Challenges And Opportunities in the Cryptocurrency Sector: Interview With CEO Of Crypterium

Conventional banks are increasingly getting challenged by so-called “neo-banks”, such as Chime and Monzo, and decentralized alternatives – digital currency (or crypto providers) like Crypterium, especially as Covid-19 accelerates digitalisation and moves consumers towards online convenience and away from cash and traditional bank branches. 

The loss of trust from the banking crisis and the expensive and inflexible nature of traditional financial service models has led consumers to easier to use, mobile-led financial services. These are generally cheaper and make moving money around very easy – either person-to-person or across frontiers. Increasingly, also, digital currencies like Bitcoin or Ether, are being seen as viable alternatives to “fiat” currencies (such as the US Dollar or Euro). A major benefit of cryptocurrencies (and blockchain in general) is that they are decentralised, making them truly global and enabling new types of financial proposition. 

Governments have seen these trends and are experimenting with digital currencies. The Chinese digital yuan has been leading in this respect and the Chinese government is creating wide usage and acceptance by using existing digital players such as WePay and Alipay. Digital currencies allow anyone with a mobile phone to access money (token-based) as opposed to traditional account-based models. This enables financial inclusion and allows, for example, the easy disbursement of funds to citizens, such as is happening in India and the Philippines. Some central banks may however also welcome using a centralised model for greater control and oversight of money flows and usage. 

Major financial services players have been very risk-averse and slow to take on the advantages of cryptocurrencies. This has allowed a digital provider, like Crypterium to satisfy emerging consumer needs. Crypterium makes it easy to buy, sell and use cryptocurrencies, through accepting and enabling card payments and bank transfers. It even has its own prepaid Visa card which allows a customer to control funds and use crypto to buy goods and services in traditional and e-commerce channels. 

Only set up in 2018, Crypterium already has some impressive achievements, with a  user base spread around 170+ countries and €150 million turnover. The next milestone, for 2021, is €200M turnover, which will place the company in line with some of the most competitive industry players. Crypterium has real potential to help transform the way that global consumers use financial services. 

I am speaking to the CEO of Crypterium about the company, the challenges and opportunities in this growing industry, as well as how decentralized currencies could transform the lives of people around the globe. We also discuss an upcoming milestone where Crypterium will be “burning” up-to 30% of its CRPT token. 

Let’s begin by clarifying:  how can your company help real businesses to solve the most challenging financial problems?

At Crypterium, we have a view that with major trends such as open banking and digital currencies – namely, cryptocurrency, financial worlds are blurring and merging. At Crypterium, we make it easy for consumers to have all their digital currency needs met in one place – in one easy to use app. With Crypterium, a consumer in any recognised country can buy, send and exchange crypto and use it for crypto deposits or loans. 

With our virtual and physical Visa card, they can also easily access and spend their crypto in everyday ways. We also believe that we are unique in the industry in that we provide our service as a B2B platform. As a business, you can integrate our app into your own products and services and switch on crypto to your own customers, all “powered” by Crypterium. Our goal is to be the leading “crypto-as-a-service” provider.  

How do digital assets stand out compared to “fiat” based services? What are the main features helping Crypterium to excel?

The main advantage of digital assets is their globality and de-linkage from normal account-based finance. With a digital asset, all you need is a mobile phone (token) in order to have access to cryptocurrency, which is processed through distributed blockchain technology. You can access the money anywhere and send to anyone (with all the normal provisos around fraud and money laundering). For “fiat”, you need either to have cash or an account, which is primarily restricted to one country and where moving money can be very expensive and very slow. 

With Crypterium, for example, you can send money to any mobile number, Visa or MasterCard, around the world, at the touch of a button. It will arrive within seconds. As noted, we also have our own linked Visa card and you can also have traditional access to send to or receive from bank accounts through our IBAN service. We see this combination as a winning proposition. 

So far, it seems to me that decentralized banking is focused on provision of free and accessible services, which, no doubt, creates a strong appeal to the clients. However, how does the company generate the profit in this case?

The financial dynamics of both neo-banks and digital currency providers are different from traditional banks. Traditional banks primarily make their money from taking deposits and lending them out – for example, for mortgages or as loans to companies. Neo-banks have outsourced these types of products to intermediaries such as banking-as-a-service providers. They make their money from card commissions and fees from value-added services. A digital (or crypto) currency provider, such as Crypterium, primarily makes its money from exchange commissions. 

