EN | Next Generation Investors: How Brokers Adapt to a Digital-First World | MERGE Madrid 2025

Hello. Thank you for um interrupting your lunch for to join us here. Um you are up for a treat. Hopefully everyone will leave more educated after this uh after this session. My name is Saul.

Um I hopefully I have some friends in the audience. I work for Coindesk, the media and events group. I am a director of partnerships and um my role is to look after our clients across Europe. Um and I am joined here by a stellar lineup. Um I will start the the panel by introducing all of my speakers.

But um what you are hopefully you're in the right one. We're going to hear about the next generation of investors and how brokers are adapting to it to this new type of customer that demands a new type of asset class. Um so I will start with

Yeah. Thank you very much. Um I'm Morris. I'm running at FlatXro the market side together with a colleague. We're an online broker 15 countries, 3 something million retail clients all across Europe and including a from my point of view very good and significant group both in Spain and in Portugal.

Um I'm speaking today because we're last year built within three months a crypto offering real coins uh 20 coins. um we've been completely overwhelming our IT organization with it. But anyhow, um but it's possible and it's um to to get to to the investors. We think it is important a to attract new clients, but also um to give a complete portfolio to our clients. The asset class is way too big to ignore it.

It's here to stay. So, we had to do it and we think we've

we're late.

It's not going anywhere.

No.

Excellent. Uh Chris.

Yeah. Hello everybody. My name is Chris. I'm the founder of Traders. We are a German-based often regulated securities trading bank focused on market making and liquidity provision for institutional clients in the digital asset space.

Um we've been around for 5 years. Uh originally emerged out of a traditional securities trading bank. Um partner with a number of retail facing brokerages, neo banks and traditional banks. ThetX is one of our esteemed partners and yeah looking forward to discussing some of the uh challenges and then also the solutions to enable of course uh traditional uh uh platforms to yeah enable crypto trading for for the retail client base.

Thank you. And we have um Mark.

Mark I am head of Europe for Gemini. Um Gemini crypto exchange founded by Winkls twins back in 2015. Been around now for 10 years. We look to build ourselves to be a hundred-year-old company and we see Gemini as forming the kind of future of finance and that's what we're building towards right now.

Excellent. Thank you for being here. And Alexander.

Hello everyone. My name is Alexander. I work for Swissborg which is a Swiss company. We're also an exchange but we go a bit further than that in the sense that we do wealth management with crypto. So we help investors being newbies or seasoned investors to invest in the well in the in the crypto world in the world of web 3.

So uh this is me and uh my background is uh I come from the trady world. I worked 16 years in the traditional space with UBS, Pik 10, other banks and I made the huge leap of faith uh four years ago into crypto.

And how has that been?

Exciting.

Hopefully you will never look back, right? Um next gen from let's say a wealth management, private banking type of of perspective always feels like that's the it's a transition of of of wealth or the trespass of of wealth from one generation to to the other. We are talking today about the next generation of of investors. Although I would probably call it the current generation of investors. This isn't the future.

It's more like the the present this these days, isn't it? Um, so starting with you, Morice, what do would you say that defines the the next generation of investors or the current users now, which is why you've created what you were telling us before? what do you think they expect in terms of access, in terms of user experience, um, and and the the the assets classes?

Yeah, I think it will be a bit different than in the past. Um, but we still have some cornerstones as before. Stable platform, especially in difficult markets, not only when the sun is shining, the top thing, good client support with a person on the phone, help with AI and whatever, but if you need to, you have a person to call. um that gets more more important rather than less important from our point of view.

Um trust like ever in banking trust is the basis for everything and that is even more the case in um in web 3 and anything else.

Um but at the same time we have very interesting inputs or insights into our clients and what they really care about. Do they care about price? Do they care about speed? What is relevant? user experience is relevant.

Getting into an app and trade within seconds is more relevant than the best price for one group. But if you if you cover different clients, well, if you have experienced clients who trade ETPs in the past, warrants, whatever,

if you show them an unclear price and a non-predictable uh quote, you lose the client instantly. So, for us, we've intentionally chosen to say we give you a predictable price. It's transparent. It is comparingly cheap but it's not the cheapest. Uh but it is predictable and that really depends on where you see your your your client group.

For the 20 to 30 year olds maybe it's different. For the 50 year olds they look at transparency.

Would you tend to agree or disagree Alexander with this view?

No I definitely tend to agree. I would say that here we need to keep in mind that we're dealing with a cohort of people who have grown up with uh transparency, full transparency, with personalization, with uh um instant access. So it's a it's a it's a it's a very specific uh cohort and they don't want the same as uh their parents are were used to. For example, sitting in Geneva or somewhere with a banker etc with somebody with a suit and tie that's gone. I think most of them are looking for a one-stop shop where they can find everything under one umbrella uh straightforward.

