Safello: The Next Generation of Bitcoin Exchanges

Safe, Simple, Safello.

Safello CEO, Frank Schuil

New bitcoin exchanges are popping up all over the world, strategically positioning themselves to take on the leaders of the industry. Safello is one of these newer exchanges, but one with a difference. It is often said that bitcoin exchanges are too complicated for the average person, that they are too techy in nature. With this in mind, the founders of Safello focused on developing a platform to provide a safe and simple entry point to bitcoin for the average consumer. This new platform was launched in July 2013 and couldn’t have come sooner for the pseudo-technophobes of the world, like me. I spoke to Frank Schuil, CEO of Safello to find out more about this exciting exchange.

In light of the recent events I asked Schuil if Safello.com had experienced any negative effects following the collapse of MtGox. The obituaries for bitcoin had been flowing so it’s only right that, where possible, we highlight just how wrong the general media has been. He replied:

Like other exchanges we actually saw a peak in user registrations on our platform. Many customers from MtGox got a harsh reality check that you need to be picky when choosing your Bitcoin supplier.

One of those stung by MtGox, was Erik Voorhees, who lost over 550 bitcoins (worth approx $366,000 today) to what is now commonly referred to as “Goxed”.

However, Voorhees has invested  in Safello and has nothing but praise for this company.

“Safello is a premier example of the new generation of Bitcoin companies – a professional team with a focused, well-executed service. Its growth has been amazing thus far.” -Erik Voorhees

Onwards and upwards

I asked Schuil if he felt Safello is well positioned to be a leading exchange in Europe. Based in Sweden, Safello already has a top 4 bank (Handelsbanken) on board and by facilitating a safe way into bitcoin wrapped in a user-friendly interface they are providing exactly what people are looking for. Schuil confirmed that direct payments for customers in Sweden and the Netherlands already exist, which is an advantage while the price of bitcoin fluctuates heavily. He also said Safello are actively talking to banks and PSPs (Payment Service Providers) to expand their direct payment capabilities. Eurozone customers can already use this service with SEPA (Single Euro Payments Area)  and Safello is working hard to be able to support more payment methods.

On top of the user friendly interface, the team at Safello are committed to providing a fast and reliable service.

Our primary goal has been to create a 10 minute experience for every customer, whether a newcomer to bitcoin or a hardcore enthusiast.

So whether you want to buy or sell bitcoins, for direct payments you can expect to complete your transaction in as little as 10 mins. Obviously, if you are paying by Bankgiro, or by SEPA payment, there is a slightly longer turnaround time, but that is to be expected. Even the verification process, which can be lengthy, has a target completion time of less than 24 hrs. Overall the feedback has been positive for Safello.

There is always room for improvement of course. We get great feedback from our customers on a daily basis, which guide  our development road-map.

Not only does this exchange take its slogan “bitcoins, safe and simple” seriously, Safello is seriously bending, if not breaking the mold when it comes to bitcoin exchanges.

Rather than promote their own, potentially immature wallets, Safello recommend the use of a Blockchain wallet, as they are both user friendly and allow the user to retain full control of all funds. The decision not to have a wallet within the Safello exchange was an intentional decision by the founders. In doing so, the customer is empowered to decide which of all the range of wallets available they prefer personally. But never fear, for those who have no idea how to choose a good wallet, the team at Safello have provided a tutorial.

When I pressed him as to whether Safello might develop their own wallets in the future Schuil responded:

We want to take our time to deal with security and compliance issues, but there is a reason we had Roger Ver and Nicolas Cary in our investment round.

With big names like Cary and Ver in the background , take note and watch this space.

Bitcoin is a world wide technology, and Safello has compiled a world class team. I suspect they will quickly become a leading company in the world of bitcoin. -Roger Ver

I also spoke to Schuil about the voluntary initiative started by Andreas Antonopoulos to verify the security of bitcoin businesses across the industry, by members from within the industry. Schuil told me he thought the initiative was great and that he was in full support of it.

We currently don’t hold any bitcoins for anyone, but if we ever decide to do so, Andreas is more than welcome to come by.

One of these things is not like the other.

The Safello model differs from the existing exchanges because they store no bitcoins at all. Bitcoins are sent directly to the customer and they control their own wallets.  Safello serves only to facilitate transactions. Schuil further clarified:

We find the best market price from our liquidity partners. The difference between, for instance, Bitstamp, Kraken and us is that we don’t match orders between customers, but customers actually buy their bitcoins from us directly.

Another difference is that Safello doesn’t require the customer to deposit funds into their accounts. Instead bitcoins can be bought instantly without the requirement for a deposit. Since Safello.com holds neither the customers funds nor bitcoins, the threat associated with another rogue exchange (cough, Gox) is infinitely minimised. This in itself is something Schuil feels is essential to the customer experience. In essence he is an advocate of the big promises of Bitcoin: to be your own bank.

For this transparency and education is key. And again Safello.com aim to serve the wider general audience by offering free tutorials to those who need more information on bitcoin and how it works. Not only do Safello teach customers how to choose a wallet, they also show how to pick a safe exchange. The tutorials exist to educate bitcoin users, so even though  Safello would naturally like those who read the tutorials to sign up with them, they don’t have to. Schuil continued  on to say that even if you don’t sign up they encourage everyone to read these.

Buzzword: bitcoin regulation

With talk of regulation of bitcoin rife at the moment, I asked Schuil to weigh in. Regarding the future regulation of bitcoin he said:

Regulation is inevitable, it’s a sign of maturity of the protocol that more regulators take crypto currencies seriously. Our approach is to actively work together with the regulators so we have a chance of influencing the outcome. Bystanders or those actively fighting regulation will only negatively impact the end result.

The team at Safello have already taken more steps than many of the existing exchanges to ensure compliance with AML (anti-money laundering) regulations. Not only that, but the involvement of Handelsbanken highlights that cooperation with banks can exist and work well for all parties involved.

Europe’s first Bitcoin ATM

The focus on compliance couldn’t be clearer when you look at the ATM revealed in December 2013  by the team at Safello. This was the first bitcoin ATM revealed in Europe and showed just how quick and easy bitcoin ATMs make it to buy bitcoins.

Unfortunately this one has hit a minor set back when it comes to general release . Schuil told me that the team were awaiting for the APIs from the ATM manufacturer to connect it to their back-end. The delay of general release was in order to abide to the AML/KYC (know your customer) regulations in Sweden.

The first ATM will still be deployed in Stockholm and Safello will measure its success there before deciding where else they may potentially set up shop. Focusing on the positives, Schuil added

We have been approached by multiple parties across Europe and beyond to facilitate the compliance platform in conjunction with the ATM. We foresee a larger opportunity there once we get up and running.

There is always a silver lining. Compliance will be a hurdle for many as countries worldwide struggle to enforce some measure of regulation of the bitcoin marketplace.

In parting Schuil shared some wise words:

To succeed we need a topnotch infrastructure to support bitcoin’s growth. Without losing the spirit of innovation this means we need to take safety and compliance into account. It is our duty to educate customers. Without this knowledge the adoption of bitcoin/cryptocurrency will be delayed.

My lasting impression of Safello is one of an innovative, forward thinking exchange. But more than that, I see the cooperative spirit of the entire community, sharing the best resources rather than solely self-promoting. Knowing the ingredients of a successful exchange is one thing, figuring out how they all fit together is another thing completely. From what I have seen the team at Safello have a winning recipe.

This has been an interview between Coinreport and Safello’s CEO, Frank Schuil.

Images Courtesy of Safello