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Nium Podcast: Cryptocurrency – The Future of Payments

As cryptocurrencies continue to capture the imaginations, and wallets of the financial services ecosystem, on this episode we explore the world of crypto payments. Host Taneia Bhardwaj chats with Eric Barbier, founder & CEO of TripleA Payments, a crypto payment gateway that helps merchants to easily accept bitcoin payments.

Tune in to discover:

  • How to add crypto as a payment method
  • Advantages of accepting bitcoin payments
  • How crypto solves for cross-border payments
  • Dealing with crypto volatility risk
  • Hurdles blocking mass adoption of crypto
  • The future of financial infrastructure

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Full Transcript:

Taneia Bhardwaj: Eric Barbier has been an entrepreneur for almost all his life. From co-founding Mobile 365 that he sold to Sybase in 2006 to transforming his first fintech venture Transfer to into a leading cross-border mobile payments network. Eric is what you call a quintessential serial entrepreneur. So, when Eric tells you that crypto is the future of payments, you’d better sit up and listen.

Hi, I’m Taneia Bhardwaj, and today we’re chatting with Eric Barbier on his latest venture, TripleA Technology, a crypto payment gateway that helps merchants to easily accept Bitcoin payments. So, if you’re in the fintech or payment’s world and have questions around cryptocurrency adoption, this should be of interest to you.

I began by asking Eric what really led him down the crypto path.

Eric Barbier: Hi Taneia, thanks for having me on the show. So really, the goal of TripleA is to help the hundreds of millions of Bitcoin owners and cryptocurrencies in general. You have this huge number of users who are currently not able to spend most crypto because most merchants don’t accept crypto payments. So really, our goal is to enable merchants to easily accept crypto payments.

And obviously, what is interesting for them is that they are able to target a global and international audience of those hundreds of millions of Bitcoin users so then they can increase their revenues no matter where they are around the world. Whether they have a credit card or not, whether they want to use a credit card or not online, targeting people who may be underbanked.

So really, we see crypto payment as a kind of a universal alternative payment method for those merchants.

TB: I’m curious to know how crypto solves the anxiety and friction that’s normally associated with cross-border payments.

EB: Absolutely. So, the user experience is first. For many people in Asia we’re all very familiar with QR code payments. And that’s exactly how it works today. So the user experience for crypto payment is very similar to what you would expect from an Alipay or WeChat pay. So, it’s very, very straightforward. As long as you have a Bitcoin wallet, our solution is compatible with it. In terms of cross-border payments, it really enables merchants to have a global footprint of users because it’s exactly the same technology across the world. It doesn’t have to integrate a payment method per country. Very often I’m getting the question from some merchants who are asking about crypto saying, hey, but in which country can you work? The users of a crypto can be pretty much anywhere around the world and that’s one of the big benefits compared to most payment methods, which tend to be local.

TB: That sounds really powerful. How easy is it, though, to integrate from merchants and currently, which are the cryptocurrencies that you’re supporting?

EB: We have been focusing on Bitcoin because 99 percent of the users holding crypto hold Bitcoin and that’s really the main cryptocurrency being used. We are looking at adding stable coins as a next step, in particular Libra. I’m a big believer that Libra, which will launch later this year, will have an amazing impact on cryptocurrency adoption. So really, our goal is to enable our merchants who will be able to accept Libra as soon as it goes out later this year.

TB: I also wanted to get your thoughts on the narrative that’s been built around the crypto universe. I’ll start with security concerns. How do you respond to arguments that the cryptocurrency infrastructure is still young and susceptible to hacking and often use as a conduit for illicit activity?

EB: There are two sides to it. First, the Bitcoin network from general cryptocurrency has never ever been hacked. Some people’s wallet has been hacked because people were not careful, but it has never been possible to have a double-spend, taking somebody else’s money and so on. So that’s one side. The other side, which we are taking very seriously at TripleA is that we are now regulated by the Monetary Authority of Singapore (MAS) under the new Payment Services Act.

We are regulated for merchant acquiring as well as digital payment tokens, which is MAS’ name for cryptocurrencies. So as such, we are doing everything you would expect from a payment service provider in terms of checks, including full KYC, transaction monitoring, and sanction screening. We have a very strong anti-money laundering and financing for terrorism program. The great thing about crypto is that because of the blockchain, we’re able to trace every single transaction.

