- Crypto.com is a cryptocurrency exchange app founded in Singapore by Bobby Bao, Gary Or, Kris Marszalek, and Rafael Melo.The company was founded on the belief that consumers have a basic human right to control their money, data, and identity.
- Crypto.com makes money via debit card interchange fees and maker-taker fees that it collects for matching buyers with sellers.
- Crypto.com also collects loan interest and charges two different sales fees in its NFT marketplace. Through Crypto.com Capital, the company also makes money by investing in emerging start-ups and selling its stake for a profit.
| Business Model Element | Analysis | Implications | Examples |
|---|---|---|---|
| Value Proposition | Crypto.com’s value proposition includes: – Cryptocurrency Wallet: Offering a secure and user-friendly wallet for storing and managing various cryptocurrencies. – Crypto Visa Card: Providing a Visa card that allows users to spend cryptocurrencies like traditional money. – Exchange Services: Offering a cryptocurrency exchange platform for trading digital assets. – Earn and Borrow: Allowing users to earn interest on deposited cryptocurrencies and borrow against their holdings. Crypto.com appeals to cryptocurrency enthusiasts and users looking for a one-stop platform for managing digital assets and using them in daily life. | Attracts users seeking secure cryptocurrency storage and management. Offers a convenient way to spend cryptocurrencies with the Crypto Visa Card. Engages traders with a cryptocurrency exchange platform. Provides opportunities to earn interest and borrow against crypto holdings. Delivers a comprehensive value proposition for cryptocurrency users. | – Secure cryptocurrency wallet services. – Crypto Visa Card for spending digital assets. – Cryptocurrency exchange platform for trading. – Earn and Borrow features for crypto holders. |
| Customer Segments | Crypto.com serves the following customer segments: 1. Cryptocurrency Enthusiasts: Users interested in holding and managing cryptocurrencies. 2. Traders: Individuals and entities engaged in cryptocurrency trading. 3. Everyday Users: People looking to use cryptocurrencies for everyday purchases and transactions. 4. DeFi Participants: Users interested in decentralized finance (DeFi) services like earning interest and borrowing. Crypto.com caters to a broad range of users within the cryptocurrency space. | Attracts cryptocurrency enthusiasts interested in secure storage. Engages traders with a cryptocurrency trading platform. Serves everyday users looking to use cryptocurrencies for daily transactions. Connects users to DeFi services for earning and borrowing. Diversifies customer segments for broader market reach. | – Cryptocurrency enthusiasts and holders. – Traders engaged in cryptocurrency trading. – Everyday users looking to use cryptocurrencies. – DeFi participants interested in earning and borrowing. |
| Distribution Strategy | Crypto.com’s distribution strategy includes: – Mobile App: Offering a mobile application for convenient access to wallet, trading, and card services. – Visa Card Issuance: Distributing physical Visa cards to users for spending cryptocurrencies. – Partnerships: Collaborating with various businesses to promote cryptocurrency usage. – Marketing: Utilizing digital marketing channels and partnerships to acquire users. Crypto.com ensures accessibility through its mobile app, physical Visa cards, partnerships, and digital marketing efforts. | Provides convenience through a mobile app for on-the-go access. Allows users to spend cryptocurrencies through physical Visa cards. Expands reach through partnerships with businesses and merchants. Utilizes digital marketing for user acquisition. Implements a multi-channel distribution strategy. | – Mobile application for wallet, trading, and card services. – Physical Visa cards for cryptocurrency spending. – Collaborations with businesses to promote crypto usage. – Digital marketing efforts and partnerships. |
| Revenue Streams | Crypto.com generates revenue through various streams: 1. Trading Fees: Earnings from fees charged to users for cryptocurrency trading on the platform. 2. Card Fees: Income from card issuance and card usage fees, including transaction fees. 3. Earn and Borrow Interest: Generating income from the interest earned on user deposits and interest charged on loans. 4. Premium Subscriptions: Revenue from premium subscription plans offering enhanced features and benefits. Crypto.com’s primary revenue sources include trading fees, card-related fees, and interest from DeFi services. | Earns revenue from trading fees on cryptocurrency exchanges. Generates income from card issuance and usage fees. Capitalizes on interest earned and charged through the Earn and Borrow feature. Diversifies revenue streams with premium subscription plans. Ensures financial sustainability through multiple income sources. | – Earnings from trading fees on the cryptocurrency exchange. – Income from card issuance and usage fees, including transactions. – Interest income from Earn and Borrow services. – Revenue from premium subscription plans offering enhanced features. |