When you transfer money between crypto-currencies or to and from “fiat” currencies, we take a small commission (in the same way any bank does for foreign currency). Crypterium uses AI to get the best rates from crypto exchanges, so we can offer customers better rates than say big players like Coinbase. To reward our customers and encourage usage generally, we often have commission-free promotions. Finally, although we offer so-called deposits or loans, these work more like loyalty bonuses as we don’t take and lend money in the same way as banks. 

Crypterium proposes several plans to benefit from the Crowdinvesting feature. What is the difference between them, and how do investment options vary depending on a country?

Crowd-investing is not just one service – it means different things in different markets. In some countries for example, there is a distinction between skilled investors, often called accredited investors, and the person who just wants to invest because they like the idea. What each type of investor can do changes practically everywhere, that’s why Crypterium’s recent crowd-investing focused on Europe and a few additional select countries. Unfortunately, this meant that some very interested potential investors had to miss out this time. But we are very much looking at other options for investors to participate in our success, which we hope to launch in the near future.

How can Crypterium help to solve challenges of those who were left in need after the financial crash?

I am not sure that Crypterium is special in this respect. What we are able to provide is, for example, a way for citizens in places like Colombia, Turkey or Venezuela to have more stable (and sometimes safer) ways to hold money. This can be in a stablecoin, like USDC or Tether, where the value is directly linked to a “hard” currency such as the US Dollar. The token nature of crypto also means that workers can easily remit funds to their home countries in speedy low-cost ways. 

What is the role of new technologies,  such as AI, play in helping to create unique services, especially in Crypterium?

As I noted, Crypterium uses AI to match crypto-currency rates between different crypto-exchanges so that we can provide the best rates to our customers. We also have a unique service, Crypterium AI Price Predictions. It’s an excellent way to enhance trading activity by gaining solid knowledge on price action, and therefore increasing chances of entering a successful trade.

This unique feature is able to provide valuable insights on more than 140 digital assets every single day of the year with an average accuracy rate of above 70%. 

I’m aware that Crypterium intends to burn up to 30% of total CRPT token supply. What’s the purpose behind this dramatic move, and how this will affect the investor base?

Yes, indeed,we plan to burn up to 30% of CRPT total supply . The CRPT token is at the heart of the Crypterium ecosystem and any significant reduction in its total number will have a positive effect on token economics. By the end of 2021 we are confident that at least 2 300 000 tokens will be burned through organic in app transactions, and if we continue on the same trajectory, at current token prices, we could burn as much as 30% within 2 years, taking the total supply down from 83.6m to as few as 60m. Of course, CRPT token price will be key, and we do expect that as the supply falls, the price of tokens will increase, affecting the number burned.

We have decided to speed things up a little, to kick start the process into a new level. In the next few days, Crypterium will engage in a buyback from exchanges and once bought burn them. Our gift to the token owning community.

Could you share with our readers more about the mechanism behind distribution of CRPT tokens?

Most of our tokens, in fact 70% of the total supply, were bought by a very large token community back in 2017. At the time we had one of, if not the largest token buying communities ever with over 80,000 different buyers. Some tokens were distributed amongst the founders of the company and some to our advisors. Very few of our tokens were bought by big institutions, we really appealed to the person on the street.

Quite a lot of those tokens are now locked up in savings accounts, but generally the vast bulk of tokens are still owned by a very large community of Crypterium supporters. That’s why if we have a buy-back, it can appeal to tens of thousands of owners, not just a few big funds.

And the final one – what practical steps will you implement in 2021 to hit a 200M target?

Firstly, we need to get our basic proposition right. We know that with such rapid growth, service standards are key and we are putting huge effort to ensure a fast reliable service.

Next, we are looking to invest in further services. We keep adding popular new cryptocurrency tokens – we now have over 200 exchange pairs, which is much broader than some of the mainstream crypto players. We are looking to introduce our popular Visa card to the USA by the end of the year. 

And very importantly, our B2B proposition brings with it potentially hundreds of thousands of ready made users. Our services, our B2B partners brand but we share in the customer base. We are adding more than one new B2B partner per week and at this rate the 200m target is easily within reach. 

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