Redefining Finance: Deblock's Path to EME accreditation
2023 has been a pivotal year for Deblock, marked by its ascent from securing substantial pre-seed funding to achieving the coveted EME approval.
Feb 6, 2023
7 min read
TL;DR
In 2023, Deblock, a London-based fintech company founded by ex-Revolut experts, made significant strides. Key highlights include:
EME Approval: Deblock received approval as an electronic money institution (EME) from the Bank of France, marking a significant achievement and turning point.
Company Services: Deblock offers innovative financial services like a non-custodial crypto wallet, multi-currency account, IBAN, and instant transfers, focusing on security and innovation.
Impact on Web3 Industry: The EME approval signifies the potential for the Web3 sector to adapt to regulatory frameworks and integrate with traditional finance.
Role of EMEs: Electronic money institutions are crucial for managing electronic money, offering payment services, and providing additional services like currency exchange, custodial services, and credit issuance.
Web3 compliance with Synaps: Synaps ensures compliance and fraud detection for crypto companies, with solutions like AML, KYC and KYB service. Synaps provides a PVID-certified offer (Remote Identity Verification Proof) in collaboration with Ubble, facilitating adherence to AML-CTF directives and enhancing customer due diligence.
Deblock, from PSAN registration to EME approval
celebrating success: Deblock's milestone year
On November 22, Deblock reached a major milestone by receiving an electronic money institution (EME) approval. This recognition, granted by the Bank of France, marks a turning point for Deblock after a year 2023 filled with significant events.
At the beginning of the year, Deblock successfully raised 12 million euros in pre-seed funding, with the support of renowned investors such as Headline, Hoxton Ventures, Kima Ventures, and Kraken Ventures. This fundraising was followed, in June, by obtaining a registration as a digital asset service provider (PSAN), thus consolidating its place in the digital financial ecosystem.
Founded in London in 2022, Deblock is the result of the association of four former Revolut collaborators, each bringing unique expertise to the company. Jean Meyer, former crypto head at Revolut, leads Deblock as CEO. He is supported by Mario Eguiluz Alebicto, former crypto tech lead, as CTO, Adriana Restrepo, former COO, and Aaron Beck, former head of payments and banking partnerships.
Deblock stands out with its unique value proposition, focused on innovation and security. The company offers a non-custodial crypto wallet, a multi-currency account, an IBAN for facilitating transactions, as well as instant transfers and other financial services. This multidimensional approach aims to meet the diversified needs of its users.
A positive signal for the Web3 industry
The EME approval granted to Deblock is a strong signal for the 99 PSANs in France. It demonstrates the ability of the Web3 industry to integrate into existing regulatory frameworks while continuing to innovate. This recognition opens up promising prospects for the future of the sector, marking a significant step towards the integration of digital finance into the traditional financial system.
Electronic Money Institution (EME): What is it?
An electronic money institution (EME) plays a crucial role in the financial sector, especially in terms of creating and managing electronic money. Here is a simplified yet comprehensive presentation of what an EME is and its main functions:
Issuance and management of electronic money:
An EME is responsible for creating and managing electronic money. This involves the production of electronic monetary value units, such as balances on mobile payment apps or prepaid cards. These electronic units can be used for digital transactions, like paying for goods and services or transferring money between users.
Provision of Payment Services:
EMEs offer a range of services related to the management of payment accounts. Among these are:
The ability to make cash deposits and withdrawals.
Managing daily operations on a payment account.
Executing various payment operations, such as direct debits, card payments, and transfers.
Providing solutions for payment operations involving the opening of credit.
Ancillary Services to Payment Services:
In addition to payment services, EMEs can offer complementary services, such as:
Currency exchange services, enabling currency conversion.Custodial services, ensuring the security of funds.Recording and processing data related to transactions.Guaranteeing the execution of payment operations.
Granting Credits within Payment Services:
EMEs are also authorized to grant credits, provided that these are ancillary and directly related to payment operations. These credits must be repaid within a maximum period of twelve months and must not be financed by the funds held for executing payment operations.
Services Related to the Issuance and Management of Electronic Money:
Finally, EMEs can offer services directly related to the issuance and management of electronic money. This includes the custody of electronic funds and processing the data associated with these funds.
Synaps, a key player in compliance and fraud detection in the crypto sector
Verifying users to ensure compliance
Just like electronic money institutions (EMEs), digital asset service providers (PSANs) are subject to strict regulations to combat money laundering.
EME: Issuers of electronic money must identify and verify the identity of their customers as well as the beneficial owners for electronic money withdrawal or reimbursement transactions exceeding 50 euros. The same applies to payment transactions initiated via the internet or a remote communication device beyond this threshold.
PSAN: PSANs, according to the decree n° 2021-387 of April 2, 2021, are required to identify and verify the identity of all their clients, including occasional clients, to combat the anonymity of virtual assets.
Synaps facilitates the compliance of crypto actors with its compliance and risk management platform, as well as its KYC (Know Your Customer), KYB (Know Your Business), and AML (Anti-Money Laundering) solutions.
PVID solutions for simplified compliance
Several solutions enable compliance with the 5th directive of the AML-CTF (Anti-Money Laundering and Counter-Terrorism Financing), such as:
Verification of identity documents combined with the completion of a micro-payment,Use of qualified electronic signatures,PVID-certified solutions.
In addition to ensuring compliance with European and French AML-CTF directives, PVID solutions are a reliable alternative to the micro-payment method. This method, although fast, has limitations in anti-fraud efforts. We often observe cases where establishments are blacklisted by our clients due to insufficient AML-CTF protocols, leading to recurrent frauds by users associated with these establishments.
PVID allows companies to effectively manage customer due diligence (CDD) and prevent fraud. This solution is also the only one allowing banks to meet the needs of the unbanked population, making the PVID solution particularly sought after in the banking sector.
Synaps' PVID offering
Synaps' offering includes a certified PVID (Remote Identity Verification Proof) solution in collaboration with Ubble, facilitating compliance with Article R561-5-2 of the Monetary and Financial Code.
The benefits of this integration are multiple:
Accessibility: The certified PVID solution is affordable and accessible to all sizes of companies, with attractive rates starting from 1,000 identity verifications per year.
Integration: Ubble's solution is pre-integrated into Synaps' identity verification process, allowing for easy implementation without additional development.
Sustainable Approach: The Synaps offer with Ubble complies with the highest market requirements. It prevents the need for a change of provider over time following the publication of new directives.
The collaboration between Ubble and Synaps offers a combination of the certified PVID solution and Synaps' risk management platform, which helps to reduce fraud and assess risks when integrating new clients.
