A few small European banks are swimming against the tide by getting involved in the cryptocurrency market. They perceive this as an opportunity to fill the vacuum left behind by the big players, which refuse to participate in the bustling sector.
Speaking to the Financial Times, Bank Frick CEO Edi Wögerer said:
“There are risks involved but there are also really big opportunities. We know what to do from a security perspective so this is a big opportunity for banks like us.”
The Liechtenstein-based bank is not the only one that has joined the fray. Switzerland’s Vontobel and Falcon Bank have also thrown their hats into the ring, offering to handle cryptocurrency investments on behalf of their clients.
Wögerer added that larger banks are “scared” of cryptocurrencies because they don’t fully understand them or feel threatened by them in some way.
Oliver Bussman, head of the Crypto Valley initiative in Zug, Switzerland, believes that the refusal of bigger institutions to touch cryptocurrencies is opening the door wide for smaller operators to step in and offer services.
Wögerer’s Bank Frick is among those that have taken things a bit further, providing investment advice on initial coin offerings (ICOs). According to Wögerer, his bank has been involved in 10 ICOs.
Jurisdictions such as Liechtenstein and Switzerland may not be full-fledged members of the EU, but they have membership in the European Economic Area, which allows them to avoid harsh measures by the European Commission while still serving clients on the continent.
The Zug canton of Switzerland has become a bit of an icon for cryptocurrency enthusiasts, earning itself the nickname “Crypto Valley.” Given its lax regulations on virtual currencies, it is perhaps not surprising that organizations like Bitmain are setting up bases in the area.