The Era of Crypto-Banks Opens in Switzerland

The Swiss Financial Market Supervisory Authority (FINMA) granted banking licences to two start-ups specialising in digital assets: Seba and Sygnum.

Goal: craft regulated banking services based on crypto-assets.
Zurich-based FinTech Sygnum provides companies, institutional and private investors, banks and other financial institutions with advice when investing in digital assets.
The crypto-assets specialist SEBA helps building bridges between conventional and crypto environments.
These crypto-banks may now:
- Store and manage bitcoins and ethers,
- Convert Swiss francs, euros and dollars into these cryptocurrencies,
- Transfer tokens, yet only between customers from these two players.
If successful, this pilot phase could lead to other customers to be addressed, even if residing outside of Switzerland.

Compliance challenge. These licences granted by the FINMA came with the implementation of a new doctrine on KYC compliance. The financial watchdog drew inspiration from recommendations released two months ago by the Financial Action Task Force on the obligations crypto-asset platforms must meet.
Regulators’ dilemma. In line with AML and counterterrorism rules, the anonymity inherent to Blockchain technology poses increasing risks. As this country works towards appearing “Blockchain-friendly”, authorities must hit the right balance between high-regulation in this industry and an intent not to hamper innovation.
Asian extension. Besides this banking licence, Sygnum also aims for Asia. Discussions would be underway with Singapore authorities to be granted a licence for processing capital market transactions.

This announcement is made after a delegation of US parliamentarians visited Switzerland to clarify regulatory issues surrounding Facebook’s Libra project.
Rival start-ups such as Lykke, Bitcoin Suisse and Crypto Finance, also applied for banking licences. Sygnum and Seba, however, waited to be granted the highest possible authorisations from the FINMA before launching their services.

Category : Alertes quotidiennes