They think it's too late. They think, oh, it has done 100x, so it's too late. Market sentiment and retail investor sentiment is really at an all time low. Fear and greed index is an absolute fear. So now we're seeing a very tough bear market. What do you think will bring momentum back into Bitcoin? I've never seen this before, to be honest, like that. Where will we be, let's say, like a year or two from now? Hey, everyone. Joining me here this week at BTC Prague is Julian Lineger. He is the founder and CEO of Relay, which is the most popular Bitcoin exchange in Europe, right? Thank you. Thank you so much for having me, Natalie. Yes, I mean, popular, it depends on how you define popular, right? But definitely we're the Bitcoin only on ramp that people really know and use a lot in Europe. We're also a very proud sponsor here at this conference and we've onboarded more than 100,000 Europeans to Bitcoin and they bought around 20,000 Bitcoin with us in the last six years. So we're very proud of that. Tell me a little bit about the history of Relay. How did you come to build this company and why did you see Bitcoin adoption as something that you wanted to help with in Europe? So that story actually starts like 10, 11 years ago when I got into Bitcoin 2015 and I was fascinated by it but I had a very hard time buying it myself. I actually had to have this friend of mine who was more a tech nerd who showed me Bitcoin. I had him buy it. I went home, I was hooked, I tried to buy it, it was too complicated so I asked him, can you buy me one Bitcoin? It was 500 bucks back then. So I gave him basically 500 bucks in cash and he bought me the Bitcoin because it was too complicated for me as a non-tech nerd guy, right? And as I got deeper into the rabbit hole actually the next year Ethereum came out and back then I was not Bitcoin only yet I learned that now right but I was interested in investing in Ethereum in the ICO for one dollar per Ethereum and I couldn't do it because it was too complicated so I did not buy it would have been a good investment right so and I was frustrated of how complicated all these things are with Bitcoin crypto etc and so then fast forward 2018-19 I had this idea because a lot of people asked me, hey, Julian, can you help me buy Bitcoin? And it was just too hard. Like nine out of 10 of these people just didn't make it through. They only wanted to buy 100 bucks Bitcoin, maybe set up a savings plan. That's actually what I wanted to do as well. Set up a savings plan for 100 bucks a week or something. And there was nothing that just made it click and make it easy for the 90% of the people that are not tech and finance nerds like many in Bitcoin. So then I ended up really founding this company. I found my co-founder, who is a CTO, who could build these things that I had in mind. And so we went live in summer 2020 just to make Bitcoin easy to understand and easy to access for people. And ever since we've been on the same mission, still the same. Every day I get up and try to help people understand Bitcoin and get Bitcoin very easily, but in the right way. Like Bitcoin only, no other things that make it more complicated. in a self-custodial way. So what's different about Relay is as well, we're not a typical exchange like Coinbase or Bitpanda in Europe where the exchange holds the user fund. We never hold a penny of our user's fund. We're a self-custodial wallet integrated into the exchange. Why did you choose to do that? So first of all, it's of course an idealistic thing because the full potential, the full benefits of Bitcoin you only get really when you hold Bitcoin yourself. like take control of your future is our mantra basically we want to help people take control of their money no counterparty risk you can send it anywhere in the world to anyone over the internet no counterparty within a few seconds and it's just a true no one can censor it no one can take it away from you all of these things only work when it's self-custodian people actually hold it So we truly believe in that. But also, and that's more the controversial point, is that I believe long term it's going to be actually easier to use Bitcoin in a self-custodial way because it's much less regulated. Now that we have all these licenses, we see what you need to do if you hold Bitcoin on behalf or any asset on behalf of your clients. So, of course, now it's still like you need to write down the 12 words, you need to have a hardware wallet, etc. This is for many people like off-putting and too complicated. So that's why some, many of them prefer custodial exchange or even an ETF kind of thing. It's just easier. It's something that people know. But I feel like in the next five to ten years, the industry will come up. And we are coming up also with solutions like cloud backup, face backup, stuff like that, where you actually don't need to worry about the 12 words at all. You lose your phone. No worries. Buy a new phone. Download the app, face ID, cloud backup, a few clicks. And you have your whole funds and transaction history. and basically your whole financial life back again. And you really hold your coins. And it's actually easier