Zurich-based private bank Maerki Baumann will now form banking partnerships with cryptocurrency firms, enabling eligible companies to open bank accounts and conduct business using fiat.
Financial news outlet International Investment reported on August 6 that Maerki Baumann became the second bank in Switzerland, after the Falcon Private Bank, to accept funds “generated through business involving cryptocurrencies,” offering a banking solution for clients who “so far have had to take their assets elsewhere.”
Quoting a statement from Maerki Baumann, International Investment reported that the bank is “generally prepared to accept funds generated through cryptocurrencies, be it through speculative transactions or in the form of payment received for services provided or from mining profits.”
According to International Investment, most Swiss banks “refuse to accept such money,” mostly because the background of such assets “may be tainted or hard to verify to comply with money laundering regulation.” As a result, Switzerland, a major European crypto hub, is nonetheless missing out on a lot of business and capital, much of which is flowing to neighboring Lichtenstein.
Bank Frick in Liechtenstein became one of the first European financial institutions to accept funds generated from crypto businesses and provide direct investment opportunities for clients looking for cryptocurrency exposure.
However, unlike Falcon Private, Maerki Baumann is not planning to offer cryptocurrency asset management or custody services.
Maerki Baumann’s decision to service cryptocurrency-related businesses may help slow the exodus of crypto startups from this blockchain-friendly country. Although Switzerland has been hailed as a haven for crypto companies, with over 200 initial coin offering (ICO) projects and other blockchain companies headquartered in the Swiss ‘Crypto Valley’ of Zug, problems with accessing banking services have forced some companies to look elsewhere, like Liechtenstein, Gibraltar, the ‘Blockchain Island’ of Malta, and even the British Virgin Islands.
The Swiss National Bank (SNB) warned that some ICOs could be violating money-laundering laws due to an absence of anti-money laundering checks on their investors. Banks that do business with non-compliant ICOs, many of which held token offerings before the current legislation was enacted, could face legal consequences.
Maerki Baumann’s entry into the market could reverse this trend and enable many companies to return to Switzerland.