Thanasis Noulas (Trade Republic): "Europe must not lose its lead in crypto"

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A former Uber, Airbnb and Netflix employee, the head of technology at German investment app, Trade Republic, knows the U.S. well. We met him in Berlin. For him, financial innovation and the crypto industry are an asset for Europe.

You joined Trade Republic a little over two years ago. What is your role here?

Our goal is to create a global company. When I say global, I'm not talking about size, but about its reach, its footprint.

Google, Meta, Uber, Stripe or Coinbase are global companies. Everyone knows them and it is not a question of size, but of standards and ability to impose themselves on their market.

I like to start with that because that's why I'm here in Berlin. I came to Trade Republic to become a global company that transforms the way we invest.

Do you think Trade Republic will successfully disrupt its industry like Uber or Netflix?

Every situation is different. I believe in the success of Trade Republic because finance is a highly regulated industry. When you're in a less regulated environment, or not regulated at all, it's much more complicated to compete with Americans who have a lot more capital.

The advantage of a regulated business like finance is that it creates a common framework for everyone. You can't have an Uber or an Airbnb coming in and imposing its rules. This is an opportunity for European players.

How do you see Trade Republic?

We are a company that allows people to invest their money in the best way for the long term. This is a fundamental issue. Your money represents your work, all the time you've invested. In the United States, this is taken more seriously than in Europe.

Does Trade Republic give advice?

Do you want to read more?

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No, our role is not to tell people what to do, but to enable them to do it.

Trade Republic is not a bank, but you don't like to be called an "investment application" either. What are you then?

This is a very good question. We don't want to be a bank with a mobile app, nor do we want to be an investment app with a banking license.

We are convinced that the investment world is going to experience a revolution, and we like to think of ourselves as the "Booking" of investment.

What does that mean?

I'm old enough (40 years old, ed.) to remember my first vacations when I still went through travel agencies. At that time, and it still exists, they provided you with packages with the hotel, the plane, and all that cost you 2%, 3% or even 4% in commissions. It's the same thing in the financial world.

Today, you are able to invest your money directly, as you can book your hotel, take a plane...

Is it as simple as that?

No, of course, you also need to have the right product, the right design, and the lowest possible costs. We have a simple system at Trade Republic that sets us apart from the competition: it's 1 euro per transaction regardless of the volume.

Is this the only thing that differentiates you from the competition?

When I arrived in 2020 to take over as Trade Republic's data/engineering director, Tech represented 40 people. Today, we are more than 200, we have invested a lot in this area (there are 700 employees at Trade Republic, editor's note).

You raised $900 million in 2021 when the markets were euphoric. Isn't it too complicated with this Bear Market?

Everyone is affected, there has been a drop in activity, but we are cautious. And paradoxically, the drop in the markets also encourages people to invest. They say to themselves that this is the right time. That's why we've had a very good start to 2023.

Germany has a strong fintech culture. How do you explain this?

The German economy is the largest in Europe. If you add to that the fact that there is a real culture of savings and investment, in any case more than in the rest of Europe, as well as a lot of engineers, you have a fairly fertile ground for the development of fintech.

Who do you talk to?

If I tell you everyone, you won't believe me, but I do.

We obviously target working people who want to invest, but also retirees, and from this point of view the current debates in Europe on pensions show how important the management of long-term savings is, and of course also younger people who are attracted by alternative products and in particular crypto-currencies.

Trade Republic allows you to invest in crypto-currencies. Why? What do you think about this universe?

Lots of good things. We have to be lucid, crypto-currencies have become a major topic. Individuals are interested in it, companies are interested in it, even states! Toothpaste is out of the tube and no one will be able to get it in.

Look at what has happened in the last few days. Several US banks have just fallen, people are looking for an alternative financial system and cryptocurrencies are part of the answer. Especially for the new generation.

Cryptocurrencies are still quite volatile. Don't you have a duty of care about what you offer on the platform?

We allow you to buy and sell more than 50 crypto-currencies, in a secure environment. It would even be a mistake for us not to do so if we are convinced that we offer the best framework to do so.

You allow buying and selling cryptocurrencies, but not withdrawing or sending them. Why not?

