Companies offering financial services based on blockchain have been trying to break into the traditional banking space for a while now. In a new twist in the blockchain industry, the Swiss Financial Market Supervisory Authority (FINMA) awarded banking licenses to two blockchain firms along with guidelines on money laundering. FINMA, which is responsible for monitoring Switzerland’s financial network has always provided guidelines for financial institutions to follow including blockchain firms.
The breakthrough is interesting to see and industry experts are wondering how this will impact the fintech and banking space in other places apart from Switzerland. Now that blockchain gets banking licenses, FINMA has issued strict guidance on Anti-money laundering (AML) that blockchain businesses must follow.
Who Are “The Deal Breaker Blockchain” Companies?
The blockchain companies that secured the banking licenses are SEBA Crypto AG and Sygnum AG with both firms registered broker-dealers focused on a certain blockchain sector. Both companies are also expected to fulfill the AML requirements laid down by FINMA.
FINMA considers the AML to be neutral and applicable to all financial transactions including blockchain. The rule stipulates that companies must carry out customer verification and ascertain the account beneficiary identity, and monitor business relationships using a risk-based approach.
With active searches for illegal transactions by the authorities, responses are quick. A money laundering report is filed with the Money Laundering Reporting Office Switzerland (MROS).
The Goal of Both Blockchain Projects
Both blockchain-based companies are trying to fill the gap that exists between the traditional financial sector and the Distributed Ledger Technology (DLT). Several firms have been trying to among the pioneers that bridge both sides of the divide together but so far no one has proven to be a total success.
However, now that blockchain gets banking licenses, it lays down a strong model going forward for blockchain businesses.
The Companies Profile
Sygnum AG focuses on offering wealth management service along with traditional banking fused with blockchain efficiency and the underlying DLT. Additionally, services like brokerage, tokenization, asset management, and credit are among the planned service offerings. The company poses as the first digital asset bank in the world. This fuses with Singaporean and Swiss heritage for a global operation. The company seeks to bring a change to the financial landscape using DLT infused banking.
SEBA Crypto AG, on the other hand, emphasizes on asset management along with storage custody and transaction banking services. The company seeks to create the perfect blend of the banking sector and the blockchain technology to redefine finance.
Thereby creating a link between the traditional and digital asset industries. As blockchain gets banking licenses, the company is filling the hole found in between traditional banking and the digital economy.
The industry looks on as both companies lead the charge for the spread of blockchain technology. The goal is the creation of new markets as well as innovative creation of value. By combining technological innovation with traditional banking, blockchain companies seek to break the barrier as blockchain gets banking licenses.