What prior experience did you have before Cryptopay?
I graduated from university with two degrees - one in Automated Information Processing and the other in Business Economics, so during my first post-graduate years I was deciding which way to go in my professional career and began trying different roles in several small businesses. One of them was 3D prototyping which was really an innovative and emerging technology at that time - ever since then I've always gravitated towards cutting edge ideas that bring something new to our world.
My next big step was joining assurance and advisory practices in one of the Big4 companies - there I spent almost a decade participating in multiple projects for various industries ranging from small family businesses to large multinational IT, transport, and oil & gas companies. The insight I obtained on how different businesses operate as well the experience of performing performing top-quality work that supports key decision making processes has proved to be invaluable to this day.
How do you feel working in an emerging fintech company? It might be totally different from your previous experience in a global transcontinental network, is not it?
Being part of Cryptopay is as much like and different than my previous work. The similar bit is the people - our company recognises staff as its main value and gives great attention to gathering enthusiastic and talented people who share the same passion for the development of innovative products. The diversity of issues and decisions that are made everyday is obviously clearer than everywhere I was previously - Cryptopay emerges very fast and the professional environment here is very demanding.
When did you first get interested in cryptocurrency?
I think it was in 2013 when Bitcoin began its rally and came into public eye. Back then, I remember discussing with colleagues and friends on if Bitcoin had any underlying value and if it was the 21st century alternative to gold. I bought some Bitcoins, and I could have never imagined it would have reached the popularity level that that's at now, and what's more, I never even thought that I'd end up working at a fintech company that deals with cryptocurrencies!
Please describe Cryptopay's current financial position - was the downturn of card program critical for the business?
Nowadays, many fintech startups go through an extended research and development phase with significant initial rounds of investment being attracted and spent for set-up of the business. Cryptopay on the other hand, has been operating in a significantly different manner since its absorption. Mainly because initial investments were quite small and the company started earning money to support its everyday business operations very early. This is why our financial situation is solid at the moment and we do not have any solvency or liquidity issues - the company remains profitable even with the absence of one of its main products.
The January 2018 cessation of the card program was definitely unlucky and unfortunate, but when it happened we already had sustainable income from our other services and we've had enough funds to support all current developments. When the card program comes back the company will have more funds to invest in new, exciting products with innovative developments that have the potential for great upside.
How much does cryptocurrency 'volatility have an effect on Cryptopay and similar services?
Well Cryptopay and similar services are strictly dependent on the behavior of the cryptocurrency market, but there is no linear correlation between them. Yes, we definitely benefit from the increasing popularity of cryptocurrency and it's obvious that an increased interest is thanks to their volatility. Having said that, we have seen various reactions from our customers to different significant cryptocurrency market developments - in some cases significant volatility ruled in a decrease of revenue in comparison to months when the rates were reliably stable.
It's important to understand that Cryptopay's business model assumes holding cryptocurrency in the amount that is exactly the same as the liabilities we bear to our customers - we do not have any positions in cryptocurrency and because we are not susceptible to the risks that comes with the exchange rate.
Why did Cryptopay team decide to do an ICO?
Even though in 2017 Cryptopay was already an established and profitable company we felt that taking the business to the next level required more capital to scale our impact. Of course we understand the risks that an ICO could pose due in fact that they are an unregulated source of finance. So, that's why our team decided to run our ICO as a separate legal entity. This approach allowed us to keep all the experience and skills as a team while at the same time legally separating the ICO project and all its possible risks from our core business.
Offering a token sale instead of a traditional venture capital round enabled a larger community to participate in the CPM success story, rather than limiting it to a small, selected number of traditional venture capital funds. A token sale appeared to be a fast, transparent, and efficient means of collecting funds.
Did it go as you planned?
We planned to attract over € 50 million investments through the ICO but as the ICO went on we saw that realistic figure was close to € 15 million. The majority of funds were taken in by a small group of professional individual investors while the remaining was spread through the larger community. At some point, we understand that our ICO campaign lacked the sufficient marketing support because we put almost all of our effort into working on the project itself - shortly after the public sale ended this directed into a significant decrease in CPAY's token price.
Now the situation is slowly, but certainly improving- we've seen more people getting interested in our project thanks to an increased public relations and transparency campaign we've been delivering to the community.
How are things going with the CPAY token? Why is it cheap at the moment and does it have any growth potential?
To reiterate what I said in the last question, we see the main reason for the undervaluation of CPAY is the lack of recognition of the project. We were so concentrated on the project itself that we did not realize how important marketing actually was. Moreover, the Cryptopay card program termination played its role - the loss of our flagship product affected the token price adversely and it remains to recover until the new program will be launched.
With a reliably good return revenue share yield CPAY currently representing an interest buying opportunity and we've already seen an increase in trading value during the past several weeks. Of course, one of the main issues to be resolved remains the listing on major changes. While HitBTC & IDEX are fine for developing tokens, CPAY needs a significantly larger audience in order to improve its performance.
As soon as you mentioned cryptocurrency exchanges - many of CPAY token-holders wonder why is the listing process is so delayed? Let me quote one of our users: "So the shitcoin with replay issue that just copied Bitcoin's code is listed on Bitfinex. Yet CPAY can not get a listing done. "What can you say about this?
I personally monitor the situation regarding new exchanges close since this is still such a major issue. The reason we've been struggling to list on somewhere like Kraken or Bitfinex is simple - CPAY gives its holders a revenue share and is not yet integrated into the project ecosystem. These two issues act as a red flag of sorts for most changes since they do not list "security" tokens.
It is paramount to understand that legally CPAY is not a security token, but this is very difficult to prove to exchanges. They analyze hundreds of tokens by the same unified rules on a weekly basis and it's hard to defend your position if your token is structured in such particular way even if it has been done so by a reputable law firm.
After all is said and done - is CPAY a security or a utility token?
CPAAY was issued by a company registered in the Cayman Islands and according to our attorneys based on conversation with the Caymanese authorities it's not a security. The legal form of the token described in the T & C does not fall under a security not only on the Cayman Islands, but also in many other countries as well. Countries that recognize such contracts as a security were excluded from the territories available for initial participation in the ICO.
At first glance CPAY is very much equivalent to security tokens - it provides revenue share and does not have any utility function at the moment. We're currently working toward integrating CPAY into the Cryptopay ecosystem while at the same time we're going to give it a sound utility function - this will take some time, but eventually this will take out all the remaining questions about CPAY's legal status.
What else remains to be done to cement cryptocurrency as a part of the financial world as a whole?
I think the largest feature here is transparent regulation - cryptocurrencys are still in a legal gray area in many places and this prevails them being being recognized by the community at large and in turn the global financial system. I believe that once cryptocurrencies have achieved legal status in major countries (which is really not that far away) we will see a giant leap towards a unified financial sphere where Bitcoin and other cryptocurrencies will be an integral part like EUR or USD.
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