N26, a German online bank, is preparing to offer cryptocurrency trading in 2022
The co-founder of N26 admitted that the German financial behemoth made a mistake by emphasising regional development over crypto services.
N26, a German online bank, disclosed intentions to establish a crypto trading service this year and then expand into stocks brokerage, according to Financial Times.
The bank, which is one of Europe’s largest fintechs, with a value of more than $7.8 billion, made a myopic choice to prioritise global development above innovative offerings, said N26 co-founder and co-chief executive Max Tayenthal.
“Should we have focused on trading and cryptocurrency rather than debuting in the United States? In retrospect, that could have been a good idea,” N26 co-founder and co-chief executive officer confessed in an interview with the Financial Times.
According to Tayenthal, the bank just recognised that it had “stretched itself exceedingly thinly.” “There are so many other things we can concentrate on instead of establishing flags in new regions,” he said, disclosing the bank’s ambitions to refocus its strategy and emphasise service diversification.
Following N26’s decision to shut its US operations, Tayenthal admitted how the bank’s fast global growth pushed the development of other services, such as cryptocurrency and catering to the retail equities trading boom, to the back burner.
“We have to broaden our product universe,” Tayenthal continued, stressing that N26, which serves seven million users in 24 countries via current accounts, plans to start a cryptocurrency trading company this year, followed by an equities brokerage.
German finance regulator criticises
German financial regulator Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) imposed restrictions on N26 expansion, compelling the bank to strengthen its anti-money laundering safeguards after it accepted an average of 170.000 new customers per month last year.
According to Tayenthal, BaFin’s limitation, which restricted onboarding to 50.000 new clients each month, was a “huge constraint” on N26, which was backed by “growth investors” and positioned itself as a fast-growing firm.
“There is a great deal of confidence (among investors) in our ability to get these growth limits released again,” Tayenthal asserted, adding that he is hopeful the cap may be lifted completely by late summer.
“We have a strategy. We understand what has to be done and are capable of carrying it out,” he added. According to Tayenthal, the group will be prepared for a stock market listing by the end of the year, although the timing of the move has not been determined.
“The perennial question is: When is the appropriate time? “Do you want to go public when you still have a significant amount of money in your accounts from last year’s fundraising?” he quipped.