Matthias Kröner, Fidor Bank of Germany CEO, has recently been interviewed by International Business Times (IBTimes) on the subject of digital currency. As known, this year Fidor Bank partnered with German Bitcoin exchange bitcoin.de to provide Bitcoin express, instantaneous service that provides users with €100,000 deposit insurance on transactions by virtue of being once removed from a regular bank account.
Looking back, in 2009 Fidor Bank was granted a full European banking licence. “When we approach an issue we ask ourselves, ‘why can’t this be done any better’, or ‘is that really the final solution’, or if there is a segment like the crypto issue, ‘why is this not being executed by a normal bank?'” said Mr. Kröner about being ahead of other banks.
During the interview Mr. Kröner called bitcoin “a natural part of the digital lifestyle”:
“We simply think that everything which is coming along with crypto or even bigger with the blockchain is a more or less a natural part of the digital environment or the digital lifestyle. It is, as always, not a good thing to ignore or exclude important parts of a certain lifestyle once your customers are executing this lifestyle.”
As said by Mr. Kröner, the regulators are “very fine with what we do, that we are supporting those businesses, or that we are servicing those businesses in a proper way”.
“This gives them [regulators], for the first time, a first-hand insight into what is actually happening in this industry,” he commented.
However, he added that it remains a huge step for regulators to allow a bank to hold Bitcoin “really in the account, in the sense of that this is depository money and this is on your balance sheet and in particular for the volatility reasons, they are afraid of the sustainability of this business”.
“Once the sustainability, or this doubted sustainability, is touching the balance sheet of a bank, this is where they get scared,” he stated. At the moment Fidor Bank has partnerships with bitcoin.de and US-based Bitcoin trading operation Kraken.
“Our partners want us to focus on them, which created the situation – not intended by us – that they are paying us for exclusivity. I would not say this is for eternity, but currently it’s the way it is,” said Mr. Kröner.
“I think this is for the sake of the customer isn’t – you can be sure this is not a kind of garage offer somewhere in a country you have never seen before, where you cannot be sure one day the management will not take the money and run,” commented Mr. Kröner meaning that a limit on partnering and the overall size of the bank’s operation at present is a good fit since it allows the regulators to monitor closely all digital currency activities at the bank and its exchange partners.
In contrast, Fidor Bank is in the process of coming to London, the presumed FinTech capital of the world: “We absolutely aim to be in the UK as a bank in 2015. That’s for sure.”
They say, the process has been immobilized by the big sponsor banks – Barclays, HSBC, Lloyds and RBS – not accepting Fidor Bank as a customer, so denying the challenger access to the UK’s payment system.
Mr. Kröner clarified the issue by saying it was about the speed of progress and not about a lack of support:
“If we say ‘let’s do this quickly’ we mean like in the next five minutes; if they [big agency banks] say we do it quickly they mean within the next five months. Which I absolutely understand – each of them is a big organisation. Besides the matter of speed, actually we are very satisfied with the process. It’s a step by step journey and they take it very seriously.”