This February, PostFinance became the largest retail bank in Switzerland to enter the crypto business. The bold step was taken after several years of preparation in response to strong customer demand. However, there is a long-term strategy behind the offering, says Head Digital Assets Alexander Thoma in an interview with CVJ.CH.
Back in July 2022, PostFinance revealed that it was working on a crypto offering. Strong customer demand and positive experiences with the trading app Yuh were deciding factors. Just under two years later, the bank launched trading and custody services for cryptocurrencies. Switzerland's first systemically important financial institution positioned itself in this space. 2.5 million customers were given easy access to the asset class.
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CVJ.CH: In February this year, PostFinance became the largest retail bank in Switzerland to enter the crypto trading market. What led to this decision?
Alexander Thoma: It is of strategic importance for us to be involved in forward-looking technologies such as distributed ledger technology (DLT) and blockchain. In the long term, it's essential for a financial institution to build knowledge in these areas. Our analysis also showed that our clients are increasingly looking for offerings in this area. Previously, clients had turned to less regulated exchanges to trade cryptocurrencies because their banks did not offer such services. However, they would prefer to trade through their own bank. PostFinance also believes in the potential of the crypto market and sees the underlying technology as very promising for various applications. That's why PostFinance is now offering a corresponding service to its private customers.
Why did it take almost two years to prepare?
A project of this scale is naturally very complex, with several factors influencing its implementation. One key aspect was PostFinance's limited experience with DLT/blockchain, which required an organization-wide knowledge build-up - a time-consuming process. In addition, as the largest retail bank in Switzerland, we are required to work closely with regulatory authorities. The necessary clarifications and review processes took time. We also didn't want a quick win, but rather a "minimum marketable product," a product that could succeed in the marketplace with a great user experience. Customer feedback shows that we achieved this.
Has the effort paid off?
Demand is in line with our expectations and we are very happy. However, we are at the beginning of a major development and we are confident that we are on the right track.
How will PostFinance's crypto offering evolve?
The biggest missing features are transfers (in & out) and staking. We are currently working hard to make staking available to our customers. We will let you know how and when this capability will be introduced. We are also evaluating the transfer functionality. In addition, we have a number of smaller features and enhancements on our radar that we will roll out when the time is right, such as the recently added portfolio charts.
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How is PostFinance responding to the increasing competition from other traditional Swiss banks with its own offerings?
We set ourselves the highest standards and aim to offer the best digital asset proposition among Swiss banks. This means a fully integrated user journey with attractive conditions. The offering should be easy to understand and accessible to everyone - in the spirit of "crypto for all". Around a quarter of the Swiss population is a PostFinance customer, so we have significant leverage to offer crypto trading to a large part of Switzerland.
Is there a bigger vision behind your crypto strategy?
Absolutely! We want to become the leading retail bank for digital assets in Switzerland. That's our goal. We're not there yet, but we're working hard to get there. This vision goes beyond crypto trading to include DLT payments, asset management and parts of a new financial infrastructure.
Dr. Alexander Thoma has been with PostFinance since 2020 and is currently Head of Digital Assets. In this role, he is responsible for all products and initiatives in the area of digital assets and represents PostFinance both internally and externally in this area. He holds a PhD in Economics from the University of Zurich and is a Certified Digital Assets Analyst (CDAA). Before joining PostFinance, Alexander co-founded Alethena, a pioneer in tokenization in Switzerland. He is a member of the expert group of the Swiss Blockchain Federation (SBF), the Swiss Bankers Association (SBA) and the Asset Management Association Switzerland (AMAS). He is also a founding member of Digital Assets Switzerland.
