Why you should partner with a crypto-friendly payment provider
The global market size for cryptocurrency stood at USD 754 million in 2019 and is expected to reach USD 1,758 million by 2027. The cryptocurrency market experienced significant growth in 2020, and as a result, many financial firms diversified their investment portfolios with crypto assets.
Bitcoin, the world’s largest cryptocurrency, increased more than 300% last year, reaching above $33,000 for the first time in history in January 2021. The overall crypto market cap also reached an all-time high this year when it jumped above $1 trillion.
It’s an exciting time for crypto companies, but the market is still in its infancy, and businesses may struggle to scale their cryptocurrency offerings without the right financial services partner.
Continue reading to learn more about how the current cryptocurrency market affects the financial services industry, and why it’s crucial to partner with a banking provider that understands crypto.
Is cryptocurrency the future of financial services?
While the crypto market has grown significantly in the last year, many traditional banks are hesitant to get involved in cryptocurrency until the market becomes more mainstream. However, more financial institutions feel comfortable backing cryptocurrencies that are tied to fiat currencies. JP Morgan recently launched its own cryptocurrency, stablecoin JPM Coin, which directly links to the US dollar.
Cryptocurrency also presents a clear opportunity for new banks, especially neobanks, to shake up the financial industry by offering technology supporting crypto, which traditional banks don’t have.
Long-established institutions often struggle to adapt to changes in technology, but these advancements are inevitable. Although central banks still seem to dig in their heels, it seems likely that they will have to embrace blockchain technology and digital currencies, like crypto, at some point.
Challenges for crypto companies
Aside from traditional banks resisting change, crypto-positive companies face some challenges when trying to scale their cryptocurrency products or services.
To compete with online banking, Visa/Mastercard, PayPal or Venmo, cryptocurrencies must deliver at least the same features that people associate with them, including security and real-time transactions. While demand for Crypto is at an all-time high, most crypto applications do not meet the regulatory standards to offer the banking capabilities that users are increasingly after.
Technology around crypto, such as blockchain, evolves at incredible speed. As more companies get involved in the space, new advancements will disrupt and change how crypto companies operate. Keeping up with this evolution trajectory will also affect how your partners and clients interact with you, and you can’t afford to play catch-up once it’s too late.
While the cryptocurrency market continues to gain traction in various financial activities, many are still reluctant to trust the underlying technology that supports the structure. Unlike fiat currency, crypto is not backed by institutions or legislations, which makes them perceived as riskier to some. The decentralised network can also make cryptocurrency vulnerable to crimes like fraud, scam projects and cyberattacks.
Why You need a crypto-friendly banking* partner
Unfortunately, established financial institutions often misunderstand and under-serve crypto companies, offering restrictive services that harm scalability and user experience. Partnering with a crypto-friendly payments partner like Modulr isn’t only wise, but necessary to succeed in the fast-paced cryptocurrency market. *We’re not a bank but we provide payments and accounts infrastructure as an alternative to traditional banking infrastructure.
Faster and safer payments
A digital payments provider, like Modulr, makes it easy for crypto companies like Bitstocks to accept fiat payments and invest funds in crypto quickly while providing a seamless payments experience for its customers.
Our platform, with market leading uptime, offers embedded access to SLA-driven faster UK Payments and the Single Euro Payment Area (SEPA), allowing you to unlock faster, smoother and more reliable ways to move money across the UK and Europe. In the background, we handle the technological and regulatory operations involved with plugging into these payments schemes.
Established in crypto
Today's crypto companies have yet to find a bank that understands the crypto industry’s demands or offers the scalable payments infrastructure they need. FinTechs like Modulr have a deep understanding of crypto, including the trends, the challenges and the opportunities. We also have a well-established network and currently work with over 25 crypto platforms, including Bitstocks and Mode.
Less friction from Compliance
Choose a partner that appreciates and understands your industry and how you manage risk associated with crypto transactions. Likewise, find a partner that can protect your customers' fiat currency in line with Electronic Money Regulations so you can focus on innovating, challenging and thriving. For instance, all GBP funds with Modulr are held and safeguarded at the Bank of England, meaning your customers can gain greater assurance their funds are in safe hands.
Deliver the Customer Journey 2.0 powered by Modulr
Ready to take your crypto offerings to a new level?
Modulr provides a new type of payment account designed for faster, easier and more reliable ways to move money. At the forefront of cutting-edge industry initiatives, we work hard to make the latest innovations available to our customers. We provide a seamless payments experience for customers wanting to invest in crypto through your platform.