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Switzerland Considers Granting Crypto Businesses Access to Banking Services
ECONOMY & REGULATION
14 mins ago | Lubomir Tassev | 396
Switzerland Considers Granting Crypto Businesses Access to Banking Services
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Crypto companies based in Switzerland may receive access to regular banking services as early as this year. Political will and economic wisdom seem to be in place as some government officials and bankers are already working to resolve a serious issue. Swiss banks have been refusing accounts to firms from the growing crypto industry.
Also read: Swiss Crypto Company Acquires License to Distribute Funds to Investors
Banks Expected to Offer Services by the End of the Year
Switzerland Considers Granting Crypto Businesses Access to Banking ServicesIn terms of crypto development, Switzerland is now standing at a crossroad. With very few exceptions, most of its banks have been refusing banking services to a growing number of startups residing in the country’s Crypto Valley and this is beginning to suffocate growth in the fintech sector.
Luckily, far-sighted policy makers and seasoned financiers have already pulled their sleeves up and are working to break the deadlock. One of them is Heinz Tännler, the finance director of the canton of Zug, home of the Swiss Crypto Valley. Speaking to the Financial Times, Tännler said he expected Swiss politicians and regulators to remove the obstacles in the coming months, which would allow crypto companies based in the country to operate with banks just like any other business. He added:
We hope to clarify relationships by the end of the year at the latest. Time is pressing – other jurisdictions such as Malta and Singapore are very active and making a lot of effort to attract these companies. The lack of access to bank services is a significant competitive disadvantage.
According to Mr. Tännler, the country’s central bank, financial supervisor and federal government “are willing to help.” He also stressed that “We have to push certain national institutions to resolve this problem quickly and effectively, but that now seems to be going well.”
Traditional financial institutions are increasingly under pressure to offer crypto startups regular services like bank accounts. According to Swissinfo, the bottleneck has become acute since the ICO craze brought $1.46 billion to Switzerland last year. A recent report by the Crypto Valley Association revealed that token sales through May this year have attracted nearly double the funds raised in 2017.
Starving startups of bank accounts is akin to killing the goose that laid the golden egg,” said blockchain and cryptocurrency expert Guido Schmitz-Krummacher, former director of the Tezos foundation and advisor to projects like Cardano. He believes that the failure to provide a reliable environment for startups will harm the reputation of the Crypto Valley in Zug.
“I am already seeing projects choose Singapore, Malta and Gibraltar because they can’t get a bank account in Switzerland. They will be followed by projects already established in Switzerland unless the banks and politicians address this topic.” The lack of access to normal banking services is worrying, according to Alain Kunz, chief executive of Coinlab Capital, a startup offering blockchain asset management services. “You can do a lot with crypto but you can’t pay rents and salaries,” he told the FT.
