The future belongs to crypto, its bank is called Sygnum

For Matthias Imbach of Sygnum Bank, the dual Swiss and Singaporean identity of the crypto bank makes it a leader in the finance of the future.

Sygnum Bank, launched in 2018, is pushing its pawns to become the global reference bank in the world of cryptocurrencies: Swiss banking license, Singapore Capital Market Services license, Deutsche Börse partnership in 2019, new Series B fundraising in early 2022… Double-headed headquartered in Zurich and one in Singapore, the group more than doubled its assets under management in 2021 to place $2 billion and more than 1,100 professional and institutional clients today. The current industry crisis? Matthias Imbach sees this as proof that this is an asset class in its own right, with a great future that the bank he created will create. Interview with Matthias Imbach, co-founder and CEO of Sygnum Bank.

What makes Sygnum different from a traditional bank?

The fact that Sygnum is active in the field of crypto assets in no way relieves it of the obligations and obligations of a bank registered in Switzerland. Specifically, we are managed by Finma and meet the same capital, compliance and governance conditions as any Swiss bank. It should be noted that our clients’ accounts are separate from the bank’s assets. Thus, the client bears no counterparty risk to Sygnum. This sets us apart from many crypto brokers and exchanges. The main difference lies in our technology stack: we can take advantage of a public blockchain such as Ethereum, for example, to enable near-instantaneous settlement of transactions. We are also “cloud first” and use the latest technologies to create value for our customers. In this sense, we can be seen as a digital asset technology group backed by our own bank.

So you offer your customers the same services as a traditional bank?

More than 1,100 Sygnum clients, institutional or accredited banking clients, have access to a range of corporate banking services, accounts (fiat) and custody of securities (cryptocurrencies, stablecoins, tokens), 24/24 and 7/7 trading, pawn loans with crypto- collateral or a range of asset management products and tokenization services, including a regulated secondary market. Some of our products are listed on the SIX Swiss Exchange and in Germany. We have also developed the “BtoBbanking” platform, which allows about ten partner banks to offer our services to their clients, which is a solution for those who want to diversify their portfolio by adding assets in crypto assets.

Our clients are banking professionals as well as wealth and crypto asset managers, family offices or founders of major crypto funds. Not only do they benefit from the full range of benefits of a traditional bank applied in the field of crypto assets, such as capital requirements protecting client assets, regulated services, “bank grade” security or quality management, but also first-hand access to innovative new DEFI products and markets, which you can expect from a technology group focused on digital assets.

Geneva offers a wide range of potential partners for Sygnum.

What exactly distinguishes you from these actors, banks and platforms working in the field of crypto assets?

Very few of them are regulated, so they do not offer the necessary guarantees to convince financial professionals, much less institutional investors, in particular in the area of ​​risk management and compliance. Moreover, they do not mobilize the same resources as we do for a mission that is especially important to us from an educational point of view, by providing materials developed by our research teams.
Only SEBA, another Swiss bank – it is no coincidence that Switzerland offers the best conditions for the development of the crypto asset industry – is more or less comparable to Sygnum, that is, simultaneously providing a banking license, an international profile and an integrated vertical model.

And traditional banks, do you think they can become competitors?

Perhaps some, in particular the largest private banks, will choose to develop their own platform for their clients. Today they are thwarted in these ambitions by sometimes real, reluctant boards of directors, a binding generational gap. Smaller banks that we are already close to will choose to partner, Geneva offers a rich pool of potential partners for Sygnum.

The crypto asset market has crashed in recent weeks, but your AuMs keep going up, how do you explain that?

This is the strength of our business model based on a wide variety of sources of income. Specifically, in the last period, in particular in the month of May, trading activity broke all previous records, which allowed us to more than compensate for the losses caused by the fall in prices for the main tokens, BTC and ETH.

What is your answer to those or those who bury cryptocurrencies as they are purely speculative and short-lived assets?

It is to be regretted that these critical voices often have few arguments to support their thesis, otherwise I would respect them. If it’s about building on the current crisis, I think it’s fair to look at it in terms of a general crisis in risky assets rather than specific cryptocurrencies. On the contrary, I think that cryptocurrencies have become much more resilient over the last decade. In other words, if this crisis had happened in 2012, when I entered this nascent industry, I’m not sure it would have survived. Today, cryptocurrencies are proving that they are an asset class in their own right, which, like all others, is affected by the reaction of the central bank to inflationary pressures.

How do you see Sygnum in this industry?

Our positioning based on the dual identity of Swiss and Singaporean predisposes us to become a global leader. With our Swiss license, we are very well positioned to serve Europe, and our Singapore CMS (Capital Markets Services) license, recently extended to new activities (notably corporate finance advice and provision of accounts and trading solutions to institutional investors), allows us in a unique position to serve the Asian markets.