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Tuesday, January 25, 2022

Lithuania greenlights blockchain banking

BEM Europe UAB disclosed Jan. 20, 2022, that it obtained an electronic money license from the Bank of Lithuania, granting the company permission to launch Benker, a new kind of financial institution that will be run entirely on blockchain technology.

Official approval, granted Jan. 13, paves the way for Benker, a Lithuanian fintech, to act as an Electronic Money Institution, the first of its kind to offer services and client onboarding in the world, company representatives stated.

Viktor Bodnár, CEO at Benker, proposed that Benker will fundamentally transform how personal finances are managed digitally as well as establish an industry-wide standard. "By obtaining our Electronic Money Institutional license, we can now radically diminish a client's risk exposure to financial market participants," he said. "Benker will transform electronic banking as we know it and will mark a new world order."

Bodnár further noted that Benker will be Europe's first licensed bank to operate entirely based on blockchain. Its advanced technology framework will mitigate risk and facilitate a range of digital financial services, he added, all backed by what he termed "technology guarantees" that have been prevalent in other areas of life but are lacking in financial services.

Technology guarantees

Technologies such as fingerprint scanners on phones and other biometric methods of authentication guarantee safety and security to users in a wide variety of vertical industries, Bodnár noted, from healthcare to mobile apps. Blockchain technology can bring the same level of security and guarantees to the financial sector, which has lagged behind until now, he added, because financial service providers that implement blockchain technology will be held accountable to laws and regulations and will have to deliver full transparency on transactions.

Banks will no longer be able to change rules at their discretion, Bodnár said, indicating that Benker and other participating institutions will have to provide 24/7 transparency to clients while giving them complete control over their own financial matters. Benker calls this concept "compliant client autonomy," he said.

Benker is now in startup mode, the company stated, with plans to open its first branches in the first quarter of 2022. The company also noted that Benker will run on NATRIX, a hybrid blockchain framework designed for the banking industry that meets GDPR, bank privacy, and regulatory requirements.

Complaint client services

Benker representatives explained that the bank's business model is markedly different than other financial institutions and will be based on the compliant client autonomy principle, which gives clients control and freedom over their money and lives.

"The [bank] will offer numerous features that assure compliant client autonomy – or ultimate freedom, complete control for clients, high-level security, and ease of use," the company said in a statement. "The vision behind the innovation of Benker is to provide users with complete control over their finances. The result is a system in which clients and service providers will finally stand on an equal playing field while maintaining all legal and regulatory requirements.

Pledging to eliminate imbalances between service providers and users, the company shared preliminary information on its website, www.Benker.io, regarding its licensing and pre-registration process, offering exclusive offers to customers who sign up before the launch.

"You will be a certified part of fintech history," the Benker website stated. "We will send you a physical certificate of that after the launch once you complete the KYC." end of article

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