They are acquiring interest of some kind in a certain coin (or perhaps a basket of them), but that they don't necessarily 'come into possession' of the coins (which is of course electronic anyway).
I mean, I'm sure one can also actually buy the coins and put them into their coin bank to then use to make purchases denominated in coins (or hold as an investment), but I don't think that's the bulk of the investment industry today for bitcoin. Rather you 'buy into' investment instruments similar to how you can buy into the gold market w/o ever physically possessing gold.
Someone correct me if I'm wrong on that point.
Regarding not needing a bank account, people definitely have 'coin banks', that's where the coins go as they are mined and is the method of exchange for making purchases with them (i transfer from my coin bank to yours in exchange for something).
If you want to actually buy them w/o mining them yourself (or possessing any cryptocurrency in a coin bank you could make a trade with e.g my Etherium for your Bitcoin) or invest in them generally, then yeah, I assume you need some sort of traditional bank account so you can pay for the coin or the investment vehicle (and probably to take money out if you have 'shares' that go up in value).
But actual transactions of cryptocurrency take place outside the regular banking system, from one 'coin bank' to another. These 'banks' are maintained by the coin system itself (although I think banks can also be set up outside of it as well), a peer-to-peer connected system which is distributed across 1000's or even millions of computers worldwide. Each persons 'account' is anonymous, basically you just have an account number and I'd suppose a password (which you guard with your life if you have many coins lol). Which is why it's great for the black market lol ...
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