than to interact with a custodial kind of traditional financial service, like even a bank. So I think this will go away and it will be actually in the self-custodial way. It's going to be easier to interact with Bitcoin than in a custodial way. That's really what we're working on, why we're doing this. Coin Stories is brought to you by Speed Wallet, my favorite Bitcoin lightning wallet. Buy Bitcoin with a card, Apple Pay, bank transfer, or cash, then send it or spend it all in one app. And with Speed Streaks, buying a little Bitcoin every day earns you real Bitcoin rewards. $100 or more every quarter just for building the habit. Download Speed Wallet at speed.app slash coin stories and use code coin stories 10 for bonus sats on your first buy. Let in just introduce their lowest rates ever. The larger the loan, the lower the rate on all new loans, refinances, and renewals. Your Bitcoin stays custodied, never lent out, and you can repay any time with zero penalties. And for all my gold bug listeners, Ledin now supports tokenized gold with gold-backed loans coming soon. But you know, I think there's no second best to Bitcoin. Get a quarter percentage point off your first loan at ledin.io. Tell me a little bit about your customers. Where are they primarily from? Are they more like older, younger, female, male, like give me the demographics that you're seeing. So our persona that we're working with is called Stefan. He lives on the countryside in Germany. He's 43 years old. He's a little bit overweight and he's a little bit below average IQ. And he works at a very normal job, you know, maybe as a taxi driver. These are the people we attract, just normal people on the street like people who are taxi drivers or hairdressers or work at the bar or you know students just all these people are not deep into finance or technology but just want to do better in life financially and these people are very interested in bitcoin but when it comes to all the tech and how do you explain bitcoin to the how we bitcoiners explain bitcoin to them is like they don't understand all the technicalities encryption and blockchain and it's peer-to-peer and they're like why what what is it what does this have to do with me right um so really the these are the newcomers that we didn't necessarily understand at the beginning we wanted to attract the millennials we thought our customers are like the revolute customers the 20 maybe beginning of their 30s um year olds the kind of digital native that are that are critical against the system, they don't like banks, they don't like governments that much, they understand that fiat is broken and they want to change to Bitcoin, this new exciting financial and technical revolution. But what we found is actually, well, these were the first early adopters, also Bitcoin enthusiasts it was our first early adopters still part of our community of course and helped us really grow But where we saw most of the adoption of our just the easiest Bitcoin on in Europe is 40 50 years old We have customers that are 80 and also often more affluent and even private clients that start investing a few hundred bucks. But then all of a sudden they invest 10K, 100K. We have people that invest millions with us. And it's very different than we thought. These are not digital native super tech. These are just normal people on the street that find Bitcoin interesting because it goes up in value over time. So you're in every country in Europe? Yes. Now, by the end of last year, we got the Mika license. So first we started in Switzerland with a Swiss license and we were able to accept all other European clients and we grew very fast in Germany like in the whole German speaking area right there's 100 million people, 8 million people living in Germany and another 8 each in Switzerland and Austria and there we grew the fastest and now it's more than 50% of our users are actually Germans. And also we grew pretty quickly then in France and Italy and Spain, a bit less, but still like the long tail in Eastern Europe and Northern Europe. We were not able to actively market in these countries. So this was all organic growth. People just figured out that there's this Swiss Bitcoin app that they can use that is super easy. And so we grew very organically the first few years. But then Mika came in, this new regulatory framework that is encompassing and basically for all the EU countries. Switzerland is the one, Switzerland and the UK are outside of the EU, right? And all the other 40 plus countries in Europe are in the EU. And when this framework came, basically, if you don't get this license, and we did get it now, but if you don't get it until end of this month, actually, you need to stop offering completely services if you don't have this license in all the EU countries. What is the license about? It's called Mika license, marketing crypto assets. This is encompassing EU regulatory framework. It's just you need to get this financial services license, financial intermediary, if you want to offer brokerage services or any financial services in the EU to EU clients. So before with the Swiss license, we could offer our Swiss financial service