Consultancies Should be Cautious of Ignoring Crypto-Convert Clients
This article originally appeared in Consultancy UK.
After a meteoric rise and fall, much of the hype around cryptocurrency has faded from mainstream discourse. But according to Danny Barugh, founder and chief executive officer of LondonLink, that may not mean that professional services firms can afford to write it off yet.
The paradox of cryptocurrencies is that the most compelling salespeople are those who don’t shout about it. Businesses that use crypto tend not to go on social media to ‘pump-and-dump’ the latest coin; they’re too busy harnessing crypto’s unique capabilities to transform their operations, slash costs, and remove the barriers to transacting across borders.
These businesses – your potential clients – are the best crypto advocates you’ve never heard of. The question for professional services firms is not what they themselves think about crypto but whether they can afford to ignore a huge market of potential clients that have already made up their minds. Industry analysis showed that more than $7 trillion was transferred via stablecoins in 2023, growing ten times since June 2020.
Considering Crypto
We won’t deny it: crypto can be complicated, and there are many reasons. When it comes to your customers and clients, the primary motivation is quite straightforward: to do business better.
First, some housekeeping: Crypto encompasses a wide range of digital money, but the most important distinction is between decentralised coins that float freely (like Bitcoin) and those that are pegged to a fiat currency, known as stablecoins. While there are strong business use cases for Bitcoin, stablecoins have the most obvious, immediate, and transformative utility for businesses.
The advantage of stablecoins is that they feel familiar to “traditional” money yet operate far more efficiently. Like any blockchain-based currency, stablecoins bypass traditional, fiat financial infrastructure; they cut out the middlemen and enable near-instant, low-cost transactions between any two parties anywhere in the world. The benefits are obvious: suddenly, professional services firms can open up new markets where the cost of business (or capital controls) previously made it impossible.
Is it secure?
If crypto’s superpowers sound miraculous – and they are – then you may still be wary of its historic association with financial crime. Certainly, there are some shadowy use cases for criminals. But that doesn’t delegitimise crypto any more than the existence of other digital services used by the criminal underworld (or, for that matter, that perennial favourite of criminals, cash).
There’s a good reason gangsters don’t use mainstream crypto: it’s not nearly as ‘anonymous’ as it’s made out to be. Bitcoin transactions can be traced, and stablecoins are just as visible, if not more transparent than government money. That’s exactly as it should be, and it’s why financial regulators worldwide are changing their tune on crypto. They once deprecated it in the strongest terms; now they’re slowly but inevitably moving towards regulating crypto, with some central banks even issuing their own digital currencies powered by blockchain.
According to Chainalysis, the blockchain analysis tool favoured by governments and law enforcement, crypto transactions only comprised 0.34% of the volume of illicit transactions. Meanwhile, the United Nations estimates that between 2% and 5% of global GDP is laundered each year.
How do I harness crypto?
There’s no easy answer to that question. After all, you know your business and your market better than us. Still, the principles we’ve outlined should give you a good idea of crypto's transformative possibilities for consulting and professional services firms.
Let’s take just one example: imagine a conveyance solicitor in Switzerland attempting to execute a sale of a property to someone in Turkey. This transaction will be tedious and time-consuming, full of hurdles and delays, and subject to a range of fees and FX costs – and that’s to say nothing about the huge volatility of the Turkish Lira that the buyer would need to keep in reserve for a months-long transaction.
If the transaction is made via stablecoin, all this expense, volatility, and friction are instantly swept aside. What makes crypto so exciting for consultancies—and such a genuine revolution in financial affairs—is that crypto is not just a basket of currencies but an entirely new financial infrastructure that unlocks new markets and turns any business, anywhere in the world, into a potential customer.
Adopt or not – but don’t ignore
It’s fine to have reservations about cryptocurrencies. Crypto's whole ethos, its whole culture, is based on doing your own research. It can’t solve all of your problems, but it may streamline cross-border transactions while opening up new markets.
That’s exactly what whole swathes of the global business (and consumer) population have done, before landing firmly in the crypto camp. And it’s not just your potential clients, but major rivals too: from PwC and Deloitte to Magic Circle law firms like Baker McKenzie and even central banks, some of the world’s biggest businesses and institutions are already investigating new business use cases for crypto.
It’s not up to us to change your mind, though. Our real advice on crypto is to listen carefully to those making the least noise.