There is a balance to be found between ease of use and safety. We don't want to do what some people do and expose our customers. As I said, we are in a regulated industry and therefore we want to follow the regulations.

Take the case of the exchange platform Gemini. They started by following step by step the American regulation, they were the good student, everything was going well, and then they wanted to go faster than the music, and we know what happened (nearly a billion dollars are blocked at a provider linked to the collapse of FTX, editor's note)...

Europe is in the process of getting a crypto regulation, MiCA, which is a very good thing. We will wait for it to come into force to launch new products, offer new features.

We also need to be aware of one thing: in 2023, sending and receiving cryptos is a nightmare in terms of compliance and anti-money laundering. And I'm not even talking about taxation. These are real hurdles that are going to have to be simplified.

Speaking of obstacles, you've seen that the US stock market regulator (SEC) has decided to hit the crypto industry hard. Isn't this an opportunity for Europe?

Yes, of course, but you have to keep in mind that Europe moves slowly. Everything is slower in Europe, which allows us to make fewer mistakes, but also to seize fewer opportunities. It's a real choice! Regarding crypto, Europe is ahead, so good. But we have to keep this lead.

What could prevent us from keeping it?

Reversals, new laws that would prohibit, for example, the Proof of Work, or that would fragment the market as the United States is considering doing by considering bitcoin as a commodity and all other cryptos as conventional financial assets... With that you create a two-tier market, and you break the machine.

What do you think could accelerate the adoption of cryptos?

There are many factors, but I see one that is never mentioned even though it is important: de-globalization. With geopolitical tensions, trade between certain zones will become increasingly complicated. This is already the case between the United States and China or between Russia and Europe. Yet in this context, the only way to continue to transfer value is by using cryptocurrencies.

You are European (Greek, ed.) and have worked in several large American technology companies. What has this taught you?

Technology companies are very different from traditional companies.

The margins of Tech companies, especially in the US, are off the charts, so as long as you manage to grow, you don't need to be efficient, you make money easily if I may say so. It's afterwards that things can get complicated, as we're seeing today with some of the tech giants (Meta has just announced the loss of 10,000 jobs, ed.)

What's also very different is that tech companies attract a lot of talent. And that's what it takes to create giants like Netflix or Google.

How can we make these giants European?

Not easy (laughs). To create these great groups, you have to be able to attract the best people and keep them. And to do that, you have to be able to pay them well. Until we understand that in Europe, we won't succeed...

Imagine, today the biggest European technology company is called Booking, and it weighs less than 100 billion dollars (Thanasis Noulas worked there for 2 years, editor's note). Do you really think the Americans are afraid of Booking or other European players of this size? They hardly know we exist. That's why Europe has to move.

The philosophy behind Web3 is one of decentralization, but yet people use centralized players a lot to buy cryptos. What do you think about this paradox?

Today we talk about decentralization while the Web3 universe is particularly centralized. There are no official figures, but a large majority of crypto holders are via platforms, and for some they have no idea how it works.

How can we change things?

There needs to be a use case that switches hundreds of millions of users. I think this will come through digital wallets, which today are still complicated to use.

We tend to forget it, but the first "mobile" phones date back to the 1980s. They were reserved for big bosses and traders. At the time, we wondered what they could be used for by the general public. 30 years later, this kind of question would make everyone laugh.

Speaking of use cases, you couldn't miss ChatGPT which is the sensation of this beginning of the year. They just released the new version (ChatGPT 4). Is this a topic for you?

Of course, but we are very clear about artificial intelligence: we don't want to become a robot-advisor, so we have to be very careful with tools like ChatGPT when it comes to investing.

As for the rest, what is certain is that artificial intelligence will allow us to improve things internally, in terms of processes. It is possible to automate many tasks!

Do you want to join the Web3 revolution?

Find the best of the crypto, NFT and DeFi news every Wednesday and Thursday in the two newsletters written by our specialised journalists Grégory Raymond and Raphaël Bloch.

