Crypto Finance is working for a Swiss banking license

Virtual currency investment firm Crypto Finance has closed a €13 million capital raise to fund an application for the license with Swiss Financial Market Supervisory Authority (FINMA), but did not specify a timeline. Established in June this year, the company provides asset management, brokerage and storage facilities to the crypto-investing community.

It is one of a wave of startups looking to create an alternative financial system in Switzerland as the country's traditional banks continue to shy away from the booming cryptocurrency market. 

In a statement, Crypto Finance CEO Jan Brzezek said of the process: “It is of critical importance to prepare this step early on, to be strategically positioned to offer a full range of financial services to crypto investors.”

Other institutions planning to lodge applications with Swiss licencing authority Finma include Lykke and MtPelerin, while yet others are exploring the banking-as-a-service model as a means of taking deposits and offering financial services.

The new breed of startups are clustered around Switzerland's own Crypto Valley, located in Zug, a Government-backed zone intended to position he country as a global hub for blockchain and cryptographic development with the support of multiple blue chip partners, including UBS, Thomson Thomson Reuters, PwC, Consensys and Luxoft. The company says the additional capital will be used to fund the arduous process of applying for a Swiss banking licence. 

Crypto Finance currently employs 26 staff and runs a "cash-flow positive" trading desk says Brzezek. Its first two funds will launch early January offshore, and in 1Q/2018, pending Finma approval, in Switzerland. The institutional crypto storage facility will be opened in April 2018.