Fintech/Analysis/ How long can fintech firms resist crypto FOMO? Europe's neobankers are all getting into crypto. It's probably only a matter of time before the digital banks do as well. By Ryan Weeks 11 May 2021 \Fintech Getting killed by your crypto holdings? Invest in distressed credit and forests By Eleanor Warnock 7 February 2023 Fintech/Analysis/ How long can fintech firms resist crypto FOMO? Europe's neobankers are all getting into crypto. It's probably only a matter of time before the digital banks do as well. By Ryan Weeks 11 May 2021 At some point a line was drawn between fintech and cryptocurrency — as if the two are separate sectors rather than part of the same thing. But that line is now blurring as a growing number of ‘standard’ fintech firms succumb to the lure of surging crypto markets. Crypto ‘FOMO’ (fear of missing out) has already made a noticeable impact on Europe’s neobrokers. London-based investment apps Freetrade and Plum began hiring crypto experts in February to build new trading tools. Berlin-based neobroker Trade Republic followed suit by announcing the launch of crypto trading last week. “It’s definitely something we’re noticing,” Accel partner Andrei Brasoveanu told Sifted. “The success of Coinbase in the US is opening the eyes of many companies, whether it’s banks or brokerage firms.” It seems inevitable that Europe’s digital banks will eventually fall into line too. Revolut, of course, has stolen a march over its European rivals by launching crypto trading way back in 2017, and is busily adding new functionality. There are now signs that even Starling and Monzo — firms that have never shown much interest in crypto — are having a change of heart. Two people close to Monzo told Sifted that while no product launches are imminent, the digital bank’s top brass are now much more open to the idea of exploring crypto products. Monzo did not respond to questions about this. Starling Bank’s founder and CEO Anne Boden told Sifted the digital bank does not see a big demand for crypto currently, but “will respond” as and when that changes. “Some fintechs are rushing into crypto. That’s not the Starling way. Our approach is discovering what customers want and need,” she said. Meanwhile, digital wallet provider Curve has also discussed imminent plans to introduce a crypto ramp. Nutmeg, the robo-adviser which made headlines by crossing the £3bn mark in assets under management last week, looks like a rare crypto holdout. In a video posted in January this year, the robo-adviser’s director of investment strategy Brad Holland was asked if he would consider investing small amounts in bitcoin or ether. “The short answer is that we don’t see these instruments as a bonafide investment,” he said. “For now, this space is really being overrun by speculation and the rush of trading platforms to service that speculation. A ‘fear of missing out’ is no basis for a long-term investment strategy — which is all about liquidity, transparency and diversification.” Sounds sensible, but it doesn’t quite fit with Nutmeg CEO Neil Alexander’s plan to become “Britain’s Robinhood”. The bottom line is that crypto is a tempting prospect for any fintech firm because it’s a high margin, extremely volatile, heavily hyped market — the sort of market which can be extremely lucrative for those in the business of processing buy and sell orders. And for bog standard fintechs stuck in a perennial struggle to make money (see, for example, this excellent piece on Monzo boss TS Anil’s efforts), crypto is becoming harder and harder to ignore. Ryan Weeks covers fintech at Sifted. He tweets from @RyanJamesWeeks and coauthors our new fintech-focused newsletter. Sign up here. Related Articles Travails of US wealthtech sector provide lessons for Europe By Adam Green Click here to read more Revolut staff vent frustration over share options By Ryan Weeks Click here to read more N26 top director departs as digital bank scouts $10bn valuation By Tom Matsuda Click here to read more Crypto payments infrastructure startup Ramp raises $53m on the back of impressive growth By Kit Gillet Click here to read more Most Read 1 \Startup Life Tech Nation shutting down as UK government controversially pulls key funding 2 \Healthtech Spotify founder Daniel Ek officially launches new startup — and this time, he’s taking on healthcare 3 \Startup Life Series A funding for startups: What VCs want to see from founders in 2023 4 \Sustainability Planet A closes €160m for science-based climate investing 5 \Startup Life Five women and multicultural founders to watch in 2023
N26 top director departs as digital bank scouts $10bn valuation By Tom Matsuda Click here to read more
Crypto payments infrastructure startup Ramp raises $53m on the back of impressive growth By Kit Gillet Click here to read more