Per a report from CNBC, digital bank N26 launched a crypto trading service for customers in Austria. The service is called N26 Crypto and will allow users to gain exposure to the price of Bitcoin (BTC) and Ethereum (ETH).
The crypto trading service will provide N26 customers in Austria to buy and sell over 100 different tokens. The digital bank, valued at $9 billion, plans to expand its service in the coming months.
The bank will expand its crypto trading offering. It plans to list over 194 coins as the service grows. In addition, the digital financial institution will launch the service in other countries in the European Union (EU).
Regulators inside the Eurozone have been reluctant to approve a legal framework for crypto trading and cryptocurrency-based services. However, this status quo might be changing for the benefit of Virtual Assets Service Providers (VASP) but to the detriment of those operations that are considered too energy-consuming, like Bitcoin mining.
BTC’s price moving sideways on the 4-hour chart. Source: BTCUSDT Tradingview People Still Interested In Crypto Trading Despite Downside PressureN26’s Chief Product Officer Gilles BianRosa told CNBC that their newest crypto trading product would allow people to dabbed into digital assets inside the “safety” of their platform. Users will be able to gain exposure to digital assets, but they won’t be able to transfer their crypto to external wallets.
PayPal and Revolut, two of the world’s largest fintech companies, launched similar services with the same limitations. Eventually, they implemented support for users to buy and sell crypto with the option to withdraw the assets to external wallets.
N26 might face regulatory hurdles in implementing this feature. The bank’s crypto trading service was conceived as a “closed-circuit investment loop” to comply with European regulations and prevent people from buying “something from the dark web with those assets from your wallet,” BianRosa said.
The N26 Chief Product Officer added:
We have a very strong working relationship with all the regulators, so obviously, we inform them of our plans, they’re aware, and we’ve covered all the regulatory needs we have for this market.
The executive claims that demand for crypto-based products is high, despite the current downside pressure in the nascent sector. In that sense, BianRosa said that the financial institution believes digital assets will have a long-term impact on financial products.
Will Crypto Trading Save N26’s Finances?Bitpanda will support the N26 Crypto service. The exchange will receive a commission for every crypto transaction on the bank.
The financial institution will charge a 2.5% fee to its customers for buying and selling crypto; Bitcoin will have a minor fee of 1.5%. For users subscribed to the Metal accounts plans, crypto transactions will cost 1% for BTC and 2% for the rest of the digital assets.
The heavy fees might be part of a strategy from N26 to capture the demand for digital assets and boost its revenues. In certain parts of Europe, people have few alternatives to gain exposure to Bitcoin and other cryptocurrencies.
The CNBC report claims that the digital bank is facing revenue issues. In 2021, N26 recorded 172 million euros in losses, a 14% increase compared to 2020. Will the crypto trading service allow it to capture new users and increase revenues? Time will tell.
by Reynaldo Marquez via Bitcoinist.com
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