Most of the time they do their own trading etc. Some of them are okay with having advice but it's a very very different approach than uh than than the way wealth management was done 15 years ago.

It's much more um hands-on, isn't it? Um Mark Grace, is there anything you'd like to add? I think we've moved into a stage where people expect full coverage all the time 247 and crypto markets provide that but also the instantaneous feedback that we all want to receive when we sit in a sit in an app want to be able to see real time what's happening be able to move across chain be able to move across wallets that's an infrastructure that doesn't exist in traditional finance it's it's old it's dead and it it it doesn't compare so crypto builds a different generation of investors who expect immediiacy, who expect transparency, but expect full control and ownership as well.

Ownership, that's also you're in a way much more invested into uh your your service provider. Chris, is there anything you'd like to add?

Yeah, maybe just one thing. I think we talk a lot about the technology, but when I look at the, you know, new generation of investors, I think, uh, they take almost the technology for granted and really all they care about is a seamless user experience, right? So I think what we got to make sure is that yet the technology is working that it's efficient that it's costefficient. Uh but really I think for the user it's probably not as important to see actually what's going on behind the scenes for them. I think the seamless experience is what's key and and and uh I think that's that's also a big change that we're we're seeing.

It it is it is important because in in many cases that's what um aside from you know the fear of the unknown I feel that the user experience tends to be what puts people off as well. um in from from crypto. So let's move. So as you were saying before, private banking used to be much seen as a very traditional type of business that is shifting uh already and it has been in in in changing for for a while. What do you think is the bridge that we need in terms of the regulatory framework for traditional firms to be able to offer a digital asset service or for um the digital asset service providers like uh like um Gemini?

What what do you think they need in terms of of a of a regulatory framework?

I think number one, Mika was a great first step. It put a benchmark in place for us to understand what the expectation was for firms that got into the digital asset space and I think for a long time there were some bad actors that maybe played against us in that and so first step implementing Mika was a great great first move. We then get into focus on how do we integrate that with the third parties that we work with and institutions. So instead of the fragmented previous regime, you have a kind of an overarching compliance framework that satisfies some of the concerns that may have existed before because regulation didn't exist. So I think it was an important part for us to establish what what good looks like and that the benchmarks that we can hit give people confidence to invest in the space.

That allowed us then to build and grow the product set that we could offer. So, not only were we able to tackle the compliance functions that needed to get gain trust within the market, but it allows you then to build on top of that platform where there is confidence. You can then start moving into tokenized equities, perpetual futures. All of those elements rely on a really solid foundation and I think Mika was an important step for that to happen.

Yes, you have uh you have the framework and you can actually have a regional franchise as uh as well. Chris, what would you say about uh regulation as well?

Yeah, I think uh similar to Mark, Mika was a great step in in Europe. We're seeing some more regulatory clarity uh coming out of the US as well this year. And I think uh that's exactly a point. Removing uncertainty is is is the most crucial fact, right? We can talk about um whether the regulation is perfect or what aspects might might be able to get changed.

uh but I think removing uncertainty particular for for traditional institutions to gain comfort to move into the space is extremely important and what we've done actually since day one so we're a MIT regulated entity as well as Mika so we sort of live in in both worlds and we've taken a goldplating approach meaning we've applied actually my rules to uh crypto assets even when they were not regulated as such um because our customers they were familiar with those processes and procedures and we tried to map as many of these procedures and processes to what they're used to making it feel just like another asset class because I think uh when we look at any project in the past successful and unsuccessful if you're not able to convince and bring in the control control functions um of those traditional banks and players early on and and make them feel comfortable um the project is bound to fail right and I think uh having regulatory clarity and see that continuously evolving is is is a crucial step and and sort of mapping that to how the traditional world works what is what is the same and what is different is is really really important um for the success of of any project.

So there seems to be a consensus that the framework is not perfect but it's good that it is there. It has made your lives a little bit easier.

It's needed.

It's 100% needed. What Mark said is is 100% correct. It's it was very needed and it's all about trust and at the end of the day the regulation helps to set a framework and it helps building the trust in the space. Do you think your older customers feel more comfortable because there is some sort of investor protection then?

Yes, 100%. This was very much missing up until now. At least that's my feeling.

It's always the same whether it's banking regulation, whether it's MIFT, whether it's Mika. It's painful. Yeah. And yes, it's a boundary to get over, but it's the only basis to to really uh build a proper solution. And doesn't matter how bad the rule is, as long as it's consistent and you have level playing fields.

It's we can adapt and that's one of our not only in in in this particular product but also if you're active in 15 countries 15 different views on investor protection and consumer law great idea that's why no one else is doing this.

No Mark and I were talking about this earlier. It just makes costs just impossible impossible to manage. Um excellent. Okay. So it's it's it's um what I was going to say is that it also gives the asset class uh some certain of validity.

