With the technological advancement in the global financial market, cryptocurrencies and crypto assets are increasingly helping companies and economies to step into the digital world. However, many people still confuse these two concepts, which, although related, bring important differences.
“The two solutions are linked to the new era of decentralization of transactions and investments, but not necessarily one is equal to the other, especially when we look at the possibilities of applications,” says the CEO of Pinbank, one-stop-bank-provider with a complete ecosystem of financial solutions, Felipe Negri.
Main characteristics
Basically, a crypto asset is a digitally encrypted asset. Among the options in this category are cryptocurrencies, but there are also alternatives like NFTs (an acronym in English for “Non-Fungible Tokens”), stablecoins, and utility tokens.
“When we talk only about crypto assets, we are discussing a more abstract idea because they do not depend on fiat currencies to determine their value,” says Negri. “That is, they are assets that follow the market completely disconnected from a governmental model or a specific strategy, depending much more on supply and demand,” he adds.
Cryptocurrencies, on the other hand, have a value backed by real currencies, which, in turn, bring processes guaranteed by governments. One of the main examples is BTC (Bitcoin); according to CoinMarketCap, it exceeded the price of US$ 85,000 in mid-April and increasingly becomes an accepted option by different investors and organizations.
“In the case of cryptocurrencies, which are backed by natural currencies, the supply does not occur haphazardly,” explains the CEO of Pinbank. “For this reason, there is a market movement as a whole to embrace this crypto asset, as it is a solution to streamline and optimize payments and transfers around the world,” he adds.
Evolution in Brazil
In Brazil, the cryptocurrency market is heating up, which can be identified by the performance of cryptocurrencies themselves. Data from the Federal Revenue Service reinforces this reality by revealing that these assets moved around R$ 248 billion between January and September 2024.
On the other hand, Negri points out that there is a significant challenge in the country to make the use of these alternatives more clear. “New technologies always need to be applied to solve pains, which in this case relate to the prevention of financial risks. This means that both governments need to educate the population on the subject and accelerate their regulations, and companies must create services to reduce fees and improve user experiences,” he notes.
The executive also emphasizes that the development of the crypto segment can help Brazil face the ‘fiscal chaos.’ “Seeking to tackle exchange rate volatility through innovation is an efficient way to enhance commercial operations and even investment strategies, without being at the mercy of global economic uncertainties. In other words, the market has a much greater chance of achieving sustainable growth with the digitalization of processes,” he concludes.
