Following the crash of FTX, Telcoin ramped up the listing of new assets on its platform. They could not let a good crisis go to waste. Telcoin has sought to position itself as an alternative to centralized exchanges. Telcoin CEO even tweeted, saying, "a sad week for the industry. We shouldn't need to trust that centralized exchanges won't loan our assets to others. We are seeing a huge influx of deposits to Telcoin wallets and hope we can help restore trust in the technology." On Discord, he stated, “we should accelerate (the listing of new assets) to take advantage of the flow of assets moving out of centralized exchanges.”
But what does the above mean for Europe? Can we read anything from it about Telcoin’s strategy for Europe?
The European team
David Stuart, Ricardo Pires, and Dan Blackband lead the prospecting and exploration in Europe and the UK, where Telcoin has already established a base.
Mr. Stuart is the Vice President of Global Operations at Telcoin based in London. His primary task is to manage Telcoin's ongoing country-based operations and new market entry across Europe. Previously he worked for Veon Group, where his responsibilities included the delivery of AML compliance solutions and operations across a portfolio of over 90 financial services products in 10 operating companies. In July 2021, Mr. Stuart and Paul Neuner registered Telcoin LTD (company number 13522825) based on Shelton Street, London. Mr. Pires, also based in London, is the Commercial Strategy Lead for Europe and Africa. Working with Mr. Stuart and Rajesh Sabari, Mr. Pires has to explore market conditions and opportunities for Telcoin and help commercialize its offering to the European market. Mr. Blackband is also part of the Tim Mahota in the Compliance team. They are tasked with exploring the regulatory framework in Europe and developing Telcoin's compliance strategy.
To Europe through Lithuania
With the above team, Telcoin recently opened its second European office at Laisvės pr. 60, LT-05120 Vilnius, the capital of Lithuania. This was after Telcoin Europe UAB (company number 306146698) was registered in Lithuania in 2022. The company is registered to offer self-custodial digital asset wallet and cryptocurrency exchange services to Europeans. I suspect that Lithuanian government policy was the main attraction for Telcoin. According to Company in Lithuania UAB, which specializes in company registrations in Lithuania, “since 2020, Lithuania offers businesses offering cryptocurrency exchange services and cryptocurrency wallet services a friendly and regulated regulatory environment. The Lithuanian government offers transparent and cost-effective authorization for the use of virtual currencies.” There are two licenses offered, namely, an exchange license for cryptocurrencies (a license for cryptocurrency exchanges) and a license for the provision of crypto wallets and custodian services (a license for the provision of crypto wallets and custodian services). Telcoin announced these two services, suggesting that it already has relevant licenses and is ready to start operations.
You may be interested in knowing that Bifinity UAB, a subsidiary of Binance, "was also established under Lithuanian law, but its services extend to the European Economic Area and the United Kingdom.” It is the official provider of payments in fiat and digital currencies in the region on behalf of Binance. To ensure compliance, Binance partnered with Skrill Limited, “a company incorporated under the laws of England and Wales with registration number 4260907," to provide e-money and payment services, and Paysafe Payment Solutions Limited to offer similar services in the Eurozone. Skrill is a Paysafe brand in the UK. Similar to Binance, Huobi established HuobiPay UAB in Lithuania, “a registered Virtual Currency Exchange Operator and Depository Virtual Currency Wallet Operator with the Register of Legal Entities of Lithuania, (which) offers a secure and professional over-the-counter (OTC) desk that allows institutional clients and high net-worth individuals to purchase or sell a quantity of cryptocurrencies with a real-time manner, which cannot only reduce the risk of market slippage but also get the ultra-competitive quotations and optimize capital efficiency.”
For Binance and Huobi, establishing a subsidiary in Lithuania has been the first step, followed by partnerships with European payment service providers to offer on/off-ramp platforms. I suspect that Telcoin will follow the same strategy. It's not clear at this stage who Telcoin will partner with, if anyone, but they will likely make relevant announcements soon. I suspect that Telcoin LTD (registered in the UK as a financial intermediary) will provide on/off-ramp services for UK users, similar to Telcoin LLC in the US. Keep an eye on Paysafe subsidiaries – one of them, Viacash, is already in bed with Vodafone, a GSMA member. Another one, Neteller, offers payment services, money transfers, and crypto services, including withdrawals.
