Nubank hits the hammer and prepares to enter the world of cryptocurrencies

Check out fintech’s investment in cryptocurrencies and Nubank’s co-founder’s opinion on the regulation of digital currencies.

Image: Jo Galvao / shutterstock.com

Estimated reading time: 3 minutes

Recently, Nubank co-founder David Vélez told Valor that cryptocurrencies and blockchain technology can increase financial inclusion and decrease expenses in international transactions. Vélez stated that entering the world of cryptocurrencies “is something we want to invest in and focus on in the coming years”.

For Vélez, investing part of the financial institution’s cash in cryptocurrencies is a way of aligning itself with the digital bank’s account holders and explained that this investment demonstrates conviction to customers.

Vélez also made it clear that, because the technology is still new and risky, Nubank has only allocated 1% of its equity, which will still be distributed little by little. At the end of December 2021, the company’s cash position was BRL 13.4 billion, so the amount would be around BRL 13.4 million.

The executive also highlighted the institution’s vision for cryptocurrencies in the future. Without giving details, Vélez said that the digital bank has several teams working on projects linked to cryptocurrencies and blockchain. “It’s something we want to invest in and focus on in the coming years.”

Investment in cryptocurrencies

Nubank has made investing in cryptocurrencies available through the app since May 11. When talking about this subject, Vélez stated that there is “a lot of noise” in the market: “there is a lot of noise and a lot of tokens that make no sense. A lot of things that don’t make any sense.”

The banker also reported that, therefore, the institution decided to provide the option to trade only Bitcoin and Ethereum.

Cryptocurrency regulation

Regarding the regulation of the sector, Vélez stated that it has a good side and a bad side. The good side is that it gives recognition to an asset that is “sort of in the informal market”, and that is already being used all over the world. The downside, according to the banker, is that if there is regulatory pressure on cryptocurrencies, it could end innovation.

Bill 3.825/2019 was approved on April 26th in the Senate and forwarded for approval in the Chamber of Deputies and aims to regulate the cryptocurrency market.

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Image: Jo Galvao / Shutterstock.com

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