Daniel Dimitrov, CEO of Gleec, explains how COVID-19 and institutional attention are shaping the future of Crypto
From Decentralized Finance (DeFi), NFTs, and the ever-rising price of Bitcoin, the cryptocurrency world has received sustained attention over the past few months.
Institutional players continue to signal their openness to digital assets. While government entities and regulators can still admit reservations about cryptocurrency, they are starting to recognize that digital assets are here to stay.
Daniel Dimitrov, blockchain expert and CEO of Gleec, a decentralized digital ecosystem providing a range of products, says the coronavirus pandemic has also played an important role in the shift in perspective towards crypto.
Daniel Dimitrov (Image source: Gleec)
In a recent interview covering topics relating to the crypto card industry, the future of cutting edge concepts like NFTs, and the influence of institutional attention in the crypto space, Dimitrov outlines his vision for the pandemic and attention from legacy financial entities. impact on the future of crypto.
Tesla and Elon Musk: the pioneers of the crypto industry?
Tesla made headlines in early February after announcing in an SEC filing that it bought $ 1.5 billion in Bitcoin, news pushing up the price of the flagship cryptocurrency. Tesla founder Elon Musk was quick to express his enthusiasm for crypto in his own time, gaining notoriety for tweeting, sometimes in a flurry, about an altcoin named Dogecoin.
Musk’s words have an impact. An investigation in early February revealed about a third of respondents made a crypto investment or thought about doing so after reading Musk’s tweets.
Dimitrov thinks Tesla’s bitcoin buying frenzy may not be the best for shareholders as he admits “some investors will view the addition of a crypto asset to a portfolio as something that could influence the volatility of the stock. “
However, he explains that the choice is good for the crypto industry since “IIt’s a good idea to see a large company adding Bitcoin at a time of massive global debt and financial uncertainty. “
Regarding Musk’s emphasis on an altcoin like Doge, Dimitrov argues that it’s a bit murkier if the institutional focus on a lesser-known coin is beneficial.
“It depends on who you ask” he thinks.
“Obviously Elon continues to tweet about Doge and the price hasn’t really gone up lately. But for all those who got into the medal before he started talking about it, good for them. Thinking of the recent accusations involving John McAfee, there is an element of deception with these lesser-known altcoins and their promotion that we cannot ignore.
Tesla and Musk are just a few of the many institutional players who have delved into the world of crypto. Roughly a week after Tesla’s purchase, North America’s first Bitcoin ETF (BTCC) was launched on the Toronto Stock Exchange.
The bottom benefited from strong demand, with a trade volume of $ 165 million in the first 24 hours.
Dimitrov thinks that BTCC “a strong first day speaks for itself ” and signals clear demand for ETFs and similar crypto investment vehicles, arguing that the pattern of strong investment prospects will continue.
Will financial heavyweights kill crypto’s potential or boost the industry?
Asked about the decision by payment processors like Mastercard to start accepting crypto, Dimitrov suggests that the rationale is based on the crypto’s understanding of power.
He explains there “There were enough questions with Libra in 2019 that pulling out made sense … I now imagine they realize the crypto is ‘not going away’, so they might as well go for it. industry. Although I’m curious what their plan is because it looks like the only big coin to really follow the desired standards would be the USDC.
In his eyes, the natural expansion of the crypto card industry as a result of decisions by companies like Mastercard is truly “More than a stepping stone” to foster innovation.
Discussions of institutional attention in the crypto world inevitably come down to one key question; How does the “decentralized and open philosophy” that many associate with digital assets balance with traditional finance?
Dimitrov doesn’t mince his words, admitting that juggling these two points is “is going to be a huge challenge, but we knew this question was going to arise.
Yet he remarks “there will always be projects that will innovate and present products with a private and decentralized concept. This demand will never go away. But of course, institutional money is hard to ignore for some.
In his eyes, the growth of decentralized finance (DeFi) will lead to a continued dispersion of the Bitcoin market, cultivating a situation where “the future will lean towards decentralization as a whole ”, in his eyes.
The future of the crypto-sphere and how today’s business is transforming tomorrow
One of the crypto and blockchain ecosystem’s greatest hopes is the potential to upgrade or entirely replace existing financial institutions. According to Dimitrov, this trend is observed most poignantly in the field of crypto-banking.
He argues that digital asset-based banking is a
“Big winner for emerging markets like Turkey which are sort of stuck between European and Asian markets. A lot of talent in the banking industry has had enough of the bureaucracy and crypto-banking is an exciting new area to put their skills to good use. Another [area of success] lowers the insane interest rates seen by some traditional banks that have just a ton of debt. “
Asked about Coinbase’s decision to go public, Dimitrov says he’s optimistic that direct listing will improve public confidence in crypto exchanges due to a perception of greater openness.
To him, “the key will be if other crypto companies follow suit. Coinbase’s performance largely depends. “
Despite Coinbase’s intention to go public, Dimitrov isn’t so sure older cryptocurrency exchanges are interested in embracing innovative elements of the virtual currency world, like DeFi.
He explains how “Coinbase lists DeFi as a potential competitor in their S-1 prospectus and they’ve invested in Compound as well, which I guess could impact Coinbase’s positioning. We’ll see how they react with decentralized Layer 2 exchanges, as some of them will have user experiences like Coinbase. “
He is also pessimistic about the role government entities will continue to play towards crypto.
Mentioning Treasury Secretary Janet Yellen comments in February about “extremely inefficient” Bitcoin, he admits “the global financial establishment is not going to make openings with regulation to Bitcoin and other crypto holders. “
Can crypto overcome some of its biggest challenges?
Many have expressed concerns about the immense environmental concerns associated with Bitcoin mining. Some worry about the huge energy consumption and its ramifications in terms of energy consumption and production.
Dimitrov believes that innovation is the key to tackling issues relating to environmental impact. I think there is something to be said about environmental concerns, he explains.
“However, there are a lot of innovations but that we don’t talk about a lot. I saw in Sichuan China that Bitcoin miners could profit from a glut of electricity due to the Three Gorges Dam project. These are unique solutions like the ones that need to be focused on to minimize worry. “
Asked about another pressing concern in the crypto world; Ethereum scalability issues, Dimitrov points to promising projects such as Polygon and Skale Network.
Yet he prefers “see what’s going on with Ethereum 2.0, but who knows when it’s actually coming out, so we can’t count on it just yet. “
Despite the vast innovations in the crypto and blockchain world, Dimitrov still believes that a concept yet to be devised will completely restructure the economy. Regarding DeFi, he says a future that includes “using a piece of land in Decentraland to secure a loan will be a game-changer for the crypto and financial world.
Speaking about NFTs like the ubiquitous CryptoKitties, he believes “they will be an integral part of the DeFi world, especially if holders can use NFTs to wager their tokens. “
In a turbulent financial world with many looming questions and uncertainties, one thing is clear to Dimitrov when he reflects on the future of crypto, that there is always “oone of the best assets for those looking to park part of their heritage ” in a world “Filled with debts, doubts and uncertainties.”