Speaker 1: Bloomberg'sperience in Lacwa sat down with Richard Tang, the CEO
Speaker 1: of Crypto Exchange Finance, as he celebrates a year in
Speaker 1: the role. They discussed the rise in bitcoins price and
Speaker 1: the impact that the Trump administration could have on market
Speaker 1: sentiment and regulation.
Speaker 2: It's been a year actually since you've been in charge,
Speaker 2: so congratulations on the year. But what are the biggest
Speaker 2: changes that you've implemented at finance?
Speaker 3: Oh, thank you so much for having me on the show.
Speaker 3: It's always a pleasure to be here. I do think
Speaker 3: that we have moved away from a founder led CEO
Speaker 3: led company firstly to a corporate structure that's a board
Speaker 3: of director led company today, so we have seven independent
Speaker 3: seven directors with three independent directors with an independent chairman
Speaker 3: at the helm and the senior management, which include myself,
Speaker 3: both very close with the board of directors to chart
Speaker 3: our path going forward. I think that's one of the
Speaker 3: significant changes. We continue to invest very heavily into compliance.
Speaker 3: I think finance has always been a user first organization,
Speaker 3: but now we have added another dimension to that in
Speaker 3: terms of compliance span. We continue to increase it quite substantially.
Speaker 3: In twenty twenty two, our compliance span was one hundred
Speaker 3: and fifty eight million US dollars. That went up to
Speaker 3: twenty thirteen million US dollars last year and this year
Speaker 3: you'll go up even much more. Right, so, our compliance
Speaker 3: account if you include know your Customers, Know your Business operations,
Speaker 3: and about one hundred tech staff that just purely look
Speaker 3: at how do you enhance the process, how do you
Speaker 3: include AI to come about to bring about great accuracy
Speaker 3: in the things that we do in terms of detecting
Speaker 3: anomally getting much better results from things like surveillance, transaction monitoring,
Speaker 3: Know your customer or your business, et cetera. Is totally
Speaker 3: close to one thousand, three hundred people. So is a
Speaker 3: very substantial increasing on that frame, and we continue to
Speaker 3: invest reight heavily into compliance. We are now the most
Speaker 3: regulated exchange globally with twenty regular approval around the world.
Speaker 4: This is alone. You've gotten six.
Speaker 3: Regulatary approval including in India, Argentina, Indonesia, Thailand, Kazakhstan and Dubai.
Speaker 3: And that list goes on and hopefully we can announce
Speaker 3: small good results before at the end of the year.
Speaker 2: Richard, when you look at bitcoin and other cryptocurrencies. I
Speaker 2: mean they're flying off the shelves. It is the Trump trade,
Speaker 2: and actually, what are you expecting in terms of US
Speaker 2: regulation and the impact this has on finance.
Speaker 3: Well, President Trump being elected suddenly give a boost and
Speaker 3: give greater clarity to this. But I will say that
Speaker 3: twenty twenty four has been a landmark year, and that
Speaker 3: momentum started earlier this year. So if you look at
Speaker 3: what happened in January this year with bigcoin ETF being
Speaker 3: approved firstly in the United States and the subsequently all
Speaker 3: around the world from Brazil to Canada to Australia, Hong Kong,
Speaker 3: and that list goes on. It gives a lot of
Speaker 3: recognition and finally the rest fact that this sector deserves
Speaker 3: all along and with the likes of all the largest
Speaker 3: money manager and all the top financial institutions around the
Speaker 3: world starting to recognize the value of this space, you
Speaker 3: have Larry fin CEO of the largest money manager, Black
Speaker 3: Rock in the world, that went from a crypto skeptic
Speaker 3: to a crypto believer.
Speaker 4: I think that it self peaks value.
Speaker 3: So if you look at the Bitcoin ETF is the
Speaker 3: best performing ETF so far in the I think in
Speaker 3: the history of ETF right again. It shows that institutionalization
Speaker 3: has started and mainstreaming has started.
Speaker 2: And I mean, could the Trump administration change everything from
Speaker 2: for cryptocurrencies.
Speaker 4: Well, it's a big positive.
Speaker 3: I think the last four years, especially if you're in
Speaker 3: the United States, I think the last four years has
Speaker 3: been pretty tough, right in terms of you know, regulation
Speaker 3: bia enforcement, which is not necessarily the best form of regulation.
Speaker 3: President we have a very pro crypto president. And if
Speaker 3: you look at it's not only President Trump himself, but
Speaker 3: the House of Representative toots of the legislator being elected
Speaker 3: a pro crypto. The same stories happening at the Senate level.
Speaker 3: Many pro crypto legislators and policy makers are being elected.
