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Blockcast.cc: Dear all, good to hear from all of you this Monday. Blockcast.cc aims to bring like-minded crypto experts to our weekly interview session. This week, we have Anndy Lian, an intergovernmental blockchain advisor and Advisory Board Member of Hyundai DAC here with us as the moderator and Jay Hao from OKEx as our guest speaker.
Anndy Lian: Hi Jay, how are you? Been a while since we have last chatted. I bet everyone knows who you are but please, tell us more about yourself, your career, past and current work experience.
Jay Hao: Thank you Anndy, of course! My name is Jay Hao and I am the CEO of OKEx, one of the industry’s leading cryptocurrency spot and derivatives exchanges. I joined OKEx just over two years ago and am loving the experience. There is never a dull moment and every day brings a new opportunity or challenge.
OKEx is highly innovative and we offer the broadest range of products, services, and trading tools for our global user base. We work hard to roll out cutting-edge new projects, continually improve the user experience, and to forge partnerships with companies that are pushing the envelope when it comes to what the tech can do.
Prior to OKEx, I worked for several years in the blockchain industry with a particular focus on building blockchain-driven applications for live video streaming and mobile gaming. I started two companies and learned a lot about management, development, and the challenges that come with working in such an emerging field.
Before blockchain, my career was still very technical and I racked up more than 20 years of experience working in the semiconductor industry. We’re talking about a sector with zero-tolerance to risk, so I learned how critical it is to build products that do not fail. This unwavering focus on absolute perfectionism has helped me throughout my career and especially when it comes to keeping a cryptocurrency exchange up and running 24/7 for our users even in the most volatile of market conditions.
Anndy Lian: I started the crypto and blockchain early and have seen many exchanges. Far and few managed to stay on top. How did OKEx do that? How is OKEx different from its competitors?
Jay Hao: I believe that it is our steadfast commitment to innovation and to our users. We aren’t just another crypto exchange in the industry, but actively striving hard to change the world for the better and we fully believe that the time will come when financial barriers are eliminated completely and the global financial system can include everyone.
This core vision is vital because, before listing any token or adding any new functionality, we ask ourselves if it aligns with our long term objectives. User feedback is also extremely important to us and we always communicate with our customers, asking them what they would like to see, how we can improve, and serve them better.
As well as CEO of OKEx, I have another job, which I take very seriously, which is Chief Customer Service Officer. I regularly speak one on one to our users and I find this essential to understand who we are making our products for and how we can differentiate ourselves further from our competitors.
Beyond this, OKEx has demonstrated our robust infrastructure many times compared to our competitors and continued uptime even during extreme conditions. We can also offer our users superlative market depth, the most flexible suite of derivatives products on the market, a plethora of yield-enhancing products and practices, and improved risk management capability.
Anndy Lian: Customer service is indeed very important and the face for the organization to handle all kind of requests and grievances. You mentioned partnerships earlier, can you tell us about some of the latest partnerships OKEx has entered into and what this means for users?
Jay Hao: We’re still in the first quarter of this year and we have already made so many advances, there are many things I could talk about! As I mentioned, one of our main areas of focus is on user experience and, to that end, we have made deep strides in improving this by partnering with Unstoppable Domains to allow users to receive payments to a domain name, like jon.crypto rather than having to provide a length alphanumeric address. They can also receive payment in all currencies that we support to the same domain, making it much easier, faster, and convenient.
We are also integrating with the Lightning Network to allow users to send Bitcoin transactions much faster at a fraction of a penny. We’re excited about this because not only will it improve the user experience, but OKEx can show our deep commitment to the furtherment of the Bitcoin ecosystem by becoming a node on the Lightning Network.
Anndy Lian: Lightning Network is efficient and allows Bitcoin to transact at a low cost is vital for the crypto space. I do see that OKEx is working closely with the Alogorand blockchain too. Tell us more about that.