that was licensed in Switzerland. We could offer it to EU customers. But now with this whole Mika framework, if you're not licensed in an EU country and have this particular Mika license which is quite hard to get like it's almost banking license that allows you to exchange it would allow as well for custody which we don't need and if you do some tweaks it also allows you for lending and all other different financial service providers but yeah this was very hard to get fortunately we got it so now yes we are active in all EU countries except UK which again has another regulatory framework this we will tackle next year. Okay so Germany is your most popular country in terms of users what are the next two is Germany Switzerland that's where we originated Austria because these are the German speaking and then Italy actually not sure why but Italy was always like at one point was the second biggest even in surpassing Switzerland not sure why Italy and then France now because we have our office and license and do some marketing in in France and it's also one of the Swiss languages so we had the French French language from the beginning we have five languages in the app and on our website etc and Spain is also coming and Portugal and then much less the Eastern and Northern European countries. It's surprising that you have fewer customers in the Eastern European countries just because formerly Soviet I feel like they tend to embrace things like Bitcoin at a faster pace than maybe some of the Western European countries. Have you found that? Yeah it's true especially like Prague. Prague is is the hub like there's treasure there's big companies great companies they're very early um and and the adoption is pretty big i'm not sure if there's maybe some preference for local service providers here i could imagine maybe for smaller ones um for switzerland that's true too like swiss people are very reluctant to use service providers especially in finance like fintech apps from other countries and maybe in Eastern Europe and Northern Europe that's a bit the same. What we see, for example, in Germany, they really like Swiss, they prefer Swiss brands and companies to German ones. So maybe it's just cultural differences. That's the nice thing about Europe, right? We have a continent that is roughly the size of the US, but there's 40 different actual different cultures that grew for thousands of years. So it's also a challenge, it's super interesting, but also a challenge to market to this whole continent. Do you find that people are a little bit more skeptical of Bitcoin just because the governments in Europe have been more, there's been more opposition to it, especially from even like the ECB and they attack Bitcoin so much. Does it feel like Europeans are a little slower to adopt or do you think no? Yeah, it feels like it also depends on the country. Switzerland's pretty quick, even though you would think that, I mean, we have a stable financial system and currency. So you would think the need maybe is less. But actually, the adoption rate in Switzerland is like 20%, which is ahead of the average 10%, 10, 15%, for example, in Germany and 10 or less percent in other European countries. So, yeah, I feel like it's definitely the narrative is very driven by the EU politicians. and the media is definitely not embracing this technology at all. I'm not sure if this is much different in the US. Definitely now, I think, with the new administration, it must be. But the traditional media in Europe is definitely still very skewed towards, no, no, Bitcoin is too volatile, it's used by criminals, it uses so much energy, it's boiling the ocean, and all these narratives you really literally now the latest one is the the quantum computing one like the traditional media really finds all these uh excuses basically not to to explain people why not to use bitcoin um and it's i think must must have to do as well with that they want to push the narrative of they want to keep it the people on the euro and the euro of course has a high inflation right everything is super expensive also the tax most EU countries take like up to 50 percent income tax and then there's unrealized gain tax and capital gain tax wealth tax there's so much tax and so much inflation so it's getting harder and harder to keep people away from the alternative bitcoin which makes just total sense for people have understood it but those who have not yet understood it i still follow the traditional media for them they really try to push this narrative So yes, I think definitely the organic adoption that would be there is being stopped by the EU and hence the media which they use as an instrument. But also X and other social media and independent content creators like you, less maybe than in the US, but also in Europe, gain much more traction. So I feel like unfiltered, pure, good information that is a bit outside of the traditional media system is getting more popular and that's hence also Bitcoin is getting more popular, but it just takes a lot of time for sure. Most Bitcoin wallets assume nothing will ever go wrong but that not real life BitKey is built differently No seed