When speaking of bitcoin and similar assets, the centralized system that is being replaced with the distributed system are banks. So, why would banks be interested in providing banking services to assist crypto companies, many of which have, as an ultimate objective, the elimination of the need of banking services?
Well, even the most zealous crypto disciples do not expect that this change is going to occur overnight or even in the next few years. It’s a process, and even in the most optimistic scenarios, there will remain the need for some type of financial facilitators. Money and banks have been around since the Roman Empire set up their first mint on Capitoline Hill in Rome, and there were probably currency equivalents around much, much earlier than that.
As everyone probably knows, BofA, JPMChase and Citigroup are turning down transactions to buy cryptocurrencies and many other international banking institutions are following suit. Bloomberg reports that these large banks explain that the reason has to do with the volatility of the digital currency. But there are several other reasons.
One has to do with the risks of dealing with a currency that by its nature is engineered to maintain privacy and thus if a purchase is made with a stolen credit card, the bank has little recourse and would have to absorb the loss.
In addition, there is a cost of compliance with Anti-Money Laundering (AML), KYC (Know your Customer), and CTF (Counterterrorism Finance).
Some banks have been found to be willing to take on these risks. Not because they have a high risk tolerance, and not because these banks are not reckless or imprudent, they are just working a little smarter by specializing in crypto companies, by incorporating some technological efficiencies, and eliminating some services.
For instance, several banks that we have contacted, are not full-service commercial banks, they are not focused on individual or family banking. They are strictly focused on corporate accounts, pound per pound they are a lot easier to perform the requisite KYC and AML on a finite number of corporate clinets than on a seemingly unlimited universe of personal banking.
All of these banks, are either contemplating incorporating or have actually incorporated blockchain technology into their KYC and AML evaluations, a step that is quite typical of businesses that wind up leading the pack through early adoption or through being blessed the accurate foresight to remain ahead of the crowd.
Addressing the last issue, regarding the credit cards, these banks follow the simplest solution – they don’t issue them.
Tango Capital has done a great deal of research and found a few banks that are willing and able to provide banking services to crypto/ICO/blockchain companies and who, most important, are fully licensed and compliant with international regulatory agreements such as Basel II.
Any company wishing further information or who are ready to engage in banking services should contact us via email at firstname.lastname@example.org, and we will send you an engagement form and an application.
If you are a compliant crypto or blockchain company and can pass KYC, AML scrutiny you will be able to get a commercial bank account, which will allow your company to move money internationally and pay bills etc.
Here’s how the process works.
- Company contacts Tango
- Tango will send the Company an Application
- Tango will perform a preliminary KYC/AML screening (This costs $1,000)
- If Company passes the KYC/AML Tango will apply to the most appropriate bank and the bank will perform the complete due diligence and within one week you will be set to go
- Tango’s success fee is $5,000 for the services and is only paid when the company opens their account
That’s all there is to it. The process can take as little as 7 days.
So, contact us today by completing the form here or emailing us at