The executive assures that the sharp falls in cryptocurrencies have accelerated purchases by investors who trust that their price will rise again.
Lukas Enzersdorfer-Konrad, Bitpanda’s chief product officer, is the mind behind the user experience of the cryptocurrency, exchange-traded fund (ETF), and stock investment platform. Since 2021, he has directed product development and has promoted a hub in Barcelona that has involved an investment of 10 million. From his new headquarters in Vienna, the executive shares his perspective on the future of crypto assets after the strong correction they have experienced and the collapse of the digital currency Luna and the stablecoin terraUSD, to which it was linked.
The crypto asset market has been hit hard in recent weeks. Is it a hit to your waterline?
No. There are several factors that have not only affected us but the entire technology sector. We are still seeing growth and new liquidity inflows from investors on our platform, although obviously there have been losses. Investors are waiting to see how the economic environment evolves. Governments must regulate crypto assets so they can be safely invested in
How has the reaction of crypto investors been to the correction?
Some investors have bought into market declines. Many have raised their bets on Bitcoin in the hope that the price will recover because they have seen an opportunity to enter. As it falls further and approaches $25,000, Bitcoin purchases accelerate and investors raise trading volumes. This happens throughout the market, not just on Bitpanda. It’s super interesting. I don’t think the way El Salvador is using Bitcoin is the correct one.
Many investors have lost a large part of their savings. What is your advice?
The most important thing is that users can do something about their losses. We have activated the staking functionality [an alternative to mining for the generation and validation of blocks that works as a bank deposit, offering a percentage of profitability]. With this option, the investor can receive benefits without selling. For example, if the investor has a Solana portfolio, you can receive up to an additional 4% weekly for lending the token for this service. Thus, when the next cycle arrives, the investor will have obtained capital gains.
Do you think that the strong volatility of the crypto asset market is due to cycles?
If you look at the last five cycles of Bitcoin, they are.
Will there be some cryptocurrencies that will never recover from these falls?
The major cryptocurrencies that are correlated to Bitcoin tend to move in cycles. As long as you haven’t invested in something like terra Luna you’ll be fine. Outside of the big cryptocurrencies, it depends on each currency. Some are based on smart contract ecosystems that give them a backing. Others like Bitcoin work more as a refuge. And there are some like Dogecoin that just has community and emotion-based value, so to speak.
The European Union develops a regulation on the cryptoactive sector, but alarms are growing about its role as a threat to financial stability. What role should the sector have?
It depends. If we talk about applying Blockchain technology to existing currencies, I think it could be something very interesting. But I don’t think that the way El Salvador is doing it is correct [it has adopted Bitcoin as legal currency]. Bitcoin does not work as a means of payment. It is not stable enough to be a currency of exchange, it works better to store value. Governments must regulate so that investors can invest in cryptocurrencies and with entities that are also regulated. The European Union has made a lot of progress with this, but what happened in El Salvador doesn’t seem to me to be working.
By Audy Castaneda
