It’s been a troublesome begin to 2019 for cryptocurrency companies. With the worth of Bitcoin crashing at finish of final yr and curiosity in digital belongings declining, companies are not swimming in money like they have been 12 months in the past.
Exchanges have in all probability been probably the most badly affected by all of this. Unlike the businesses issuing tokens, which have services and products to work on, exchanges have seen volumes declining and, one would presume, revenues shrinking.
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And but, for these exchanges which might be nonetheless operational, the present should go on. A living proof is Globitex.
On Wednesday of this week, the agency launched its EURO Wallet. Managed by bitcoin pioneer Jon Matonis, the pockets might act as a gateway for the agency to supply various totally different companies sooner or later.
To get a greater thought of what the pockets can do, and see what else Globitex has been as much as, Finance Magnates spoke to the change’s CEO, Uldis Teraudkalns, this Thursday.
Making funds with Globitex
Based within the Latvian capital Riga, Teraudkalns, who was one of many change’s Co-Founders in 2015, has been in his position since May of final yr.
We began our dialog by discussing the product that has simply gone reside – the EURO Wallet. The new service will grant Globitex customers entry to a private IBAN quantity, enable them to ship and obtain euro SEPA funds and allow them to make immediate deposits and withdrawals to and from their Globitex buying and selling account.
“Traditionally, when a dealer deposits euros with an change, that cash goes into the change’s custody,” mentioned Teraudkalns. “That in itself could be a drawback for folks. But the larger points are time and utility. Withdrawing fiat forex can take two days and even longer and, when the forex is with the change, you possibly can’t do something with it besides withdraw it to your checking account. Our EURO Wallet speeds issues up, you can also make immediate withdrawals, and permits you to use that cash for one thing – making a web based fee as an illustration.”
Reading the above, certainly one of course will get the impression that the EURO Wallet is aimed solely at retail merchants. But, over the course of our dialog, Teraudkalns stored describing potential clients as ‘merchants’ and ‘corporations.’ Who then, I requested the change CEO, is Globitex hoping will use its new pockets?
“It’s each,” he mentioned. “The options that I described can be helpful for a daily dealer but in addition for corporations. Any enterprise that offers in crypto wants the power to transform to fiat forex and transfer cash round shortly. The different profit for them is that it acts as a way of storing fiat forex. Many banks, as quickly as they hear the phrase ‘crypto,’ gained’t cope with you. So having an IBAN account is a significant profit for these corporations.”
The Globitex card
Though you might be able to retailer cash in an IBAN account with Globitex, the agency will not be a financial institution, solely a funds supplier. NexPay, a subsidiary of the change, facilitates these funds.
Licensed by the Bank of Lithuania as an ‘digital cash establishment,’ NexPay is headed up by the aforementioned Matonis. One of Globitex’s founders, in addition to the primary Executive Director of the Bitcoin Foundation, Matonis left his director’s position with the change final month to give attention to creating NexPay’s companies.
Though within the fast paced world of economic expertise folks might have forgotten it, each Monzo and Revolut began out as purely funds suppliers. In reality, Nikolay Storonsky, a Revolut Co-Founder, initially launched the corporate as a way of permitting folks to make funds abroad with decrease charges and at a greater change charge.
It’s unlikely that we’ll see a Globitex financial institution within the close to future however, I requested Teraudkalns, would possibly we see the change begin to present playing cards to clients?
“Yes, that’s one thing that we hope to develop this yr,” mentioned the Globitex CEO. “It’s a really interesting possibility and one that ought to come naturally to us. After all, if you’ll be able to make funds to pals and so forth, it follows that you would be able to additionally take that cash and spend it in a store for instance.”
No PoS machines
Another rising space on the planet of cryptocurrency funds is point-of-sale (PoS) machines. True, you possibly can’t pay in your groceries in bitcoin simply but, however the variety of corporations providing machines that facilitate such funds is growing. For now, nevertheless, it appears as if we gained’t be seeing a Globitex PoS machine.
“It’s positively an space we’re keeping track of,” mentioned Teraudkalns. “But it requires lots of due diligence and compliance. We wish to be a gateway between this new world of crypto and conventional banking. So we’re very excited about working with a retailer that accepts crypto as a type of fee however not essentially as the corporate facilitating the fee itself.”
Moving away from the corporate’s latest product, we turned to the state of the cryptocurrency market.
Surviving the bear market
In February of final yr, Globitex was capable of elevate roughly $10 million by way of an preliminary coin providing. Combined with ramped up buying and selling volumes, particularly within the first quarter of final yr and on the finish of 2017, the corporate ought to manage to pay for to maintain going for some time but.
Still, the bear market has been pretty brutal and, although the agency is doing significantly better than a few of its rivals, Globitex hasn’t been immune from this.
“We are believers in crypto and, due to that, have vital cryptocurrency holdings,” mentioned Teraudkalns. “Of course, meaning we’ve felt the market downturn strongly. So we can’t do all the things directly, which is what we needed to do. That doesn’t imply we aren’t going to do these issues we deliberate doing, it simply means we’re being extra prudent about how we do them.”
“Things” is after all an imprecise phrase. Thus, I needed to ask – what merchandise does Globitex plan on launching sooner or later?
“We are creating extra advanced monetary merchandise,” mentioned Teraudkalns. “That’s one thing we all the time deliberate on doing. It’s simply going to be a barely longer course of as we prioritised the launch of the Euro Wallet.”
A required a part of any cryptocurrency interview, I needed to end off my dialogue with Teraudkalns by asking him that the majority cliched of cliched questions – the place is the cryptocurrency market heading?
“I believe current occasions have supplied a mandatory training to folks out there,” he mentioned. “Companies ought to perceive now that they must give attention to constructing high quality merchandise and bringing worth to their clients. You can’t simply slap ‘blockchain’ or ‘crypto’ on one thing and hope it really works. Doing these issues will assist however, broadly talking, there will likely be must be a significant revolution within the world monetary system for cryptocurrency to actually take off.”
Whether that revolution would require us all to reside like Venezuelans stays to be seen. In the meantime, Globitex is plodding alongside effectively, even when we must wait a bit longer for its derivatives merchandise.