Wirex reaps the rewards for bringing trust to the crypto market

Bit­coin has occu­pied the more extreme end of the tech­nol­o­gy hype cycle for a num­ber of years now. In the last six months alone, it has grabbed major head­lines after Pay­Pal said its cus­tomers will be able to buy and sell cryp­tocur­ren­cy using their Pay­Pal accounts, once-scep­ti­cal insti­tu­tion­al banks like J.P. Mor­gan and Mor­gan Stane­ly vocalised their inter­est in the mar­ket and Tes­la revealed it plans to accept it as pay­ment for vehi­cles. 

Cryp­tocur­ren­cies are now ever so grad­u­al­ly being seen as a viable alter­na­tive to con­ven­tion­al cur­ren­cies with their vir­tu­al, decen­tralised medi­um of val­ue exchange, inde­pen­dent of gov­ern­ments or cen­tral banks. 

Back in 2014, how­ev­er, few peo­ple had heard of bit­coin, the old­est and best-known cryp­tocur­ren­cy, and if they did it was more like­ly due to noto­ri­ous sto­ries around its use in online black mar­kets such as Silk Road. Yet it was at this time that Pavel Matveev and Dmit­ry Lazarichev saw an oppor­tu­ni­ty.   

“We were reach­ing the peak in our pre­vi­ous careers,” says Matveev. “I spent my entire career in invest­ment banks, devel­op­ing trad­ing sys­tems and trad­ing strate­gies for the likes of Mor­gan Stan­ley, Bar­clays and Cred­it Suisse. We were look­ing for a new ven­ture and chal­lenge, and we saw bit­coin and blockchain as quite an inter­est­ing tech­nol­o­gy.”

Cru­cial­ly, they saw its poten­tial to be used in more tra­di­tion­al finan­cial ser­vices such as pay­ments, if only its poor rep­u­ta­tion as a facil­i­ta­tor for crime, and even beyond that a lack of under­stand­ing of exact­ly what it is, could be over­come. The best way of reduc­ing con­fu­sion and mak­ing it more trust­wor­thy, they decid­ed, was to make it more phys­i­cal. 

“The phys­i­cal bank card is some­thing peo­ple trust,” Matveev con­tin­ues. “Our idea was to bring togeth­er the two worlds: a bit­coin wal­let, hold­ing a vir­tu­al cur­ren­cy you can send any­where in the world in real time with almost no fees, with a phys­i­cal card.”

Wirex was born with a first-of-its-kind prod­uct: a bit­coin deb­it card that con­nect­ed to a bit­coin wal­let and allowed users to spend their vir­tu­al cur­ren­cy in an exist­ing net­work of more than 50 mil­lion mer­chants accept­ing Visa and Mas­ter­card in over 200 coun­tries. Matveev and Lazarichev, as co-founders and co-chief exec­u­tives, have since built Wirex as a mar­ket leader in a bur­geon­ing sec­tor that includes thou­sands of cryp­tocur­ren­cies.

Borderless payment platform

The Wirex app has evolved into a bor­der­less pay­ment plat­form that enables cus­tomers to buy, store, exchange and spend both con­ven­tion­al and dig­i­tal cur­ren­cies quick­ly and secure­ly, with no hid­den fees. Exe­cut­ing on its mis­sion to make cryp­to and tra­di­tion­al cur­ren­cies equal, acces­si­ble and sim­ple to every­one has dri­ven CAGR growth of 426.33 per cent in the last three years, plac­ing Wirex at num­ber three in the Accelerate50 awards by Dun & Brad­street.

Of course, sim­ply being ear­ly in the cryp­to mar­ket did not, in itself, mean Wirex would be a suc­cess. The lack of reg­u­la­tion in the cryp­to mar­ket, cou­pled with its rep­u­ta­tion, left Matveev and Lazarichev strug­gling to find the part­ners they required to get their idea off the ground. It was so dif­fi­cult that the pair very near­ly gave up alto­geth­er. 

“We were excit­ed by this idea, but we need­ed to part­ner with a card issuer and it was a chal­lenge to even open a bank account,” says Matveev. “Every­one we spoke to said they will nev­er work with a bit­coin com­pa­ny. We were real­ly get­ting close to des­per­a­tion, and think­ing even about just doing some­thing else, when we decid­ed to call one final com­pa­ny. Long sto­ry short, that turned out to be the card issuer for our first prod­uct.”

When the prod­uct final­ly came to fruition, its total unique­ness in the mar­ket soon met enor­mous demand, which result­ed in expo­nen­tial growth, start­ing in Europe before expand­ing into Asia and then, this year, into North Amer­i­ca. When it came to scal­ing up to accom­mo­date the demand, Wirex found one ele­ment easy and anoth­er quite dif­fi­cult. 

“From a tech­nol­o­gy point of view, it was an easy exer­cise for us. As a plat­form, 99 per cent of Wirex is built in-house and it is cloud native. Rather than tra­di­tion­al banks that have to migrate lega­cy infra­struc­ture to the cloud, fac­ing lots of pain­points along the way, we were born on the cloud, which made it so much sim­pler scal­ing from serv­ing just one coun­try to serv­ing mul­ti­ple con­ti­nents and thou­sands, and then mil­lions, of cus­tomers,” says Matveev. 

“The more dif­fi­cult part of scal­ing at pace, how­ev­er, and I think a lot of oth­er star­tups would res­onate with this, is try­ing to retain your cul­ture. When you’re get­ting a lot of new employ­ees, you need to train them and com­mu­ni­cate your vision. If you don’t real­ly focus on get­ting that right, and peo­ple don’t share the val­ues and goals of your team, you can end up with a tox­ic cul­ture. Cul­ture was very impor­tant to us from day one.”

Wirex remains a young busi­ness in a young, fast-chang­ing indus­try and its plan in the com­ing years is to solid­i­fy lead­er­ship in its three main mar­kets: Europe, Asia-Pacif­ic and North Amer­i­ca. Data intel­li­gence is piv­otal to cus­tomis­ing its strate­gies for meet­ing cus­tomer demands in all these mar­kets, as cryp­to adop­tion con­tin­ues to mature and com­pe­ti­tion grows from more estab­lished organ­i­sa­tions such as Pay­Pal and Ama­zon.

“Peo­ple use our appli­ca­tion dif­fer­ent­ly,” says Matveev. “Some peo­ple use it just as a card because they love receiv­ing cryp­to back. Some peo­ple use it for trad­ing. Some peo­ple use it for send­ing mon­ey to their friends and fam­i­lies. Data allows us to seg­ment these cus­tomers into 15 dif­fer­ent per­sonas based on their user behav­iour. Through this seg­men­ta­tion, we can ulti­mate­ly under­stand, incen­tivise and serve cus­tomers bet­ter.”

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