Most people in the cryptocurrency and blockchain industry know how difficult it can be to obtain a bank account. Banks are turning away these businesses out of fear that the companies will fold under regulatory pressure, or out of fear that cryptocurrencies represent perhaps the greatest threat to traditional, institutional banking in our lifetimes. Institutions are coming around, and realizing that it is better to get involved in the industry than to avoid it, and Heinz Tännler, the Financial Director of Zurich, Switzerland called upon the Swiss Bankers Association (SBA) to help blockchain companies open up new bank accounts.
As reported in Cash.ch, Tännler wants the SBA to create a working group for blockchain and digital currency businesses. Swiss banks are not alone in making it difficult for these companies to open up new accounts. American banks and those in the EU, Asia and other locations are also making the process difficult. However, this fear-driven decision-making creates new opportunities in the free market, and banking institutions in Zug may very well capitalize on them.
Tännler is working with Ernst Stocker, to put the issue in front of the Federal Council Ueli Maurer. They have made the case that Switzerland will lose business to institutions in other countries that have a friendlier environment for blockchain companies. Tännler said, “It must not be that Switzerland loses an innovative industry because it makes payment transactions impossible.”
We are already seeing this in the United States. At the local level, states like New York where licensure is required, difficult and expensive, have driven blockchain companies across the country to more economically friendly states. At the national level, ICOs have already been driven out of the United States, only to open up shop in Singapore, Malta and other countries where regulations don’t make it impossible to do business. As a result, these countries are reaping the benefits of having blockchain companies participate in their local economies, while the United States is losing out. Switzerland does not want to follow in the footsteps of the US.
In response to this statement, Maurer pulled together a meeting between representatives of the SNB, the State Secretariat for International Financial Affairs (SIF), the Swiss Financial Market Supervisory Authority (FINMA), the SBA, Hypothekarbank Lenzburg, and the Canton of Zug.
The SBA will lead the new working group in recommending policy decisions to banks on how they may engage local blockchain companies. These recommendations, in turn will be consolidated with FINMA.
As reported by Cash.ch, the Tax Directorate of the Canton of Zug expressed the necessity for compliance with financial regulations, particularly those related to money laundering. As existing regulations are not specific to blockchain-based companies, it stands to reason that there will need to be some regulatory adjustments in Switzerland to make the plan work.
Hypothekarbank Lenzburg is the first bank in Switzerland that has accepted blockchain companies as clients. If more banks follow suit, then we may see tremendous amounts of capital moving into Switzerland. With a market capitalization of almost $250 billion, and continued growth in the blockchain industry, Switzerland’s economy has much to gain.
Daniel is an experienced and dynamic entrepreneur with a demonstrated history of launching and operating successful businesses. Skilled in Business Strategy, Technical Consulting, Coaching, Sales, Entrepreneurship, Team Building, and Public Speaking.
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