(Adds details and gives context)

MADRID, June 18 (Reuters) – Spain’s BBVA said on
Friday said it was launching a bitcoin trading service for
private banking clients in Switzerland interested in digital
asset investment.

The bank said the new business, launching on June 21, would
include bitcoin trading and custody services, with the aim of
extending it to other cryptocurrencies. It would not offer
advice on these types of investments, it said.

BBVA said that during a gradual roll-out it had detected a
“significant desire” among investors for crypto-assets or
digital assets to diversify their portfolios despite their
volatility and high risk, BBVA Switzerland’s Chief Executive
Alfonso Gomez said in statement.

The trading service comes amid growing institutional
interest in bitcoin. The largest cryptocurrency is seen by
investors and some companies as a hedge against inflation as
governments and central banks turn on the stimulus taps.

El Salvador has become the world’s first country to adopt
bitcoin as legal tender even though central banks
globally have repeatedly warned that investors in the
cryptocurrency must be ready to lose all their money.

Major economies, including China and the United States, have
signaled in recent weeks a tougher approach, while developing
plans to develop their own central bank digital currencies.

In May Goldman Sachs revealed details of a
cryptocurrency trading group, according to a staff memo seen by
Reuters.

On Friday, BBVA said it was limiting this new cryptocurrency
service to Switzerland because the country has clear regulation
and widespread adoption of digital assets.

“Its extension to new countries or other types of customers
will depend on whether the markets meet the appropriate
conditions in terms of maturity, demand and regulation,” it
said.

BBVA is present in Switzerland through a fully owned
franchise, focused on international banking services.
(Reporting by Jesús Aguado; Editing by Emma Pinedo and Jan
Harvey)