The world’s banking industry is ever-evolving, with new trends and disruptive opportunities emerging every year. In 2020, the global pandemic gave rise to a large shift in consumer behavior in almost every industry. For banking, like many others, this was a shift to online or digital operations, as in-person service was inevitably no longer viable. Though the banking sector retains a great deal of influence in the digital space, e-solutions such as CashApp and Wirex are increasingly prominent, as well as crypto-native exchanges, protocols and apps.
Cryptocurrency is the hot topic on everyone’s lips, which is no surprise given Bitcoin’s market cap high of $1 trillion dollars this past year – higher than that of any bank in the world. This was aided by MasterCard and PayPal announcing that they would begin to welcome Bitcoin, Ethereum and Litecoin on its networks. According to Ronit Ghoti of Citi, in their latest Future of Money report, “money is entering a format war” – and it would seem that these two payment giants are hedging on a digital/crypto victory.
Experts believe that the crypto-banking market will grow at a rate of 6.30% in the next five years. This growth will be largely influenced by increasing remittances in developing economies, the prevalence of initial coin offering purchase machines, the rising number of fluctuations in monetary regulations and increased awareness.
Similarly, the growing acceptance of cryptocurrencies in different industries backed with venture capital investment will help further boost various growth opportunities. The emerging high-value subsector here is ‘DeFi’ (decentralised finance). DeFi refers to financial applications in cryptocurrency or blockchain which aim to disrupt financial intermediaries. With no central authority, users interact with financial instruments using smart contracts – thus removing the need to trust financial or corporate middlemen. DeFi protocols and platforms allow users to deposit crypto and earn high-interest yields on the savings, as well as borrowing and lending them out.
Over the last 12 months, the total value locked (TVL) on DeFi protocols has increased 8300% from $980m to $87bn. Institutional capital has poured into this untapped sector previously inhabited by only a minority of the crypto world.
Scallop vs Traditional Banks
Scallop is the ‘World’s First De-Fi Powered Neobank’ whose mission is to accelerate the world’s transition to a more decentralised and equitable financial system. The traditional banking sector is facing its greatest challenge to date in the form of technology and social behavioural shifts away from centralised powers. As such, a banking platform that offers both digital and decentralisation to its users could unveil the future of how we bank. Scallop has global plans to take on the global banking industry, with their recently announced roadmap detailing product launch in the EU and UK in September and expansion into Asia in Q1 2022.
Scallop is FCA registered and provides a platform where users can quickly and securely manage crypto and fiat assets in a single place. It provides a seamless on/off-ramp for the conversion of fiat into crypto and vice versa. The platform has various tools such as Scallop Pay and Scallop Cards which seamlessly integrate crypto and DeFi assets with real-world applications. For instance, for the first time ever, users can use a Scallop Card to purchase any goods or services directly with their crypto assets without having to sell first to fiat and then send it back to their bank to use. Scallops innovative technology will handle all parts of the conversion process on the backend, allowing users to just tap their card on the front end.
Scallop will offer both a Personal and Business Banking Account that can be opened in just minutes with AI-powered KYC. These accounts work in the same way as traditional banking accounts but with additional DeFi powered possibilities. With ‘Scallop Earn’ users can access DeFi protocols such as Compound, Aave and dYdX directly from the app and earn high yields of (6-15%) on their assets, with multiple APYs to choose from.
Further DeFi and Banking Products will include: Scallop Exchange, Scallop Hardware Wallet, Scallop Chain, Scallop NFT and Scallop Token (SCLP)
The banking industry is yet to see the full disruptive potential of crypto. However, Scallop is joining the likes of Paypal and others who are making significant strides in challenging the traditional frameworks as we know them. As recently expressed in Forbes – ‘The big banks had better pay attention. Silicon Valley has not only arrived, but it has also brought its friends, the global decentralized digital finance gang’.