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Zuger Kantonalbank customers will now be able to invest in cryptocurrencies. The central Swiss financial institution includes Bitcoin, Ethereum and Co. in its offerings. It is the first state bank to include trade.
For a long time, crypto banking was not an issue in the management of traditional Swiss banks. Digital currencies were seen as objects of speculation that also encouraged money laundering. But the industry seems to be slowly rethinking. Blick answers the most important questions for anyone looking to get started.
Is crypto trading finally becoming socially acceptable in Switzerland?
“Many Swiss commercial banks are now much more open to the topic of cryptocurrencies and public blockchains than they were a few years ago,” says Fabian Schär (35), professor of blockchain and fintech at the University of Basel. “At that time, all banks wanted to create their own blockchains.” It is a rather unusual idea for commercial banks to not have the infrastructure completely under their control. However, many banks have now realized that a comprehensive solution provides advantages.
Recently, the number of large banks that want to offer their services via blockchain is increasing. Despite the late login, they can earn points with the high security standards and reliability they gain from traditional financial services.
Which banks are already there?
“Classic” Swiss banks offering cryptocurrency trading to private individuals are still rare. In addition to Zuger Kantonalbank, Valiant Bank also launched a corresponding offer in the summer. Mortgage Bank Lenzburg offers business customers the opportunity to store tokenized securities and cryptocurrencies. However, the offer is not yet available for private customers.
According to the Financial Market Supervisory Authority (Finma), there are a total of around 20 banks operating in the crypto sector in this country. Most of them are specialized financial services providers with banking licenses, such as Swissquote, Sygnum or Seba trading platforms.
What should I pay attention to when trading cryptocurrencies?
When trading privately, a key and a password need to be stored for your own wallet, i.e. your own crypto portfolio. Anyone who loses these two security keys will also lose their digital assets. The biggest advantage of banks is exactly at this point: With the offer of Zuger Kantonalbank, trade is carried out via e-banking. This provides support in case you forget your password.
However, banks do not cover all expenses. Following developments and trends in international crypto markets remains a special topic. Because rapid and high price fluctuations are not uncommon. Banks do not carry the risks of crypto investing, namely the risk of losing a lot of money. The motto is still: Invest only what you are willing to lose.
Joining the bank makes it safer and easier to trade cryptocurrency, but it certainly doesn’t make it any less risky.
Which providers will soon follow suit?
Luzerner Kantonalbank also wants to enter crypto trading soon. The offering for private customers is expected to be available early next year. Postfinance also wants to offer digital currencies to customers by spring. Others, such as top UBS and most of the cantonal banks, have not yet announced plans to enter the market. For what reason? “Such projects should generally not be taken lightly,” says Schär. “Technical, economic and regulatory issues must be carefully clarified.”
Source :Blick
I’m Tim David and I work as an author for 24 Instant News, covering the Market section. With a Bachelor’s Degree in Journalism, my mission is to provide accurate, timely and insightful news coverage that helps our readers stay informed about the latest trends in the market. My writing style is focused on making complex economic topics easy to understand for everyone.
