It may seem odd that numerous fintechs, including Betterment and Step just this week, are launching cryptocurrency trading services during the so-called Crypto Winter, as prices of the assets have crashed over recent months. And yet neobank Current, known for its early paycheck deposit feature and high-yield savings accounts, is now among them, launching their much-teased crypto trading feature this week.
“For us, it’s really about access. We didn’t time this release with a Crypto Winter, we got it to market as quickly as we could when we said, ‘Okay, there’s value here,’” Trevor Marshall, Current’s chief technology officer, told Fortune. Current CEO Stuart Sopp added that “for a product’s growth and attach rate and all that stuff, you probably don’t want to launch in the height of the high,” noting that it could also be more advantageous for users to get into crypto at lower prices (but that this is not investment advice). Unlike industry titans such as crypto exchange Coinbase, which recently took a big hit on transaction revenue owing to the crash, Current doesn’t care as much about how many people are transacting, and how often, insofar as they’re not monetizing the feature—at least not right now.
As a zero-fee service for Current, “we don’t see this as a primary revenue stream,” Sopp said. Instead, the value for Current is to keep users in its ecosystem of other revenue-generating products and services: “Engagement even with a limited number of trades drives retention into the platform,” Marshall noted. The crypto trading feature, which has been live since Wednesday, only lets users buy and sell crypto for now, offering 27 tokens (including, of course, Bitcoin and Ethereum, as well as others like Dogecoin). The company, which claims to have over 4 million users, says customers can get instant liquidity from their crypto trading into their spending accounts, which they can then put in savings.
The company is partnering with several third-party firms to facilitate the trading and hold the crypto, as Current doesn’t currently custody any crypto, Marshall said, but declined to provide names.
Current is far from the only fintech venturing into crypto, and fee-free trading is also not unique to them. Its move comes at a time when other fintech players in more traditional finance spaces are adding crypto features to their platforms. This week, robo-advisor Betterment launched crypto investing, which includes four thematic crypto offerings, while Gen Z neobank Step launched Bitcoin investing on Tuesday. Entrenched players like PayPal and Block, formerly Square, have been ahead of the curve, adding crypto trading features on their apps in recent years (Block’s Cash App, for instance, skyrocketed in popularity during the crypto boom in 2021).
Marshall argues that since Current is offering a bank account plus crypto, it’s not in direct competition with the likes of Coinbase, but he does concede the fintech firm is brushing up against stalwarts like Revolut, the $33 billion startup based in the U.K. that also offers zero-fee (up to $200,000 a month) crypto services, as well as PayPal. But to Marshall, the difference “really comes down to primacy, which is, we are where our customers get their paycheck.”
The company has ambitions to expand further into crypto and Web3 in ways that could become revenue-drivers down the line. “This is really just the beginning of a longer crypto road map for us, and I think there’s more direct monetization available in some of the more advanced types of features we want to build,” Marshall noted. Sopp said that enabling access to USDC, the stablecoin pegged to the U.S. dollar, as well as wallet functions, is Current’s “natural next step.” The new crypto feature isn’t Current’s first foray into the space: Marshall noted they originally started building bridges to the likes of Ripple back in its early days.
However the macroeconomic environment has been rocky for tech and fintech companies, and Current has been working on improving margins and slowing hiring to shore up, Sopp says. The fintech was most recently valued at $2.2 billion following a $220 million funding round in early 2021, and firms like Andreessen Horowitz and Tiger Global Management back the fintech. Even amid the tricky climate, Sopp says, “we probably don’t need to raise next year,” but that “everyone’s going to look [to] sometime next year,” referring to fellow startups. He estimates Current can be profitable in 2024.
As for a potential IPO, it’s something Sopp “for sure” wants to do—but not anytime soon.
