What's Next for Crypto?

thank you daniel so hi everyone and welcome to the second day of the european blockchain summit my name is tracy wang and i am a senior reporter at coindesk based in new york and i'm so excited to be interviewing our amazing guest for today's fireside chat we have eric anziani who is the ceo of crypto.com so eric joined crypto.com in 2018 and currently oversees several functions including product growth institutional sales uh strategy research and data and the crypto.com token cro is currently the 15th largest cryptocurrency by market cap and as a reminder this will be an interactive session so if you do have any questions for eric please submit them into the question box and we'll try and answer them at the end of the session all right so welcome eric um so for those of us not familiar uh could you tell us a little bit about crypto.com yes of course first of all thanks for having me and really glad to participate in the european blockchain convention uh so crypto.

com is a simple sentence the world's fastest growing and regulated crypto platform it serves more than 10 million users globally and it really addresses all their crypto needs from buying spending and growing their crypto and nft assets and we were funded about five years ago with really the goal to bring cryptocurrency to every wallet um so crypto.com you guys have made some headlines recently for purchasing the rights to the la lakers staples center um could you talk us through you know what were the reasons for the purchase and uh the fans really do want to know do you plan to change the name of the stadium of course and uh i think it really comes back to our mission which is to you know bring cryptocurrency to every wallet what we mean by that is really having five billion users globally owning and using cryptocurrency in their day-to-day life so for us to achieve that goal for the industry we know we need to make the technology mainstream we need to create more awareness and and use cases and value add for uh individuals across the globe and the acquisition of the the navy rights for this uh iconic staple center in la now uh renaming into crypto.com arena is definitely a historic and and pivotal moment not only for crypto.com but i feel for the industry when the announcement went out it was such a wide reach and everybody talked about it and we're very excited to see the activation that will come after the rebranding we have already the grammys happening uh at the cryptosgo marina we have concert justin bieber coming there of course we have all the lakers and the kings games so the the impact will continue throughout time and it's looking to be a tremendous um let's take a step back and look at the crypto landscape in the past year so the crypto community in general in 2021 has had quite a tremendous year um you know we we saw new all-time highs for bitcoin and ethereum we saw the emergence of new layer one tokens we saw an explosion in d5 in terms of total value locked and also the rise of nfts and the metaverse so in your opinion what do you think was the biggest development in 2021 and what are your overall thoughts on where we are in the current cycle the latter part is a bit more difficult to answer but i i would say you touch upon a lot of good and major items that happen this year and you know for people follow the space or working in the space it's just you know fascinating to see the level of innovation and things happening every day so it's hard to summarize you know the key items but definitely nfts the explosion of the volume we we hit about 12 billion dollar of transaction volume uh this year and i think we had a research team look about 13 14 million transactions just on nft there's been a huge explosion uh in terms of growth through the psp avatar and through gaming as well so huge huge trend emerging the second one you mentioned a little bit around you know ath for bitcoin and ethereum that was milestone for the industry but more importantly was the development behind it um you know the eip1559 for ethereum where you know the the currency started to become a little bit more uh deflationary and then the bitcoin tackled upgrade for more efficiency especially on the multi-sig side that was kind of underlying the growth also from a technology standpoint on these two big tokens outside of bitcoin ethereum i think meme coins was something super big this year even just today i think there was a another tweet from from elon talking about supporting dodge coin uh as a payment uh currency on on the tesla platform um and you know driving again some some action uh on the demand front it's been a tremendous year where a lot of the communities and retail kind of took over the market by storm a little bit as they did in the stock market with gme so definitely notable if we step back also at the country level we saw of course you know el salvador making bitcoin a legal tender that was a huge huge muscle for the industry and with also a couple of countries including china are going in implementation mode for cbdc's again another big step in the digital currency space finally i will add two things that you touched upon a little bit one around this blockchain interoperability items between l1 and l2s we're starting to see you know more bridges more connectivity between all these different blockchain that are made emerging to solve scalabilities and fees issue we've seen on some of the bigger platform um and lastly you talked about defy tvl um so the growth of of the defy space and also we've seen towards the end of the year the migration or the emergence at least of what we call d5 2.0 which really tried to improve capital utilization within d5 protocol so an also an another a major trend helping the growth of of that category yeah certainly when you take a step back and look at the past year there were uh you know just so many um wonderful developments in the crypto community uh let's let's talk a little bit about you mentioned retail traders um and so crypto in the past couple years it's it's really kind of taken off due to retail interest um but 2020 2021 was kind of the year that we saw institutions starting to pay attention whether it be large asset managers or you know even hedge funds or even uh you know family offices or even pension funds in cryptocurrency investments and we also know that you know retail and institutional clients kind of have different preferences one of them likes mean coins or mean stocks and the other uh prefers you know kyc and compliance and uh for somebody running a you know crypto business such as crypto.