Thanasis Noulas (Trade Republic): "Europe must not lose its lead in crypto"
Published on
Published on
March 15, 2023

Thanasis Noulas (Trade Republic): "Europe must not lose its lead in crypto"

A former Uber, Airbnb and Netflix employee, the head of technology at German investment app, Trade Republic, knows the U.S. well. We met him in Berlin. For him, financial innovation and the crypto industry are an asset for Europe.

You joined Trade Republic a little over two years ago. What is your role here?

Our goal is to create a global company. When I say global, I'm not talking about size, but about its reach, its footprint.

Google, Meta, Uber, Stripe or Coinbase are global companies. Everyone knows them and it is not a question of size, but of standards and ability to impose themselves on their market.

I like to start with that because that's why I'm here in Berlin. I came to Trade Republic to become a global company that transforms the way we invest.

Do you think Trade Republic will successfully disrupt its industry like Uber or Netflix?

Every situation is different. I believe in the success of Trade Republic because finance is a highly regulated industry. When you're in a less regulated environment, or not regulated at all, it's much more complicated to compete with Americans who have a lot more capital.

The advantage of a regulated business like finance is that it creates a common framework for everyone. You can't have an Uber or an Airbnb coming in and imposing its rules. This is an opportunity for European players.

How do you see Trade Republic?

We are a company that allows people to invest their money in the best way for the long term. This is a fundamental issue. Your money represents your work, all the time you've invested. In the United States, this is taken more seriously than in Europe.

Does Trade Republic give advice?

Do you want to read more?

Only premium subscribers have access to this article!
Sign up to access the best content, get exclusive info and join the whale community. 🐳

Subscribe for free to read more.

No, our role is not to tell people what to do, but to enable them to do it.

Trade Republic is not a bank, but you don't like to be called an "investment application" either. What are you then?

This is a very good question. We don't want to be a bank with a mobile app, nor do we want to be an investment app with a banking license.

We are convinced that the investment world is going to experience a revolution, and we like to think of ourselves as the "Booking" of investment.

What does that mean?

I'm old enough (40 years old, ed.) to remember my first vacations when I still went through travel agencies. At that time, and it still exists, they provided you with packages with the hotel, the plane, and all that cost you 2%, 3% or even 4% in commissions. It's the same thing in the financial world.

Today, you are able to invest your money directly, as you can book your hotel, take a plane...

Is it as simple as that?

No, of course, you also need to have the right product, the right design, and the lowest possible costs. We have a simple system at Trade Republic that sets us apart from the competition: it's 1 euro per transaction regardless of the volume.

Is this the only thing that differentiates you from the competition?

When I arrived in 2020 to take over as Trade Republic's data/engineering director, Tech represented 40 people. Today, we are more than 200, we have invested a lot in this area (there are 700 employees at Trade Republic, editor's note).

You raised $900 million in 2021 when the markets were euphoric. Isn't it too complicated with this Bear Market?

Everyone is affected, there has been a drop in activity, but we are cautious. And paradoxically, the drop in the markets also encourages people to invest. They say to themselves that this is the right time. That's why we've had a very good start to 2023.

Germany has a strong fintech culture. How do you explain this?

The German economy is the largest in Europe. If you add to that the fact that there is a real culture of savings and investment, in any case more than in the rest of Europe, as well as a lot of engineers, you have a fairly fertile ground for the development of fintech.

Who do you talk to?

If I tell you everyone, you won't believe me, but I do.

We obviously target working people who want to invest, but also retirees, and from this point of view the current debates in Europe on pensions show how important the management of long-term savings is, and of course also younger people who are attracted by alternative products and in particular crypto-currencies.

Trade Republic allows you to invest in crypto-currencies. Why? What do you think about this universe?

Lots of good things. We have to be lucid, crypto-currencies have become a major topic. Individuals are interested in it, companies are interested in it, even states! Toothpaste is out of the tube and no one will be able to get it in.

Look at what has happened in the last few days. Several US banks have just fallen, people are looking for an alternative financial system and cryptocurrencies are part of the answer. Especially for the new generation.

Cryptocurrencies are still quite volatile. Don't you have a duty of care about what you offer on the platform?