Speaker 3: And you know, this give a lot of clarity. And
Speaker 3: President Trump has said that he's going to come out
Speaker 3: with their pro crypto frameworks to support the industry. The
Speaker 3: discussion of a bigcoin US bigcoin reserve, really I think
Speaker 3: it's also very important in that conversation. It's not only
Speaker 3: the US that's looking at having a big cooiny reserve.
Speaker 3: I think that's park conversation in many different parts of
Speaker 3: the world. Different governments starting to look into this, and
Speaker 3: that is a continuation of the momentum that we're going
Speaker 3: to see. And I do think that I've said it earlier.
Speaker 3: I do think that the golden year of crypto is
Speaker 3: just beginning. We are six between six and seven percent
Speaker 3: crypto adoption globally, and if you look at history, what
Speaker 3: happened to Internet when you hit six to seven percent,
Speaker 3: The next ten twenty percent will come very quickly. So
Speaker 3: the pace of adoption will come very fast in the
Speaker 3: future compared to what you have seen in the last
Speaker 3: five years.
Speaker 2: Richard, have you spoken or has anyone at Finance actually
Speaker 2: spoken to President elect Trump and his team?
Speaker 3: Well, I think we are not a US company. We
Speaker 3: do not have operation Engine at the US, I think,
Speaker 3: but as part of the crypto industry, we congratulate President
Speaker 3: Trump on his election. US, as you know, have an
Speaker 3: outsized influence around the world in terms of his policymaking
Speaker 3: and rules, and I think that's a big positive, right.
Speaker 3: So I do think that many regulators, especially today only
Speaker 3: one of global regulators are regulating this space. So going forward,
Speaker 3: you're going to see a lot more positive momentum, a
Speaker 3: lot more positive sentiment towards this particular industry, which is
Speaker 3: a big positive. So certainly wish President Trump and his
Speaker 3: administration are the best in terms of supporting this industry, which.
Speaker 4: Is to me, AI and blockchain are the.
Speaker 3: Two important, the two most important technological advances that will
Speaker 3: set the foundation and support every economic subsector from rested
Speaker 3: to supply chain, financing to entertainment to financial service going forward.
Speaker 3: So any countries would do very well to come up
Speaker 3: with good policies mud regulations to support the innovative aspects
Speaker 3: of these two technologies for managing the risk. Right, it's
Speaker 3: going to bring in a lot for dire investment economic growth.
Speaker 2: Are you looking more forcefully to re enter the US market?
Speaker 2: And if he has, and what kind of time.
Speaker 3: Frame at this point in time, you know it is
Speaker 3: not under consideration, but you know, things always are fluid.
Speaker 3: We will always keep everything under close review for every
Speaker 3: market we deploy globally. Today we have more than twenty
Speaker 3: four you two million customers globally. We're very happy without
Speaker 3: global deployment and global efforts on that front. As I mentioned,
Speaker 3: we're the most licensed exchange on a global basis. This
Speaker 3: year alone, we saw sixty two million new users coming
Speaker 3: on board and the pace of adoption as US compared
Speaker 3: to last year. The number of institutions and corporate this
Speaker 3: year has searched on our platform, so the number of
Speaker 3: onboarding has more than double. So we'll continue to focus
Speaker 3: our efforts in terms of global deployment in every region
Speaker 3: where crypto users are looking for us to support their journey,
Speaker 3: will be there.
Speaker 2: Richard, how much are you looking at some specifics for
Speaker 2: example for the US and there could be a framework
Speaker 2: of stable coins which has been talked about by lawmakers.
Speaker 2: If that were the case, would you reintroduced your former
Speaker 2: stable coin BUSD or look at something else in the market.
Speaker 3: I think let's let's not speculate on things that have
Speaker 3: not happened. I think if you look at global rules
Speaker 3: and regulations, many regulators are coming out with formulations of
Speaker 3: stable coins, including Europe currently ad in terms of stable
Speaker 3: coin regulations. We look forward to giving our feedback to
Speaker 3: all the different governments coming out of our own with
Speaker 3: their own framework to come up with smart regulations. Again,
Speaker 3: as I mentioned, supporting the innovative aspects of the crypto
Speaker 3: industry while managing the risk aspect.
Speaker 4: Similarly, if we see.
Speaker 3: Those regulations being released in the States, we're happy to
Speaker 3: play our part. Giving our views and feedback from industry
Speaker 3: participant perspective on what makes a good framework.
Speaker 4: For participants as well as for users.
Speaker 3: What sort of protection should they be accorded under those frameboards.
Speaker 2: You mentioned more financial You know established financial institutions entering crypto.
Speaker 2: What does it mean for crypto native platforms such as
Speaker 2: finance they use your platforms and will that increase or
Speaker 2: will they try and do another exchange.