com how do you kind of cater to both uh we we've kind of seen a lot of crypto native companies like coinbase or or even ave uh kind of separate the two arms they create an institutional arm and then a more of their traditional business that was uh you know kind of uh that catered to more to retail so how do you think about um you know catering to both and also the ways the ways in which the crypto industry can be more um friendly towards institutional adoption that's a great point and i think it's one of the development also in 2021 i think institutions have ramped up their game massively towards crypto you know 2019 or 2020 still a lot of stocks a lot of interest but little action i think 2021 was really the year of action where we saw numerous companies started offering crypto services directly to their customers whether it's fidelity goldman jp or paypal for example or even investing their own treasury uh into crypto and bitcoin in particular tesla you know some some of the fintech also in latin square of course and a few others um so that was really a major trend and a lot more action and volume coming from institution this year uh on our site at crypto.com we've been developing uh you know and growing our institutional offering primarily through the crypto.com exchange which is really the venue where institutional player can uh on board and and trade via api uh on spot and and and and some other products as well like otc the the approach that we had is this you rightly said uh institute customers are very different and they need different type of offering um so we build you know state-of-the-art matching engine we had dedicated technical and sales support team just for institutional client we build also infrastructure so our clients could be co-located in terms of the servers and have better performance we develop new forms of credit line and different fee structures so for institution and launch an otc offering really to to serve that a very highly growing base of instrument clients and we were very happy just a couple of days ago we were the top two exchange on the spot side uh according to coin gecko um passing five six billion dollar of trading volume per day thanks a lot to of course institutional clients uh let's turn over to let's talk a little bit about user adoption which seems uh top of mind for almost every single crypto project out there whether you're a layer one or a you know crypto.com everybody is trying to get more people on boarded into the ecosystem so um you know we like to uh the crypto community in general likes to compare themselves to web 2 companies and we're seeing that you know facebook which i mean meta formally called facebook and youtube these web two companies have actually built platforms where billions of users use them every single day um you know so far crypto adoption has grown but it's not yet at that scale so what do you think will bring crypto user adoption up to that you know next order of magic magnitude from millions to billions so it's a great question i think this year uh if we look at the crypto space itself we grew roughly from about 100 million users globally at the beginning of the year and our research team is looking at the numbers for december but i think we're going to hit 300 million users so still some decent growth for the industry but much uh you know smaller scale than than web 2. the growth has primarily uh was primarily driven by the trading use case and we will we do expect to see strong growth still for that use case but for us to get to 1 billion users and then 3 billion users other use cases and verticals need to be leveraged in particular i think the next step for the industry is really gaming where you know globally today we have three billion maus um you know uh in the gaming sector so for uh crypto space connecting blockchain and gaming as we're already seeing a bit the trend uh this quarter it's gonna be be access to a huge number of new users that will be introduced to the industry and then from gaming to social network or metaverse the frontier is not that far but again you can increase the number of users and grow the space further so you know to summarize trading use case will still be they'll continue to grow i think the next big lever is gaming and then down the road social networking and metaverse um so to kind of add on to what you said about nfts could you tell us a little bit about crypto.

