Regulatory breakthrough: ZTLment becomes Europe’s first payments institution built on blockchain

Europe Business

Danish fintech startup, Ztlment, is the first in Europe to gain a licence that lets it operate fully regulated payments on top of blockchain.


For the first time, an EU supervisory authority grants a payments institution licence to a company where blockchain rails are used to move funds. The company, Ztlment, developed smart contract software to move euros peer-to-peer on blockchain in full PSD2 compliance. With its solution, digital marketplaces and cloud-based B2B platforms can move money and value instantly and automatically between buyers, sellers and financiers.


The company has raised €1.3 million in pre-seed funding from venture funds specialising in fintech. The startup’s smart contract software moves euros instantly and automatically on blockchain in full regulatory compliance.


“Our goal is to build a completely frictionless system where business partners don’t have to bother with complex banking infrastructure nor deal with volatile crypto currency, unregulated stablecoins or complicated consensus mechanisms,” says co-founder and CEO, Mads Stolberg-Larsen.


Blockchain and programmable money have been some of the most hyped technologies over the past five years, but mainstream adoption has been slow. The main two reasons for this are bad user experiences and regulatory uncertainty according to the founders.


“The benefits of the technology are clear. Digital marketplaces and cloud-based B2B platforms can instantly and automatically move money and value between buyers, sellers and financiers. However, so far user experiences have not been built for business workflows and compliance with European payments regulation has been missing,” says Stolberg-Larsen.


Ztlment’s smart contract software has now been approved under Payment Service Directive 2 (PSD2), a European open banking framework, in a regulatory first. European regulator, Danish Financial Supervisory Authority granted the licence.


“We are opening a new playing field for moving euros and other fiat currencies between business partners with simple IF-THIS-THEN-MONEY logic. It is like direct debit, but with rocket engines on,” says co-founder and COO, Harry Kearney.


When milestones are hit or relevant workflow events recorded, funds are moved peer-to-peer in five seconds or alternatively paid out to traditional bank accounts. All transactions are done in euros and other fiat currencies and in full compliance with PSD2.


“Our customers can focus on building great user experiences and safely harness the benefits of the technology,” says co-founder and CTO, Jason Spasovski.


Ztlment is targeting digital marketplaces and other cloud-based business platforms, which connect buyers and sellers. With a snippet of code, they can link money and value to existing workflows – or build entirely new ones with smart contract software embedded from day one.


The risk between trade participants and financial partners can thereby be reduced as funds only move when relevant milestones are hit. This opens up for data driven trade finance models, which in turn can bring much needed working capital to sellers around the world.


“Eliminating the global trade finance gap is a 1.7 trillion euro opportunity,” says Stolberg-Larsen, who previously was Head of Fintech and Blockchain at the procure-to-pay platform, Tradeshift.


The team has been backed by Upfin, a Nordic fintech fund, and Giant Ventures.


“Like Mads, Jason and Harry, we believe that the rails for money and value are changing, but financial regulation is here to stay,” says Johan Lorenzen, Managing Director of Upfin.


“We back world-class, purpose-driven founders using advanced technology to solve the planet’s biggest challenges. By abstracting away blockchain complexity, the team is unlocking enormous socioeconomic potential,” says Managing Partner of Giant Ventures, Cameron McLain. “Ztlment can deliver the trust, transparency and efficiency benefits of blockchain.”


Ztlment is a European payment service provider offering smart contract software that is fully compliant with PSD2. With a snippet of code, digital marketplaces and cloud-based B2B platforms can offer business workflows, which instantly and automatically move money and value between buyers, sellers and financiers.


The company is founded by Mads Stolberg-LarsenJason Spasovski and Harry Kearney and is headquartered in Copenhagen. It is registered as a payments institution with the Danish Financial Supervisory Authority (FTID 22043). Read more at