phrase to lose a screen now so you can actually see what you approving and recovery and inheritance are built right in No subscription and no extra service. Order BitKey today and use promo code STORIES for 10% off the new BitKey. This episode has been sponsored by BitKey. Are they listening to every call and tracking every tap, seeing what apps and websites you're visiting? it is time to ditch big tech surveillance for a privacy phone. The Bitcoin Way is your guide, helping you choose a device, install a privacy operating system, and regain your sovereignty. They did it for me. They can do it for you. Visit thebitcoinway.com slash Natalie to begin today. With Bitcoin IRA, you can invest in Bitcoin 24-7 inside a tax-advantaged IRA. Choose a traditional IRA to defer taxes or a Roth IRA for tax-free withdrawals later. Either way, you can invest in Bitcoin while saving on taxes. Take control of your future with Bitcoin IRA. Head to Bitcoin IRA.com slash Natalie and get up to a $1,000 funding bonus. What kind of behavior do you see during bear markets? Are people holding? Are people buying more? Or are people capitulating? And you can kind of mark the bottom because you see that everybody's selling when really they shouldn't be? Yeah. Fortunately, we attract, we seem to attract people that first understand Bitcoin before they start buying. And so many of them hop on a savings plan. And we were seeing in bear markets, and now we're seeing a very tough bear market in terms of market sentiment and retail investor sentiment is really at an all time low. Fear and greed index is an absolute fear. There is some capitalization for sure in the market. And so what we're seeing now is that we keep almost all of the savings plans. So that's the good news. People stay on the savings plan on our platform because they've really understood what Bitcoin is, the store of values, digital goals, long-term savings. They understood that I'm just doing this weekly or monthly savings plan. I automate it. It's money that I don't need today and tomorrow. I want to save it for 10 years. And they just keep going. That's great. But actually also, more than 50% of our volume comes from smash buy, buy the dip when prices go down we see a lot more volume so people do buy the dip when prices go up they fomo in or some sell but we always have 80 percent buy and 20 percent sell that's that's always kind of the ratio that's also interesting but definitely volatility is good for our business even better when it goes down just really people buy the dip part at a day where the bitcoin price loses four or five percent we have sometimes three four five x the volume to an average day Also when it goes up, when it's stable on a lower price level for a longer time, which it has been between 60 and 80k the last two, three months, that's where we see the retail sentiment that our user activity really, really low. So basically it almost goes down to just these savings plans. And then when it goes up again, what we're seeing is many new clients. When it goes up, for example, nine months ago we had an all-time high. This was one of the best months for us was probably last year, October, November. So Q4 last year when really like Bitcoin price went up, means that people FOMO buy, they buy higher volumes as well. Now we see the average volume per user is basically half of what it was in Q4. And new users are coming in, many more new users coming in. Because also it's in the media, Bitcoin is all time high. people think that they're missing the train so they want to get in. We see many, many more app downloads, 3, 4, 5x more app downloads per month than we're seeing now in such phases. And sign-ups, the conversion rate also is going up because people are actually motivated to go through the whole onboarding process and then start buying. They buy more, they buy more regularly. The activity is just much higher. So we are in a very cyclical business that basically you can plot together the market, like the price of Bitcoin and the volatility to the user activity. It's just one and one. This is the third bear market we're going through now and we're seeing the same basically all the time. The only difference now is that we have more of these savings plan users. So from a business perspective, it's much more stable because we see that this revenue is not going away. What changes is that when the price goes up and the market sentiment comes back and many people are interested again and Bitcoin is in the news and everywhere, we have much more of this one-time-buy behavior, which basically doubles and triples our volumes. What do you think about the sentiment in this bear market? I've never seen this before, to be honest, like that. in the business it's now for six years we're doing this it's the third time that we have a bear market and for me personally 10 11 years in the market it's it's maybe we had a few like five or six and but i've never seen that people are so hands-off when it comes to investment when it comes to trying to understand bitcoin it feels like retail investors have kind of really have other things in mind right now than than bitcoin uh they it