CVA Podcast: Guido Buhler, SEBA Bank

Transcript

[Music] hello hello and welcome back ladies and gentlemen to the crypto valley association podcast you're listening to season three i am your host straz ahmed and we're just about ready to kick off another bite-sized episode with you all today many thanks to cevibank for supporting this initiative as they pursue their mission to redefine finance for the new economy i have no doubt that our special guests today will be able to tell us a bit more about them now let's discover together the growing trends of this fast-moving space and try to shed some light in the mysteries it contains today on the very first episode we are joined by guido ruler

chief executive officer of ceba bank a pioneer in the financial industry providing a seamless secure and easy to use bridge between digital and traditional assets so let's dive straight into the world of banking hello guido how are you doing today great thanks thank you very much for the invitation it's our pleasure i mean what how about we we start off things here today by allowing you to share with us your first blockchain related experience well it was um a call of a family of this client in prior december adventure i was running with another co-founder he liberated the family office and one hour our client called us in 2017 early

on and asked us to establish a crypto portfolio where my answer was how you spell crypto and what is it is all about and that was basically stored into diving and understanding blockchain up to the point where then i understood in i remember on the 27th december on at five o'clock in the evening in the board that blockchain is a multi-purpose technology that has four attributes which allows to basically redefine the rules and responsibilities of finance in in its entirety and the conclusion of that was for me

to really approach it from a top-down perspective and that was the idea at the beginning of civil bank wow fantastic and why don't you tell us more about ceba bank and what cell bank represents vision mission and ethos yeah so so basically it's very obvious for the audience here but it's still worthwhile to reiterate right the blockchain is more than crypto and crypto is more than bitcoin and with its purpose technology it's clear that the finance has a new tool set it can redefine elements on the accident the

liability side on the primary market and the secondary market to all various client segments and that is really what cebu bank is all about to provide this holistic service offering to the various client segments so how are we doing this uh initially we started out to be the full bridge right so between the digital and traditional world initially our clients were private clients or private clients with institutional needs and then clients that are already familiar with the crypto world and wanted to have a more seamless experience in the meantime

we have a lot of i call it traditional money institutional traditional money like other banks pension funds hedge funds independent asset managers that are looking for a fully regulated capability with institutional service capability across the life cycle of a product and what are we doing are we offering digital banking services typical ramps services for the g20 currencies and also maybe for some more exotic ones for our partners uh we have a wallet associated to that is a card debit or a credit card and with our superior custody

capabilities then we have as another capability we have a trading and credit platform it's probably the most integrated platform that currently exists which is uh based on a principal basis so when you deal with us the deal is uh secured and agreed you don't have to um care anymore about market sleep pitch or execution risk it's it's done at this particular moment without commission and without additional mining costs and we also provide them credit services typically crypto lending but also what we have done we also have financed real estate

on the back of bitcoin holdings and technical investment finance then our third element is the investment products we have launched various investment products from the sebox which is a a basket of selected cryptocurrencies based on a official buy side research capability that we have in line with the swiss banking association that's very important for the traditional money that comes in that they can give evidence they that their investment decision is based on a reliable source lately last week we

also have launched our polka dot tractor certificate that is also listed on the exchange also representing the views on what kind of protocols or players we believe are playing an important role in the future and last but not least it's all about the origination digital corporate finance function that is obviously doing the digitalization of assets we all know the story about that but also for select account the parties and mandates we accept mandates for uh crypto for corporate finance really helping to raise equity for various companies so um that's a quite a holistic offering

providing a full suite of services at the one stop shop yeah definitely a very very full and complete and inclusive uh sweet suite of services then i'm really looking forward to deep diving individually to to quite a few of them but but maybe just start off by by congratulating you i mean you just received digital startup of the year award from the from the ita group i mean this must be uh incredible uh news for you i mean how do you react to to hearing such news and what does this mean to you it means a lot to us as a team it's clearly um people are always driven by uh you know a purpose and

the mission and then we full pride we are executing and there is always you know the things that you work on you are quite of quite proud of it but it's then even nicer if there is an external recognition that uh also manifested what you have what you do and what it has been achieved is a sort of a cool thing so we are very proud of the particularly that award is uh issued by a very company with a significant renown and has a significant credibility in tech space so yes we we are proud having received that award incredible yeah and undoubtedly so

i mean uh you know most of us found out about about civil bank from the news in august 2019 right when the financial the swiss financial market authority finla they granted you with a banking license becoming one of the first financial service providers in the space to have done so i mean this is where you're at now but tell us more about that moment maybe in the past of of how that felt to receive rather well then and how far you've come to winning digital startup of the year it's incredible so yes so basically you start you start with uh planning the bank right so when i had the idea that 27th of december the first i had to find some people that are crazy enough to embark on that