| Marketing Strategy | Crypto.com’s marketing strategy involves: – Sponsorships and Partnerships: Partnering with sports teams, events, and influencers to increase brand visibility. – Referral Program: Encouraging users to refer friends in exchange for rewards. – Digital Advertising: Running digital advertising campaigns to attract users. – Community Engagement: Actively engaging with the cryptocurrency community through social media and forums. Crypto.com focuses on sponsorships, partnerships, referrals, digital advertising, and community engagement to grow its user base and brand presence. | Increases brand visibility through sponsorships and partnerships. Encourages user referrals to expand the user base organically. Runs digital advertising campaigns for visibility and user acquisition. Actively engages with the cryptocurrency community for ecosystem growth. Implements a comprehensive marketing strategy for brand growth. | – Sponsorships and partnerships with sports teams and influencers. – Referral incentives for users who refer friends. – Digital advertising campaigns for user acquisition. – Active engagement with the cryptocurrency community. |
| Organization Structure | Crypto.com’s organizational structure includes: – Executive Leadership: Responsible for strategic direction and decision-making. – Development Team: Overseeing software development, security, and technology enhancements. – Card Issuance Team: Handling card issuance and support for physical Visa cards. – Marketing and Partnerships: Promoting Crypto.com’s services and engaging with partners. Crypto.com maintains a structure aligned with core functions for efficient platform operation and ecosystem growth. | Led by executive leadership for strategic direction and growth. Employs teams dedicated to software development, security, and technology enhancements. Focuses on card issuance and support for physical Visa cards. Promotes Crypto.com’s services and engages with partners through marketing and partnerships. Maintains an organized structure for efficient operation and ecosystem expansion. | – Led by executive leadership for strategic direction and growth. – Teams responsible for software development, security, and technology enhancements. – Focus on card issuance and support for physical Visa cards. – Marketing and partnerships for service promotion and engagement. – Organized structure for efficient operation and ecosystem growth. |
| Competitive Advantage | Crypto.com’s competitive advantage stems from: – User-Friendly Services: Offering a user-friendly platform for cryptocurrency storage, spending, trading, and DeFi. – Visa Card Integration: Providing a seamless way to spend cryptocurrencies in daily life. – Diverse Cryptocurrency Support: Supporting a wide range of cryptocurrencies and DeFi tokens. – Marketing and Partnerships: Leveraging sponsorships and partnerships for brand visibility. – Multiple Revenue Streams: Generating income from trading, card fees, interest, and subscriptions. Crypto.com’s strengths in user-friendliness, Visa card integration, cryptocurrency support, marketing, and diversified revenue streams make it a competitive player in the cryptocurrency space. | Distinguishes itself with user-friendly and comprehensive cryptocurrency services. Facilitates cryptocurrency spending through Visa card integration. Attracts users with a diverse range of supported cryptocurrencies. Increases brand visibility through marketing and partnerships. Ensures financial stability through multiple revenue sources. Enjoys a competitive edge in the cryptocurrency market. | – User-friendly platform for cryptocurrency services. – Seamless cryptocurrency spending with Visa cards. – Support for a wide range of cryptocurrencies and DeFi tokens. – Leveraging sponsorships and partnerships for brand visibility. – Multiple revenue streams for financial stability. – A competitive edge in the cryptocurrency market. |
Origin story
Crypto.com is a cryptocurrency exchange app founded in Singapore by Bobby Bao, Gary Or, Kris Marszalek, and Rafael Melo.
