Crypto Banking Firm BCB Set to Fill US Dollar Payments Gap Left by Exiting Silvergate
The founder and chief executive of BCB Group, Oliver von Landsberg-Sadie, announced plans to integrate US dollar-denominated payments. The official revealed the plans to introduce the dollar fiat-to-crypto services in the subsequent quarter.
BCB Group’s Instant Dollar Settlement Services
BCB Group offers payment processing integrating crypto firms with the mainstream banking system. Since the receipt of the payments license from the Financial Conduct Authority (FCA), the UK-based firm has been serving various institutional players, including Bitstamp, Kraken, Gemini, and Galaxy Digital, with the fiat-to-crypto rails such as Yen, Swiss Francs, Sterling Pound and Euros.
The Landsberg-Sadie-led firm is readying to offer US dollar capacity to leverage the termination of Silvergate Exchange Network (SEN).
The London-based BCB was the pioneer in securing a license from FCA to serve as the payment processor for institutional crypto players.
Crypto Firms Vulnerable to Dicey Banking
Landsberg-Sadie considers that banking involves a dicey activity for the crypto firms, with the majority perceiving the improvement of conventional finance as the primary goal. The BCB Group official lamented that fraudulent schemes and collapses triggered the scattergun enforcement from the US-based regulators.
The scattergun approach becomes the choke point gradually strangling crypto banking, as witnessed in Silvergate Capital.
Real-time Liquidity Interchange Network Consortium
Similar to SEN, BCB Group introduced the instant settlement network identified as BLINC in June 2020. It replicates SEN in offering instant settlement for transactions comprising Euros, British pounds, and Swiss Francs. The operations match the dollar transactions facilitated by the terminated SEN to leading crypto clients in the US.
Landsberg-Sadie noted New York’s Signature Bank’s Signet is set to benefit from Silvergate Capital woes, given its services are equivalent to SEN. It runs the largest network offering instant USD-denominated settlement, thereby filling a portion of the demand.
Landsberg-Sadie indicated that plans to introduce the BLINC dollar component started a year ago. He restated that plans for its completion are at the advanced stage. The declaration acknowledges that Silvergate Capital announced terminating the SEN network.
Multicurrency Dollar-Denominated Component
The BCB Group official indicated that the dollar component would go live by Spring. The expedited delivery would enable users stranded by SEN termination to realize continuity. Its launch will benefit the London-based payment firm, given the existing overlap of Silvergate and BCB clients.
Landsberg-Sadie indicated that the distinguishing factor between SEN and BLINC is the latter’s capacity to accommodate multicurrency transactions. Also, Unlike SEN and Signet, BLINC is not vulnerable to the restrictions of a single credit institution. Instead, BLINC’s design involves a purpose-oriented payment platform to offer onramps to multiple banks across Europe, Switzerland, and the UK.
BLINC Deploys Decentralized Model in Payment Solutions
Landsberg-Sadie portrayed BLINC as utilizing a decentralized model. Although it lacks deposit-taking, BLINC is suited to exceed in providing payment solutions. The executive decried Signature and Silvergate for their attempts to offer payment solutions, whereas they are providers of the solution to credit institutions.
Landsberg-Sadie assured the BCB community and investors avoiding the challenges that brought down Silvergate Capital. He observes that the Silvergate crisis began when it facilitated users to place long-term bitcoin bets secured through short-term cash deposits. The position became impossible to reverse following the prolonged crypto winter in 2022.
Landsberg-Sadie affirmed that BLINC funds have matching collateral in servers through 1:1 unleveraged and unrehypothecated securities.
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