Currency.com U.S. CEO talks user experience, regulatory promise, and more

With CEX.io, I was leading the regulatory strategy as we entered the US market and applied for state money transmitter licensing. I gained valuable experience building new systems as well as integrating existing ones to ensure full compliance with US law. This early experience has helped shape our playbook for how Currency.com will enter the US market.

Yes, I was one of the original team members at Gemini, starting in 2016. Joining the team there was my pivot into crypto. I was doing civil litigation at a law firm in New York when the lure of crypto overcame me. I had heard about it in law school when it was in its infancy, and I just couldn’t stop thinking about how transformative the technology was. It kept getting into the news cycle more and more, and I thought ‘maybe being a junior attorney isn’t the move, I am jumping to crypto.’

When I first got into crypto, the regulatory consensus was somewhat different. Some exchanges believed that if they were a licensed Trust company in New York,  the Trust license would supersede the money transmitter licenses in some states. However, most exchanges saw the benefit of availing themselves to further compliance, and ultimately chose to layer on money transmitter licenses in each state. New York has the most strict crypto-specific license called the BitLicense, and back then only maybe 10 firms had received the license. Every year we would have an in-house exam from the New York Department of Financial Services where they would dig into each aspect of the business. At the time, it seemed a little burdensome, but looking back it sharpened my insights into what regulators are looking for. My experience with NYDFS has definitely made me anticipate regulator behavior and make adjustments before it becomes an issue. It definitely gave me a holistic approach to compliance, and with it being so early in the evolution of regulation for the industry, it has paid dividends later on in my career.

I think to answer this question there needs to be a distinction between exchanges: on one side you have the US-regulated spot market exchanges , then you have the exchanges that are regulated in offshore jurisdictions such as the Seychelles, Mauritius, etc. The growth strategy for each is totally different. For the latter, they can just put out exciting trading products. If it meets consumer demand, the product goes to the moon and revenue hits stratospheric levels because it hypercharges the market, one such example being when offshore exchanges launched the perpetual swap, or when offshore exchanges preempt a popular IPO with a perpetual product. Now, with the US-regulated spot exchanges, the rules in the US are pretty inelastic; regardless of consumer demand, we are tethered to a spot market, simple buy and sell products. For these exchanges, growth is driven more by UX improvements, ease of onboarding and removing friction of cumbersome payment rails. This is the space in which Currency.com will compete.

Great question, and I think you hit on a fundamental issue exchanges need to focus on. Eliminating friction between legacy payment systems and allowing people access to crypto is paramount for regulated US spot market exchanges. At Currency.com, we want to make the customer experience as easy as ordering something on Amazon.  We will handle all back-end legacy systems like cumbersome credit card payment rails to make sure the customer gets quick access to the asset class in a familiar UX design that they feel comfortable using. Right now we are seeing an influx of people entering this asset class for the first time, so understanding payment rails is essential. However, once we reach a critical mass of people entering the asset class, equivalent fiat outflows may be less likely as more people decide to hold onto crypto rather than sell it for fiat. Maybe this will cause the fiat payment rails to innovate.

I think the Office of Comptroller of Currency (OCC) clarifying the bank custody rule was huge for adoption. That was a great unexpected development that I think further propelled the confidence in the bull market. I think collectively, people see the approval of a bitcoin ETF in Canada as a sign that the US SEC may be close to granting a similar approval here. Rather than pick a clear winner, I would imagine they’ll approve several proposals all at once. This may propel a rally, probably by multiples of the previous all-time highs. People always point to when the first gold ETF was approved and the price went up almost 3x that year. I do think there could be some enforcement actions that could slow the growth of an altcoin rally. We’ll see what happens, interesting times.

I think crypto definitely captures an attitude that investing can be fun.  However, we have to strike a balance to ensure people understand the risks associated with investing with any enjoyment they may get from it.  This is why we believe education is important and should be an integral component of any exchange design. At Currency.com, we are building  a platform that is designed to be fun, safe and also informative and educational.

Crypto is unlike a traditional stock brokerage account because of the portability and utility of crypto. With crypto, the trader can take possession of their coins and do whatever they please. That may be to find arbitrage opportunities across many exchanges or jurisdictions, engage in DeFi with a self-hosted wallet, pay for goods and services, lend or stake their coins for yield, vote on network protocols, or simply exchange their coins for other coins. That offers much more excitement in the utility of the asset class. Once people begin to dip their toes in the pool with crypto, we are confident that they will see how many layers the onion has to offer. 

Yes, we are excited about the flexibility that Canada’s regulatory environment offers. We believe with the proper licensure, we can bring many of the trading products that have made our platform popular in the rest of the world to Canada.