Jay Hao: Perhaps one of the most exciting partnerships, though, has been adding support for USDC and USDT on the Algorand blockchain (USDTa and USDCa via the Algorand Standard Asset (ASA) protocol). As you are well aware, with the surge of DeFi and the rising price of ETH, gas fees are sky high and transaction times on the Ethereum network are slow. This makes interacting with it using the most popular stablecoins USDT and USDC expensive and even prohibitive to many traders.
Algorand allows for high-throughput, so by using it instead of the Ethereum-based versions, transactions can be processed much more quickly, which is essential to traders when time is of the essence. In fact, the TPS on Algorand is over 1,000 compared to Ethereum’s TPS of less than 15. And, rather than having to absorb punishingly high fees, using these stablecoins on Algorand can cost users as little as $0.001/transaction — regardless of the transaction size.
This is of course extremely advantageous to our users and we are pleased to provide them with this solution to Etheruem’s high congestion and fees while the community works to resolve these issues.
Anndy Lian: Now, please share with us what are some of the most interesting tokens that OKEx has listed lately and what criteria do you look for when listing a project?
Jay Hao: That’s a difficult question! The pace of development is so fast in this industry and we are always on the lookout for the most innovative projects that are displaying wide adoption, that have a real use case, a solid degree of decentralization and technical security, and that our users want to see. There has been a lot going on in the NFT space and we recently listed Chiliz’ CHZ token, which is driving fan engagement in sports and proving very popular with individual NFTs selling for hundreds of thousands of dollars.
Anndy Lian: NFT is definitely the trend. This is something that I have spotted in 2018, back then there were not many talks about it. How about the Defi space? What is interesting?
Jay Hao: We’re always keeping pace with developments in DeFi as we firmly believe that this is the future direction of the blockchain space. This week, perhaps one of the most interesting tokens we listed to that end is Perpetual Protocol’s PERP. It allows users to create a perpetual contract for any asset (including gold and oil) and trade peer to peer in a completely decentralized manner.
I think though, Stacks’ token STX, is perhaps one of the most exciting projects to watch this year. There are a few features of STX that really stand out. To start with, it is one of few projects that actually connects to the Bitcoin blockchain and allows developers to build apps and smart contracts that benefit from Bitcoin’s security, network, and capital. On top of that, holders of the STX token can stack their tokens (like staking) and earn rewards for doing so in BTC. Users will soon be able to stack their tokens on OKEx and we will be launching a host of new promotions around this, so be sure to stay tuned!
Above all, we ensure that we only work with the best and most well-respected projects in the space that are showing real innovation, traction, and solving real problems. And we continually reassess the popularity and health of all trading pairs and tokens that we list to ensure that we keep a healthy and robust trading ecosystem for our users.
Anndy Lian: This next question will be interesting. I am always curious when I see exchanges coming out with their own chain. Can you tell us a little about OKExChain, the decentralized public chain supported by OKEx?
Jay Hao: We’re extremely excited about OKExChain and the progress that has been made on it since it went live on the mainnet in December 2020. OKExChain has many exciting features but, perhaps the most important is that it is the world’s first trading-focused public chain and, as such, we foresee an entire and robust ecosystem of decentralized trading apps and DEXs built on OKExChain for its high level of decentralization (unlike some competing chains) and its high throughput. OKExChain will be a big contributor to the growth of the DeFi sector as we move forward.
Moreover, OKExChain is compatible with the dual virtual machines of both EVM and CosmWasm, meaning that we have placed a high focus on interoperability that allows blockchains to talk with one another rather than remain in closed silos. Once EVM compatibility is deployed in the final phase of the staged launch, all of Ethereum’s smart contracts will be supported in the ecosystem and developers can easily migrate their dApps over to OKExChain to enjoy low fees and high throughput.
Like Algorand, this will also provide solutions to Ethereum’s problems while also providing some healthy competition to layer 1 protocols, to incentivize them to solve their scalability, TX costs, and interoperability issues for their users.
Anndy Lian: A more practical question. How does OKExChain cater to your core user base?
