Understanding Cryptocurrency, Digital Asset and Securities Markets in Comparison to Traditional Financial Markets — NeuGroup event sponsored by B2C2

On Thursday, April 22, 2021, NeuGroup hosted a virtual interactive session to explore corporate use cases for bitcoin, cryptocurrencies, and digital assets and how they might affect traditional accounting.

The event was sponsored by premier liquidity provider, B2C2, and brought together digital asset industry leaders with treasurers of some of the largest corporations.

Rob Catalanello, President and CEO of B2C2 USA, kicked off the event with some opening remarks:

“There is a pretty big groundswell of interest from the institutional world, and by that I mean the very well-known names, who are looking into it for a variety of reasons. Either, as a form of payment, as a store of value, or just trading in a new asset class.”

He added, “It’s not the wild west. But, at the same time, it’s important for people to understand the market structure before they jump into it. There are a lot of people out there pretending to be things that they’re not. So, we encourage people to do the proper due diligence before getting involved.”

Coincidentally, NeuGroup’s event enabled many institutions to do just that: get familiar with the market structure and begin to understand how digital assets might fit into their current business.

Catalanello was also joined by a panel of fellow industry experts: Brian Kelly, Founder and CEO of BKCM, Jerald David, President of Arca Labs and Arca Capital Management, and Jared Hodgson, Treasury Manager for Coinsquare.

Brian Kelly gave a brief overview of the crypto market:

“In terms of investments, you have Bitcoin, which I view as similar to an S&P 500 index fund. Bitcoin gets you into the space and provides general beta exposure. Then you have the alt-coins…that would include Ethereum…these give you exposure to everything else that is going on, like DeFi andWeb3…all those crazy things we talk about.”

Jerald David went on to expand on some of the treasury management implications and themes:

“Obviously, one of the benefits of digital assets is the fact that they are traded peer-to-peer… It removes intermediaries, like a broker, it’s not restricted to banking hours, and it also performs a very, very interesting function. Not only is it an investment vehicle, but it can also be a medium of exchange. And that’s the beauty and the benefit of what happens when you start injecting blockchain into the new financial system.”

Of course, there are many questions and concerns that come along with this potential new financial system. After a brief Q&A, the audience was split into breakout rooms to discuss these questions and relevant topics in more detail.

Topics ranged from the sustainability of widespread adoption of cryptocurrency to whether there is the need for adoption by the corporate world in the first place.

Perhaps the most pressing question in many participants’ minds was simply: What are the applicable use cases? How can bitcoin, or cryptocurrency in general, be used in a B2B payment space and how would this actually work?

While much remains to be seen, Catalanello stressed that Bitcoin isn’t the only coin in the market.

“Stablecoins probably have more potential for actual payments, whether it’s B2B or B2C. There are a whole host of stablecoins, I think the best ones are the ones that don’t move much….as it pertains to using bitcoin to pay for goods and services, there’s a whole host of concerns…there is so much to do in terms of just the nuts and bolts of how the transaction is done. I would say it would be much easier to adopt any one of the stablecoins that are currently in the market.”

Overall, the event was an informative and engaging way for corporations to get a taste of what it might be like to start including digital assets on their balance-sheets. However, this is only the beginning and we are looking forward to furthering the conversation and seeing how this new asset class will merge with traditional markets.