Business 13 July 2018Gerald Fenech
Binance to invest in Malta’s decentralized Founders Bank
Malta continues to steal the headlines where the crypto space is concerned, this time with the development of the first decentralized bank on the self-described “blockchain island.” The collaboration between Binance and Neufund will see the setting up of Founders Bank, which will be focused on providing services to crypto customers, who, in turn, will be the shareholders of the bank through an initial coin offering (ICO).
Founders Bank will now be providing what it describes as “progressive fintech solutions to the world of innovation and blockchain.” The project is a collaboration between Binance, considered to be the world’s largest cryptocurrency exchange by turnover, and blockchain-based equity fundraising platform Neufund.
In comments to CoinGeek, Dr. Joseph F Borg, lawyer at WF Partners and founder of Bitmalta.com said the creation of Founders Bank marked another step towards further consolidation of the cryptocurrency ecosystem in Malta.
“This is an important step into the future of the blockchain island concept. It enhances the ecosystem providing solutions based on the same technology and the same philosophy. Blockchain start-ups will not find a better hub from which to run their operations. Malta is the place to go,” Borg said.
Founders Bank claims that it will become the first stable and high-tech banking solution not only focused on the founders, but also owned by them, bridging the gap between the traditional financial world and innovative crypto companies.
I am delighted to see #BlockchainIsland companies collaborate. @binance just announced its support for community-owned @foundersbankorg which will provides progressive fintech solutions and soon its #STO on @neufundorg https://t.co/5LIiOuU3PP
— Silvio Schembri (@SilvioSchembri) July 12, 2018
Silvio Schembri, Junior Minister for Financial Services, Digital Economy and Innovation within the Office of the Prime Minister of Malta commented as follows: “Yet again Malta proves to be the ultimate destination for innovative companies changing the world for better. We welcome Founders Bank with the utmost excitement and hope that their fintech solutions will attract even more world-class companies to our #BlockchainIsland. We are honoured to be chosen as the location of the first global community-owned bank that cares so deeply about transparency and regulation.”
The equity token offering, which will be conducted on Neufund under German regulation in collaboration with one of Europe’s major stock exchanges later this year, will allow all market participants to become co-owners of Founders Bank. This is pioneering as it will allow clients to decide on the development of the solutions they are using with blockchain-style governance model based on smart contracts.
In comments to the media, Changpeng Zhao, founder and CEO of Binance explained that Founders Bank would be the first decentralized and community owned bank in the world.
“We are not only excited to be one of the first investors of this inclusive community for this pioneering initiative, but also look forward to explore the full range of its banking services. We continue to be delighted by the vibrant blockchain opportunities in Malta and look forward to launching more partnerships in the region,” he said.
The bank will focus on providing a service to tech and business companies and will supposedly be offering ‘top-notch’ banking solutions–whatever that means. Users will be able to access their bank accounts from mobile and desktop applications and use them with credit cards issued by Founders Bank. The system is similar to Revolut, another online bank offering crypto services. The company is currently awaiting its banking license from the Maltese financial authorities and should launch in early 2019 through an Equity Token Offering that will be made through Neufund’s platform later in 2018.
Malta’s Blockchain ecosystem grew rapidly over the last year, with the biggest crypto companies relocating to the EU member state: Binance, Neufund and BitBay. The DLT/Blockchain bills approved by the Malta’s Parliament last July 4 created a fertile environment for blockchain companies and cleared the uncertainties surrounding the market for decentralized assets, while also establishing direct communications with blockchain leaders.
Note: Tokens on the Bitcoin Core (SegWit) chain are referenced as BTC coins; tokens on the Bitcoin Cash ABC chain are referenced as BCH, BCH-ABC or BAB coins.
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