Arthur founded B2Broker in 2014 with the goal of providing leading liquidity and technology solutions for the crypto and FX industries with an emphasis on ready-to-use solutions for brokers, exchanges, hedge funds and asset managers. Fast forward six years and B2Broker is now an established full-service provider with over 165 employees worldwide.
Q: Arthur, thanks for joining us. As our intro says, B2Broker has come a long way from launching in 2014 to today – can you talk about the changes in the crypto industry, which drove your company’s success early on and shaped the services you provide to digital asset firms today?
A: Yes, we have come a long way since launching the company and things have moved very quickly. To date, we have developed, and now offer, a wide range of products and services since we started out in 2014, and from 2017 we started working on crypto solutions. It’s hard to believe that we are almost at the point where it has been 4 years since we started working on crypto solutions! Our first solution was crypto liquidity and looking at our position in the market now, we have become the industry’s number one Crypto CFD liquidity provider, offering the tightest spreads and deepest liquidity pool in the order book. With over 100 crypto CFDs with excellent leverage, I can confidently say that we offer one of the best propositions on the market.
We have also now started working on crypto perpetual futures which do not have expiration dates and are based on spot underlying market price. This is a big milestone in the roadmap of products that we are planning to introduce. They are becoming very popular on the market and are well suited to the current trading environment since they can be conveniently used for macro position taking and risk management purposes. We are currently working with Prime and Fix API to bring to the market a solution that will be available across all our platforms, especially through B2Margin, so keep an eye on our news for some interesting developments coming soon!
In terms of crypto liquidity, we are working on extending our crypto CFD liquidity pool and on increasing leverage for our crypto CFD liquidity pool.
Back in 2017, we launched our B2BinPay project and it is now in the top 3 crypto processing companies in the world. We process huge volumes for many major forex and crypto brokers and regulated online casinos, all of who use our solution to enable crypto payments. Our Enterprise solution has just been revamped and we’ll be releasing version 2 soon. This is a very efficient system whereby brokers and exchanges can use our infrastructure to provide wallets to their end-users and have the ability to accept tokens or launch a new token in just a couple of clicks. It’s a very comprehensive solution that is easy to integrate and makes accepting crypto as a payment method really simple.
We also strive to improve B2Trader, every day. B2Trader is a matching engine for crypto exchange clients which has come on leaps and bounds technologically since we launched it, and now includes a whole range of new features which we recently announced. B2Trader is fully compatible with B2BinPay, B2Core, wallets, etc. We are also working on implementing integrations of our products with different solutions across the market. For example, we have integrated KYT systems, various crypto futures, redeveloped our B2Core system and added continual improvements to our B2BX project such as a mobile app and improvements to liquidity.
We never stop improving, and are always on the lookout for new talent and new developers – the very best out there! We do our utmost to try and satisfy all our clients’ needs.
In terms of changes in the crypto industry, I think it’s clear to see that, overall, the industry has changed dramatically. In 2017, there was a lot of hype surrounding crypto – many people were involved but now it has evolved into a different ball-game and many countries have implemented new legislation for cryptocurrencies. Central banks have also started working on implementing central bank digital currencies. I believe that to be the new future – and that future really is not so far away. For example, take a look at China which has already launched RMB and rolled it out across the economy. The real goal behind this strategy is for their central bank to remove cash from the market, saving them money on, and maintenance of, currency issuance.
We can see that a lot of institutional money has come onto the market – it’s a really interesting situation watching Bitcoin hit $50K! It’s a new reality – a new world in which Bitcoin has officially become a real alternative to gold. Many companies, in order to protect themself from inflation or depreciation of currencies, now invest in Bitcoin and other major cryptos. If you look at the state of play 4 years ago, the situation was completely different. It’s now increasingly more about institutional money, smart money and serious companies who want to develop new products for the market, along with central banks and regulators of strong jurisdictions part of the picture. Crypto has become commonplace as I anticipated it would years ago. Many people back then didn’t believe it would, but the predictions have come true and more central banks have started implementing CBDCs. Changes are happening fast and any serious broker out there should start implementing crypto processing and take Crypto CFD liquidity without hesitation.
Q: Over the last year and even most recently, we see that cryptocurrencies are achieving more and more adoption from global citizenry, companies and governments alike. Can you tell us how these changes are influencing your customer’s demands for crypto market solutions?
A: Crypto has generated huge interest – there’s no doubt about it. The most frequently requested product at B2Broker is crypto processing. This is because many companies face a variety of issues with banks, many of which are not willing to serve companies related to the crypto industry as they feel they are dealing with risky clients like forex brokers, casinos and other high-risk businesses. So essentially, they have distanced themselves. Clients, therefore, need to find a way to work in spite of these obstacles, to cooperate with other clients and partners and continue their business as they move full steam ahead into the crypto world.
