Q&A with Wirex co-founder

Pavel Mateev, co founder of Wirex

Following the news that London-based Wirex is to team up with Stellar over 26 fiat-backed stablecoins for its users, we caught up with the FCA-regulated company’s co-founder Pavel Mateev.

1) Why did you choose to launch stablecoins on Stellar?

Stellar is the right partner for this project due to our shared goal of democratising access to financial services – not to mention the superior infrastructure and scalability of the Stellar blockchain. The majority of stablecoins released so far are built on Ethereum, which is capable of processing around 25 transactions-per-second (TPS). Stellar processes 1000TPS, making it a viable alternative to established global payment institutions like Visa and Mastercard. Equally as important is Stellar’s inbuilt compliance framework – as an FCA-regulated company, regulatory compliance is our priority.

 

2) How are stablecoins helping with international remittances?

Stablecoins have the potential to transform international remittance. For a start, they combine the speed and cost of cryptocurrency transfers with the market stability of fiat currency. Traditional banking remittance can be expensive and time consuming and does not reflect the 24/7, 365 days-per-year live economy that consumers have come to expect. Fiat-backed stable coins also fall under existing e-money regulation – e.g. in Japan, where cryptocurrency is regulated, there is no need to obtain a Virtual Currency License if your company only deals with fiat-backed tethers.

 

3) Wirex launched the world’s first Visa card that allows users to convert and spend cryptocurrencies wherever Visa is accepted – how’s that working out?

Our mission is to facilitate the establishment of a token economy, but we’re realists – we know that mainstream adoption of digital currency cannot happen overnight. Features like the Wirex Visa card bridge the gap between conventional financial services and a tokenised future. The main impediment to widespread adoption is currently low merchant acceptance. Instead of convincing millions of merchants around the world to accept crypto, we’ve utilised the existing merchant networks of Visa and Mastercard to allow people to use their digital assets, including stablecoins, at 40M+ merchants around the world.

 

4) Why are you launching 26 stablecoins?

Most stablecoins are pegged to USD. While these are suitable for a specific use case – hedging on cryptocurrency exchanges – they can’t be used for payments as they’re not scalable and don’t support local currencies. Since payments (cross-border and day-today) are Wirex’s main focus, we added support for local currencies with the aim of using stablecoins for international transfers. Local currency-pegged stablecoins don’t require a local liquidity provider and can be easily and cheaply exchanged to the equivalent local fiat currency.

 

5) Can you talk about potential customers – who will be using these stablecoins and why? Can you name specific businesses?

Wirex stablecoins will be available to every one of our 2M+ retail and 5K corporate customers across more than 130 countries worldwide.

Who stands to benefit? Retail customers – stablecoins are a cost-effective and efficient way to move funds across the globe and we expect a large volume of retail customers to use stablecoins for sending money to their friends and families around the world. These stablecoins can then be spent using Wirex Visa card, redeemed into bank accounts or spent directly with merchants who accept fiat-backed tethers.

SMEs – Businesses will use Wirex stablecoins to pay international suppliers, manage FX exposure and pay salaries – particularly if a company’s employee base is distributed across several countries or regions.

Merchants – Every merchant that accepts Wirex stablecoins will benefit from zero fees (a 3-5% saving on existing Visa/Mastercard charges) and instant settlements. Wirex stablecoin tokens are available immediately, whereas Visa and Mastercard can lock funds for 2-4 weeks – a nightmare for small and medium businesses.

 

6) Does this mean there are expansion plans in the pipeline?

Our plan is to expand Wirex and allow people around the world to take control of their digital and traditional currency. We are launching in North America (USA and Canada) and the APAC region in Q2 2019 and already have 700,000 potential customers on the waiting list for a Wirex account.

 

7) So, how would you sum all this up?

Our partnership with Stellar is not just mere technological convenience, or because big names like IBM are working with them. Wirex and Stellar share several key core beliefs about the role of digital currency and its potential to change the way people use and managed their money. Stellar seeks to enable swift, reliable and inexpensive money transfers for institutions, systems and people around the world – a mission that matches perfectly with Wirex’s vision of a fully-tokenised future. We want to bank the unbanked, democratise access to financial services and facilitate the integration of the burgeoning token economy.

 

" Darren Parkin : @DP_tweets Editorial Director Darren is a former daily newspaper editor and award-winning journalist with a media career spanning three decades. He previously worked for Trinity Mirror. From becoming the UK’s youngest newspaper editor at the age of 24 he has most recently held positions as Editorial Director and Non-Executive Director at several international business and economics publications.."
Disqus Comments Loading...