Speaker 3: We are very happy that there are more players coming
Speaker 3: into this arena. It shows the mainstreaming right, so the
Speaker 3: future is extremely right. We are very confident of what
Speaker 3: we are doing. We have always been a user first organization.
Speaker 3: As I mentioned, this is alone in terms of the
Speaker 3: number of institutions, the corporates, the family officers, High Nightwork
Speaker 3: individual onboarding on our platform. He has more than double
Speaker 3: COMPAREDTIVE last year. A lot of trading desserts that in
Speaker 3: the past are just trading commodities, fcs, stocks and bonds
Speaker 3: are now adding a cryptodesk.
Speaker 4: To their platform.
Speaker 3: A lot of sovereign wealth funds, foundations and doowmands are
Speaker 3: looking to increase their allocations. So we are really support
Speaker 3: all the users in terms of their journey. Unlike many
Speaker 3: of the trad five firms. Our platform operates on a
Speaker 3: twenty four basis around the world, so operational robustness resilience
Speaker 3: is extremely important. But it's also very important that people
Speaker 3: have around the clock ability to make investments depending on newsflow,
Speaker 3: to hatch risks depending on news flow, and to manage
Speaker 3: their investment portfolio on a very effective basis, which many
Speaker 3: of these other films will not offer, including investment into ETF.
Speaker 4: Which is a great low cost products.
Speaker 3: For retail investors that are not seven enough to really
Speaker 3: treat crypto on some of the mainstream exchanges like olays.
Speaker 4: But it's no VI's approach. Once they get to know
Speaker 4: more about.
Speaker 3: Crypto, are very confident they will gravitate to US exchanges
Speaker 3: they offer them twenty four to seven services for sure.
Speaker 2: There's also regulatory change foot in Europe. So when do
Speaker 2: you expect to get your MIICA license in the EU
Speaker 2: and what countries have where have you applied?
Speaker 3: As you know, we are today regulated in six different
Speaker 3: European Union countries. We have very close communications with all
Speaker 3: our regulators and you know we welcome what the European
Speaker 3: regulators have done in terms of make a framework giving
Speaker 3: clarity to the industry as well as giving clarity to
Speaker 3: users on the type.
Speaker 4: Of investor protection they should look forward.
Speaker 3: But you can appreciate all the conversations we have with
Speaker 3: regulators are necessarily confidential in nature, so as and when
Speaker 3: we have more news, we all share it publicly.
Speaker 2: When will you select a global headquarter? This is the
Speaker 2: question that I keep on that I'm sure you get
Speaker 2: asked on a weekly basis.
Speaker 3: Or not not necessarily weekly. I think I've answered that
Speaker 3: question many times have people are not answer to that,
Speaker 3: But these are a very serious question, right, so the
Speaker 3: senior management of the firm to credit about our directors,
Speaker 3: we spend a lot of time. There are a lot
Speaker 3: of considerations, right, including things like taxation, whether the hub
Speaker 3: can really support our talent going there to work as
Speaker 3: a regulatory framework is being recorded, can it, you know,
Speaker 3: manage a firm? We have different products, streets of our nature, etc.
Speaker 3: So there are multile of considerations and these are very
Speaker 3: complicated discussion. We are in deep talks with a few
Speaker 3: jurisdiction and like you, I hope that we can make
Speaker 3: a deliberation very soon and make those disclosure, but it
Speaker 3: requires time and careful consideration, and again, once we have
Speaker 3: reached a decision point, we're definitely share it with the public.
Speaker 2: So can you give us an idea of where you're
Speaker 2: looking at and whether you have to reapply for licenses
Speaker 2: for global headquarters.
Speaker 3: No, I think it's a different consideration for global headquarters.
Speaker 4: Right.
Speaker 3: So again we are very in deep talks in several
Speaker 3: jurisdictions that's based in different regions around the world. Things
Speaker 3: like double taxation, the regulatory framework, the regime, the ability
Speaker 3: for us to have our h you know, experts and
Speaker 3: our talent poo there. Those are key constitutions that you know,
Speaker 3: we are in close composition that regulators.
Speaker 2: So you can't tell us anymore.
Speaker 4: I won't go anything beyond that.
Speaker 2: Would you talk to me a little bit about you know,
Speaker 2: whether I guess the model going forward will be more
Speaker 2: joint ventures in local places or acquisitions of exchanges as
Speaker 2: a means to grow.
Speaker 4: Well, I don't think.
Speaker 3: I don't think there's a one size fit all right,
Speaker 3: A different mode of operations may be needed for different
Speaker 3: regions and different countries. Even in the in the one region,
Speaker 3: different mode of operations might be needed. I mean, we
Speaker 3: have for the majority of the twenty regulatory approval that
Speaker 3: we have. Majority of them are we apply on our
Speaker 3: own right. There are a few that were acquired in
Speaker 3: terms of existing financial institution firm that we acquired and
Speaker 3: start operating, and there's I believe one joint venture so far.
