Europe’s Small Banks See Crypto as Opportunity to Take on Big Banks
Unlike larger banks who are criticizing crypto, some smaller institutions in Switzerland, Germany and Liechtenstein are bucking the trend. They are are instead offering their clients opportunities to be a part of the digital currency revolution.
Big banks are losing out
Whether it be as a method to control the financial freedom that cryptocurrencies offer, or as a genuine way to introduce virtual currencies to the masses, regulation is on the increase.
While some major banks are declining crypto-related transactions, smaller institutions are of the opposite view. According to the Financial Times, Swiss private banks Vontobel and Falcon Bank, as well as Fidor Bank in Germany and Bank Frick in Liechtenstein, have rather embraced the industry by offering a range of crypto services.
Edi Wögerer, who is the chief executive of Bank Frick, had this to say:
“There are risks involved but there are also really big opportunities. We know what to do from a security perspective so this is a big opportunity for banks like us.”
Wögerer added to the common chorus that bigger institutions see virtual currencies as a danger to their well-established status quo. He said that larger banks were “scared” of crypto and that “because they don’t understand them, they feel threatened”.
The popularity of virtual currencies is undeniable, which means that even if these bigger institutions aren’t interested, others most definitely are. President of the Crypto Valley Association in Switzerland, Oliver Bussmann, has said that “more and more bankers are coming in,” hoping to capitalize on the lucrative gap left by their larger counterparts.
ICOs are also feeling the love
Bank Frick offers advisory support for startups conducting ICOs, and they even screen investors. Payment for their services is in the form of cryptocurrencies.
With ICOs having the cloud of possible fraud hanging over them, Wögerer has said that these services are in “huge demand”, but the firm is “very selective”, having worked with 10 ICOs so far.
In their bid to embrace crypto, the bank also facilitates investor access to crypto exchanges, offers a crypto-tracker fund and keeps a hard copy of coin codes safe in their vault.
The given trend supports a prediction by Bitcoin expert, Andreas Antonopoulos, who stated that big banks will eventually lose ground to innovative fintech platforms and smaller banks, who are more willing to embrace open-access, network-centric cryptocurrency. This approach will help them tap into the unbanked market, which includes over 4 billion people.
Smaller banks won’t be deterred
Even though global institutions aren’t in favor of the digital financial future, these banks aren’t concerned. Wögerer added:
“We hear these international statements. If it gets regulated, and it will get regulated, we will already comply with it.”
These smaller banks offer a range of crypto services to their clients. Vontobel has a Bitcoin tracker, and also has crypto-betting facilities.
Falcon Bank allows investors to buy virtual currencies, and accepts proceeds from crypto sales.
Fidor Bank not only offers a euro bank account to Kraken, but also gives its German clients access to the US-based exchange.
A main reason that larger financial institutions give for their aversion to crypto, is its alleged attractiveness for money laundering, tax evasion, financing terrorism, and other illegal activities, despite evidence to the contrary.
However, Bussman has stated that these smaller banks could introduce their own processes, such as screening their clients to ensure that they are not in breach of any financial laws or sanctions.
Do you think that we’ll see an increase in smaller banks offering crypto-related services? Let us know in the comments below!
Images courtesy of Antonopoulos.com, bankfrick.li, Shutterstock