It it makes it you know a much something that you know motivational investors will be happier to and we are talking about you know what um family offices or or like smaller personal investors. Let's go. We were saying earlier about uh the user experience the the the technology the the agility that the customers um demand. I I wanted to um ask you um in particular, Alexander, how how is your your investment in in technology? Is that a top priority?

There seems to be many things that you need to manage, regulation, compliance, marketing, getting out there so that your clients can can find you. But how how much uh investment goes into tech into the tech stack?

Pretty much everything from the get-go. We we don't invest much in marketing. It's it goes all in into this because for us from the very beginning from day one it was very clear that user experience is the name of the game if we want to be able to appeal to the masses. Um so definitely having an app that is super userfriendly, super easy to to just onboard is key to the success and uh and at Swissborg we're extremely proud of one data point is that we have uh realized over the last couple of months that we have on a weekly basis people who are over 75 over 80 years old who are on boarding with the app starting to trade and uh and for us it's something that makes us incredibly proud because it means that it's super super easy to to And that means that anybody can can can give it a try and start investing and and and work towards this financial freedom that crypto can bring.

Anyone else wants to add anything on the on the user experience and how we attract clients through seamless technology.

I I think I can give two angles to this as a starting point. Well, we're fully regulated bank. We were a neo broker 20 years ago when the rule didn't and the word didn't exist. Now we're somewhere in the middle. not a New Yorker, not a bank, but some strange animal.

We have roughly 1300 employees and out of those 700 are IT people that that to answer your question of how important tech is. Tech then AML then compliance and then well the front office somewhere in the end. Yeah. Um so that's the general statement on crypto when we as I said we did it in a very condensed time frame. We've been taking every well loophole we could find in on the call banking system and the booking and whatever to integrate it somehow.

But the front end was fully integrated. Uh it looks like every other asset no inframe something solution and just whatever it needs to be fully integrated otherwise you don't get the clients in.

Interesting. Um anything else to add on this or otherwise we'll we'll move to the um I'm I'm very pleased to be here with uh you know the disruptors because again wealth management is seen as something very very traditional and suddenly this bunch of people come along that they are getting more for I mean not not everyone is wearing a tie here which is fine we are at a crypto conference but you know the the the type of your your typical private banker has has changed the customer has has changed as well and you know these uh these companies your companies are are disrupting the the business model. The lines between a broker, a wealth manager, a crypto chain, they are blurring because those those business become uh more and more similar to um to each other. So this competitive pressure, how do you see the landscape transforming? Do you think that traditional banks will have to adopt be being able to offer um a digital assets uh service to their clients?

Do you think that they will build that? Do you think that they will actually white label it from from someone else who wants to take that first?

I think we've seen traditional banks now have clients coming to them looking for solutions. They want to give their clients access to Bitcoin, to Ethereum, Salana, but they realize they're behind in terms of building. The crypto companies, those who are more cryptonative, have been operating in the space for 10 years. And so I think what we'll see over time is that we won't all provide one financial place where you can do your mortgaging, your banking, everything else. What we'll see is that in the investment space, digital asset and digital asset technology will start to dictate what that looks like.

And I think we'll move from existing banking rails to onchain movement of stable coins and fiat becomes I'm not going to say obsolete but it becomes a less used transactional method for most people and what we then see is the onchain capabilities of transparency and ownership again puts it in the hands of the users. So I feel like crypto's empowered more people to be able to take ownership and direct what they want to do from an investment capability. And what we see then with tokenization, bringing equities on chain, bringing treasuries on chain, it gives you ownership and control of that. So I feel like know the days of old of people providing advice and taking huge fees in order to do that. That's gone.

It's now transparent. It's available 24/7 and and it's focused on a a product capability.

It it has been disintermediated completely. I

think so. And it's just the first and simplest use case for DT. So distributed ledger has so many more opportunities than just crypto trading. It's the first one that is accepted and it's good. But it's a bit odd that this is the first thing that's really going through the roof.

Yeah. Um when when when I started in looking to this, I was convinced that in two years time we will not have anything like charted accountants anymore because we don't need them. Yeah. It's all evidence every single trade. Why do I need to talk about AS400s in the seller and and the booking center uh for for my books and records?

I know I was a bit too positive, but I think still think we'll get there.

We are slowly but but surely yes, get getting there. We were saying before crypto is not um is not going away. Um Chris, I wanted to ask you about um you know the in in terms of uh institutional versus retail uh adoption. And when we talk about institution, I mean, you know, family offices, uh, family offices, fund managers, how do you see that that trend?

Yeah, I think that evolution particularly in Europe has been a bit slower than than the retail space. I think the market in Europe has been predominantly retail driven um, so far, but we're seeing u increasing interest uh, basically on on on a daily basis from those kind of customers. I think the hurdles to get in um, are are at times a little bit different. uh things obviously like counterparty risk are are very important for for those sort of players. Um they need deep liquidity.