Soon after registering the company, Telcoin Europe UAB advertised a position for a Fintech Operations Manager, likely to be based in Lithuania. The job advert states that Telcoin “will launch EU operations for DeFi crypto exchange in January and need someone to assist (its) global accounting and compliance teams. The role will involve daily coordination with our UK and US offices and EU banking/payments partners."
I must emphasize the above statement is from a job advert from Telcoin Europe UAB because I want you to pay attention to two things:
Telcoin will be launching “EU operations for DeFi crypto exchange in January” (2023)
Telcoin has “EU banking/payments partners."
By any measure of imagination, these two points are significant.
From what I can see, the focus in Europe is not as much mobile money or remittances as in Southeast Asia. In Europe, the plan is a self-custodial digital asset wallet and cryptocurrency exchange service to Europeans.
The European market
According to a Gemini study in the UK, “in December 2019, there was a significant increase in people currently or previously holding cryptocurrencies — from 3.0% to 5.35%, compared to the previous year. Gemini’s 2020 research found that 13.5% of respondents are current or previous investors in digital assets, representing a 152% increase from the previous study by the FCA. Currently, 3.7% are active cryptocurrency investors, with another 9.8% holding crypto in the last few years.” Bankless Times reports that crypto adoption has increased 650% in 3 years in the UK. They also note that Bitcoin ownership rates dropped from 56.7% in October 2021 to 42.8% in December of the same year, likely due to regulations and a lack of trust.
Gemini also reports that Europe is lagging behind the global average for cryptocurrency adoption. While around 17% of Europeans have adopted cryptocurrencies, they lag behind the global average of 23%. The survey found that 41% of crypto owners globally made their first purchase in 2021. In Europe, 40% of those who own crypto first invested last year. Out of the countries surveyed, Ireland had the highest number of "crypto curious" consumers in the world who were interested in learning more or were likely to buy crypto in the next 12 months, at 58%. Among non-owners, 36% in Europe say there is legal uncertainty around cryptocurrency.
Here is the key: the UK population is 67 million, and the EU is 447 million. With only 13% and 17% adoption, the UK and the EU are clearly open for business. Considering these statistics, it makes sense for Telcoin to focus its strategy on a self-custodial digital asset wallet and cryptocurrency exchange service for Europeans. Since most crypto services providers are centralized, unreliable, and unregulated, Telcoin's decentralized, user-owned, compliant self-custodial digital asset wallet and cryptocurrency exchange services will soon become highly on demand.
What to expect in 2023
After announcing the listing of new assets on the Telcoin wallet, Telcoin Vice President Ryan Tully tweeted: “One final gift in your holiday stocking before we hit the ground running in 2023!"
I, therefore, expect Telcoin to ramp up its overall operations in Europe as follows:
There will likely be a significant drive to promote Telcoin adoption in Europe to take advantage of the flow of assets moving out of centralized exchanges.
Telcoin will launch EU operations for DeFi crypto exchange in the first quarter of 2023.
Telcoin will likely announce payment services partnerships in Europe to allow its market penetration across the EU.
The number of assets available on the Telcoin wallet will likely increase significantly to give European users the necessary options and give Telcoin relevant competitiveness.
The offices in the UK and Lithuania are likely to be beefed up to support self-custodial digital asset wallet and cryptocurrency exchange services.
Like mobile money services, Telcoin adoption in Europe will significantly increase TEL volume and, subsequently, TEL market cap. This will likely coincide with the next Bitcoin cycle, possibly leading to the 2024 Bitcoin halving.
In line with Mr. Tully's statement, I expect Telcoin to hit the ground running in Europe. Perhaps this is why the CEO, Paul Neuner, on November 4, 2022, announced: "UK is a high priority (I am flying to London tomorrow)” – because Europe is about to explode!
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Disclaimer
This article will be updated as and when new information becomes available.
The information and content (collectively 'information') provided herein are general information. The authors do not guarantee the suitability or potential value of any information or particular investment source. Any information herein is not intended, nor does it constitute financial, tax, legal, investment, or other advice. The authors have no affiliation with Telcoin or other persons or companies referred to in this article. The information in this article is based on the sources used.