The global payments infrastructure platform Mercuryo has recently announced the launch of a Banking-as-a-Service (BaaS) solution that makes it possible for crypto companies to create bank accounts for their users. The company also entered into a partnership with MetaMask, one of the leading crypto wallet providers.
In an exclusive interview with Finbold, Petr Kozyakov, Co-Founder and CEO of Mercuryo, shared the latest company developments, the strategy his company adopted to cope with the drastic market changes of 2022, and how Mercuryo grew into a more sustainable company as a result.
The CEO also shared his outlook on how today’s crypto market is seeing a growing number of decentralized and non-custodial providers of financial services and their growing need for banking services to help cross the bridge between crypto and fiat. Kozyakov spoke of Mercuryo’s future plans and his views on how they are going to contribute to the advancement of cryptocurrency usage in payment practices worldwide.
1. 2022 was a challenging year for the fintech market. How did Mercuryo cope with the realities of the market during this period? What lessons have you learned for yourself? What advice would you give to other companies regarding how to endure such times?
“2022 was indeed a harsh year, both for the cryptocurrency industry and finances in general. The crypto market collapsed by 60-70%, and the global stock market was also down, demonstrating the biggest annual drop since 2008. Businesses worldwide faced harsh conditions, with many companies shutting down altogether as they could not continue their operations.
Personally, I would say that the main lesson we at Mercuryo learned is the importance of building a sustainable business. If previously we could simply think in terms of growing our company, we now have to think about growth in a sustainable manner. We needed to avoid taking on any further operational or financial hurdles and instead earn money while growing.
And I believe this is relevant for all businesses because if you have a sustainable company, then a downturn can become a chance for you to grow. An opportunity to build up your product to boost your growth in the long run.”
2. What had been the primary focus of Mercuryo’s work in 2022?
“To continue my earlier point about sustainability, in the case of Mercuryo, we did our best to adapt to the complicated realities of 2022 by dedicating our efforts to boosting our efficiency. That meant focusing on improving our internal systems and strengthening our team of developers and core products.
As a result, it helped us become one of the most efficient payment providers in Europe and the UK. We have polished our services and entered 2023 with a new BaaS solution to simplify the transition between crypto and fiat payments.
Along the way, we committed resources to boost our partnerships, carefully selecting market players whose services and goals align with the value we wish to bring to our clients. In short, things have actually ended up going fairly well for us, and we are continuing our operations with the intent of alleviating the pain points of the international payments market.”
3. Where does your company stand now? What do you plan to pay attention to in 2023? Which directions to develop?
“As things stand, we are in a great position, actually. After the FTX collapse, we have observed immense growth among non-custodial wallets and decentralized players. And these players create a demand for a variety of different financial products.
At Mercuryo, we have a full product line that we can offer to such companies, starting from the fastest on-ramp and off-ramp solutions. We are one of the only firms that allow cashing out crypto to fiat globally via major international card providers like Visa and Mastercard. In addition, our recently launched Banking-as-a-Service solution will also be in great demand among these companies.
We plan to continue expanding geographically – Mercuryo is already the most efficient payment service provider in Europe and the UK. And this year, we are planning to achieve similar positions in the US and several other emerging markets. Our ultimate goal is to become a one-stop-shop provider for all decentralized custodial players.”
4. At the beginning of 2023, you announced the launch of BaaS – can you tell us more about the product?
“Mercuryo’s BaaS (Banking-as-a-Service) was launched with the purpose of enabling users to manage banking and crypto accounts within a single platform. The product assists businesses, like DEXs or investment apps, in opening full-fledged bank accounts, letting their customers store, transfer, and pay with fiat currencies. Users can also convert their fiat funds to crypto within the same account if they so desire.
Mercuryo has previously conducted research showing that 57% of customers in the US and the UK are more likely to choose a bank that offers crypto services on top of traditional finance for their financial needs. Traditional banking systems have become outdated, and it is difficult for them to start offering crypto-related services directly. And by the same token, due to the crypto industry still being young and underdeveloped, it is also hard for crypto organizations to integrate with fiat payment systems smoothly.
Utilizing Mercuryo’s BaaS product helps solve this issue, allowing traditional and crypto-native platforms to integrate fiat payment infrastructure and cryptocurrency gateway. This way, people can freely use fiat and cryptocurrencies to store and transfer their funds, making payments whenever needed.
It is a huge step in terms of bridging the gap between the two worlds, and we are already seeing many of our partners integrating this technology into their platforms. We are eager to see where this will lead, as we think that the development of crypto/fiat banking services is going to be one of the major trends in 2023.”
5. Where do you believe the digital payments market stands in 2023? What will its development be from this point forward? How does Mercuryo plan to contribute to it?
“I believe that in 2023 we will see many more real use cases where crypto is employed to solve some of the dysfunctions and problems of the traditional fiat world. Using cryptocurrencies for transfers, settlements, cross-border payments – that sort of thing. And in order to make such use cases possible, we need to keep closing the current gap between the fiat and crypto space.
Mercuryo’s goal is to enable crypto companies to have full fiat capabilities inside them. Introducing our BaaS service is one of the steps we have taken to streamline and innovate payments by helping traditional fiat and crypto fields draw closer.
As an outcome, people can make international transfers from their IBAN accounts in a crypto app. Or, vice versa, they can receive crypto payments and then spend those funds via IBAN.
Another example I can raise in this case is the partnership we have recently struck with MetaMask, one of the leading cryptocurrency wallets out there. This collaboration streamlines the process of acquiring digital assets for MetaMask users. Mercuryo’s solution enables small purchases to be done immediately without spending too much time on ID verification. And it also allows purchases directly within the MetaMask mobile wallet using bank cards, Apple Pay, Google Pay, and various local payment methods.”
6. We have been seeing news on different countries tackling the issue of crypto regulation in the wake of the 2022 turmoil. What is your stance on this matter? How do you see the development of regulation for crypto and payment in the future?
“We believe that the more regulatory clarity there can be, the better. Mercuryo has been a regulated company since day one, strictly adhering to all relevant laws. One of the trends of 2023 will be that crypto regulation, especially for payments and crypto-fiat exchanges, will gradually grow close to what we already have in the field of electronic money regulation.
Take safeguarding client funds, for instance: it is a common thing for an electronic money institution (EMI) to adhere to, but crypto companies have yet to match this practice. In turn, it represents a prominent avenue to explore as part of creating legal frameworks and compliance practices for crypto in the future. And we are already seeing steps in this direction, as recent news suggests that the UK will be putting the focus on consumer protection with regards to crypto activities.
In this line, Mercuryo is in a great spot because we are one of the very few crypto companies with an EMI in our group, which would greatly help us. We are fully ready to move in a way that adheres to this line of market development.”