com uh kind of new uh venture into the nft vertical yeah definitely we launched earlier this year at nft marketplace and our goal at the time was really to make it easy and really enjoyable for anyone to go and discover buy exchange or even create nfds and do it also in a sustainable way and so we wanted to leverage a public blockchain that had also you know proof-of-stake mechanism and minimal impact on the environment and that's why we chose the crypto blockchain to to support that um we we looked at the industry and you know we wanted to put ourselves in the shoes of the buyers as well as you know the creators and for buyers really what they were looking for is you know how um can i buy nft in a very simple way for most people going on the traditional historical platform you know setting up metamask and transfer ease and where do i get it and and just this whole experience for cryptocurrency is is extremely difficult um so we wanted the amazon like experience two clicks um you can buy an nft using your credit debit card or crypto if you want and both experiences should be seamless for you the second aspect we wanted to bring is really unique and high quality content so we started with a fully curated platform for customers to to pick from as well as big partnerships with top brands like ufc or 76ers or aston martin to bring really high quality and differentiated content for users and the fans of this brand um so they can generate value and get utility out of those nft beyond the art quality of it so we work very hard to do that and later this year we've opened up the platform to 30 and emerging creators to make sure we develop the marketplace and bring new talents in um finally i see on the buyer's side you know making sure we introduce also something very popular and which is at the core of nfc which is community based series like like psps and the first one we launched last month was called loaded lions it's been generating massive success a lot of engagement beyond the drop itself is really about the community around it the benefits and and what can be built on top of it which is really really fascinating um that's kind of the buyer side on the creator side really we wanted something that is open for them to create mint and nft instantly for free and be able to showcase their work to you know more than 10 million users the the entire crypto.com ecosystem so very very powerful especially for emerging artists also what was very interesting for creators across the board in the nft space is the royalty mechanisms and on a platform ensuring that every time they sell a piece and that piece is also sold um they get royalty uh um so that that was super important and i think that brings great value to to creator across the globe and they they capture more uh of that value and it's really the spirit of web3 and that we're trying to support as a you know industry participant create that environment where the builders the creators and the users can have ownership and share the value um let's turn over to regulatory and i think this will be the last question and then i want to get to some of the questions that uh our audience members have submitted about crypto.com um so just a quick one on regulatory uh you know we had the u.s house financial services committee hold um you know a hearing on crypto regulation and it seems like it's the most serious they've uh taken the crypto industry just what were your you know top two or three takeaways from that hearing yes it's uh it's a great question i mean i've uh we've followed it from from afar i think it was first of all a recognition of where the industry is to have the hearing itself um so i think it was a an important signal and i think uh a willingness to engage uh from from uh you know the the the committee itself so that was i think a first good step as we've seen across the board especially especially in the u.s today the regulatory framework is the traditional framework it's a mtl is the way that traditional payments are regulated and there's a lot of discussion on how do we actually regulate crypto not only the the vast but the the operators but also you know defy and taos those are the big topics and so it's very good signal and that there is engagement i i won't go into the details on the the content of the interventions uh per se but i feel there is an opening in the us to create a new framework and have more proactive engagement with regulator uh whether it's the sec or cftc um and and some of the others as well at the state level um there is willingness of engagement and i think we should see this as an industry and and try to be force of proposals to shape um the regulation going forward and so you know crypto.

com will play its part um to make sure we develop a regulatory framework that at the same time protect your customers interest but does not impede innovation and growth in the sector thank you eric um i'm just gonna fire off some questions from our audience uh we have one question asking on the topic of institutional versus retail what's going to be the focus of crypto.com institution institutional clients or everyday users i think we will cover both and will try to provide the best experience for both customers at the root that we started and we still have very strong retail customer platform and that's our kind of our dna but i think to have a flourishing ecosystem it's also important that we have institutions the the exchange play a big strategic role in terms of liquidity and influence in the industry it gives opportunity to project to get access to customers and so it's it's an important part of the ecosystem it benefits retail and of course it's a great venue for institutions um to enter the space uh hedge their positions and and trade the market so you know we're an ecosystem we will continue to be so and serve both retail and institutional at scale great thank you eric the next question is uh what is your opinion about elon musk promoting dogecoin and other coins that's a direct question um well you know in general we are um we're happy for people to generate awareness um around the space and and drive adoption um so i think these um you know people who are trying to explain and drive utility for um you know crypto asset nfts uh driving awareness is helpful um i i won't comment on specific you know tweets on out of elon musk but you know being able to have large companies enter the space support the cryptocurrency as a category and and drive more awareness all in is positive uh whether one specific to it and the impact it has on the market is the good thing a good thing or not i'm not so sure um but yeah that would be my immersion answer on this uh we have a two-part question for eric where does crypto.com see itself in five to ten years and uh your comments on the cro token yeah i mean we're we're here to drive the the industry afford and drive adoption across the globe we want to be there in five years and have three four five billion users owning crypto in the world and improving people's life because of that you know if we come back to the roots you know why are we doing what we're doing today what's the value proposition of crypto it's to give people better control um control over their money their data and identity and that's why we want to promote the technology and web3 in particular which give opportunity to everyone who participate the builders the creators the users to take more value out of the the new ecosystem that we're building so that that's really what we are aspired to do and of course do the best that we can to contribute um to the adoption and the positive value that it brings to societies and individuals um not sure what's the question on the cro token we usually don't comment specifically on on price or anything like that but what we've seen recently um through um one of the blockchain called chronos um that where cro is a native token is the explosion of the ecosystem especially on d5 and nft so it's uh it's a recent blockchain that the team has reported on the infrastructure side um that has already above a billion of tdl great engagement from communities it's the first evm chain in the cosmos ecosystem and we see a lot of great potential there so very excited about this development and being able to provide infrastructure for people to build and create value uh the next question is is crypto.com allowing people to hold their own keys in line with our missions we actually launched uh about a year ago uh the what we call the d5 wallet which is a non-custodial wallet uh where our users have complete control uh over their assets uh what we say you know your keys your crypto um so we have this uh d5 wallet it's multi-chain it supports all the big protocols it's connected to d5 it's connected to wallet connect uh it also has now a browser extension so it's easy to navigate on all the d5 protocol and at the end of the day you have been you're in full control you have the private keys and you control your security okay the next question is uh would crypto.com acquire other businesses to expand its user base we've done a few acquisitions uh since we were created five years ago and the most recent one with the acquisition of two cftc regulated businesses in the u.