Speaker 4: So but different.
Speaker 3: Models are needed, so we will always consider what's the
Speaker 3: best and most appropriate model in terms of operations for
Speaker 3: local deployment.
Speaker 2: Binance also owns a piece of X. So have you
Speaker 2: or CZ been personally in touch with Elon Musk since
Speaker 2: the US elections?
Speaker 3: Our team has been in touch with the X team.
Speaker 3: I mean not only post election. I think we have
Speaker 3: been in constant dialogue with the X team on that front.
Speaker 3: So again, you know, these are investments. We do have
Speaker 3: quite a lot of investments globally, and these are investments
Speaker 3: that we know. We keep in close constant touch with
Speaker 3: the companies that we've invested into.
Speaker 2: So Binance is still also facing, of course, the investigation
Speaker 2: by the SEC. Do you expect that to change and
Speaker 2: to be dismissed now that Donald Trump is president elected
Speaker 2: will become of course the president, and also now that
Speaker 2: the SEC chair has.
Speaker 3: Resigned, but there's an ongoing civil dispute between ourselves and
Speaker 3: SEC is not criminal. This is not criminal investigation. It's
Speaker 3: a civil dispute. We intend to defend our position faver robustly.
Speaker 3: We're confident of that. So I think that's ongoing. Other
Speaker 3: than that, you know, as with any dispute, we can
Speaker 3: really go into the details or any discussion on that.
Speaker 2: What the final question where, I mean, where do you
Speaker 2: see bitcoin going? And actually if it, you know, can
Speaker 2: it go to one hundred and twenty one hundred and
Speaker 2: thirty very quickly? And then does it bring does it
Speaker 2: lift other cryptos with it?
Speaker 3: Well, at the beginning of the year in January, people
Speaker 3: ask me where big coin will be by end of
Speaker 3: this year. Right, So at that point in time, I
Speaker 3: believe bigcoin was forty thousand. I said, you know, I
Speaker 3: believe it will definitely be higher than eighty thousand.
Speaker 4: I think I've been proven right.
Speaker 3: I think it's you know, it's I don't have a
Speaker 3: crystal ball to look into the future where the coin
Speaker 3: price will be. What I see currently based on market trend,
Speaker 3: is the very robust pan of demand for bitcoin right
Speaker 3: from institutions, and you're seeing a lot of allocation. I
Speaker 3: do think that if US come in with the strategic
Speaker 3: Bigcoin Reserve and many other countries falling suit and sovereign
Speaker 3: real funds endowment and the rest starting to do allocation,
Speaker 3: I think those are big positive.
Speaker 4: I do think that. I say that at the beginning of.
Speaker 3: Twenty twenty four, and I'll repeat it here. I do
Speaker 3: believe that twenty twenty five will be a better year
Speaker 3: than twenty twenty four because, as with any institutional adoption,
Speaker 3: which which started to see you only twenty twenty four,
Speaker 3: many of the institutions we need your time to do
Speaker 3: due diligence. Companies need time to do to diligence, and
Speaker 3: that normally takes six nine months through the compliance program
Speaker 3: before they are really to onboard and do investments and
Speaker 3: allow their clients to come through those So I think
Speaker 3: next year we'll be right for or that with much
Speaker 3: more positive crypto regulations, firstly in the US and then
Speaker 3: subsequently around the world. Again, that's another big positive. And thirdly,
Speaker 3: in terms of interest rate environment, I do think that
Speaker 3: for the majority of twenty twenty four, we are still
Speaker 3: in a pretty high interest rate environment, and that has
Speaker 3: come down, and I do believe that inflation is under
Speaker 3: control in most countries and with a much more benign
Speaker 3: interest rate environment. Again, that's going to be a big
Speaker 3: boost for you know, rese assets throughout the world, including crypto.
Speaker 3: So for all those key reasons, I do believe that
Speaker 3: given the pace of crypto adoption, twenty twenty five will
Speaker 3: be a better DAAR.
Speaker 2: But twenty twenty four went from forty to one hundred.
Speaker 2: I mean, just twenty twenty five go from one hundred
Speaker 2: to one hundred to two hundred and fifty is at
Speaker 2: the trend.
Speaker 4: I wish I have a crystabal.
Speaker 3: I wish I can make this picture, but I can't.
Speaker 3: You know, but many people have made those predictions. Some
Speaker 3: are extremely bullish.
Speaker 4: I hope they are right.
Speaker 3: Invested into crypto or for some time now, and I
Speaker 3: definitely hope they are right.
Speaker 4: But do your own research.
Speaker 1: That was Binance CEO Richard Tang speaking with Bloomberg's Francine Laqua.