journey and they met the first time on the second february 2018 and at that time you know do we still need a bank if yes how does a bank look like and we were kind of in the planning the bank phase until uh the first of october when we in the meantime presented our blueprint to the regulator and by we were super positively surprised that we got an affirmative action we also have think that at that time raised a hundred million to build the bank and kick off the bank so then on the first of october we went into build the bank that was super exciting so from from six people we ended up like

eventually uh to 65 people until august 2019 when you obtained the license and then eventually we kicked off the running the bank accepting our first client which was me by the way uh in november 2019 it was uh it was a quite a significant transition right because build the bank is a project mode you're very excited that you are reporting to the regulator but then when you go live you are you know you are monitored by the regulator and it's super important for the regulator that an organization has its full stability

and things all going the way in process and products as you you know intended to do the versus then every startup has its pivoting moment and you have to be very agile and so the excitement was uh super great in august when we obtained the lives but also then we had a bit of a reality check when we started to run the bank and to get a bit of context in july now as we are in 2021 it's only the seventh quarter that we are running the business and it's been a heck of a journey so we have been we have growth rates of 12 on the client base compounded

on a monthly basis we were growing assets by 30 on a compounding basis we had a trading volume 70 so significant growth in the meantime and it's a super exciting journey but it's it's not easy to be a bank and startup in a space that has to redefine itself so to speak yes and while those are truly some incredible numbers that you just shared there and i'm sure that a lot of that comes from the community right i mean the user acquisition having more people join you as well where some of this community of course they're kind of

maybe a little bit against banks which we'll touch upon a little bit later but i want to focus now a little bit on the community side and you mentioned than the new announcement of uh the polka dot etp i mean maybe you can talk us through a little bit more about like maybe not why polka dot but why how do you come across listing new new products how the focus on the community when taking into consideration new products new releases and the likes so yes it's a it's a very good question so one of blockchain from a cultural perspective also means three things right it's it's about open open source it's about collaboration and it's about

sharing so that's also when we moved into build the bank space we announced ourselves at that time because it was very key it was very important to us that we learned from the community you know we were thought we were not embedded in the community and we were sort of an outlier in the traditional world it was super important for me to be fully connected and that really helped us to do you know on board some super experts into the organization that saw the vision and wanted to be part of that journey the second point is when we are now there's about i think it's eight

more than eight thousand assets or tokens are listed on the various exchanges we have to be very careful who we are we are engaging with you know what kind of protocol we endorse and as a as a bank you just do have to know that we know about getting an asset in it's really about uh integrating a blockchain a protocol and that protocol will issue certain assets and once we integrate a protocol with the protocol we can we can issue products or assets we can store them we can finance them we can distribute them we can trade them we also can do

the forensic in in the in the context of money laundry laws and all the likes so it's it's quite an important step and and so the selection is basically bottom up and topped down uh bought them up in terms of who is behind the protocol what is the governance therefore how immutable is the technology how robust is it what is the development environment the adaption so that's one criteria and then from a top down perspective is also the interest from potential investors the interest in terms of the space that the particular protocol wants to engage

and is there an asset class that's in particularly interesting order a use case so to speak and we are very very careful about this and then we are selecting a range of potential protocols and like an investment committee there are very difficult and thorough conversations until we come to a conclusion and take the decision and for instance like both local then adapt that as an asset class with a right view for full adoption into the organization and then even list that tracker on the space digital or the swiss exchange uh the say stage exchange is

uh soon to come great okay yeah thank you thank you for that detailed expectation there and so this is a question i mean we we often bring up in in the podcast actually it's as the crypto valley is based in switzerland and you're you're yourself um tell us more about the decision on basing civil bank in switzerland and not another jurisdiction maybe like singapore for example or or elsewhere around the world or even what is really attractive in your opinion about the swiss ecosystem so crypto valley established by a coincidence basically right i mean we had um where the bank is located today the calling plots it was before was the government

of the city and as you know there were where the first um cryptocurrency was accept accepted as a as a payment and it was that decision was um basically you know the conclusion for the decision was by the city government being approached from some crypto valley individuals that the government would accept this new concept of money and why do i say that it is a typical example of how switzerland works and it's it's it's a little bit like it's a decentralized government when we talk about decentralized lecture technology it is still you know the the power of many of

structure policy of fiscal policy is with the community in in the city and then it's over obviously embedded in the county or the canton and then it goes up to the nation and this distribution allows much quicker adaption to innovation so that's that's the first thing and in line with that dna sharing in a way at that time the the prime minister right rauhman said we wanna switzerland wants to be the crypto nation of the world and actually promoted many of those thoughts and that all brought new talents from all over the world into the crypto valley

and zugin itself is a cluster of various echo players so we have a lot of commodities we have lifestyle life science health license right many of the big super nationals are residing here and so it's it has a very fruitful ground of collaboration collaboration and sharing and it's it's supported by this group and um that's how it it all comes together and then last but not least switzerland has this concept of a universal bank um which is not an official statement you know people say a banking license but the banking license

