the Currency (OCC) officially issued the “Guidelines for Crypto Asset Collateralized Lending,” clarifying that banks can conduct such activities under conditions of sufficient capital and anti-money laundering review. The EU, through the Markets in Crypto-Assets Regulation (MiCA), has provided a clear compliance pathway for banks engaging in crypto collateralized financing. Against this backdrop, institutions like Goldman Sachs and Morgan Stanley, which have not yet publicly disclosed related activities, are reportedly building internal Bitcoin collateralized lending systems, with a full-scale launch expected in 2026.
This financial revolution led by Wall Street giants not only redefines Bitcoin’s asset positioning but also ushers in a new phase of deep integration between the crypto economy and the traditional financial system. As Michael Saylor stated: “When the world’s largest banks begin accepting Bitcoin as collateral, it means the value of crypto assets has been recognized by the backbone of the financial system—this is not the end but the beginning of cryptocurrencies becoming mainstream assets worldwide.”