Swiss banks remain wary of bitcoin

Is Credit Suisse’s investment in digital assets platform Taurus the moment Crypto Nation Switzerland has been waiting for? It looks more a case of blockchain ‘Yes’, bitcoin ‘No’.

Switzerland’s second largest bank is the lead investor in a $65 million (CHF60 million) series B round in Taurus, which specialises in crypto finance.

The Geneva-based Taurus provides services to store and manage cryptocurrencies and to issue stablecoins, a type of cryptocurrency backed by more traditional assets.

But this doesn’t mean that Credit Suisse is primed to dive into bitcoin. The bank is more interested in Taurus’s other business – creating blockchain compliant versions of company shares and other securities.

This means creating digital versions of securities that are stored and transferred on Distributed Ledger Technology (DLT) systems. The hope is that DLT will make it faster, more cost-effective and transparent to create and trade stocks and bonds.

DLT interest spreading

Credit Suisse is following a path already trodden by other traditional financial players, such as the Swiss stock exchange and other banks.

Taurus has a proven track record of tokenising company shares. It recently helped the Swiss private bank Cité Gestion achieve this feat with its own shares.

Swiss companies Metaco, Daura and Aktionariat are also very much in the same game.

The term digital assets can these days encompass a whole range of items: from cryptocurrencies to digital securities and DLT tokens representing art and real estate.

Decentralised vs centralised

Credit Suisse’s foray into digital assets is a far cry from the libertarian values of bitcoin and other public blockchains that are striving to move away from centralised gatekeepers, such as banks.

Very few Swiss banks are willing to jump on the bitcoin bandwagon, particularly after the collapse of the crypto exchange FTX last year. “Like many banks, we are still conservative,” Credit Suisse Switzerland CEO André Helfenstein told the Handelszeitung newspaper.

The centralised and decentralised pathways for digital assets are locked in an arm wrestle for the future of finance.

It’s perfectly possible that both systems could prevail, running in parallel, depending on consumer demand and the exact goal of their operations.