The three most important takeaways
- Tobias Eckl, CEO of the Bavarian fintech company Gubbi, criticizes the traditional financial world for underestimating or ignoring the importance and impact of MiCA regulation so far.
- Banks and financial institutions must rethink their business models and face up to the challenges of the new regulation in order to remain competitive and not be left behind by innovative fintech companies.
- MiCA regulation also offers opportunities for fintech companies aiming to offer innovative crypto-assets and digital financial services.
“The traditional financial world is sleeping through the MiCA regulation,” is the opinion of Tobias Eckl, CEO of the Bavarian FinTech Gubbi. This is because companies often do not realize how much they are affected by the regulation on the EU-wide regulation of crypto-assets. But that is precisely the problem and at the same time the opportunity for those who are dealing with it now.
“The regulation will come into full force in 2024 and it is important to address the issue now. If you want to become an innovation leader and take on a pioneering role, you should place your first digital asset before regulation in order to have a cost advantage and possibly also serve as a reference project for BaFin. Many people also fail to recognize the seal of quality that comes with this,” says Eckl in an interview with Fundview.
Legal certainty is a key point for customers and issuers. Companies need to think about how they can tokenize their products and funds. “That is the key point. Tokenization has many advantages, such as fungibility, faster transferability and possibly, as with NFTs, tax exemption. These advantages mean that they will gradually overtake traditional or classically designed products,” warns Eckl.
Many banks have been trying to position themselves in the crypto industry for some time now. Deka and Commerzbank, for example, have already applied to BaFin for cryptocurrency custody licenses. So you can see that they want to position themselves step by step in the digital assets sector. However, Eckl points out: “Of course, they have problems pushing ahead with such things in-house due to entrenched structures and thought patterns. In addition, the banks are ignorant when it comes to FinTechs. This is very problematic here, but in turn an opportunity for FinTechs.”
“Little knowledge available”
There is actually a great deal of ignorance on the subject among medium-sized and smaller companies. Eckl explains: “In conversations with managing directors or board members about adding products in token form, you quickly notice that they have little to no knowledge of cryptos and digital assets. And one thing won’t work anyway: You can’t have a business in the real world today and be in the digital world tomorrow. It’s a process that requires development. Anyone who believes that it can be done so quickly and that companies can be converted within a very short space of time just because it has to be done now is very much mistaken.” That’s why companies need to start the transition to the digital world now and therefore primarily deal with issues surrounding blockchain technologies.
It is therefore important to understand that the development of a company is not a switch that can be changed, but a gradual process. “As Gubbi, we guide issuers by building bridges to digital technology that are easier to cross with us. This means a network of specialists, experience in consulting and full digital blockchain-based implementation. The transition to the digital age, especially to blockchain technology, is an important step for companies to be well positioned,” says Eckl.
Among other things, Gubbi offers token consulting and the appropriate network of specialists. Token consulting refers to consulting including the tokenization of assets and other assets. Gubbi has also built up a network of lawyers, tax advisors and marketing experts. “We recommend companies such as asset managers, banks, fund companies, real estate and solar companies to fully tokenize their products successfully and bring them to market. Unlike most providers, we don’t just offer tokenization, but provide a comprehensive setup that ranges from our own programmed digital asset platform for white labels to marketing, PR and sales support,” says Eckl.