The start of 2021 has been eventful for Blockchain and cryptocurrency enthusiasts across the globe, as valuations of Bitcoin and Ethereum – the largest and second largest cryptocurrencies by market capitalization, respectively – soared to historic highs. This development has prompted many economists and financial advisors to view the crypto market in a new light. While the increasing institutional interest has left many surprised, some proponents believe the best is yet to come.
One of the leading voices championing cryptocurrencies in the Middle East is Khurram Shroff, the Chairman of the IBC group and one of the region’s largest “HODLers”, with an estimated one million Bitcoins. Khurram was also instrumental in the recent Ethereum 2.0 launch, which saw him invest $10 million for 20,000 stakes, which helped the beacon chain reach its threshold and go live. We spoke with Khurram, who elaborated on some of the key aspects driving the crypto market’s current run, and how he expects things to play out in the near-to-distant future.
Can you tell us what Bitcoin’s current bull run means to you?
I have been involved in the Bitcoin Blockchain since 2009, right from the start, when each coin was valued at $0.0008. Today, as Bitcoin crosses the $40,000 mark, it is a validation of my decade-long belief in decentralized, inflation-resistant and instantly-verifiable digital currencies. At IBC Group, we have adopted a spray-and-pray approach to these digital currencies, and invested in every single cryptocurrency in existence today. We currently hold over 4,000 different cryptocurrencies, which we believe speaks for our commitment towards promoting the entire Blockchain industry. The security and transparency afforded by cryptocurrencies are in a league of their own, compared to traditional fiat currencies and investment avenues like bullion, and the world is beginning to see this now.
You have been an ardent supporter of Ethereum. What is the future you envision for Ether?
Ethereum has made great strides recently, along with Bitcoin. It has its own fan base, and is now catering to a wider market. I was a big supporter of the recent launch of Ethereum 2.0, which replaces the traditional, energy-intensive Proof-of-Work model, with a sustainable Proof-of-Stake model. This, I believe, is the crypto market’s way of showing how it is aligned with the evolving needs of the contemporary world. These recent breakthroughs have encouraged the IBC Group to extend its crypto and Blockchain footprint further, through an investment of $1 billion into a joint venture with Canada-based BitBit Financial. Together, we will launch Blockchain-based projects out of Canada, including a digital securities exchange, a tokenization platform and over 3,000 Bitcoin ATMs.
How do you see the bull run play out in 2021? What is different this time, compared to the 2017 run?
Unlike previous bullish phases, which were largely inspired by retail interest, the current bull run is driven by diversified market forces. In fact, the year 2020 can be regarded as the critical inflection point in mainstream crypto adoption. In response to the pandemic and the subsequent economic fallout, many institutional investors turned to hedging against inflation in fiat currencies. And as central banks continued to print money, inflationary pressures continued to mount. In such a volatile economic climate, decentralized cryptocurrencies like Bitcoin and Ether have emerged as the most viable hedge instruments.
This traction is set to continue its upward trajectory, with the sustained institutional interest. Be it Paypal, S&P Dow Jones Indices or the entry of old-school billionaires into the crypto pool, the current market sentiment is unlike any other that I’ve witnessed in previous bull runs. Industry stalwarts like Tyler Winklevoss have gone as far as projecting a $500,000 valuation per Bitcoin and $75,000 valuation per ether, in the near future.
Where do you think the UAE and the GCC region stand in the larger crypto revolution? What are the opportunities we can unlock?
The GCC region has been particularly receptive to Blockchain-based applications. The Dubai Blockchain Strategy, the Emirates Blockchain Strategy, the Saudi Arabian Monetary Authority’s use of Blockchain technology and the establishment of the Global Blockchain Council by Dubai Future Foundation are a few notable examples.
I’m particularly enthused over UAE’s exploration of Blockchain use cases in public governance. Since transparency and financial democratization are central to Blockchain and crypto transactions, such endeavours could have a major positive impact on the nation’s socio-economic development. With many such initiatives in the pipeline, I believe we are on the right track to harnessing the opportunities that Blockchain has to offer.
What is in works at the IBC Group? Any plans to invest in UAE’s Blockchain startups or the emerging DeFi segment?
On the back of the recent bull run, around 300 original members of the IBC Group, spread across 190 countries, retired on the 7th of January 2021 with a few million each, after cashing in on their Bitcoin holdings. This is a proud moment for me, our investors, employees and partners. But we are only getting started.
The UAE offers a fertile ground for Blockchain startups and applications to thrive. And I believe decentralized financial services can play a key role in increasing purchasing power and aiding post-pandemic economic recovery. So, we are keeping tabs on the latest developments in Blockchain and DeFi, and will offer our expertise and use our Blockchain acumen to promote the industry, whenever opportunities unfold.
About Khurram Shroff
Arab ‘whale’ Khurram Shroff, whose IBC group holds more than a million Bitcoin, has been an ardent champion of Blockchain and was also instrumental in the recent launch of Ethereum 2.0, through an investment of $10 million (around 20,000 Ether stakes). Khurram is an award winning global banking and finance leader, who has been featured in the prestigious list of the “Top100 Most Powerful and Influential Muslims in Great Britain and the World” by Power100. He is the Chairman of IBC Group, which is a substantial Global Real Estate and Tech investment company based in the UAE, as well as Chairman of Gallery Suites, which focuses on inspirational living with bespoke art collections in holiday home properties across Middle East and Asia.