Finma Grants Licenses to First-Ever Crypto Banks26 August 2019
The Swiss financial regulator FINMA has granted banking licenses to cryptocurrency banks. This is a game-changing decision for fintech, crypto-market as these will be first ever crypto banks operating in Switzerland.
First-ever Swiss Crypto Banks
FINMA granted licenses to Seba Crypto and Sygnum – fintech start-ups that have managed to get onboard some well-known bankers and gather serious financial resources. The move is considered as a game-changing for the industry, but the fact there are two licenses granted at once comes as no surprise. It was previously reported that if FINMA indeed plans to give for the first-time license to a crypto bank, it will choose to grant two at the same time. In such case none of the institution gets an advantage of being able to start operations first.
About the Crypto Banks
Seba Crypto is based in Zug and has Julius Bauer as a partner – the private bank from Zurich. Whereas Sygnum has in the board former USB CEO Peter Wuffli and as an advisor – former central banker Philipp Hildebrand. Sygnum has its own digital payment token that is pegged to CHF – which means its exchange rate is similar to that of Swiss Francs. Tokens are used to pay for trades on Sygnum platform. Both banks will become fully-fledge banking institutions once they complete final regulatory procedures.
Proved to Be Trustful
Swiss financial supervisory authority so far was not conceived that any entity operating in cryptocurrency market is able to provide safe and reliable services. Connecting traditional banking and crypto banking not so long ago seemed as impossible. But both projects – Sygnum and Seba – have proven to FINMA that they can be trusted and change the watchdog’s stance.
At the same time, FINMA put out new anti-money laundering regulations that are based on guidelines from FATF, a G7 task force. Some of them are also concerning crypto banks. Seba and Sygnum or other that will follow, can only send tokens or cryptocurrencies to users of verified identity. If information about institution cannot be verified in traditional payment systems, crypto banks won’t be able to receive from it or send to it any crypto-securities, tokens.
Crypto Banks Are Satisfied
Obviously, founders of both Seba and Sygnum welcomed the information of granting licenses as deeply satisfying. They stated it would change the game and give the green light to a vast integration of crypto currencies and digital assets within the traditional financial sectors.
“This is the first time such licenses have been granted worldwide, so Switzerland is playing a pioneering role,” Manuel Krieger, CEO of Sygnum Switzerland, told swissinfo.ch. “We now have a responsibility as an enabling platform to help banks and other financial players make the step into the digital asset world.”
Whereas Mathias Imbach who runs the group’s Singapore operation added that: “Cryptocurrencies will come out of the shadows if dealing with these assets can be done in a 100% compliant manner upholding all the rules that a strict regulator demands. That is a game changer.”
Switzerland Is Crypto-friendly
Granting two banking licenses to crypto banks add further to Switzerland’s reputation of the crypto-friendly country. It is one of the global leaders when it comes to the adoption DLT technology, tokenized digital assets and in fintech start-ups market. Additionally, Switzerland is preparing laws that would be applicable to crypto market. There is a reason that Facebook decided to make Geneva as headquarters for its Libra, crypto currency project’s foundation. International customers are hungry for digital assets and crypto currencies – like they are eager to buy Swiss francs in times of economic turmoil. That is why banks like Swissquote, Vontobel or Maerki Baumann are looking closely at blockchain projects and crypto currencies finances.
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