We allow you to buy and sell more than 50 crypto-currencies, in a secure environment. It would even be a mistake for us not to do so if we are convinced that we offer the best framework to do so.

You allow buying and selling cryptocurrencies, but not withdrawing or sending them. Why not?

There is a balance to be found between ease of use and safety. We don't want to do what some people do and expose our customers. As I said, we are in a regulated industry and therefore we want to follow the regulations.

Take the case of the exchange platform Gemini. They started by following step by step the American regulation, they were the good student, everything was going well, and then they wanted to go faster than the music, and we know what happened (nearly a billion dollars are blocked at a provider linked to the collapse of FTX, editor's note)...

Europe is in the process of getting a crypto regulation, MiCA, which is a very good thing. We will wait for it to come into force to launch new products, offer new features.

We also need to be aware of one thing: in 2023, sending and receiving cryptos is a nightmare in terms of compliance and anti-money laundering. And I'm not even talking about taxation. These are real hurdles that are going to have to be simplified.

Speaking of obstacles, you've seen that the US stock market regulator (SEC) has decided to hit the crypto industry hard. Isn't this an opportunity for Europe?

Yes, of course, but you have to keep in mind that Europe moves slowly. Everything is slower in Europe, which allows us to make fewer mistakes, but also to seize fewer opportunities. It's a real choice! Regarding crypto, Europe is ahead, so good. But we have to keep this lead.

What could prevent us from keeping it?

Reversals, new laws that would prohibit, for example, the Proof of Work, or that would fragment the market as the United States is considering doing by considering bitcoin as a commodity and all other cryptos as conventional financial assets... With that you create a two-tier market, and you break the machine.

What do you think could accelerate the adoption of cryptos?

There are many factors, but I see one that is never mentioned even though it is important: de-globalization. With geopolitical tensions, trade between certain zones will become increasingly complicated. This is already the case between the United States and China or between Russia and Europe. Yet in this context, the only way to continue to transfer value is by using cryptocurrencies.

You are European (Greek, ed.) and have worked in several large American technology companies. What has this taught you?

Technology companies are very different from traditional companies.

The margins of Tech companies, especially in the US, are off the charts, so as long as you manage to grow, you don't need to be efficient, you make money easily if I may say so. It's afterwards that things can get complicated, as we're seeing today with some of the tech giants (Meta has just announced the loss of 10,000 jobs, ed.)

What's also very different is that tech companies attract a lot of talent. And that's what it takes to create giants like Netflix or Google.

How can we make these giants European?

Not easy (laughs). To create these great groups, you have to be able to attract the best people and keep them. And to do that, you have to be able to pay them well. Until we understand that in Europe, we won't succeed...

Imagine, today the biggest European technology company is called Booking, and it weighs less than 100 billion dollars (Thanasis Noulas worked there for 2 years, editor's note). Do you really think the Americans are afraid of Booking or other European players of this size? They hardly know we exist. That's why Europe has to move.

The philosophy behind Web3 is one of decentralization, but yet people use centralized players a lot to buy cryptos. What do you think about this paradox?

Today we talk about decentralization while the Web3 universe is particularly centralized. There are no official figures, but a large majority of crypto holders are via platforms, and for some they have no idea how it works.

How can we change things?

There needs to be a use case that switches hundreds of millions of users. I think this will come through digital wallets, which today are still complicated to use.

We tend to forget it, but the first "mobile" phones date back to the 1980s. They were reserved for big bosses and traders. At the time, we wondered what they could be used for by the general public. 30 years later, this kind of question would make everyone laugh.

Speaking of use cases, you couldn't miss ChatGPT which is the sensation of this beginning of the year. They just released the new version (ChatGPT 4). Is this a topic for you?

Of course, but we are very clear about artificial intelligence: we don't want to become a robot-advisor, so we have to be very careful with tools like ChatGPT when it comes to investing.

As for the rest, what is certain is that artificial intelligence will allow us to improve things internally, in terms of processes. It is possible to automate many tasks!

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Do you want to join the Web3 revolution?

Find the best of the crypto, NFT and DeFi news every Wednesday and Thursday in the two newsletters written by our specialised journalists Grégory Raymond and Raphaël Bloch.