What’s next for cryptocurrencies?

Credit unions have begun dipping their toes into cryptocurrency over the past year. The timing largely coincided with the “crypto winter” that saw coins plunge in value and several exchanges and lenders collapse.

But at the height of the crypto craze in late 2021, many credit unions saw their members buying digital coins in significant numbers.

Lone Star Credit Union, a small Dallas-based credit union with about $163 million in assets, refers members interested in buying crypto to BankSocial, a non-custodial wallet provider, which gives buyers control over access to their cryptocurrency.

In an interview with AP, Lone Star Credit Union CEO Becky Reed discusses the partnership with BankSocial and her optimism about the future of crypto.

What was behind Lone Star’s decision to enter crypto?

It was in late 2021 and early 2022 that we noticed that our members were buying crypto. At that point in time, we really thought that our members weren’t. If you asked our executive team and our board they would say ‘well, our members don’t care about cryptocurrencies.’ Well, the data showed otherwise.

What did the data show?

There is a popular notion that wealthy people are buying a bunch of crypto and holding it and selling it and making a lot of money. But the truth is what we saw was people buying it similar to what they would buy with stocks like on E-Trade or something. Every time they got a paycheck, they would buy $100.

Has that trend changed with the downturn of cryptocurrencies?

Now that has dramatically decreased. Now it’s like the die-hard people. Maybe 10% of the people who were buying it are still buying it. So, we've seen it greatly reduced in both volume and how often.

So where do you see cryptocurrency going?

A lot of the hype that was happening in the early part of 2022 in particular, caused a lot of fear of missing out, FOMO … People potentially got into the space without really understanding what it is that that they were getting into … Now the real use cases and the real builders in this space kind of have a runway to do things in a regulated and compliant way. I believe that distributed ledger technology, which includes cryptocurrency, but is not limited to cryptocurrency, is the future of finance.

Does Lone Star offer any kind of financial advice about crypto?

In no way are we recommending that people go out and buy crypto. If you choose to do that, we recommend BankSocial, but it’s really around, you know, this is not an investment product, it’s not insured, and it has a high amount of volatility and risk. And we at Lone Star are not giving you any advice as to what you should buy.