N26, a European digital bank, announced on October 20 it is getting into the cryptocurrency space and would be launching a cryptocurrency trading service, with Austria serving as the product’s initial market.
The digital bank which has its headquarters in Berlin, will use the trading and custody platform provided by the Austrian cryptocurrency exchange Bitpanda to provide some of its customers with access to cryptocurrencies including Bitcoin (BTC), Ethereum (ETH), Cardano (ADA), and XRP, according to a report by CNBC published on October 20.
Named, N26 Crypto, the service which will initially comprise 100 tokens such as Bitcoin and Ether, will be accessible to N26′s Austrian customers in the coming weeks. Afterwards, N26 intends to roll out the service to consumers in additional markets over the following six months, ultimately expanding its token offering to include 194 currencies in total.
N26 latecomer to the crypto bandwagon
N26 has entered the crowded cryptocurrency market rather belatedly. Payment behemoths Visa (NYSE: V) and Mastercard (NYSE: MA) also sell cryptocurrencies and so-called “Web3” services to their customers.
Fintech competitors PayPal (NASDAQ: PYPL) and Revolut have been providing their users with the opportunity to purchase and sell digital assets for quite some time. Meanwhile, Nubank, a Brazilian digital bank, introduced its own cryptocurrency, which it calls Nucoin, on October 19.
Gilles BianRosa, N26′s chief product officer, stated:
“Our users are extremely interested in crypto. That interest remains super high, even in a bear market.”
To initiate a trade, users choose a coin and enter the amount they wish to purchase or sell. When customers finish their order, cash is withdrawn from their primary account balance and displayed beside their chosen token. Customers may also “drag and drop” cash from their primary account into their cryptocurrency portfolio, according to N26.
The timing of the challenger banks crypto venture may have been better. This year, Bitcoin and other tokens have seen significant losses as investors exited the market owing to concerns about rising interest rates and liquidity shortages.
N26, which has an EU banking license, is testing the waters in the cryptocurrency industry despite the fact that many traditional financial institutions have avoided the sector out of fear of its high volatility and potential for fraud.