Crypto exchange Binance has given their backing to plans for the creation of a decentralized bank in Malta. This new type of bank gives crypto token investors the chance to become co-owners.
The Founders Bank will aim to ‘bridge the gap between traditional finance and crypto’ and allow users access to standard banking services, with a focus on serving businesses in the tech space.
The crypto-friendly island has been in the sights of Binance for a while, and founder Changpeng Zhao recently expressed optimism over the direction Malta are heading with cryptocurrencies.
“We welcome Founders Bank with the utmost excitement and hope that their fintech solutions will attract even more world-class companies to our #BlockchainIsland,” said Silvio Schembri, junior minister for financial services, digital economy, and innovation, in a Binance statement.
“Yet again Malta proves to be the ultimate destination for innovative companies changing the world for better.”
The crypto exchange, one of the world’s biggest, is a major investor in the company and currently holds a 5% stake in this new type of bank. According to Bloomberg, the pre-money valuation for the new bank is around $155 million.
Binance says that this investment is the first step towards the Founders Bank coin offering, which will be carried out on the blockchain-powered fundraising platform, Neufund. Equity tokens are issued to participants who buy into the sale, making them co-owners.
The company currently awaits its Malta banking license but looks set to become the first community-owned bank in the world. This is big news: a statement from Binance said ‘it will allow clients to guide their banking solutions with blockchain-style governance model based on smart contracts.’
Essentially this means that the power of banking services would be placed firmly in the hands of the community. This quite possibly signals what the future of the banking industry could, and might, look like.
The Founders Bank will have its equity token offering through Neufund’s platform later this year and plans to launch its banking services fully in the first half of 2019.
Callum reports on developments in the cryptocurrency world and offers a take on the future of the blockchain. Can often be found with a cup of tea reading an altcoin whitepaper.