Bitstamp to help European banks get into crypto

73
2
Bitstamp to help European banks get into crypto

Bitstamp, the biggest cryptocurrency exchange, said it's in talks to help three large European banks begin offering crypto services around the first quarter of next year.

The news, which was revealed by a senior executive in an interview with CoinDesk, suggests the European Union's major crypto regulatory effort, called Markets in Crypto Assets, is easing the way for conventional financial firms to get into digital assets.

That's a stark contrast to the US, where regulators are cracking down, so that old-school firms are hesitant and force crypto companies to consider moving abroad.

Bitstamp has gotten a lot of interest in Europe for the exchange's relatively new Bitstamp-as-a-service offering, a white-label licensing and technology combo designed to help banks and fintech firms offer crypto buying and selling, Zagotta said.

He said he had quite an increase in inbound inquiries about this offering from large European banks. He didn't identify the firms.

The reverse is happening in the U.S., Zagotta said. Some large regulated companies are moving their crypto operations to other countries, such as Singapore.

While the U.S. is cracking down on crypto, places like Europe have been busy getting regulations in place and traditional financial institutions are now collaborating and formulating strategies, including big players like Deutsche Bank and HSBC.

Bitstamp, which was granted a BitLicense by the New York Department of Financial Services in 2019 and audited by EY, has also seen demand for a fully regulated perpetual swap product in Europe and the exchange has been working on this, Zagotta said.

With the collapse of FTX and the regulatory challenges faced by Binance, Zagotta feels Bitstamp's buttoned-up approach to regulation and governance is now reaping rewards.

Bitstamp onboarded about 36% more corporations in the first half of 2023 compared to the second half of 2022, partly a result of FTX evaporating in November and its market share being redistributed, Zagotta said.

The cryptocurrency industry can ill afford another blow-up like FTX, Zagotta said, pointing to the possibility of another large player like Binance being brought down in some way or another.

Zagotta said the decision was made on whether he was going to become the president of the United States or not. t wish for them to simply go down in flames like FTX. We just hope that there's a level playing field across all of us.