WEGBank has secured a license to trade crypto assets and offer custodial services. The licenses are valid in Estonia, meaning the bank can target the extremely lively European crypto market.
https://twitter.com/weg_bank/status/1165783011612401664
WEGBank is partially owned by the Litecoin Foundation and is also partnering with TokenPay and Verge Currency.
The move by WEGBank arrives at a time when crypto companies are facing higher institutional scrutiny, and securing banking services is problematic for some projects. WEGBank will combine all parts of the process, linking traditional finance with the potential to create a new crypto exchange.
Europe is one of the most active regions for crypto-related activity, with smaller local banks cooperating with crypto finance. However, in separate cases, banks refuse to deal with crypto companies. Recently, Barclays broke its partnership with COINBASE UK, and reports have surfaced that the Spanish Santander bank has refused to serve transfers to and from exchanges. At the same time, smaller banks continue to allow crypto transactions.
Estonia, along with Latvia, has surfaced as one of the crypto-friendly regions in Europe. The country was known for attempting to launch its own crypto token, though being discouraged by the European Central Bank (ECB).
Estonia is a leader in crypto licensing, allowing companies to work while remaining compliant with the Money Laundering and Terrorist Financing Prevention Act (MLTFPA) that came into force in 2017. The country has a double-licensing regime, with the first type of license covering crypto-to-fiat exchanges. But Estonia has a specialized license for those offering crypto wallets, custodial services, and crypto transfers.
Currently, operating crypto wallets is still unregulated, though the recent Financial Action Task Force (FATF) recommendations target anyone offering crypto services, with no regard to offering exchanges for fiat. Regulators and researchers are also pointing out the potential for using crypto assets for terrorism financing, and direct observation of blockchains is accelerating.
