Small private banks in Europe ignore the efforts of regulators.
While larger banks across Europe and the world are cracking down on bitcoin investments, a subset of European small banks is bucking that notion and is actually moving to increase investor access to bitcoin. These banks are also, according to Financial Times reports, advising firms on ICOs despite the fact that regulators are trying to get that market under control.
Vontobel and Falcon Bank — both private Swiss Banks — are among the lenders that are working on cryptocurrency-based investments for clients. Germany’s Fidor Bank and Liechtenstein’s Bank Frick provide similar services.
“There are risks involved, but there are also really big opportunities,” Edi Wögerer, chief executive of Bank Frick, told the Financial Times. “We know what to do from a security perspective, so this is a big opportunity for banks like us.”
He went on to note that his counterparts at larger banks are “scared” of cryptocurrencies “because they don’t understand them, they feel threatened.”
Oliver Bussmann, president of the Crypto Valley Association in Switzerland’s canton of Zug near Zurich, noted that big banks quitting the field in this regard had opened the door for smaller competitors.
“More and more bankers are coming in,” he told the Financial Times.
Wögerer also noted the “huge demand” for his bank’s services and that demand has meant they can be careful about the firms they work with. “We are very selective.”
Banks worldwide have been prone to steer around cryptocurrency in all its forms, as money laundering and terrorism finance have both been associated with bitcoin.
And banks are worried about the volatility of the price — hence the number of British and U.S. banks have that have blocked cryptocurrency purchases on credit cards.
“Resolute ringfencing measures might be needed,” Yves Mersch, executive board member of the European Central Bank, warned last week.
But the small banks and their leadership like Mr Wögerer remain unconcerned.
“We hear these international statements,” he said, comparing the current furor to the early days of the internet, which many viewed as a threat. “If it gets regulated, and it will get regulated, we will already comply with it,” he said.