For many years, TransferWise, the fintech company that allows users to send bank payments with extremely cheap fees and shorter verification periods was the most dominant fintech business in Europe.
This month, Revolut reached a $1.7 billion valuation after integrating cryptocurrency, surpassing Transferwise.
Why the Statement of Nasdaq CEO Wasn’t a Joke
Earlier this week, Nasdaq CEO Adena Friedman said that the second biggest stock exchange in the US and one of the world’s leading markets, is open to becoming a cryptocurrency exchange. On CNBC’s Squawk Box,
“Certainly Nasdaq would consider becoming a crypto exchange over time. If we do look at it and say ‘it’s time, people are ready for a more regulated market,’ for something that provides a fair experience for investors. I believe that digital currencies will continue to persist it’s just a matter of how long it will take for that space to mature. Once you look at it and say, ‘do we want to provide a regulated market for this?’ Certainly Nasdaq would consider it.”
The cryptocurrency is market is still relatively small and is valued at $400 billion. But, it is also one of the fastest growing industries internationally. Recently, as CCN reported, a major cryptocurrency exchange Binance surpassed the profits of Deutsche Bank, Germany’s largest financial institution. Startups within the cryptocurrency sector are directly competing with banks and leading financial service providers.
Revolut, a London-based fintech company, was valued at less than a billion dollars last year and its user base was not comparable to its rival company TransferWise. In late 2017, Revolut integrated cryptocurrency trading, allowing users to purchase and sell cryptocurrencies like bitcoin. In addition, Revolut also revealed a debit card which users can utilize to spend cryptocurrencies at any Visa-accepting merchant.
Within a year, the valuation of Revolut surged to $1.7 billion and it beat Transferwise in market cap. TransferWise is currently valued at $1.6 billion, $100 million less than Revolut.
The new $1.7 billion valuation of Revolut reflects the rapid increase of the company’s user base, which increased by more than 70 percent following its cryptocurrency integration. Apart from Coinbase, Revolut remains as the only bank-like network in Europe that allows users to spend, store, send, and receive payments from both bank accounts and cryptocurrencies.
Adopt or Become Isolated
South Korea, the US, and Japan have taken the approach of adopting the cryptocurrency industry and businesses within it. This month, South Korea’s deputy minister of Ministry of Strategy and Finance stated that central banks should be concerned about the rapid rise of alternative payment methods like cryptocurrencies and the threat they pose against the fiat system.
“Cryptocurrencies like bitcoin and Ethereum, which led an investment and speculative bubble earlier this year, have stabilized and are leading both the authorities and investors to question the foundation of the fiat system. The central bank should consider the emergence of alternative payment methods such as cryptocurrencies as a threat to the existence of the traditional fiat system,” said Minister Kim.
Featured image from Shutterstock.
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Published at Sat, 28 Apr 2018 18:17:42 +0000
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