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BofA gets tech patent for bitcoin use

Bank of America has recently filed a patent for technology that enables it to use cryptocurrency for fund transfers between countries. Global banks are now examining the viability of using bitcoin and digital currency in banking operations but one area that remained unexplored was the technology for transfer of funds using cryptocurrency. The bank received the patent on 17 September. It describes the cryptocurrencies as Bitcoin, Litecoin, Ripple, Peercoin, and Dogecoin, which can be used to transfer funds between accounts. Doing so would help speed up the transfer, make it more reliable, and reduce the amount of customer data sent to third-party clearing houses like SWIFT, which traditionally facilitate cross-border payments.

According to the patent, much of the action will take place on the backend of the transaction. After a customer submits for a money transfer, the bank would determine whether using a cryptocurrency would be appropriate, based on how quickly a traditional wire transfer can be processed and how expensive it would be. Also, Bank of America will be agnostic about the particular currency used – a cryptocurrency will be selected for a transfer based on a number of risk factors, including volatility and price. It will also try to make the settlement process ‘essentially simultaneously’ to limit any changes in price. There are reports that many financial services institutions like MasterCard, Amazon and JPMorgan have applied for bitcoin-related patents. However, none of them have actually started using bitcoin, most likely due to the uncertain regulatory climate surrounding digital currency.

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