Former UBS Executives Want To Build Licensed Crypto Bank, Raise $100 Million

Former Union Bank of Switzerland (USB) executives raised 100 million Swiss francs (almost $102.5 million) in funds to operate SEBA Crypto AG (SEBA), a cryptocurrency bank.

The investment came from various international institutional and private investors that included Black River Asset Management and Summer Capital. The startup published a press release Thursday on its website announcing the investment and said it intended to become a banking and securities dealer, licensed with the Swiss Financial Market Supervisory Authority (FINMA).

Andreas Amschwand, chairman of SEBA and formerly UBS global head of foreign exchange and money market said Switzerland was an ideal place to launch a new financial services paradigm and the venture had support from regulatory authorities as well for building a positive cryptocurrency ecosystem.

“In Switzerland, we have a commitment from various authorities to establish a comprehensive regulatory environment for the development of blockchain technology and the sustainable, stable growth of crypto assets. I’m excited to be part of a team of experts helping to usher in the crypto economy,” Amschwand said in the press release.

The cryptocurrency market is regarded as risky by many, since it lacks regulatory protection in terms of investment guidance, and that is one of the reasons traditional financial market participants exclude themselves from integrating with the cryptocurrency market. Likewise, cryptocurrency entities and investors find it hard to move assets from the cryptocurrency market into the traditional regulated banking industry.

For this reason, SEBA aims to bring together a Switzerland-based team of global experts focused on obtaining the banking and securities dealer license from FINMA for developing a new platform.

This new platform is said to be developed by "leveraging state-of-the-art FinTech and best-in-class service partners to deliver military-grade secure traditional and crypto banking experiences."

A license from FINMA would also allow SEBA to offer a range of services, including secure storage and custodial services, trading and liquidity management, crypto-corporate finance advisory, and crypto asset and investment management services.

SEBA aims to bring in cryptocurrency and blockchain products and services to the traditional market by providing a fully licensed and supervised banking solution for private individuals, institutional investors, and corporate investors.

“The investment in SEBA is predicated on deep analysis of the velocity of the cryptographic asset market - if adoption, use, and utility continue to gain traction at the same rate; crypto will become a legitimate, sound asset class and therefore hold a requisite allocation in investors’ portfolios,” said Guy Schwarzenbach, CEO of Black River Asset Management, investor and designated board member of SEBA.

Guido Buhler, CEO of SEBA said a fundamental aspect of generating funds was to promote the potential that blockchain holds in global economic reform and financial inclusion.

"With safety, transparency, and performance as core values, our ambition is to become a market leader in the convergence of traditional finance with the crypto economy," Buhler added.

Some of the other financial institutions and digital currency exchanges working to improve the infrastructure of the global cryptocurrency market are Coinbase, Bakkt, BitGo, as well as some major traditional banks like Citigroup, Morgan Stanley, and Goldman Sachs, who have recently expressed their plans to operate cryptocurrency custodian solutions — third-party providers of storage and security services for cryptocurrencies. Such services are mainly aimed at institutional investors, such as hedge funds, who hold large amounts of bitcoin or other cryptocurrencies.