BUSINESS DAY SPOTLIGHT
PODCAST | The rise of cryptocurrencies during the pandemic
Richard de Sousa, CEO at AltCoinTrader talks about how digital currencies could enable transfer of wealth in SA
In this edition of Business Day Spotlight, we look at the rise of cryptocurrencies such as bitcoin during the Covid-19 pandemic.
Our host Mudiwa Gavaza is joined by Richard de Sousa, CEO at AltCoinTrader, a local cryptocurrency exchange.
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Bitcoin, the world’s most famous cryptocurrency, has undergone a transformation in public perception in recent years, experiencing a rally in its price, especially during the pandemic. Traditionally, investors have viewed it as being risky, unstable and associated with online criminal activity.
The tone seems to be changing with more interest being shown by both retail and institutional investors, which has resulted in the value of bitcoin rising. Having started 2020 at R105,000, it has steadily risen more than five-fold. At the time of writing, one bitcoin was trading at R530,621.97.
De Sousa says institutional investors formally getting into the cryptocurrency market has helped increase interest and adoption over the past year. This is significant because these investors have previously shied away from investing in such currencies, viewing them as risky and unproven.
Having access to large pools of capital, such as pension funds, backing from these investors carries much weight. This is coupled by fintech companies such as PayPal, which now allow cryptocurrencies as a payment method.
De Sousa says the trend has been similar in SA, especially for retail investors, who have been buying up the digital currency. That said, institutional investors in SA are yet to get into the bitcoin market as seen in other countries. De Sousa thinks this is a pity as cryptocurrencies provide an opportunity for a transfer of wealth in the SA economy.
The discussion also focuses on AltCoinTrader’s trading volumes, uptake of cryptocurrencies in SA, how US regulators have allowed banks to use blockchain as a payment layer, issues holding local institutional investors from the market, and what it will take to have blockchain-backed currencies used at retail locations in day to day life.
De Sousa also details AltCoinTrader’s new savings and interest-bearing product for its clients, who can now earn interest on their cryptocurrency holdings.
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•Business Day Spotlight is a MultimediaLIVE production.
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