Credit card companies have now also announced they will introduce crypto as they are afraid of losing market share. Mastercard, for example, has announced that it is going to implement crypto. The number of transactions across the major blockchains has increased significantly since 2017 and as I am aware, the bank card processing companies have lost around 20-30%, maybe even more of the market, which is big money. Of course, banks have been affected too. Tens of billions of transactions have moved into the blockchain. No one’s using banks for this purpose. The big companies going to the likes of regulated exchanges like Coinbase, Gemini and B2BX (our own) to exchange fiat money to crypto and send crypto to counterparties through their own local regulated exchanges. Banks have started to feel the impact by way of lost commissions. Each day, billions of transactions pass through major blockchains. I see rapid changes coming in terms of processing and liquidity and note that our client’s traders have moved away from forex and into crypto due to volatility. There is a lot of ‘pump and dump’ going on with crypto so you can make a lot of money in a short amount of time which is what has attracted Forex traders into crypto. Hence, we have seen an increase in demand for our related products, especially B2Trader and Crypto Brokers based on MT5, as well as our B2Margin platform which has really taken off.
Many brokers are therefore now launching their own brands dedicated to crypto or are trying to implement crypto trading products into their existing platforms. Without doing this, they will find it harder and harder to survive. The world has changed and what has happened cannot be ignored. Surprisingly we still see some brokers who are slow on the uptake but it’s a narrow-minded strategy. Crypto has happened, and it is here to stay. The future of crypto, in my eyes, is only going to get stronger with even bigger opportunities ahead.
Q: Given the recent frenzy around social trading and the impact on equities markets, do you foresee a similar situation on cryptocurrency markets and how would B2Broker handle such a scenario in terms of customer service? Given that, millennial and other traders on social media are a phenomenon that is likely here to stay.
A: Let me use Crypto CFDs as an example to illustrate our offering in terms of social trading. In our case, our crypto broker clients are able to offer social trading since our copy trading system supports not just copy of trades and positions, but different trading accounts denominated in different crypto. So, if your account is denominated in BTC and the account that you follow is denominated in USDt, the profit and loss will be shown in the master account of the master’s crypto denominated currency and your account profit and loss will be in your currency.
We have already given a lot of thought to this topic and built it into our strategy so all our products have been designed to take into account future ideas and client demands. By the way, I should add that this is related to crypto perpetual futures or crypto CFD products only. The problem is that with the crypto spot market, it’s very difficult to do copy trading. It’s not impossible, but we need to take into consideration that crypto spot has a different logic – it’s not a margin product therefore there are some discrepancies between the masters and followers. We certainly need to think about how to create social trading for the spot market, but for margin trading, it’s already resolved.
I think all the exchanges in the future will try to adopt the same approach as forex brokers did some 10 years ago. It’s nothing new – all the best practice from the forex and securities markets will be implemented here, just with some adjustments according to the crypto related aspects.
Q: Many predictions have been made about the future price of Bitcoin in the mainstream media following multiple recent all-time highs… what is your prediction as someone who is “on the outside looking in” at market liquidity, trading volumes and the like?
A: This is never an easy question to answer but I’ll try my best! Many companies and individuals missed the latest bull run because it came so quickly and it was so unexpected. I now think it’s pretty late in the day to enter the waters and that we should wait for a correction first and monitor the situation surrounding crypto, as well as looking at what the big corporates are doing. But it’s old news now and it’s too late this time around. Tesla entered the market when Bitcoin was $25/30k but by the time most people noticed, it was $40k, jumping to $47k in a couple of hours.
I see many predictions about the price of Bitcoin reaching $60K, $100k, etc – yes, I think that is going to happen through time and I believe it will hit $100k. But, the question is when it’s going to happen, when there’s going to be a correction, how deep will be the correction and what will then happen? Many obstacles need to be taken into consideration before answering these questions. I cannot give advice on the market, but I am confident that the crypto industry generally will expand tremendously and that all the changes that come along will be implemented even faster than we are seeing now.
All leading companies want to be in line with the trends and the crypto industry overall will boom. I feel it is really going to get even bigger. Even the securities market such as equities, from what I can see, is here to stay, yet it will evolve digitally. The fact is, no one needs or wants old technology. You only have to look at the way it’s going and the massive impact of digitalisation – meetings have moved to Zoom, there are new social media channels like Clubhouse and TikTok – it’s all about new trends and people follow the trends! There is no time to stand still and I only expect to see even bigger changes and developments in this sector coming our way in the future.