“The boundaries between banks and cryptocurrency are already blurring,” – CMO of mobile cryptobank MinePlex
BeInCrypto spoke to Alexander Mamasidikov, CMO of mobile crypto-bank MinePlex, to find out which direction the crypto-industry will take to merge with traditional finance in Russia in 2021.
At the end of 2020, traditional banking and the crypto market have taken a convergence course. For example, cryptocurrency deposits, lending through decentralized finance platforms, cryptocurrency payments through PayPal and more became available for digital coin holders. This year, this trend will continue and probably get a new impetus, says the director of mobile cryptobank MinePlex.
А.М.: There is a trend of creating cryptocurrency-friendly banks in the world. The next generation of users will choose banks that support digital assets. However, at the moment, there are few crypto banks with a banking license. These are the Swiss SEBA, the Kraken exchange and Anchorage. In Russia, because of the special legal framework and the contradictory attitude of the state to digital assets, there are no such analogues yet.
What are the peculiarities of such projects, or as they are now commonly called neobanks. Firstly, it is the integration of banking services into the crypto space. That is, users will be able to pay for utilities or make other usual payments using cryptocurrency. Special algorithms are able to instantly convert cryptocurrencies into rubles, so the seller’s final account receives fiat currency. This does not contradict the legislation, but opens new opportunities for Russians. Secondly, the introduction of bank cards supporting cryptocurrency will accelerate the process of acceptance of cryptocurrencies by citizens of the country and raise awareness of digital assets among Russian and CIS residents.
Does this mean that banking products like cryptocurrency debit and credit cards will appear in the cryptocurrency market? How will they work in the country, given that Russia has banned the use of cryptocurrency as a means of payment?
A.M.: Cryptocurrency cards are obvious trend of the year all over the world. It is caused by many factors: optimization of financial relations between companies and private persons, minimal commissions, security.
The interest in the use of cryptocurrencies is supported by the development of state digital assets and the attention of institutional investors. In Russia, the attitude to cryptocurrencies and the legal sides of the issue are still open. We do not exclude that many banks will support payment with cryptocurrency or central bank digital currency. As you remember, the Association of Banks of Russia has already confirmed the need for a digital ruble. This is a huge step towards the adoption of cryptocurrencies. My opinion: cryptocurrency debit and credit cards will appear in the near future.
What about crypto deposits and cryptocurrencies? Will cryptocurrencies be able to compete with or even replace traditional bank loans, which are still too expensive for Russians?
A.M.: Many companies are already developing or providing these services. It is cheaper for users than traditional bank credits. And cryptocurrency deposits are much more profitable than bank deposits. In 2020, the government lowered the bank rate several times, which eventually led to lower interest rates on deposits. As a result, deposits began to have almost zero profitability, given the rate of inflation.
In principle, on the territory of the CIS, not only Russia, deposits cannot be considered a profitable instrument. The maximum that a depositor can count on is the protection of money from inflation. With cryptocurrencies, it is exactly the opposite. The rapid rise in the price of cryptocurrencies makes cryptocurrency deposits a profitable investment instrument. I think this direction will continue to develop in our country.
If you want read more – the 2nd pt. of interview is here