Despite the unfamiliar terminology, this is not science fiction. This is a new type of banking that is already active in conservative Switzerland – with the blessing of the financial regulator.

The Swiss bank in question, Fiat24, is not a household name. It’s a new company that was last year awarded a fintech banking licence, which limits the volume of deposits it can accept to CHF100 million ($102 million). But the licence does allow Fiat24 to introduce clients to the expanding world of decentralised finance, where investments and trades are managed by code rather than people.

A new wave of technology innovators believes the established method of banking, which needs three working days to process payments and takes possession of people’s money while imposing a range of fees, is unwieldy and outdated. Blockchain, the decentralised database on which cryptocurrencies are stored and traded without the need for intermediaries, was originally conceived as a ‘bank killer’. Now it’s slowly being absorbed by the banking system.

Encouraged by an engaged financial regulator and an overhaul of laws to incorporate blockchain technology, some Swiss banks already allow clients to dabble in the likes of bitcoin. SEBA and Sygnum, which gained full banking licenses in 2019, are more deeply connected with decentralised finance. For example, they transform company shares and oil paintings into ‘digital assets’ that trade directly between sellers and buyers on blockchains.


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