Cryptocurrencies are increasingly becoming stronger not only as a store of value solution, but also as a means of payment in different situations. “I believe that in the next two years, cryptocurrencies should grow as an investment and stablecoins as a means of payment. In addition, central bank digital currencies (CBDCs) should become a reality, perhaps in a slightly longer timeframe, between five to ten years”, says Bitfy CEO and founder Lucas Schoch.
In an interview with PanoramaCrypto, Schoch and the company’s CMO, Tony Marchese, talked about trends for the sector, the maturing process of cryptoassets users and the importance of market transparency. Check out the main excerpts.
How do you see the crypto market today?
Schoch – Currently, there are solutions to use cryptoassets as a means of payment in the most diverse situations, without intermediaries. But, to me, it is very clear that we are surfing some waves, with some uses that should not consolidate, as in the case of some games, besides the boom of brokerage companies, many ICOs. Some coins are already gone; others don’t solve any problems, although they still exist today. This shows that people are looking at cryptos mainly as an investment asset.
At the same time, technology has evolved, mechanisms have been created for payments, for example. So, a stablecoin is nothing more than a currency pegged to a fiat currency, such as the dollar or the real, as it’s the case of the BRZ. On the other hand, the stablecoins have the advantage of the blockchain as a backup, which guarantees security and the aspect that it has no borders. This is the time for stablecoins to grow because of cheaper rates and lower volatility.
At the same time, banks have also begun to look at this technology, and as a result, CBDCs are emerging, which could become a reality in the next five to ten years.
In your view, what is the advantage of stablecoins over CBDCs?
Schoch – A stablecoin solves several problems that CBDC might also solve; the big issue is the use of CBDC. They are being created so that the government has more control and can have transparency. A stablecoin, on the other hand, allows use options throughout the entire chain that accepts cryptocurrencies and also faster, borderless transactions without anyone “taking care of my money”. Such will not be the case with a CBDC.
They are different cases and have dfifferent uses. Both are based on blockchain technology, and this is what attracted the attention of governments, the prospect of greater transparency of transactions.
Another interesting aspect is that, increasingly, technology will allow the creation of new products in blockchain.
NFTs are products that have stood out, including new trends for games. It was playing that you entered this sector. Could you tell us about your experience?
Schoch – That was in 2011 when I was playing World of Warcraft, but I had no idea what I was doing. To buy in-game items, I was using bitcoin without knowing it. For example, to buy a US$ 5 item, it was necessary to make a remittance to Japan, which cost US$ 85.
So, without knowing it, I started mining bitcoin. I programmed scripts and left the machine mining so that I could play. I spent a lot of bitcoin on the game.
However, this is a game that exists to this day; it is exciting and fun. The trend of play-to-earn games will only be sustained if there is this focus. If the person starts playing it just to make money, as an obligation, there is no fun anymore.
Marchese – But, the interesting point is that already at that time (2011), people were seeing the value of these items and making transactions of buying and selling. It was something that helped to foster market growth.
When did you understand that this was an interesting market?
Schoch – In 2013, I decided to understand what that was it and I created my own mining pool, mined in Paraguay, and created an arbitrage algorithm. I did that for a few years in parallel to what I was doing professionally. Then, in 2017, I decided to create a product, which was a cryptocurrency checkout. The idea was good, but it had no audience. At the time, I accredited more than a thousand business premises, but only four transactions took place in one year!
However, it was with this experience that we created the right product. Between 2017 and 2019, we developed a wallet in which people have their key. Bitfy was officially established on December 28, 2019; the business expanded during the pandemic.
We are not a broker, but we allow buying and selling cryptoassets in a simplified manner. People who want to purchase cryptocurrency are not interested in in-depth knowledge, such as books’ offering details and other aspects. Instead, the user is looking for simplicity, transparency, and security. In addition, the idea of being your own bank, without intermediaries, is attracting more and more interested people.
It is worth noting that Bitfy is a payment institution, which has a compliance policy and follows all the rules of the Central Bank, such as the prevention of money laundering and other crimes.
Marchese – Today, with the Bitfy wallet, the user can make more than cryptocurrency transactions. With our App, users can use their digital currencies to make payments for products or services through barcodes and QR Code in more than 1.5 million business premises with Cielo ®️ terminals. In addition, it offers a discount on companies like iFood, Evino, Outback, and courses for those who want to learn about cryptocurrencies.
Bitfy has developed during the pandemic. In your view, the digitization that took place in the period was favorable to the business?
Marchese – Yes, without a doubt. People became more inclined to study, understand alternative ways to make money and keep their investments safe, without risks arising from inflationary policies. Today, we have more than 100 thousand clients (individuals) registered in Brazil.