Why would the Bank of America treat Bitcoin (BTC) as cash?

A user on the social networking site Reddit posted an image showing a possible change in the terms of Bank of America's credit card for Bitcoin (BTC). The financial institution could start treating bitcoin-related transactions as "cash advances" in order to increase its fee income. The photo, uploaded to Reddit, sparked a heated debate in the crypto community. The letter from Bank of America shows a change in the terms and conditions of the Bank of America credit card. According to the letter, all transactions related to Bitcoin, Ethereum, Litecoin and other cryptocurrencies could be considered "cash advances.

In other words, the Bank of America may consider Bitcoin and altcoins to be a cash equivalent. If the above applies, the Bank of America will begin treating these transactions as “Cash Advances” and will make an adjustment to the fees related to that category of transaction.

Due to the low volatility that Bitcoin (BTC) has experienced during June, the Bank of America could be looking to capture fees on terms mostly applied to stable assets. Over the past month, the BTC price has moved in the $9,000 range. This is a relatively positive performance considering the global economic outlook.

Although an official announcement has not yet been made and the possible change has only been discussed on Reddit, some members of the crypto community have speculated about the reason for the changes. The main reason seems to be an increase in fees related to the type of transaction referred to. Transactions considered cash advances have an aggregate fee of approximately 5%.

Some users expressed dissatisfaction that the Bank of America and other major institutional players like JP Morgan and Goldman Sachs have an unclear position on Bitcoin (BTC). The complaint went in the direction that the narratives of the above-mentioned institutions change at their convenience:

(…) When it suits them. It’s a commodity when they want to tax capital gains, a cash advance when that costs you more, etc., etc. Pick one and stick with it. Let the chips fall where they may.

Meanwhile, Bitcoin continues to attract more institutional interest. Grayscale’s interest in Bitcoin has been particularly important. The institution has been in a “buying frenzy” for Bitcoin and has bought up to three times the amount of BTC produced by Bitcoin miners in the last week.

Author : Reynaldo