In a 2020 interview by FinTech Magazine, CEO Kris Marszalek gave the following reasons for the creation of the trading platform:
“Crypto.com was founded on one belief: that it’s your basic human right to control your money, data, and identity. By harnessing the technology of blockchain and cryptocurrencies built on it, we can democratise finance and bring much needed transparency to banking systems, shifting the balance of power back to individuals and away from society’s most powerful institutions.”
The company was initially founded as Monaco in 2016, with plans to offer a Visa debit card where transactions were settled using a native currency called MCO.
The company secured a $26.7 million round of funding and signed deals with exchanges such as Binance and Bittrex to give it more exposure.
Though a functioning product was yet to be released, the company also managed to secure approval from financial regulators in Singapore in November 2017.
Monaco became Crypto.com in 2018 after the domain name was put up for sale and acquired for the sum of $12 million.
Three months later, the rebranded company shipped the first cards to Singaporean customers with regulatory approval then coming from the United States.
Native token CRO was released around the same time, which to some extent helped the platform surpass 1 million users by September 2019.
Rapid growth ensued after the platform offered derivatives trading and expanded into 31 European countries.
Crypot.com then acquired Australian fintech company The Card Group to secure a license to operate in that country, with an NFT marketplace unveiled in March 2021.
Additional new features included a free tax filing tool for crypto traders and a start-up fund dedicated to investing in crypto start-ups.
Today, Crypto.com has approximately 10 million users in 90 countries. Since March 2020, the company has processed more than $415 billion of trades on its exchange.
Crypto.com revenue generation
Crypto.com makes money via interchange fees, various trading fees, loan interest, NFT sales fees, and investment capital gains.
Below is a general look at the multi-dimensional revenue generation strategy of this private company.
Interchange fees
The Crypto.com branded debit card gives users access to various perks, including cashback rewards, cheaper subscriptions to Spotify and Netflix, and access to premium airport lounges, among other things.
The company makes money on interchange fees which are paid by the merchant to the card-issuing bank to cover the cost of facilitating the transaction. The fee is usually around 1% and is split between Visa and Crypto.com.
Trading fees
Like many cryptocurrency exchanges, Crypto.com works on the maker-taker trading fee structure.
Makers create buy or sell orders that are not carried out immediately, which increases liquidity when certain price conditions are met.
Those who do buy and sell instantly are called takers, who fill the orders created by the makers.
Crypto.com makes money by charging trading fees for matching buyers with sellers. Makers tend to be charged lower fees than takers because they are adding liquidity to the exchange.
Having said that, any trader can receive a discount on trading fees if they stake more of the native coin CRO or execute more trades.
The company also charges withdrawal fees, with the exact fee reliant on the destination of the funds and the type of currency withdrawn.
Loan interest
Crypto.com also offers margin loans to traders and more general loans to any account holder using the branded debit card.
Loan collateral can take the form of CRO, BTC, or ETH and the loan itself can be issued in either USDC, USDT, TUSD, or PAX.
The company collects interest on these loans according to the total loan amount and other factors such as the amount of staked CRO and the collateral provided.
NFT sales
Crypto.com operates an NFT marketplace where users can buy, sell, display, and even create NFTs.
For every NFT sale, the company charges creators a 15% fee. Sellers involved in secondary NFT sales are also charged a 5% processing fee to cover the operational costs of the marketplace.
Investment capital gains
In March 2021, the company launched Crypto.com Capital, a $200 million venture capital fund dedicated to investing in crypto start-ups at the seed and Series A stage.
Similar funds have been launched by competitors such as Binance and Coinbase to realize capital gains in emerging companies.
However, this strategy also gives the investing company access to private data that is used to guide future business direction and product development.
Read Next: Blockchain Business Models Framework Decentralized Finance, Blockchain Economics, Bitcoin.
Read Also: Proof-of-stake, Proof-of-work, Blockchain, ERC-20, DAO, NFT.
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