The news that classic banks put a spoke in the wheels of projects operating in the stock market, appear more and more often. And it’s not just about the initially conservative countries, information about the covert bath comes from all over the world.
The financial technology projects that in the description of his activities one way or another mention of working with modern digital currencies, either close current accounts or even refuse to open a Bank account. Some experts tend to believe that classic banks thus compete with rivals. But should banks be afraid of young developing startapov working with them in the same market, or should look at him and start to help the development of the “younger generation Finance”?
My opinion on this matter with ForkLog shared transboundary founder of FINTECH platform PlasmaBank and payment system PlasmaPay Ilya Maximenko.
Mass ban
In June, the Polish Association of bitcoin filed a complaint with the office for the protection of the rights of consumers in a number of banks, which do not allow projects that work with digital currency, to open accounts. The complaint relates to 15 banks that refused 52 projects. Some banks said their “no” nine times in a row that qualitatively describes their policy and says the determination of these financial institutions.
As a result, the number of Polish projects were forced to urgently look for a jurisdiction to move to and pick up new financial partners in other countries of Europe, as without a Bank account and trust accounts to work, they just can’t.
Someone does have to stop the activity. For example, the exchange BitBy migrated to Malta, which, apparently, will be one of the most attractive countries for such companies. The same thing happened in Ireland, where under Bank “ban” were previously approved and even supported by the government and state-owned banks projects such as Bitcove and bitcoin broker Eircoin. However, the exchange Bitcove, where users can buy, sell and exchange bitcoin, previously worked closely with the Bank of Ireland and was awarded the banking award “Best business startup”.
What went wrong? Banks fear competition? Unlikely. Rather, it is about the fear of disgrace from the gosregulyatora, which has not yet formed a clear and understandable requirements for the cryptocurrency market. Speculative actions of some unscrupulous exchanges around the world can also be the cause of such behavior of banks. But should the banks be hiding your head in the sand at the first threat?
European example
Some financial institutions of Germany went the other way. For example, a licensed German SolarisBank launched its Blockchain Factory, which is confined solely under financial and technological projects, that is, provides services to companies that are directly or indirectly working with cryptocurrencies and blockchain technology. The range of services fully meet the needs of young companies: they are the available options to open Bank and trust accounts to share and store their own assets and assets that escrow account is a special account for the purchase and sale of Fiat currencies such as the dollar, Euro and others.
More importantly, startups that address in the Blockchain Factory, available regulatory and legal framework, including services such as transaction monitoring and KYC procedures (know your client – know your customer). That is, the Bank itself offers startups assistance in ensuring compliance with the essential requirements identification of their users. It is on the compliance with the Know your client system is not transparent and the monitoring of transactions often complain about the controls, and the classical banks, refusing to work with cryptoprocta.
Simply put, SolariesBank didn’t struggle with the increasingly popular CryptoRandom, and trying to help young companies adapt to the regulations and requirements of the market.
“The world of Fiat currency is not going to disappear. We are moving to a hybrid future in which the cryptocurrency has yet to defend yourself. However, we see the revolutionary force of new business models and want to participate in building the future of the industry”, — said the technical Director SolarisBank and head of Blockchain Factory Peter Grosskopf.
In the same direction and one of the oldest Swiss banks — Hypothekarbank Lenzburg. This structure exists for more than 150 years and, unlike the financial institutions, which cautiously look at the stock market, decided to support young companies.
“Hypothekarbank Lenzburg modernizing the business in terms of technology and implements a joint strategy in vintage, so it is important for us to work with the young sector of cryptocurrency and blockchain in Switzerland”, – said General Director of the Bank of Marianna, Wilde, noting that to avoid working with unscrupulous players, the financial institution conducts a thorough screening and vetting projects.
Integrate rather than ignore
Those financial institutions that have taken control of the process of interaction with representatives of an emerging market, will benefit more conservatives who prefer not to deal with cryptoprocta even in terms of opening accounts.
Today for classic banks to develop their own crypto and blockchain projects are expensive and time consuming. This process is resource-intensive both from the point of view of financial investment, from the point of view of time. Much easier and more efficient to integrate in its system of ready-made solutions – the process of legal certification takes on average 1-2 months, and the technical integration is from 2 to 5 months.
In this case, the Bank shall not bear any significant costs and keeps pace with the times. Ignoring the trend and blocking the way cryptoprocta, the refusal to recognize their future in the best case, may lead to banking institutions lag behind the market in 2-3 years, at worst – the need to chase after the train departed progress. And it already absolutely other costs and lost time.
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