Swiss officials have expressed concerns after two banks stoped offering their service to crypto and blockchain companies.
Zuercher Kantonalbank (ZKB), Switzerland’s fourth biggest bank, has closed the accounts of more than 20 crypto start-ups in the last year, reuters says citing unnamed industry sources.
Another large Swiss bank stopped serving Smart Valor, a tokenized alternative investments platform, with sources unwilling to name the bank.
Two banks continue serving crypto companies, Banca Zarattini, a small bank in Switzerland, and Hypothekarbank Lenzburg, a regional lender.
Blockchain companies are however struggling with Heinz Taennler, Zug’s finance director, stating “these are hundreds of jobs that have been created, and every job is important.”
Thomas Moser, a governor at the Swiss National Bank (SNB), says “they raised concerns about problems with opening bank accounts, which was a worry for them, and asked for help.” He further adds:
“We would not want to close the door on the opportunities that such innovation (cryptocurrencies) might bring.”
The Swiss Finance Minister, Federal Councilor Ueli Maurer, set-up a working group last month to come up with guidelines on how banks should deal with crypto companies.
Yet worries are increasing that Zug’s Crypto Valley might lose to other centers due to potentially hostile attitudes by banks which may be trying to slow down what could be their competition.
Lichtenstein’s close proximity to Zug is a cited example. Bank Frick there has attracted 160 crypto projects, but according to reuters they have declined “90 percent of account requests from cryptocurrency companies and only accepts ICOs based onshore in Switzerland or Liechtenstein.”
Bank Frick announced in March that they begun offering crypto trading in five digital currencies: Ethereum, Bitcoin, Bitcoin Cash, Litecoin and Ripple.
While Swissquote, which describes itself as “the Swiss leader in online banking,” partnered with Bitstamp last year to offer BTC/EUR and BTC/USD trading.
Some crypto projects, moreover, ICO-ed with the explicit aim of gaining a banking license in part to address what some imply are anti-competitive practices. None has managed to gain a banking license so far.
Which means that for now they have to work with already established banks in a very competitive jurisdictional environment within Europe where a number of countries are currently effectively neck and neck especially when it comes to ICOs.
Switzerland, thus, is trying to maintain a competitive edge, making them the very first nation of size to address head on banking complaints, yet whether they will succeed only time can say.