The social investment network eToro today added a raft of stablecoins to its platform, including coins pegged to the Turkish Lira (TRYX), Polish Zloty (PLNX), South African Rand (ZARX), Hong Kong Dollar (HKDX), and Singapore Dollar (SGDX), as well as the cryptoasset Dash, Circle's USDC and Tether's USDT stablecoins and a GOLDX/BTC pairing.
It’s only one part of eToro’s plan to delve deeper into the crypto ecosystem, incorporating the eToroX digital asset platform. “We're going to take eToroX and focus on the more crypto-savvy community,” CEO Yoni Assia told Decrypt in an interview. “On the other hand, we're going to take eToro as a platform, and keep on drumming to the bigger audience of regular people who want to simply trade and invest in the global markets. They can do that, and crypto can be part of their portfolio.”
Stablecoin genius
Earlier this year, eToro launched its own suite of stablecoins, including the eToro United States dollar (USDEX), eToro Japanese yen (JPYX) and eToro Euro (EURX).
EToro has been on a crypto spending spree recently, snapping up cryptocurrency portfolio tracker app Delta for a reported $5 million, and splurging on a high-profile ad campaign with Alec Baldwin. It’s unsurprising, then, that Assia is upbeat, telling Decrypt that “we're definitely at crypto spring,” when we sat down with him recently at Web Summit, the annual technology conference held in Lisbon.
“I'm bullish from the perspective of usability as well as price,” Assia said. “There’s more adoption, there's more news, there's more product. It's becoming gradually easier for more people, for more products to both use Bitcoin and buy bitcoin.”
But what will it take to reach the sunlit uplands of crypto summer? “The doomsday scenario is the collapse of one of the big economies under debt,” Assia told Decrypt. “That would definitely accelerate things.” He likened the current state of the crypto market to the aftermath of the dotcom boom and bust in the 1990s, noting that, “In the dotcom bubble after it flopped, we never saw another rally [...] We are now maybe seeing a rally.”
Whether the crypto industry needs a major rally is another matter. “I think that if we see every year like this year—crypto going up 50%, 40%—that's the healthiest thing for the crypto industry,” Assia said. “Ten years of steady growth would be much more healthy for crypto than another rally.”
However, crypto investors are unfazed by its volatility, Assia said: “Our generation is more used to volatility, is less afraid of volatility. People in crypto should embrace volatility.” Still, he doesn’t advocate investors sinking all their money into cryptocurrency. “People at this stage need to be responsible,” he said. “I wouldn't recommend for someone to take more than 10% of his available assets and put them in crypto.”
His stance is understandable, given that eToro’s business model is built around users bundling together cryptocurrencies and conventional assets in a single portfolio. “More than 60% of our current users trade crypto as well,” he told Decrypt. “Eventually? I think it's everyone. I don't see why would you have part of your investments in one place and another part elsewhere. Eventually, I believe that a lot of people are going to invest in bitcoin and Ethereum. Then I think they'll want to have it in the same places they're investing in stocks and other assets.”
Digital national currencies and Libra
Assia has described the advent of digital national currencies as “inevitable,” a claim he stands by. “How can money not be digitized by central banks eventually?” However, he’s careful to draw a distinction between digital currencies and cryptocurrencies. “I didn't say that it's necessarily going to be cryptocurrencies or decentralized or open ledgers, but central bank digital currencies. They will know where all the money is and it will be on a shared ledger with at least the financial institutions.”
Talk of digital currencies inevitably raises the question of Libra, Facebook’s attempt to create a stablecoin backed by a basket of currencies. eToro are “big fans”, said Assai. “A lot of crypto people—especially Bitcoin maximalists—hate it because it's not Bitcoin, but you have Square and Jack Dorsey, doing Bitcoin. I think both are important for eventual adoption.”
Bitcoin maximalists aren’t the only people venting their spleen at Libra, though. The project has struggled to gain traction, with Libra Association members jumping ship, Facebook CEO Mark Zuckerberg hauled in front of the US Congress and politicians and regulators lining up to throw brickbats at it. Assai argues that the way Libra’s designed makes it hard to implement, and that there’s a “better way” to launch the coin that would make it less sensitive to regulation. “Central banks, rightfully so, are afraid of their sovereignty,” he said. “When they think about Facebook, they think, ‘Oh my god, all of our citizens are on Facebook, Facebook are going to have their own currency. That's very scary.’"
Eventually, he anticipates Libra having “a stablecoin in every country, where you have regulated money issuers issuing it on the Libra blockchain.” That, he argues, is a more decentralized way of creating a global payments network that every user of Facebook can use.