The century-old bank Delubac is the first in France to decide to register as a digital service provider (PSAN) with the AMF in order to offer its customers a cryptocurrency offering. And while it is careful not to actively promote it, the bank has become ubiquitous during crypto events such as the Surfin’ Bitcoin 2023 conference or even during the last anniversary of Adana (Association for the Development of Digital Assets, of which). she is a member.
In addition to its private banking activities, Delubac launched a diversification strategy when its managing partner Joël-Alexis Bialkiewicz launched a subsidiary dedicated to payment services, Delupay. A solution deliberately created to compete with the payment networks Visa, Mastercard and – to a lesser extent – CB. “The card costs too much, insists Joël-Alexis Bialkiewicz during the presentation of the new Delupay city management to journalists. A product as inefficient as a bank card cannot survive indefinitely just because of its network effect. The card has no future, not even a digital one.” Delupay therefore abandons the bank card, both physical and virtual, in favor of scanning a QR code or an NFC chip. For the merchant, the promise is lower commission fees than the competition (capped at 0.5% for brick-and-mortar locations and 1% for e-commerce), while for the customer, the experience would be faster than paying by card or Apple and Google. services.
To gain territory, Delupay focuses primarily on merchants: since the first deployment six months ago, 2,700 have been convinced. The service hopes to reach 30,000 by the end of this calendar year. “We believe in small traders. We believe that success will come from them: without a driver, Uber does not work”notes Joël-Alexis Bialkiewicz, who nevertheless acknowledges it “construction site” to compete with payment giants “is titanic”. However, he is convinced: “If it’s not Delupay, it will be someone else. The card is done.” Funding will be necessary to support Delupay’s ambitions: the company, whose share is 95% by Delubac bank and the remaining 5% by Joël-Alexis Bialkiewciz himself, seeks to raise 50 million euros. The search began over several months and was complicated “cold” European investors, far from it “enthusiasm” their American counterparts, according to the leader.
It also promises, without saying more, the arrival of cryptocurrency payments on the Delupay interface. A service that is close to the heart of the subsidiary president because he claims to be among them “the first in France to mine bitcoins when it was still possible with graphics cards”. A condition that explains why Delubac, despite its advanced age, is the first banking institution to accept cryptocurrencies and players in these technologies, often rejected by other banks.
Capital: In 2011, you mined Bitcoin. Can you share your motivations during this period?
Joel-Alexis Bialkiewicz: There were three eras of mining. The CPU era (Motherboard)the GPU era (Grafic card) and the ASIC era (specialized chip, editor’s note). I became interested in the consensus problem a few years ago because I was in a world that was interested in this topic (Pierre and Marie Curie University, in the field of algorithmization, editor’s note)and we saw the issue of bitcoin with great interest as a mathematical object. Mining was a way to participate. What you need to know is that mining goes beyond the principle of the reward you receive: it is a way to participate in the security of the network.
However, I am not a bitcoin maximalist. I definitely tend to think that in cryptocurrency, as in many other areas, there are a lot of challengers that are very limited, but there are maybe five cryptocurrencies that make sense. We can say that there are two categories of cryptocurrencies: installed, which have proven themselves, and experimental. A lot of people create experiences because it’s a quick and easy way to make money, and it’s a lot less fun.
Are you one of those who consider bitcoin a better monetary instrument than fiat currency?
To answer very clearly, and I’m not going to like this, the currency that exists in the world today is based on a relatively simple belief: belief in the government’s ability to extract work from its citizens. The real value is human work, it is ingenuity. And that is what fiat money is based on. It works as long as people agree to be paid for their work. However, I am not a promoter, unlike some of my friends who swear by Bitcoin, Ethereum or Solana for their own reasons. I do not know anything about that. I can say that the essence of a strong currency does not lie in the decisions of the central bank. This is based on specific facts. What gives gold its value? Its rarity, difficulty and energy demand required for its extraction. Money is based on reality: the important thing is that it must not be possible to spend it arbitrarily. More specifically, those who might choose to broadcast it must be those most harmed by the broadcast in order for there to be an alignment of interests.