seems like because everything gets more expensive people especially in europe are getting frustrated because they really like the middle class really they have hard time paying their bills right now um especially in like we have we have employees as well in almost all european countries we have 60 employees and many and not not all of them in switzerland only like 10 switzerland many are in germany or in france or in Italy or in Portugal and they tell me like people are like they earn they don't earn enough to to finance their lives they pay really high taxes and and everything is going up their real estate or their rent is going up the insurance is going up the food is going up the coffee cost double of what it used to cost two three years ago literally they are struggling they don't really have time now to get into something new like Bitcoin. They have other things to worry about. That's how it feels like. And then maybe the little money that they still have to save, they understand that fiat is not the right way to save it. But then, unfortunately, they go where there's volatility and where there's excitement. So currently, it's much more the whole AI-driven tech hype, right? They invest rather in the big tech, Google, Amazon, Meta, etc., NVIDIA. So even here in Europe, because that's clearly what the American investors are doing. It's like the AI boom, the big tech companies, but here as well? 100%. Yeah, yeah, yeah. The SpaceX IPO is a big, big thing here as well. Really? Yeah, yeah. Everyone is looking at Elon Musk here as well. Yeah, yeah. This is the same. Everyone's talking about the SpaceX. Also, even in the news, in the Swiss radio, they talk about the SpaceX IPO almost every day. Yeah, yeah. Yeah, SpaceX IPO, Tropic IPO, OpenAI, all these IPOs is a big topic. And then, of course, the wars, which result in much more passive behavior when it comes to money. People want to keep the money even more tight. And the insecurity, the uncertainty is really, really high. People don't know what to do with the money. And then, again, oil, of course. Again, what is moving? that people go there with their little money they have where things are moving. So with the oil, they hear from their neighbor that doubled his money because he invested in oil at the right time. So they're trying to gamble with that. It's maybe more of a gambling. It becomes more of a gambling behavior because people feel like I need to double, triple my money fast because I don have enough of it right They don have a time preference where they just put 50 100 bucks a month aside for 10 years They don't have this long-term view, unfortunately. Like 10 years ago, I bought my first Bitcoin for 500 bucks. And then if you just wait for 10 years, do 100x. Now it's 50, 60k, right? It's 100x. Why do you think they're not investing in Bitcoin? Do you think they just don't believe that it has that potential from here to 100x and they're looking at other investments that they think could? Yeah, they think it's too late. They think, oh, it has done 100x, so it's too late, I'm too late. They don't put in the real, I think Mike Saylor said this many times, you need to put in at least 100 hours. And most people don't have or don't want to invest these 100 hours to really understand. When they do, they end up as, for example, relay clients and then have a hundred bucks weekly savings plan. They do it for a few years. No one has ever lost money that has done a savings plan for four years. But many don't believe that this long term will again go up. They feel like it's over now and they don't put in the time to think about it. And it just doesn't move too much. Like when it's going to move again towards 100K, new all-time high, they will come again. We've seen this before. But unfortunately, I feel like really people go where the asset is really moving, where it's what's the hot thing that is also in the press and the media and the neighbors doing it, so I'm going to do it. And currently, this is all but Bitcoin. It's all these other assets, which is that. Gold was one example. It's now also much quieter about gold. But half a year ago, many people in that. I live in a small Swiss city and I have friends from school that are in complete different industries, etc. And they say gold is the hot thing. Like everyone wanted to buy gold when it doubled, right? Yeah. Yeah, it's just that's how I feel. Long term, fundamentally, Bitcoin is and stays the most interesting asset by far. It's the only thing that is just fixed supply. There's nothing else. You cannot produce or find or create more of it. You cannot print it. Everything else, including stocks and gold and oil, you can all find more of it or produce more of it. Bitcoin is the most interesting thing. And more and more people will come back to this. But unfortunately, the retail investors need movement. They need volatility. They need it to be sexy and the hot hype right now. Otherwise, they care short term. They care about something else. So what's your vision for the company? Do you plan to go public? Do you just want to keep growing and be kind of the main platform for Europeans? How do you see it? We