With Bitcoin Suisse, Seba Crypto, Sygnum and the Crypto Finance Group, four financial companies specializing in cryptocurrencies and services are fighting for dominance in this still small market.
Seba Crypto and Sygnum started as a newcomer last autumn with a banking license. The Crypto Finance Group is seeking the securities dealer license, and Bitcoin Suisse submitted a banking license application to the Swiss Financial Market Supervisory Authority (Finma) last July. She hopes to receive them in the current year.
This means that the battle for customers and market shares will intensify significantly in this niche, especially since two companies with Seba Crypto and Sygnum have a lot of ambition, but are starting from scratch.
At the Bitcoin Suisse headquarters in Zug, the new market participants can be observed with ease. The Swiss crypto pioneer founded by the Danish Niklas Nikolajsen (picture below) has been operating – and profitable – for over six years. Arthur Vayloyan, an experienced bank manager, has headed Bitcoin Suisse’s operational business since the end of 2017. Nikolajsen is executive chairman of the board and with his network in the global crypto scene is invaluable for his company.
One step means: IPO
In an interview with finews.ch, Nikolajsen and Vayloyan set out their medium-term strategy – this should culminate in an IPO for Bitcoin Suisse. “We have to think ahead about the next steps,” says Nikolajsen. “And one of these steps is to go public.”
The management duo does not yet have a precise schedule. But this is primarily due to the fact that two further major strategic steps are waiting before the IPO. In addition to receiving the banking license, this is a capital increase planned for this spring.
Capital is not enough for all services
According to Vayloyan, the goal is to raise around CHF 40 million from investors, “so that we will have around CHF 100 million in capital by mid 2020.” From finews.ch, the company information shows that Bitcoin Suisse has built up around CHF 55 million in equity over the years ,
“Our balance sheet is already very solid,” says Nikolajsen. “But it is not enough to meet the demand for our services.” Bitcoin Suisse has grown from a startup flat share to a financial company with 122 employees in recent years. Business in 2017 and 2018 was excellent: Bitcoin Suisse generated a cumulative profit of CHF 57 million.
2019 a black zero
Nikolajsen and Vayloyan used the resources to significantly expand Bitcoin Suisse. These investments plus the ongoing bear market in the crypto business will only give the company a black zero for the 2019 financial year.
But Nikolajsen and Vayloyan want to be ready for the next crypto upswing and “have a balance sheet that allows a significant expansion of our business activities”.
Everyone wants to expand
The additional capital is necessary, because with a banking license, Bitcoin Suisse will receive strict requirements as to which transactions must be deposited with how much capital. An expansion of activities, for example in lending, trading and product business, will absorb further capital – which is also why an IPO should follow in two or three years.
This means that four crypto finance companies will be advertising millions of investors in the current year. Jan Brzezek, CEO and founder of Crypto Finance, confirmed to finews.ch that they are currently looking for capital to meet the capital requirements for the securities dealer license. Crypto Finance wants to expand globally.
Foursome battle for investor funds comes to a head
Seba Crypto has already announced that it plans to raise another CHF 100 million in the first half of the year. Sygnum is also planning a financing round this year, as co-CEO Mathias Imbach says without further details. Sygnum can hold cryptocurrencies without straining the balance sheet.
According to the companies and their own estimates, the four crypto players are likely to look for a total of over CHF 200 million among investors. It will be seen whether the risk capital market can afford that.
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