that doesn't doesn't qualify in itself what kind of banking license or you have pure remittance license up to the biggest degree of licensing which is a universal bank which doesn't exist in the us where you know savings bank mortgage bank that all has to be separated and we applied for this and it's almost like being over licensed initially but i believe the technology will now present with so many new opportunities that um with this particular license that cyberbank has obtained we can adapt very fast and provide solution we are no we are not blocked or we have a hurdle

by asking for further um license granting by the regulator and this this is all the three free elements so it's the structure policy of the government it's the support of the government and then it's the regulatory environment that we have great it's very very concise there and and i think you mentioned some really really interesting points i think a lot of them reside as well around the educational topics right i mean you need to kind of know of course what what you're talking about before knowing where to to base yourself and we often hear about the importance of education and of course we've seen sabah bring out seb adversity along with actually one of the newly

elected board members of the crypto valley association marcel uh harman who who is leading uh so university can you tell us more about your thoughts on education and how you're promoting education through uh through civil from the very beginning it was clear to me that we have to do some demystification and therefore education is it was a super important element from from from the start and i have learned that you know that maybe the people from the community they are very deep into blockchain and then obviously crypto is sort of the killer app of it right and there was a very fresh but maybe

also be the naive approach to it and then you had the more the traditional guys that don't want to think outside of the box it's already fragmented and then you have many users that deal with money or finances but they don't really understand the entire universe of finance what's out there and bringing these three dimensions together was super important that's why we were very early on that concept we also working with various universities to give this education and you have to be aware it's a total we call it a non-profit arm but what i want to say is that education is totally agnostic it's never a push to to sell something

or to positions ever the code that in itself is very pure and honest and not drifted on one side and gives basically everyone the chance to understand and the concept of sep adversity has three user types you know first of all we have the curious these are the people they have heard about it and they would like to get an intro understanding the one-on-one of things then we have the the content of the explorer has already done stuff likes to do more but he's not sure what are the do's and don'ts or have identified certain shortcomings and

they're looking how to overcome these shortcomings and then we have the experts where we have gatherings with some you know people around a particular asset class that would like to understand what tokenization means what are the real benefits or not all all the likes and that's how save adversity is fully embedded now you're educating hundreds of banking relationship managers in sep university to make themselves qualified and comfortable to talk about this new asset class to their clients in their financial institution

okay and i think actually that that follows very well into one of the last questions unfortunately of this episode is that i mean you're probably familiar with the term buy bitcoin by banks and and we've seen through several actually that it's possible to do both and not to choose between either or i mean tell us more about your thoughts on the potential development of the banking space alongside that of the crypto markets and blockchain technology yeah well i maybe start on thirty thousand feet and flying with the deals right so we have these free internets right we had internet of communication which basically disrupted the entire um community you know communication space

media and the emergence of social media where suddenly we were producers and consumers at the same time right then we had internet of things which i always call the um the iphone or the smartphone to be to be um the symbol of inter bringing all these um various dimensions together and then it's it's the internet of value which is basically blockchain and in line with that my vision and having positioned how i see the strategy is we want to be the smart bank of new finance and smart bank what does it mean right it's it's three things it's connectivity in various ways connectivity

electronically apis it can be directly or through through the p2p layer then the second one is access to a full ecosystem so zebra has as i mentioned this very holistic offering and people can connect from one particular angle and then various organical follow-ups are happening in that context and i also believe that the future is that many of the networks that today exist is it messenger or social media what have you they would like to have an integrated wallet and if that integrated wallet is actually a wallet provided by a bank you have your bank with you in your community which

gives a total new dimension of interaction and possibility and last but not least is uh the third element is self-directed capabilities that you get all the the analytics in a way presented that you can execute in line with your desires and that's basically where i think it's heading to in the next five years nobody talks specifically or explicitly about blockchain and crypto but it's just the nature of doing finance in a new form it's a wonderful way to to to conclude i think i mean seba the smart bank and it's uh yeah incredible i mean greedo thank you so much for

for joining us here here today do you have any final words uh for our listeners oh really i'm thanks very much for for the interest and time and obviously i always invite the people to come to us because you know if people are in front of the door don't be shy to come in and and look around and we are always very excited to hear people's view and we are a curious organization we really want to learn every day and make sure that we can adapt ourselves in line with the loans that the people have in the calling the new economy

that's my last word so to speak that's that's fantastic and if you enjoy this conversation feel free to check out more on our website cryptovalley.swiss where we host plenty of events educational material and even provide information on how you can join our growing community so thanks again guido for joining us thank you thank you very much my pleasure stay tuned stay safe and until next time from the crypto valley in switzerland [Music] bye