Business2community.com caught up with Bitstamp CEO Jean-Baptiste Graftieaux while he was holidaying in the south of France, so we were especially pleased that he could take the time out to talk to us.
Bitstamp is one of the oldest, if not the oldest, and most reputable of exchanges in the crypto space, having been founded in 2011. Indeed, Monday 22 August was the firm's 11th birthday.
So what better time for Bitstamp to launch a marketing drive aimed at retail investors and the Q2 update of its Crypto Pulse Survey 2022, which will be released in full at the end of the month.
We kicked off our discussion by asking JB, as his colleagues often call him, about the survey's findings and the marketing push, before we dived into a wide-ranging discussion of other crypto matters.
The full interview covered everything from stablecoins to regulation, the interest the firm earns on its substantial cash pile and, among many other things, including whether Bitstamp will be launching an NFT marketplace anytime soon and how to get a coin listed on the famously selective spot exchange – and much more besides.
Below we reproduce some excerpts from the interview with Jean-Baptiste Graftieaux
Preview of data findings of the Bitstamp Crypto Pulse Survey Q2 2022
What is very interesting from the survey is that the confidence level is still there from our last survey in Q1 across the UK market.
In terms of crypto being a trustworthy investment we had a figure of 52% in 2021 – that has fallen to around 42% in 2022. That's a slight decrease but it's not dramatic.
Significantly, we continue to see a lack of knowledge and education as one of the main barriers among retail to investing in crypto – the proportion citing a lack of crypto education has increased from 45% in 2021 to 55% this year. Which means as an ecosystem we need to be amplifying on education.
On these three points – trust, education and risk – the data is pretty consistent across regions.
On Bitstamp's new features announced in its Summer of Discovery
Yes, we are making it easier for retail clients to buy crypto on Bitstamp, so they are now able to buy crypto with Apple Pay or Google Pay for instance.
We are also launching new assets on the platform at the end of August.
And we are really excited to be introducing 0% trading fees when clients trade up $1,000 in a 30-day rolling period on all assets on the platform.
On crypto winter
Crypto winter for a company like Bitstamp is a good period for us to build up our capabilities to prepare for the next bull run with new products and new features. We have a very active licensing journey across all the regions – 10 in progress globally.
Over the next couple of quarters we will increase our regulatory footprint, so we are in a strong position to fully participate in the next bull run.
The second point is that we see a strong trend on the institutional side. Many institutional companies are looking to make their first move into crypto – there is massive crypto interest from our institutional clients.
On interest rates being positive for Bitstamp's business
I think for Bitstamp we have a level of cash which is quite significant on our balance sheet. The increase in interest rates is therefore having a positive impact on our business. This was not the case before when interests were zero or negative. Since the end of July we are observing a nice return on our cash position.
What we are experiencing today is not very smart in Europe.
For example, if you want to operate a crypto business, you need to register with each country separately as a virtual asset service provider. Each country has its own requirements.
So with MiCA coming in 18 to 24 months, that will be a game-changer because there will be a level playing field. There will be one country where you can establish your activities as MiCA-compliant and then passport the activities across the different European countries.
In a nutshell, regulatory requirements are likely to increase for issuers and for the distribution of stablecoins.
Recent developments mean that if we want to regain the trust from retail clients and the next wave of investors, transparency is very important and this is my second point.
Audited stablecoins with a high level of transparency around their mechanisms and the protections they are offering, risk management and controls etc, will be the key for the success of stablecoins to enable them to last within the ecosystem.
On DeFi hacks
We see players who are new to the game who might not have a high level of controls and that might be because they are focused on the business in terms of the commercial development.
This might make them more exposed to hacks. Nevertheless, it is very important for companies to succeed in DeFI. If we bring in security and smart regulation and transparency, I believe these will combine to make DeFi very successful.
On NFTs and the metaverse
The key question is, is it going to last? I think it will, definitely. We will see NFTs in the metaverse. I am a big fan of NFT communities, where you buy an NFT to become part of a community and you get some utilities from the NFT ownership, for instance in the sport area.
On the industries ripe for blockchain disruption?
In the field of government applications – record management, identity management, voting in elections or even taxes, blockchain technology has a place in all of those areas.
Also in big data, data storage and of course financial services. The next wave, though, I think, will be outside financial services, in areas such as real estate.
On Bitstamp's attitude to listings
We are extremely selective in the assets we list.
We also listen to our customers and what assets they would like to see on our platform.
However, the most important thing is liquidity. What we want to ensure is that when we list an asset on our platform, that we have sufficient liquidity to ensure that our clients can trade the assets with no problems.
On the risks facing crypto
An unregulated industry is probably the biggest risk. I think we are seeing a good trend from the regulatory standpoint and we are engaging with regulators on an ongoing basis.
Most regions and countries are looking into regulating crypto. The key risk here is around ensuring regulations are smart and they foster a level playing field.
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