Source: in-cyprus.philenews.com
Digital assets, stablecoins and new payment technologies could create significant opportunities for Cyprus’s banking sector and service-based economy, but their wider adoption will depend on regulatory clarity, consumer trust, specialist talent and cooperation between traditional banks and fintech companies, industry executives told the Forbes Cyprus Next Gen Banking & Fintech Summit in Limassol on Tuesday.
Representatives of Kraken, Nuvei and Bank of Cyprus said that financial technology was increasingly moving beyond investment and speculation towards practical applications in cross-border payments, everyday transactions and business services.
The discussion, titled The New Finance Stack: Digital Assets, Payments and the Service Economy, was moderated by Professor Pieris Chourides, Dean of the School of Business Administration and Digital Technologies at European University Cyprus.
Chourides presented preliminary findings from research into Cyprus’s fintech sector, estimating that nearly 200 companies operate in the industry, with approximately 55% involved in payments.
He also referred to research indicating that companies from India and the wider region were using Cyprus as a base to enter European markets, taking advantage of its regulatory environment and access to specialised skills.
Kraken: Regulatory clarity helped attract investment
Alexia Theodorou, European Head of Derivatives and CEO of Kraken Cyprus, said the clarity and accessibility of the island’s regulatory authorities had played an important role in the company’s decision to establish its European base in Cyprus.
Kraken had considered several European jurisdictions and held discussions with regulators before making its decision, she explained.
“What made Cyprus win is that there was a lot of clarity from regulators here, and that is super important,” Theodorou stressed.
She argued that regulation had helped digital assets move towards practical financial applications, particularly through stablecoins and tokenisation.
As an example, she cited Kraken’s tokenised equities, which she said allowed investors to trade around the clock and use their assets in ways not readily available through traditional financial systems.
However, Theodorou stressed that technology needed to solve real problems rather than simply introduce new ways of carrying out existing activities.
She identified opportunities for Cyprus’s tourism industry, including faster settlement of transactions, potentially lower costs and automated payment processes.
Theodorou also highlighted the need for specialist skills in areas such as engineering and risk management, alongside stronger cooperation between fintech businesses and established financial institutions.
Nuvei: Innovation must solve customers’ problems
Laura Miller, Chief Revenue Officer and Global Head of eCommerce at Nuvei, said early expectations that cryptocurrencies would become a universal means of payment had been exaggerated.
Instead, she argued that the real value of emerging technologies lay in making transactions easier, faster and more accessible.
Consumers were primarily concerned with convenience and security, rather than the technology operating behind a payment service, Miller said.
She pointed to the growth of contactless payments and digital wallets as examples of technological adoption driven by practical benefits.
Stablecoins could also improve international transfers and access to financial services in less developed markets, provided users and businesses were confident in their safety and reliability.
Miller added that regulation needed to keep pace with innovation without unnecessarily restricting technological development.
“You want to regulate risk. You don’t want to regulate the novelty of the technology,” she said.
She also highlighted Cyprus’s close connections between regulators, businesses and financial institutions as an advantage for developing new services.
Bank of Cyprus calls for stronger policy support
George Kousis, Executive Director of Technology and Operations at Bank of Cyprus, said traditional banks were also preparing to incorporate digital assets and emerging payment technologies into their services.
He argued that established financial institutions could combine innovation with their capital strength, regulatory experience and existing customer relationships.
Kousis referred to discussions surrounding potential participation in bank-backed stablecoin initiatives, illustrating how traditional institutions were examining the technology.
He stressed that adopting new technologies must not undermine the trust banks have built with customers.
Kousis also raised concerns about the availability of experienced technology professionals in Cyprus, saying the challenge was not simply finding qualified graduates but recruiting people capable of competing internationally.
Despite the country’s progress in digital payments, further policy support was necessary, he said.
“It’s not about the people; it’s about getting the policies right,” Kousis said.
Looking ahead, the panellists expected digital payments and financial technologies to become increasingly integrated into everyday services, allowing customers to benefit without necessarily understanding the underlying systems.
They also identified opportunities for Cyprus to attract international fintech businesses and strengthen its service economy, provided the country continued investing in skills, effective regulation and cooperation between established and emerging financial companies.
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