The financial watchdog in Switzerland issued banking licenses to two blockchain startups. The Swiss Financial Market Supervisory Authority (FINMA) has anti-money laundering rules in place for financial services. As a result SEBA Crypto AG and Sygnum AG are allowed to offer services to institutional and professional customers.
For the first time blockchain companies get banking licenses. Both SEBA Crypto AG and Sygnum AG are being called Virtual Asset Service Providers (VASPs). This refers to blockchain services like exchanges, wallet providers and trading platforms.
These banking licenses require companies to know their customers. On top of that anti-money laundering procedures are in place. In this case they need to have a risk-based approach to monitoring business relationships, and file a report when there are reasonable grounds to suspect any criminal activity.
What do the companies do with these banking licenses?
Sygnum AG wants to provide traditional banking and wealth management services. They will do this will the efficiency of blockchain technology. They intend to offer asset management, brokerage, credit and tokenization services.
The other banking license for SEBA Crypto AG is also aimed at asset management. In the future they also want to offer transaction banking and storage custody services.
What’s happening around the world?
There are already plenty of financial services that offer cryptocurrency options. There are also cryptocurrency companies offering services to consumers. But the licenses provided by FINMA are aimed at institutional and professional customers. This means big money now has another easy way to find its way into crypto.
Other countries will follow Switzerland’s example. Representatives from the United States visited the European country earlier this month to learn about crypto. In The Netherlands the financial watchdog is busy formulating rules for banking licenses, while smaller countries like San Marino are embracing blockchain for social purposes. On the island of Malta all rent contract are being recorded on the blockchain, and the country recently announced companies are being registered on the blockchain as well.
Also published on Medium.