believe in the next 10 years, billions of people and trillions of dollars will flow into this asset. Has to, because everything else expands and Bitcoin is this only fixed asset. And it's creating more and more demand because it's the best money. And it's the best store of value that has ever been created. So we believe there will be a huge shift from fiat to Bitcoin and there needs to be a bridge. Someone needs to help these people, these normal people, these Stefans that are 43 and living on the countryside in Germany. These people somehow need help to get over this bridge and we are this bridge. I feel like if we can build a company that helps millions of people to do this transition, we can build a unicorn on the way. So that's the goal. I'm still a 10x from here to achieve this in the next 5 to 10 years. But then the goal is also to go public. I think it is for a company like ours who is in this Bitcoin space that has these hype cycles and these windows of opportunity where everything really goes up. And then it's one of the best brands. Bitcoin is one of the best like P2C brands. Everyone knows Bitcoin like Coca-Cola and Apple is like in this league. if you have a good story, a good brand around this and find the right timing and also have hundreds of thousands if not millions of clients that hold tens of or hundreds of thousands of Bitcoin and these client relationships will become more valuable as Bitcoin goes up. We have Bitcoin on our treasury, which will boost the company valuation as Bitcoin goes up And we will make much more volume and revenue and profit as Bitcoin goes up, as the retail investor sentiment goes up, etc. So this creates like this flywheel where we think in the right moment we can go public with the right story and really build a billion dollar company. So that's kind of the vision for the company. Well, before we wrap up, I just want to get Julian's forecast. Like over the next, let's say, six to 12 months and beyond, how do you see things playing out? Do you think the bottom is in? What do you think will bring momentum back into Bitcoin? And where will we be, let's say, like a year or two from now? Yeah, that's so interesting. I spend a lot of time thinking about this. I haven't seen this coming, to be honest, this brutal 56% drawdown in Bitcoin price and sentiment, etc. And also in our user activity. We have, though, seen a bottom in April, clearly. April was a button, May was a little bit better, June actually started really strong in terms of users are coming back, users are coming back to the app trading more, I also feel like from talking to users and our investors and our partners etc that like the market is getting warmer again around Bitcoin so I feel like the bottom has been reached I still feel like the rest of this year will will stay relatively stable maybe a little bit up but I don't think we'll reach 100k this this year I think there's too much else going on especially all these IPOs and big tech stuff AI this is still sucking in too much liquidity like I mean there's all these 80 billion hundred billion here there's hundreds of billions this year that flows into into this this AI build out and big techs and also the uncertainty because of the wars it's not gonna end tomorrow unfortunately unfortunately i would hope but i don't think so so this year still the uncertainty and the the liquidity suck in um from from these big tech and ai will still be there so bitcoin will not like go crazy but i think it the bottom was in and will do a little bit better towards the end of the year and then next year I feel like when this whole AI kind of bubbles out and many people will have made return on investments there will be a lot of free capital we need to flow somewhere and the next the logical thing long term is a need to flow to to bitcoins I think it can and will hopefully when also the war situation will get better and people get more confidence and more certainty again to invest in in the markets and especially like hard assets like Bitcoin, it will do much better. So I feel like next year will definitely be a new bull market and we will reach all-time highs way above 100K. Well, then it's a good time to stack, right? No, it's the best time. It's unbelievable that you can get Bitcoin for even below 100K for me is wild. And 60K is insane. Well, Julian, thanks so much for joining me. Where can people follow you? Thank you so much. I'm active on X and on LinkedIn mostly. So just type in the name, connect, send me a DM. I'm open for everything, for the feedback. And I'm very grateful. Thank you so much for having me. Yeah. And congratulations on everything Relay is doing. Thanks so much for joining me. Thank you. Thank you so much for checking out this episode of Coin Stories. This show is for entertainment and educational purposes only. Nothing should constitute as official investment advice. And you should always do your own research. My inbox is open if you want to share feedback or guest suggestions. Just reach out to us at info at TalkingBitcoin.com. Make sure you're subscribed and turn those notifications on so you never miss new content. I'll see you next time.