So liquidity for larger order sizes, right? Which has been historically maybe a bit of a challenge, but obviously the market is is evolving here as well. Um I think another big challenge is on the operations and reporting side, right? So if you're fund manager, um how do you label this asset? Am I actually allowed to invest into this asset?

um Germany actually quite early on had a had a regulation here that allowed to have um basically a hedge fund type product that has 100% native crypto exposure but it was not very widely accepted so that this was one of the few times where I think regulation actually moved first but the market just wasn't there yet because people may have not been com comfortable with it um I think predominantly because of the uh higher volatility in the market um so I think um the more and more robust the market gets and resilience is is really key here. Uh meaning being available at all times, being able to show liquidity at all times, even for larger order sizes, is is really really important. Uh something we're working on. Um I think the market is going to become more price sensitive as well when more institutional players move in. So that's something I think everybody needs to be prepared for.

Um but um we're quite hopeful that we're going to see a lot more pure institutional players moving into the market even in Europe over the next 18 to 24 months. Do do you think that's the that's the case that we are building an ecosystem that will allow for that?

I think you will get CR banks only really in if this uncertainty is solved about three times RWA holding cryptos on your balance sheet as a bank. That is we we agreed not to complain about regulation. Be happy that we have one. But that's one really painful silly component that we need clarity on. Um because with that you're just blocking so many business models and it's just unbalanced from my point of view.

Yeah. No I definitely you know the the landscape is uh in is transforming towards that adoption. Again we are sitting here with a group of disruptors. None of you seem very worried about banks offering crypto. No, to be well, I can I can speak for for for Switzerland, but I see that the the banks are doing too well in order to uh to to to to to put uh to put their risk on on this.

I mean, today it's uh it's it's it's such a a slippery road for them that uh I don't see them and that's why we have such a boulevard in front of us. uh

not sure it's going to be the case in in 3 or 5 years but today they are still very reluctant and at least the private banks the universal ones the big ones are it's a bit different but uh the private banks where have been evolving for for the last 15 years they uh the clients are asking for it a bit especially the next gen and they send them to us so it's uh for the moment it's very good

it's good for you I suppose it's very good we don't have uh we don't have much time and I want to um I want to finish on time so we talked about, you know, the next um the next generation of investors, which is the present generation of investors really. So, if we were to think about the next next generation of um of investors, what would be the most defining characteristic that you think a successful broker or or investment platform should aim to have say five years from now? I don't know in crypto years are like dog years. or let's say 3 years from now,

we need better education. That's for me the the key to everything. Logically, you need a stable platform and trust and whatever as we started this discussion, but we need to provide good quality education to the broad masses. We the population in in Germany extremely where I'm coming from, but also across Europe, there's so much financial literacy everywhere that even the basics are not there. and that whether it's traditional finance or or crypto, but this is really where we need to start,

educating the future customer.

Yes. Starting in schools, not selling products, but delivering facts. Yeah. Um that's what we we're trying to do. Well, we even run a Spotify listed podcast in in the Netherlands are in the top 10 on Spotify with finance topic, which we're very proud of as an example.

But that's nothing one person can do. The whole industry needs to do.

Yeah. No, no. Curiosity definitely definitely is is there. So I I'm sure it's very successful. Chris, what would you say?

Yeah,

we have education.

Obviously, I can't say uh having trade ideas as a liquidity provider on your platform, but uh no jokes aside, I think uh having 24/7 multiasset capability with deep liquidity empowered by blockchain is going to be key. You need to be efficient in the back uh back office processes, downstream processes. I think uh having multiple asset classes will be will be a deciding factor not only crypto but mixing in traditional asset classes in an efficient manner and having that all in a in a in a very liquid and 24/7 framework is going to be um important to be a successful platform 5 years down the road

that full-time coverage round the clock coverage and the speed as well. Mark,

I think Chris stole my line, but I I'll I'll take it as a a good sign.

Again, accessibility, I think that is the the the driver of the future of the investment capabilities that 24/7 365 deep liquidity and access. That's something that crypto can provide. And I think traditional assets will follow the same route.

Yeah. Just the being being there for your customer in whichever shape or or or from wherever they want to access you. Alexander, would you agree?

I definitely agree. For me, the the secret source is going to be those who manage to merge the the intelligence and the tradition of the private banking world. And if you manage to mix this with the transparency and the simplicity of a social app, then you have a winner.

You do. So, keep investing in that uh user experience as well. Excellent. I have a red thing flashing at me. So gentlemen, thank you so much for joining me.

I think the future for crypto is uh bright. Keep building what you are building and hopefully we will get to um more adoption responsibly. We will get to more adoption. Thank you. Please uh join me thanking my panelists for this session.

Thank you.