Voice of the Industry

Where does crypto go from here?

Tuesday 6 September 2022 08:44 CET | Editor: Vlad Macovei | Voice of the industry

Modulr’s Gavin Waddell showcases the relevance of crypto payments, what super apps are and how could they be monetised, and what must be done to gain trust in crypto.


Modulr’s Gavin Waddell showcases the relevance of crypto payments, what super apps are and how could they be monetised, and what must be done to gain trust in crypto.


It’s a fascinating time for the crypto space, with lots of headline-grabbing changes to the status quo. But within disruption there lies opportunity and forward-thinking companies have been preparing for this time of fluctuation for some time, building out other functionalities that extend beyond crypto trading. These are the organisations that are developing super apps, with crypto at the core, which aim to make cryptocurrencies a more regular and functional part of the financial mainstream.

While recent speculation around crypto investments may have calmed down, what does the future hold and how will the industry withstand times of financial instability or even a potential recession? 

At Modulr, mainstream payments is an area we’re interested in and we’re privy to a wide range of examples of how people are evolving their use of cryptocurrencies. And we don’t think it’s game over for crypto at all. We think the current climate could be the catalyst for a long overdue consolidation and broadening of the industry. 

After all, many still look to crypto to solve a particular set of problems or to offer a better solution than traditional banks. For example, there are situations where someone may want to send money somewhere relatively inaccessible, with poor banking infrastructure. In that kind of situation, using cryptocurrency or stablecoins could be preferable to traditional banking rails. 

Michael Stroev, COO of Modulr partner Nebeus, thinks we’re likely to see a change in how people approach cryptocurrencies. ‘I expect to see a slight change, especially if we go into a recession. There’s going to be less fear of missing out, less hype. You’re going to have people that are slower to come in, but they’re going to be more educated at the same time. They’re going to make more strategic investments, they’re going to look at specific use cases, and educate themselves about blockchain technologies and cryptocurrencies’.

What do we mean by super app?

Fintech super apps give users access to a range of different financial products through a single application. While there are many that claim to offer this, the reality of the payment experience often falls short and is far less comprehensive than one might expect. 

At Modulr, we believe that if you nail the payment experience, and your offering is adopted as a day-to-day account, the customer is more likely to use a wider range of features and engage much more within the application. So, getting the payments part right is crucial to driving access and adoption of all other features.

And what does the Nebeus super app offer? ‘For Nebeus, it’s always been our mission to bridge the financial and the cryptocurrency world. We have always tried to achieve that through crypto-backed lending. But right now, we achieve that through linking fiat money accounts to crypto accounts, with instant transfers between those accounts and access to cryptocurrency services on the fly, and vice versa,’ explains Michael.

What super apps need to accomplish

One thing that will need to be adopted, if crypto super apps are going to succeed, is a seamless customer experience. 

Those who got into crypto early or are part of the fintech world have an advantage in understanding crypto and how it works. But it can be quite intimidating if you're outside of the world of financial services, and you're picking up a crypto app or signing up for an exchange for the first time. And that's not the experience that you want to give a customer when they're using your app to move and manage money. If your app is clunky and hard to get on board with, the chances are your customers are going to move on to another provider. 

‘In general, I wouldn't say that the space has been easy to use for a newcomer to crypto. Recently, I needed to send some stablecoins to a friend and asked for his wallet address. He didn’t know what that was. And this is a person who has been investing in cryptocurrencies and buying stablecoins for the past eight months or so. This proves that an app that is going to solve this, or at least educate people enough so that they quickly understand what needs to be done, is going to surpass other apps.’ adds Michael. ‘This is one reason why we take different approaches on our social media and our blog – to educate different users, depending on whether they’re more casual or looking for more in-depth information.’

Modulr works with crypto clients like Nebeus to enable a bridge between traditional payment rails (where most funds are still held) and the crypto platforms. Our APIs ensure that this journey is seamless which affords a superior customer experience and better onboarding, plus the reassurance of immediate notifications when funds arrive in an account.

Building trust in crypto

When it comes to payment providers, trust is vital. Historically, banks and payment providers have viewed the crypto world with suspicion and, in turn, crypto companies have questioned whether they even understand the space.

A good example of this is the sporadic and even volatile levels of payment activity, with investment trends resulting in massive spikes in volumes. While this may be considered normal for the crypto market, it’s enough to send a traditional bank manager into payments-induced panic. So there needs to be a mutual understanding and any crypto-friendly solution needs to be able to scale with the movements of the market. 

Even some of the biggest crypto exchanges in the world have had their banking access turned off, almost at the drop of a hat. And that’s not always because the payment provider changes its mind – it could be the underlying payment or banking provider that’s powering its service. And that can have a massive impact on the crypto platform and its brand reputation.

And, as Michael attests, reputation and trust are everything: ‘It helps to build trust for our customers to show that we are a real platform, that we're regulated by the Bank of Spain, and that currently, we’re planning to apply for future licenses and registrations. We also plan to work with auditing firms, showing we’re financially healthy, and that our tech stack is stable and so on.’

Monetising super apps

If super apps are going to work, they need to make financial sense for the provider as well. There won’t be a single business model to suit everyone, but we believe there’ll be two main approaches.

The first is around adding extra features – debit cards, for example. These may not be revenue drivers on their own, but they’re a retention feature that attracts customers to use more revenue-generating products within the application, such as investment products, FX, or other features. After all, the more people use the app, the more opportunities there are for regular individual purchases and transaction fees that make the app sustainable.

The other main approach is around subscription and, if possible, multi-tiered subscription, as Michael explains. ‘Having different tiers is important. Now, we have three tiers. Number one is free. Number two is our medium tier, and number three is the completely ultimate ‘whale’ account, with unlimited everything. We're still developing additional products and perks that we're going to add to those tiers to make them more attractive. So, contrary to popular belief, we think that this is a hugely exciting time for the world of crypto. Yes, crypto investments are always headline-generating, but as the functionality of DeFi, CeFi, and Web3 comes to the fore, it reveals considerable opportunity – and that’s where the real growth potential of crypto, and its super apps, lies.’

Finally, has Modulr made Nebeus’s payment dreams come true? We asked Michael, if Modulr were a genie, what wish we could grant. ‘To be honest, I'm going to say that you’ve already made all our wishes come true. And that's really because, thinking back to a year ago, the place we are right now is exactly the place we wanted to be!’

About Gavin Waddell

Gavin Waddell is Director of Strategic Account Sales and a crypto specialist at Modulr, working with forward-thinking clients on bridging the gaps between crypto and finance. He's specialised in this area for some time, working for ClearBank before joining Modulr. You can find out more about his thought leadership in the upcoming Modulr ebook, 'Future Strategies'.

About Modulr

Modulr is the Payments-as-a-Service API platform for digital businesses that need a faster, easier, and more reliable way to move money. Businesses can automate payment flows, embed payments into their platforms, and build entirely new payment products and services themselves. All managed in real-time, 24/7 from one API. Modulr powers the payments plumbing for the likes of Revolut, Sage and Hodge Bank.

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Keywords: cryptocurrency, investment, super app
Categories: DeFi & Crypto & Web3
Countries: Europe
This article is part of category

DeFi & Crypto & Web3