When the solarisBank project was kicked off around three years ago, we had identified one major problem in the market to solve: many fintechs needed a licensed banking partner to launch their products, but could not find a technologically and culturally fitting bank to work with. Out of this need, the idea of solarisBank was born. Since then, we’ve partnered with more than 60 companies — many of them fintechs, but also tech companies and banks. Nowadays, tech pioneers are using blockchain technology to imagine decentralized versions of certain industries such as finance. Interestingly, many of these pioneers face exactly the same problem fintechs were facing three years ago: The need of a licensed partner.
Traditional banking has always been centralized, with individual banks acting as “institutions of trust,” maintaining their own ledgers and servers, and taking responsibility for safeguarding deposits. Within a closed system, banks physically retain control of the data, the flow and the processes pertaining to the customer’s bank account, and sometimes the physical currency itself.
On the other hand, blockchains (such as the ones underpinning Bitcoin and Ethereum) can be completely decentralized. The premise is to have “trustless” transactions between entities without privileged institutions mediating them, resulting in cheaper and faster transactions. The data isn’t stored on the servers of a bank, but in the public domain. The customers’ personal data is protected with a private key, meaning customers completely control their own data, wallet, and the currency within it.
Enabling pioneers to build an open, decentralized future
Many banks are already exploring ways they can incorporate blockchain into their processes. Yet for the most part, these are defensive measures, as most banks have created or joined closed blockchain consortiums.
At solarisBank, however, we see the openness of blockchains as a strength. We see open, decentralized blockchains as creating opportunities for all when it comes to innovation in banking.
While we at solarisBank are still part of the traditional paradigm, since we have a German banking license and are regulated by BaFin, we are still a tech company at our core. That means we are actively exploring options to help shape and support the emerging decentralized paradigm by enabling the pioneers that are building it. This is the reason why we’re now officially launching the solarisBank Blockchain Factory.
solarisBank starts ‘solarisBank Blockchain Factory’
The bridge between crypto and fiat worlds
Many cryptocurrency entrepreneurs I’ve spoken to the past couple of months have described a similar problem: the need of a regulatory and legal infrastructure to connect the crypto and fiat world. When you’re building up a banking platform such as solarisBank from scratch, you do not only need to develop cutting-edge APIs. You also have to set up compliance and legal processes built to explore unknown territory on a daily basis. With these two aspects plus our full German banking license, we’re well primed to support pioneers looking to bridge the gap between banking and crypto. We can not only offer their companies to jointly operate under our license umbrella, we can also provide them with services such as monitoring of transactions or know-your-customer procedures.
But the setup of our regulatory and legal platform for crypto application is only the start. The next logical step is to connect our digital banking and debit cards solution with exchanges and wallets, so partners can create their own crypto retail banking experience. These accounts significantly reduce the risk to their end-customers and make the trading and possession of cryptocurrencies not only more convenient but also more secure.
Of course, there are more services we’re already working on and a variety of solutions, which we will build in the next months and years. But while empowering blockchain pioneers is one main goal of the solarisBank Blockchain Factory, it’s not the only one. The Blockchain Factory also aims to innovate solarisBank’s core business by shaping our vision of decentralized banking. It might sound counterintuitive to be a bank and at the same time work towards a decentralized future. But we strongly believe in the future of banks in a decentralized world: as part of the infrastructure of value exchange, but most importantly as the trustworthy storage of values — a role banks have already been playing for centuries.