Jay Hao: This is an interesting question. Our core business today remains to facilitate cryptocurrency spot and derivatives trading for millions of users worldwide. However, as the industry has grown, so have the needs of the participants in it and we have to recognize that we must cater to ever-changing types of users, as well as those whose main focus is trading.
We strongly believe in the potential of DeFi even if it hurts our core business as a centralized exchange to some extent. There will always be a place for centralized exchanges in the cryptocurrency ecosystem, especially as more people on board, but those exchanges who fail to recognize the potential of DeFi and the need to create products like decentralized public chains that can satisfy the needs of a different user will likely be left behind.
OKExChain currently caters to a small percentage of our core users but we expect this number to grow steadily as DeFi becomes more mainstream and OKExChain completes EVM compatibility. We also do our best to roll out innovative products that are targeted at more risk-averse users and that allow them to make a passive income through staking instead of trading through products like OKEx Jumpstart and OKEx Earn, always embracing innovation and never being scared of trying new things.
Anndy Lian: So, let’s talk about traders on the OKEx exchange, what benefits are there to them for using your platform over others?
Jay Hao: Many traders already come to OKEx for our robust security, high liquidity and market depth, and wide selection of trading pairs and tokens. We also offer the most complete derivatives products, including futures, swaps, and options, in the market. But one feature that we are most excited about is the recent integration of Unified Account, otherwise known as Portfolio Margin (PM).
This is particularly appealing to professional and institutional traders as they now have advanced tools at their disposal to significantly enhance their risk management. Traders can now manage their margin more efficiently by selecting isolated margin or cross margin so that they can have more flexibility over their trading strategies and capital, while offsetting their gains and losses against each other during risk calculation.
Unified Account also places more emphasis on trading rather than operational overhead. So, what I mean by this is that it makes trading much more convenient and efficient as traders no longer need to own an asset to trade it – they can simply use any of their existing collateral and can trade with any instrument and all of their purchasing power. So, if a trader wants to trade EOSUSD, they can do so without having to purchase EOS, but just using their BTC, ETH, or other assets in their portfolio. This also reduces the fees associated with buying altcoins.
Anndy Lian: As more institutional and corporate investors enter the space, what is OKEx doing to cater to their needs?
Jay Hao: A huge step forward for us is Unified Account. This provides institutional traders with the type of sophisticated tools that they need to manage their margin and portfolios better. OKEx is one of the very first cryptocurrency exchanges to offer this feature that allows professional traders to access the same benefits that would normally be reserved for high net worth individuals through prime brokers
The OKEx trading platform has several advantages over our competitors, as well, the two largest probably being Binance and FTX. We offer far greater capital efficiency for traders as well as a larger variety of instruments that can be shared on margin. OKEx also supports all currencies on the exchange when it comes to borrowing, whereas Binance only supports BTC, ETH, and BUSD; and FTX only supports borrowing in USD.
Moreover, we support margin sharing among spot trading, leveraged trading, futures trading, perpetual swaps, and options, whereas our competitors limit this feature to only futures trading and swaps. Overall, we believe that our Unified Account feature is vastly superior and it will be extremely attractive to institutional investors as they continue to enter the space and seek a platform that meets their trading needs.
Anndy Lian: Finishing up, then, what advice would you give to anyone just looking at the cryptocurrency space now and wondering if they should change careers?
Jay Hao: Now, more than ever before is an extremely exciting time in the cryptocurrency space and these are still such early days. We are experiencing a profound technological and societal shift that has been accelerated by the pandemic and this is the time to decide what side of history you want to be on. The entire future of money is changing, how humans interact with the state, with each other, how we work, socialize, and conduct our lives. Just look at the incredible growth in crypto as traditional sectors are shedding jobs and declining. I would borrow from our company motto and say, “It’s OK to be daring,” now is the time to make the change, follow your dreams, you will not regret it.
Anndy Lian: Thanks Jay, good to catch up. We have spoken many times on different occasions, but today is different. We have touched on different aspects of what you are working on. Let’s work harder and do the right thing to make the crypto industry a better face.
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