Business account for ICOs: The pioneering work of Volksbank Mittweida
When you think about crypto services, you might think of B2C offerings like Wallets or Bitcoin trading apps at first. For start-ups who collect tokens via ICO, the question arises, at which bank they get a business account. In Germany dares up to the Volksbank Mittweida eG no bank to enter into a business relationship with an ICO. The regulatory uncertainty seems to deter many banks. Too big are the question marks as to whether know-your-customer, anti-money laundering guidelines etc. can be complied with.
The way to the ICO business account
Thomas Otto and Florian Uhl wondered during the Blockchain Spring School at the University of Applied Sciences Mittweida: Why is there no German bank that offers a business account for legal persons to book revenue from token sales? Finally, crypto start-ups that have collected capital in the form of tokens must pay their bills in euros. Among other things in conversation with Dr. med. Nina-Luisa Siedler, DWF Germany, one of the leading lawyers in Germany, when it comes to crypto matters, Thomas and Florian discussed this topic. The result: despite the increased audit effort, there is no compelling reason to object to an account opening for ICO-funded companies.
"It seemed absurd for companies with new ideas and technologies that demonstrably stick to regulatory law, compliance, and KYC / AML to fail in their bank accounts."
What needs to be considered
Volksbank employees worked out the important aspects for a case-by-case examination for an ICO account. With success: Several ICOs have opened an account with Volksbank Mittweida eG this year, including Iconiq Lab and Unibright. The bank does not decide whether it is a substantial and promising ICO. The bank is interested in how the company complies with the law. Most important are anti-money laundering and know-your-customer policies.
Finally, one has to make sure that the deposits are not from illegal sources. The ICO company must prove to the Regional Bank that all Wallet addresses of ICO investors can also be assigned the corresponding customer data. This KYC requirement must be met not only to curb tax evasion, but also to combat terrorist financing. Finally, there must be an opportunity to compare whether ICO investors are on sanction lists (blacklisted with individuals, organizations or companies that are prohibited from investing).
A further complicating factor for the ICOs is that they also have to prove that investors from different country groups are excluded. For example, it is forbidden for investors from China to participate in the token sales, whereas investors from the USA have to meet different requirements than investors from Europe. Florian Uhl comments:
"We do not make regulations for our customers, but merely document how exactly they fulfill their particular responsibility. Even if we ask some profound questions and have our minimum requirements, our service is not legal. "
Thomas Otto adds:
"To meet the many requirements is sometimes exhausting, but with competent specialized legal advice solvable. In this legal advice, the ICO operator can save as little as the provisions against money laundering. A new experience – we learn a lot, also from our customers, whose dependability we are particularly dependent on in this business area. "
A clear signal
As positive as it is that the Volksbank Mittweida makes a contribution to the crypto-adaptation in Germany, nevertheless the question arises, what is with the innumerable other banks in Germany, which do not dare to offer a business account to ICOs. Every commercial emphasizes how digital-affine and committed to promoting the technologies of the future. Especially the big private banks in Frankfurt / Main, which are located in blockchain consortia and have blockchain specialists, would expect more pioneering spirit. Even if a business account is an unspectacular standard service, it is indispensable. Whether for a dental practice or an ICO-funded start-up.
Be sure not to miss any important news related to Cryptocurrencies! Follow our news feed in the way you prefer; through Twitter, Facebook, Telegram, RSS or email (scroll down to the bottom of this page to subscribe). Bitcoin never sleeps. Neither do we .