Every single transaction is being scored and analysed, depending on where the crypto is coming from. We’re able to assess whether the crypto is coming from legitimate sources or not. We can also scan against crypto addresses which have been blacklisted by Office of Foreign Assets Control (OFAC). This is something that OFAC has recently added, blacklisted crypto addresses. This is something where we are putting everything in place to make sure that all the transactions, which are being processed on our network, are legitimate.

TB: The other piece is regulation. Now, one would imagine that you cannot achieve crypto adoption at scale unless regulation catches up. How are you viewing the way we’ve seen regulators react in Asia share versus, say, Europe and the United States?

EB: I’m very lucky to be based in Singapore because Singapore is probably the first main jurisdiction around the world to put in place a comprehensive regulatory framework under the new Payment Services Act, which has started earlier this year. Singapore is the most advanced jurisdiction on that front.

We’ve been seeing other markets in Asia, countries like Japan and South Korea, who have always been promoting cryptocurrencies. That’s been quite positive. Europe has a comprehensive payment service directive which can be used for crypto. Unfortunately, there are very few entities which have been licensed for that. So very few of them are really leveraging the existing Payment Services Directive (PSD) ecosystem In Europe. There’s been a couple of initiatives in every country of the European Union, but it’s still in the early stage.

I would say in the U.S. it’s further out, except New York which has a big licence, there’s been no proper regulation scheme put in place so far. There were some discussions at the Congress but so far, we haven’t seen anything there. I would really say that Asia is leading in terms of regulation for crypto followed by Europe and then the US.

TB: Well, I’m going to move away now from TripleA and for the next set of questions, it would be great if you could put on your entrepreneur or an investor hat. Let’s begin by talking about what are some of the trends for FinTech that you’ll see emerge from these COVID-19 types?

EB: What we can highlight is that what this crisis has been changing and really my expertise is cross-border payments, remittances and so on, is that what has skyrocketed is really the move to digital remittances.

We can really see the digital channel of the existing players, the digital-only players to really explode during this time. It’s very true to say that COVID-19 has really made everything faster and all the changes are way, way faster. This move to digital for an industry which was 70 percent cash-based, is moving at an incredible pace into digital transactions. So, I think that’s the most important lesson we can get from this crisis.

TB: Is that a trend that you see continuing or is it just to shift you think we’re seeing because of the unprecedented circumstances that we find ourselves in?

EB: There will be a bit like what happened to India during demonetisation. I’m sure some people will go back to the old habit of cash. However, just because this crisis has been going on for a long time and there’s still a lot of restrictions in many countries, especially for foreign workers, on how much they are allowed to go out, they are locked down, it tends to be harder for most of them than for many people around the world.

It means that this habit-forming of using a digital channel will, in my opinion, prevail for most of it. We may obviously see a bit of a drop of digital, some people going back to cash. But I would expect that at least 50-60 percent of the new users will stick to digital.

TB: What would your advice be for startups that are building a financial service infrastructure much like you’ve done very successfully?

EB: Frankly, crisis, you know, I’ve had to go through the 2008 crisis and TransferTo was only two years old and really, business was not impacted. Well, as long as what you’re building is making sense. I don’t think there’s an issue. The only thing you need to be aware of as an entrepreneur is ability to raise capital.

2008 was tough, especially for raising capital, because it was a financial crisis. I see a lot of very good news on this front because you can see that the fundraising did not stop. I am seeing good news and am aware of final due diligence phases and so on. So, there’s still a lot of money which is being pumped into fintech right now. But obviously, as an entrepreneur, you need to always be prepared for the worst-case scenario to make sure that you have enough cash to last until the end of a crisis.

TB: Without putting you on the spot, if you were to deploy cash right now, what would interest you?

EB: You know, on my side, what I’m looking actively for is always obviously fintech. I really like payments.

I believe that payments can always be improved. And there’s always a lot of innovation. One area I really think is still underserved is over cross-border B2B business payments. I think this is something which is still captured ninety-five percent by banks. So, there’s a huge opportunity for startups to compete. And very frankly, it’s always better to compete against banks rather than the more dynamic actors. I believe that the cross-border B2B space, is a huge market and is still a sector which needs to be disrupted. So that’s typically where I’m looking at investing right now.

TB: Thank you, Eric, for sharing your story and insights with us. It’s been a pleasure.

EB: Thanks a lot for having me on your show. Great talking to you.

TB: Well, that’s it from us here today. Before we log-off, we’d really appreciate your thoughts and feedback on the show. Drop us a line on [email protected] If you have any ideas or suggestions on who you’d like us to feature or topics that you’d like us to take up, do pass them along. Thanks for listening.

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