s and primarily done to expand the offering to customers in the us especially around options and derivatives in a regulated manner so this is an example of the acquisition that that we've done we're always looking at opportunities and how we can grow potential targets um that we like to work with so we've done a few in the past we'll continue to do so we're really focused on what can drive the industry forward and what new use case we can enable and and through acquisition accelerate that goal the next question is when will crypto.com invest into an etf specifically bitcoin spot yeah etf was actually a big thing this year also quite quite recent uh was kind of cash settled so it was not physically settled but there was still a big step in providing instruments that give exposure to the space for institution and retail as well so it's something that we're supportive of but today we have amazing platform that gives you direct access to the physical asset bitcoin and and eth and so we feel uh while these initiatives are are great and contributing to the adoption we offer you know the best price and and i would say um less fees and and overlap uh to get access to crypto by just you know going the with the crypto.com app or the cryptocurrent exchange and buying directly the physical asset um so we we feel that is more value generating for customers than than the etf because of their structure but they play a role in adoption so i think it's positive overall for the industry and uh the next question i think this uh audience member is interested in the expansion projects in latin america for crypto.com yeah latin america i've seen tremendous growth uh in the crypto space and for crypto.com um very recently we we launched a cart program there um and we were the direct issuer of that cart program being a principal member of visa and we've seen tremendous uptick there the growth is is you know surpassing our expectations in brazil but also in quite a few markets across latin america um so we're investing in the region we have a lot of people on the ground and we're really trying to see what are the needs locally and how we can best customize our product to serve those needs in the region but i see personally massive potential in that part of the world on the crypto site all right and i think this will be our last audience question uh eric how do you think increasing regulation will affect your business what you know for any businesses it's uh it's critical to have clarity on the regulatory front so we we work with regulators across the globe and we try to get to clarity because this is how you can operate a business and scale um we started our business with compliance and security at the core so everything that we did like onboarding customers we kyc everybody we put in place the right male policies etc from the onset and so that helps us in our engagement with regulators and as regulatory regulation becomes stricter in some market or clearer which is more important to us so we have you know positive engagement to support and be agile and we also have very large team just focused on that and we're applying across the globe in for registration and licenses and we're lucky to to get already be granted numerous licenses across the globe um thanks to this kind of approach that we had from the onset you know compliance security uh making sure that the foundation is right for the business so we can build for for the next decade all right unfortunately we are out of time but thank you so much eric for a lovely conversation and thank you for all our viewers for tuning in it's a pleasure thank you eric sorry thank you eric thank you tracy for a wonderful panel discussion it was amazing people really appreciated that you took the time to answer to many of the questions there were a lot of questions and yeah we really appreciate it thank you once again and good luck with taking creeps.

com to the next level to the audience thank you on the next session [Music] you