There is a new sheriff in town. Well, not exactly, but there is a new financial institution set up to handle cryptocurrency transactions that just began operations in Puerto Rico. San Juan Mercantile Bank & Trust International (SJMBT) announced on Monday that they had accepted their first client deposit of cryptocurrency, a month after Puerto Rico’s Office of Commission of Financial Institutions (OCIF) approved their trading platform.
SJMBT will be a multi-purpose trading outlet, allowing customers to trade, settle, and invest in both Fiat and Digital currencies using their exchange. However, it is not protected by the U.S. Federal Deposit Insurance Corporation (FDIC), but a spokesman for the bank said that they would be depositing assets for clients into banks that are protected by the FDIC, ensuring they have a continued level of protection for their assets.
This is not the first financial institution to attempt to set up a cryptocurrency trading exchange in Puerto Rico. In February of last year, Tether was looking to set up banking operations to provide these types of exchanges in Puerto Rico, because they viewed it as a “crypto tax paradise,” where very little regulation or taxing stood in the way of users investing and trading currencies.
However, they were unable to successfully begin operations, because investors became suspicious that the tokens involved were not legitimate. In addition, when the financial institutions suffered a $31 million attack by hackers, the plans quickly came to an end.
Noble International is another financial services institution that had set up operations in Puerto Rico. They had been providing tech both crypto and OTC markets but were looking for new buyers as of October of last year. Only a handful of staff were employed by year’s end, as their association with Tether proved to be a death knell for the company.
Now SJMBT opens operations as the first financial institution operating as a bank for cryptocurrency investors in Puerto Rico. Many recognizable financial institutions are involved in the operations, including J.P. Morgan Chase, as well as the former chief operating officer at Noble Bank. It even includes the former president of the New York Mercantile Exchange.
It is expected that trading across their platform will begin within a matter of days. With their first client already on board, the company now feels confident that they are ready to begin the exchange operations. SJMBT now becomes just one of a handful of financial institutions offering cryptocurrency markets operating as banks.
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