Crypto firm Sygnum has become one of the first to receive conditional banking licences from Swiss regulators, in a landmark move that could see digital assets become more established within the financial sector. Sygnum’s co-founders, Mathias Imbach and Gerald Goh, told Bloomberg on August 27 that they now planned to obtain similar licences in Singapore.
Sygnum is a digital asset technology group based in Singapore and Switzerland. On August 26, the company was awarded a provisional banking and securities dealer licence from the Swiss Financial Market Supervisory Authority. As a result, Sygnum is set to become an official bank later in the year.
Cryptocurrency-related financial services are at a nascent stage, as blockchain infrastructure and regulation within the sector is still largely underdeveloped
Once it operates as a Swiss bank, the company will be able to issue, store, trade and manage bitcoin and Ethereum, as well as convert fiat currencies into the two cryptocurrencies. Securing a full Swiss banking licence will also enable it to apply for a traditional banking licence in Singapore. In anticipation of this, the company has already begun talks with Singaporean regulators and petitioned for a capital markets services licence.
Cryptocurrency-related financial services are at a nascent stage, as blockchain infrastructure and regulation within the sector is still largely underdeveloped. However, Switzerland has been leading the way in welcoming the technology into the banking industry. Facebook’s Libra project is headquartered in Geneva, and the nation is currently updating its financial legislation to allow the integration of crypto technologies.
Singapore’s banking sector has been comparatively slow to adapt to this disruption. As a result, Sygnum is focusing on raising capital and establishing itself as a key player in order to win regulator approval. It has raised about CHF 60m ($61m) and secured backing from a range of eminent individuals and institutions. For example, Chua Kim Leng, a former assistant managing director at the Monetary Authority of Singapore, is in charge of Sygnum’s anti-money-laundering committee. Assuming the company receives its Singaporean licences, this could signal the institutionalisation of the budding world of cryptocurrency.