How these two startups are helping grow and secure the blockchain economyApril 5, 2022 | By Vicki Hyman
Cryptocurrency was once seen as a speculative investment with a niche audience, but in recent years, interest in crypto and other blockchain-powered innovations such as non-fungible tokens and smart contracts has skyrocketed.
To bring the benefits of crypto and other blockchain-based assets to even more people, two companies — Denmark’s SPENN Technology and Germany’s bitsCrunch — have joined Start Path Crypto, Mastercard’s blockchain-focused startup engagement program providing access to partnership opportunities, insights and tools to grow.
Vijay Pravin, the founder and CEO of bitsCrunch, launched the blockchain analytics firm in 2020 and shifted to NFTs in 2021, recognizing the need to better protect the ecosystem and ensure secure and reliable trades.
SPENN Technology’s app, says CEO Jens Glaso, makes it cost-effective for banks to bring more people into the financial system, enabling people to manage their savings, payments and investments transparently and securely, even taking out loans that are interest-free for the first 14 days.
The Mastercard Newsroom recently spoke to Glaso and Pravin about their first experiences with crypto, how they built their businesses and where more opportunities may lay in blockchain:
Were you an early adopter of crypto?
Pravin: We are still early in my opinion. Some may call it late, but I feel we are way ahead of the game. The number of people in this world who are into cryptocurrency is still very low, and now we are already seeing more and more Web2 firms venturing into Web3 and cryptocurrency.
Glaso: We’ve long viewed crypto as a tool for efficiency, so for us the advantage was clear that the best way to reduce friction in an economy is to digitize the currency and allow for banks, merchants, and consumers to interact seamlessly. The cool kids call them “stablecoins,” but we’ve been minting stablecoins since we started in 2015.
What was your “aha” moment in founding your company?
Glaso: If you look at the global monetary system, you see that most fiat money is already digital but relies on an outdated infrastructure built 30 or more years ago and held together by treaties and protocols that require a ton of maintenance at an enormous cost. Mobile money has improved the situation somewhat at the capillary level, but its model is based on high transaction fees. We knew there must be a better way.
Pravin: I used to be a crypto investor since early 2019. And since I am into data science throughout my career, I always wanted to do something with blockchain data. My “aha” moment was the US$69 million sale of the NFT by Beeple last year. When I started digging into the buyer, MetaKovan, I was surprised to see that he comes from the same city, Chennai, in Tamil Nadu, in India as me. I decided to dig more on NFTs and hence founded bitsCrunch.
What is the greatest challenge in taking crypto mainstream and how could it be solved?
Pravin: Lack of awareness among people since the space is very niche and we are still early into this journey. Taking crypto to universities could make the penetration much faster. Educating people is difficult, as crypto is not straightforward, but that is one of the better ways to make it mainstream in the near future.
Glaso: The latest data suggests that crypto adoption is tracking very well against internet adoption. With that in mind, the number of crypto users is by some expected to reach 1 billion by 2024. Unfortunately, humans view things in a linear stance and are not very good at looking at exponential growth, which is obviously what crypto is doing right now. In terms of obstacles to growth, I think we still need to fix identity and the security aspect to managing digital assets before Web3 can really gain a foothold.
We are solving this by making crypto user-friendly – by implementing a solution where our users can very simply and easily hold, sell and exchange crypto into local currency as well as use it in the store real-time to purchase goods.
What do you think is the most exciting new development in the blockchain/crypto space?
Glaso: Hands down – it’s the emergence of central bank-issued currencies (both wholesale and retail) and how these currencies will intersect with privately-issued stablecoins (like SPENN) to give the maximum benefit to citizens and banks alike. We see central bank digital currencies running concurrently and eventually replacing SWIFT and private retail currencies serving at the local level to send money to your grandmother up country, buy your cup of coffee, or trade your favorite NFT.
Pravin: The advent of NFTs is one of the exciting asset classes that has gained so much traction in recent months. And we are glad to be into the forensics of NFTs as it brings more trust among people.