Traditional Finance and Crypto Integration: Role of Neobanking and Centralized Financial Systems
Summary:
The rise of centralized financial systems and neobanking platforms play a key role in mainstream acceptance of the cryptocurrency world, as highlighted by executives from OpenPayd, Ramp Network, and Damex at the European Blockchain Convention. The discussion focused on the importance of third-party payment pathways and banking infrastructures. These services address concerns about identity and traceability in cryptocurrency dealings, mitigating risk and mistrust from regulators and traditional financial entities. Services like OpenPayd and Ramp have started fulfilling the role of specialist actors, facilitating Anti-Money Laundering and Know Your Customer processes. Thus, acting as a protective layer preventing traditional banks from directly dealing with cryptocurrency businesses. The development of the EU's Markets in Crypto-Assets (MiCA) framework was seen as a pivotal step towards wider acceptance of crypto businesses.
Centralized financial systems and neobanking platforms are becoming pivotal in propelling the mainstream recognition and integration of the cryptocurrency arena, according to influential players within traditional finance and Web3. Executive members from OpenPayd, Ramp Network, and Damex have discussed the rising relevance of third-party payment paths and banking mechanisms during the recent European Blockchain Convention in Barcelona.
OpenPayd's CEO, Iana Dimitrova, encompasses the company's role in presiding over more than €3 billion of transactions each month, and issuing in excess of 2 million accounts, some of which are major crypto exchange platforms such as Crypto.com.
As Dimitrova clarifies, OpenPayd’s principal service includes banking and payment framework for various sectors, including crypto. She portrays the ongoing issue of mistrust emanating from both regulators and traditional entities controlling payment pathways, and the crypto sphere. However, she goes on to illustrate how this gap can be bridged by addressing concerns surrounding traceability and regulatory compliance through fiat on-ramps and payment rails.
Managing Director of Damex, Samuel Rondot, explains how this Gibraltar-based entity specialises in offering fiat on and off-ramps to clients facing higher risk brackets including iGaming, Forex, family offices, and hedge funds, and typically converts large crypto amounts into fiat currencies and vice versa. Yet, due to their interactions with the crypto ecosystem, Damex’s clients frequently face issues with their bank accounts.
To tackle these issues, services have emerged, such as OpenPayd and Ramp, that fill the critical role of handlers who comprehend and effectuate Anti-Money Laundering (AML) and Know Your Customer (KYC) procedures, offering a safeguard to traditional banks in dealing with businesses connected to cryptocurrency.
Furthermore, the importance of conducting thorough due diligence, as well as a willingness to conduct business with crypto-related entities, facilitates the flow of fiat between centralized and decentralized financial structures.
Ramp's CEO, Szymon Sypniewicz, emphasizes how their entity offers a single API platform to the global fiat system, and gives users the ability to globally buy and sell cryptos in a regulatory-compliant setup.
Lastly, Dimitrova, Rondot, and Sypniewicz emphasize the importance of compliance standards and agree that the development of the European Union’s Markets in Crypto-Assets (MiCA) framework will provide a shared setup for Web3 and conventional finance players to operate more seamlessly.
Published At
11/7/2023 8:41:12 AM
Disclaimer: Algoine does not endorse any content or product on this page. Readers should conduct their own research before taking any actions related to the asset, company, or any information in this article and assume full responsibility for their decisions. This article should not be considered as investment advice. Our news is prepared with AI support.
Do you suspect this content may be misleading, incomplete, or inappropriate in any way, requiring modification or removal?
We appreciate your report.