N26 is launching its crypto product in European countries – including crypto-savvy Switzerland.
Crypto winter extended by the FTX debacle or not, cryptocurrency trading remains a magnet for wider customer groups. This can also be the decisive factor when choosing a neo-bank. Providers like Yuh, Revolut and others benefit from this. Especially since the integrated cryptocurrency trading platform can not only be a new customer generator, the feature also opens up new sources of income for neo-banks.
This is why the function of crypto trading is usually quite high on the agenda of neo-banks that are not yet involved. This is not least due to investors who no longer primarily want to see growth from their sometimes highly financed FinTechs, but are increasingly pushing for profitability.
In Switzerland, Neon has also put crypto trading on the agenda for upcoming products after the last funding round and a strategy coordination with investors, MoneyToday.ch reported. According to its own statements, Neobanken wants to start with an integrated crypto product this year.
Open up new sources of income with crypto as a service
The road to your own crypto trading platform with custody, regulatory hurdles and other features is extremely time-consuming and costly and usually exceeds the capabilities of a neo-bank. Especially since crypto trading must be an attractive additional product and not the core of the business model.
Neo-banks prefer to choose the white label products from established trading platforms and thus gain access to a functioning infrastructure cheaply, quickly and without major upfront investments. The Austrian FinTech Bitpanda is one of the technology companies that makes its own trading and custody platform available to banks, neo-banks and FinTechs as a white label solution. Whether stock or crypto trading, commodities or precious metals is the respective partner’s decision, the Bitpanda solution works modularly.
After the crypto launch in Austria, N26 opens up to additional European markets
Berlin-based neo-bank N26 launched its crypto product in Austria in October 2022, MoneyToday.ch reported. Infrastructure partner Bitpanda provides trading and storage of the coins. Users trade directly in the N26 app and do not need an additional wallet, private keys or other “accessories”. Safe storage of coins has gained enormous importance after the FTX crash, as shown by the outflow from the major crypto exchanges in recent weeks. In addition, it is much easier and more convenient for non-technical people to have everything in one app.
This statement is also Gilles BianRosaChief Product Officer at N26, he says: “With N26 Krypto, we’ve created a straightforward, intuitive product that seamlessly integrates with the fully regulated N26 banking experience and shows account balance, savings and investment portfolio side-by-side – with cryptocurrencies being the first asset class we want to offer.”
The reference to “first asset class” shows that N26 has further ambitions for shares or other assets that customers can trade. But to start with, cryptos.
After Austria, N26 is now launching its crypto product in Switzerland and four other European markets: Germany, Belgium, Portugal and Ireland. The expansion of the app should be gradually activated in the individual countries over the next few weeks.
N26 starts with the impressive selection of nearly 200 selectable coins that can be traded directly. The corresponding value of crypto purchases is deducted from the available account balance, the purchased coins are immediately displayed in the user’s crypto portfolio. The same also applies when customers decide to sell a crypto position, the funds are immediately available in the main account as soon as a position is closed. To save users from clicking, both transaction types can be performed as drag-and-drop.
How high are the fees?
N26 charges the same fees that apply to direct customers on the Bitpanda platform. Customers in Switzerland are charged a 1.5 percent fee for a Bitcoin deal, trading in all other cryptocurrencies is charged 2.5 percent.
As with most other providers, the hurdles remain low, investments in cryptos are possible from as little as 1 euro.
Why is N26 starting crypto trading in Switzerland?
Notably, Switzerland is among the first countries to gain access to the crypto feature. But also understandable.
So far, N26 has not indulged Swiss customers with an excess of features in the app and only offers Euro accounts. Not the ideal account for users who travel less abroad but need an account to pay the electricity bill and for other domestic transactions in Switzerland.
As crypto opens up, the account becomes more attractive to wider customer groups. The Swiss are known to be particularly crypto-savvy in a DACH comparison, which arch-rival Revolut has benefited from for years. Not all of the nearly 600,000 Revolut customers in Switzerland trade with cryptocurrencies – but the ability to do just that is a strong argument for choosing Neo-Bank. Especially with younger customer groups. It is Valentin StalfCEO and co-founder of N26, says:
For a new generation of investors looking for ways to grow their wealth, cryptocurrency trading is a common way to start investing
Stalf could be right about that. Revolut will also keep the big lead in Switzerland for the time being, especially since N26 is quite late with the crypto entry. But the new crypto opportunity can certainly help the Berlin neo-bank narrow the gaps a bit. From this point of view, the early start in Switzerland may turn out to be a good decision in the long run. Maybe even in the short term – we’ll know that when N26 communicates specific figures about users in Switzerland for the first time.