Consolidation inevitable in the crypto space, but Bitcoin is here to stay: Ray Youssef, CEO, Paxful
The market value of cryptocurrencies has fallen by more than 70 percent over the past eight months. Meanwhile, popular crypto Bitcoin currently plunged below $ 20,000 from above $ 65,000 in November 2021. But how long will this bearish trend continue, or what are the available investment options in space? To answer all of these questions, Business Today teamed up with Ray Youssef, co-founder and CEO of Paxful, a P2P exchange, to understand where cryptocurrencies are headed. Edited excerpts:
Business Today (BT): Why does the cryptocurrency market look uncertain at the moment? How do you envision the trend continuing?
Ray Youssef: People all over the world are worried about inflation and a potential recession – we see it happening everywhere. While this is a stressful time, it is also an opportunity for businesses in the area to zoom out from the short-term focus and put real effort into how and why Bitcoin creates an alternative economic option for many people. It’s time to build genuine and empowering platforms – making it easier for everyone to take control of their financial future to transfer money, make international payments or even collect donations in hostile territories. If we focus on just the price of Bitcoin, we will lose focus on how it can bring millions of people into the global economy. We do not want to downplay what is happening in the market, but we do not want to sleep on this opportunity [correct] the direction of the industry.
BT: The government has imposed a 1 percent TDS on crypto from 1 July. How has it dampened volumes?
Youssef: We have not seen any major changes to our platform.
BT: Why there is a need for peer-to-peer (P2P) crypto exchanges. What are the benefits of P2P exchange?
Youssef: Peer-to-peer platforms allow individuals to buy and sell with real people. We have over 450 payment methods available on the platform, which provide access to almost all financial networks in the world. There is no need for a bank account, so buying and selling on the platform is available to everyone regardless of gender, location or income. And unlike a traditional bank, transactions can be done 24/7 with greater speed and lower fees. It is a solution for those without a bank and can provide access to the global economy.
BT: Do you see consolidation in cryptocurrency exchanges?
Youssef: We have no specific insight into how other companies are consolidating. We hope this shift works as a reset for the industry. This is a time to focus on what is most important – to understand the needs of people and give them solutions in the real world. Consolidation is inevitable, but Bitcoin is here to stay, and now is the time to focus on mass financial education.
BT: How can different industries use cryptocurrencies in their business in India?
Youssef: India is one of our fastest growing markets and our goal is to educate, train and inform people about the use of bitcoin. Bitcoin enables businesses to make faster transactions without having to resort to traditional financial methods. For example, Shubham, a tea shop owner in Bengaluru, started using Paxful to receive Bitcoin payments from its customers. In a neighborhood surrounded by technology companies and a young demographic, he sees over 100 customers a day. Shubham is a great example of how companies can start incorporating Bitcoin into their business model.
BT: How to make money on cryptocurrencies? Should one stick with cryptocurrencies in the long run or is trade the way?
Youssef: Bitcoin can be used for many things such as arbitrage, e-commerce, wealth conservation and start-ups. We have a user who started his business with only $ 3, and sold gaming items for a 10/20 percent margin as part-time income. Today, he is the largest trader at Paxful with a volume of over $ 60 million. Only by arbitration has he built his work in just three to four years. Starting small does not matter, but wisdom and strong ambitions can do anything.
BT: Without giving any name, what type of cryptocurrencies do you think can provide a healthy return to investors?
Youssef: For me, it’s not about Bitcoin as a speculative asset class, but it’s about showing people the true uses of Bitcoin and its intended use as a medium of exchange. The emerging markets show that bitcoin has the power to connect the unbanked and the underbanked to the larger global financial ecosystem.
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