Qonto cautiously opens up to cryptocurrencies

The neo-bank for professionals Qonto has just evolved its services by allowing its customers to invest part of their cash in crypto-currencies. By regulating these transactions, Qonto is opening up to a high-potential market while avoiding disruption.

FACTS

• The neobank now allows its customers to invest part of their cash in crypto-assets.

• Qonto is nevertheless framing this opening by specifying that the use of crypto-currencies from its Qonto account will now be possible but restricted.

• Investments in crypto-currencies will therefore be subject to several conditions, the first of which is that this crypto-currency investment activity will only represent a minority part of Qonto's customers' cash flow.

•  The FinTech is also only opening its new service to certain platforms:

  • with a PSAN licence for Digital Asset Service Providers,

  • domiciled in the US, Germany, UK or France.

• Qonto has the right to ask its customers for proof and explanations to prove the compliance of their transactions.

•  Excessive cryptocurrency flows or non-compliant use of Qonto accounts may result in account closures.

ISSUES

• A position of reason: As the most valued start-up of the French Tech, Qonto could not miss the turn of the crypto-currencies and especially, take the risk to cut itself from a part of the market of professionals interested in these investments.

• Keeping its reference status: Qonto's opening to crypto-currencies is taking place slowly, as the FinTech itself admits. Qonto justifies this positioning by highlighting its role as a payment institution regulated by the Banque de France and the ACPR.

• Satisfying new uses: By opening up to crypto-currencies, Qonto is not targeting professionals in this market but the growing number of professionals wishing to invest or whose activity is partly linked to this market: consulting for example.

MARKET PERSPECTIVE

• The crypto-currency market is no longer the exclusive domain of specialists. A growing number of historical and non-specialist players are positioning themselves over time, participating in the democratisation of this market in a virtuous circle that now seems unstoppable.

• In France, other players such as Lydia have recently joined the battle. However, the choice of partners remains erratic. While Lydia opts for Bitpanda, a PSAN-registered platform based in Austria, Qonto prefers providers such as Coinhouse, LGO Europe, Paymium and StackinSat.

• Nicolas Louvet, CEO of Coinhouse, has in any case argued that this trend will eventually affect all financial services players, including the historical banks.