Cryptocurrencies have been popular for the past years with their value increasing every year compared to the basement price of the first cryptocurrency, Bitcoin of $0.00099 per Bitcoin at its inception.
In the growing digital world, crypto-friendly banks try to bridge the gap between traditional banking and the crypto market and make cryptocurrencies more accessible to the mainstream.
As crypto is rapidly growing in value and popularity, it can be beneficial to our traditional bank system as well. It makes navigating the crypto market easier for common people. This article is a guide to crypto-friendly banks in the European region.
Importance of Crypto-friendly Banks
The financial systems that accept cryptocurrencies are referred to as crypto-friendly banks because they connect the physical money associated with the traditional financial market to the digital currency.
They facilitate the exchange between fiat and cryptocurrencies, store the funds of clients, and help companies get involved in blockchain industries. Having a dependable banking partner is even more important as regulatory agencies begin raising the bar on their expectations of financial institutions.
Purpose of Crypto-friendly Banks
Financial management is made easier with crypto-friendly banks as both traditional finances and digital assets are offered service under a single roof, simplifying financial management. These banks also make crypto easier, especially by changing their crypto asset into fiat money.
Crypto-friendly banks also support businesses in blockchain and fintech companies, especially startups. People who are still speculative about this growing non-tangible form of digital asset can be attracted by providing secure custody of the digital asset. Crypto-friendly banks offer payment processing services for transactions and even offer lending products like loans for digital assets.
Challenges to Find Crypto-friendly Banks
The challenge that people and companies face when searching for banks accepting cryptocurrency is still problematic because of the many factors such as regulatory constraints, low-risk tolerance, and no centralized crypto policies in Europe.
Regulatory hurdles: There are also the problems of Anti-money Laundering (AML) and Know Your Customer (KYC) that are quite limiting for crypto operations. Lenders most of the time act carefully in a bid to avoid suffering penalties hence limited promotion of crypto-based activities.
Perception of risk: They still believe that cryptocurrencies are unstable and used mainly for unlawful operations, which is why actual banks are cautious about embracing the principles of cryptomania. This leads to restricted service delivery to the business entities and individuals involved in virtual currencies business.
Lack of knowledge and experience: This is because many banks lack technical knowledge and understanding of how to integrate cryptocurrency services, which will yet again slow down adoption. Customers requiring assistance are either unaware of the available services or are simply turned away.
Service restrictions: Still traditional banking giants, many of which base themselves in the United Kingdom as Lloyds or Monzo, have restrictions. For instance, they may enable users to pay for exchanges, but turn down payment through credit cards for buying cryptos, making it inconvenient.
Crypto-friendly Banks in Europe
Some European Banks are actively starting to stand out as crypto-friendly combining both traditional and crypto finances irrespective of all these challenges.
Revolut
With over twenty million users in Europe, Revolut allows users to trade crypto directly within the app as well as to buy and store it. It provides simplicity of use and improved security with the help of cold storage options.
Greengage
It was established to serve digital merchant banks, SMEs, and digital asset firms. It offers e-money accounts suitable for organizations in the expansion of the crypto market.
Sygnum Bank
Headquartered in Switzerland, Sygnum Bank is the first in the world to act as a digital asset bank. It provides a full range of services like Custody, tokenization, and trading of digital assets. Sygnum operates as a bank that states its focus on blockchain technology, allowing clients to deal with both traditional and cryptocurrencies.
Contovista
Contovista is a pioneering fintech bank established in Switzerland that is engaged in helping businesses and individuals related to the crypto world. Even though it is a Sweden-based company specializing in insights-driven banking solutions, Contovista has recently started developing crypto offerings and thus can be considered an emerging provider in the digital asset field.
Seba Bank
Seba Bank is yet another Swiss-based financial institution visibly majoring in the provision of crypto-friendly banking services. They provide custody services, trading, lending, and investment for their clients. Seba Bank is known for its compliance with rules and its vision of an easy merger between the conventional and the innovative fintech industry.
FinecoBank
FinecoBank is an Italian bank as well as an online brokerage. Primarily, it is an investment platform, although it does enable and offer tools for conveying crypto deals. FinecoBank has entered the list of the preferred trading companies for cryptocurrency traders because of the trading and accounts services they offer.
Januar
Januar is a Denmark-based financial institution that focuses mainly on providing business account solutions exclusively for crypto firms and fintech firms. It provides services on payment solutions and other financial services for organizations in the cryptography market.
Amina Bank
Amina Bank is relatively new into the field of crypto-friendly banks. It supports both legal entities and individuals, coupled together to provide bank services and to use cryptocurrencies. Amina Bank pays attention to the security of crypto transactions as well as the legal requirements.
Bottom line
The future of crypto-friendly banks appears to be stable and groundbreaking enhancements in the areas of both blockchain and cryptocurrency continue to be implemented, as well as new regulations continue to develop integrating cryptocurrencies into the conventional financial system. In recent years Europe has emerged as a haven for progressive banks that accept cryptocurrencies and create services that focus on different consumer groups and companies.
For a retail investor interested in trading cryptos or a company in search of banking partners for its successful blockchain ventures, there are now solid platforms offered by institutions like Amina Bank, and Revoult among others. Though these banks open new opportunities in the digital asset market, risk assessment is also mandatory.