“I feel that the AMF is punishing Delubac for speaking too freely.
You are one of the two families at the head of Delubac. Was it actually you who instigated this offer strategy associated with cryptocurrency and its players?
Obviously. I actually wanted to do it even earlier. My first contacts with the authorities on this topic date back to 2014. At that time, the ACPR (Prudential Control and Resolution Authority, editor’s note) did not recommend it to us. So we have been waiting for the PACTE law of 2019. You should know that within Bank Delubac it is a tradition to serve companies in difficulty, companies that transact with countries in a complex context (especially Iran, editor’s note). We let everyone lie: they predicted the loss of access to the dollar and it ended up going very well. We have access to it through two US banks. Our operations in Iran are regulated and we even make our little declarations to OFAC (American Authority for the Control of Foreign Funds Operations, editor’s note).
What are Banque Delubac’s crypto services?
We have an offering aimed at companies in the crypto-sector, which is basically providing basic banking services because, frankly, they don’t have access to other banks. I would like to remind you that we were established in 1924, so we are one of the oldest and fully authorized, unlike some institutions that claim to be banks and are not.
Do you also have companies in your clientele that hold cryptocurrency in their treasury?
We have some. We experience some pretty funny situations with customers whose bitcoins come from mining, like mine. Today, and unlike the competition of certain specialized platforms that are very suspicious of the bitcoins created by mining, we understand this activity very well: we have very simple procedures for verifying funds. There are devices that cut off the marketing of crypto-currencies whose purpose is to conceal the identity of users, such as Monero, but this is greatly exaggerated: it is entirely possible to treat them in accordance with the legislation. I’m clarifying though that we don’t accept Monero due to lack of demand.
What service do you use to store crypto assets?
Today we use Taurus, a Swiss solution. It allows us to have the HSM (encryption hardware modules, editor’s note) in house, and therefore to be in control of the whole process, and if necessary, we can replace this solution with another third party tomorrow. We decided on this solution for security reasons after studying other services in the market in depth.
Can you tell us more about integrating crypto payments into Delupay?
It’s not finalized yet, but I can say that Delupay is not meant to keep your cryptocurrencies, but to allow you to transact with them. Obviously, we will offer the Delubac wallet to people who don’t have one, but what we want to do with Delupay is to offer the option of paying without having to deposit crypto with us, from the wallet you own.
The implementation of the European regulation on the crypto-asset market will take place on June 30. Have you submitted an application for PSAN AMF approval, which will allow the transfer with CASP mode necessary for practice?
Our case has been dragging on for a year. We had no questions for six months. I feel like Delubac is being punished for speaking too freely, but that’s okay, we’ll get him eventually. The transition process takes 18 months. And if we don’t have it, you know what? Delubac issues a press release explaining that it is discontinuing its crypto-asset offering for a reason beyond its control. It’s a small part of our business. However, I can’t imagine something like that, because we respect all the criteria.
⋙ Banks and crypto: the chronicle of a forced marriage
Many of your customers are also waiting. Do you think this approval phase will be too high for some of them?
We will see if the public authorities are intelligent. I will not comment on the relevance of the criteria of public authorities. However, I can say some things. It’s like matriculation: if not enough students pass, it’s because we need to lower the requirements, otherwise there’s a societal problem. Otherwise, if too many students pass, they must be relieved. This is what will happen: if too many companies keep waiting as the closing date approaches, they will relocate and continue to offer their services completely illegally. Please note that despite our PSAN registration system, some companies continue to operate from Dubai, China, multiple jurisdictions. Are we going to attack them? We do not realize that there is an item in the files that has not been processed, or that the level of requirements for companies is not sufficiently proportional to their size or progressive enough.