Centralized (CEX), Decentralized (DEX) and the future of exchanges | Manila 2023

CeX DX and the future of exchanges [Music] wow it's amazing to be here in Manila I was just in Dubai with aibc and all over the world it's a pleasure and an honor to be with you this morning thank you so much for showing up my name is Megan Nelson AKA crypto Megan I will be the moderator for this panel which is something that is pretty dear to my heart in wanting to achieve that mass adoption we're going to focus today on centralized and decentralized exchanges the difference is the pros the cons and it's going to be an action-packed panel for you so I am a high-end crypto and nft portfolio and web 3 strategy consultant currently on a world speaking tour to help adoption and advocate for women and I just launched a crypto Megan podcast so please check that out and without further Ado I would love to invite my panelists to the stage maritz director of binance Cynthia Lowe head of relationship management at huobi Jen country manager of the Philippines coin pH please give them a big round of applause as they make their way to the stage [Music] welcome welcome good to have you guys here I know that this is going to be an amazing discussion in light of everything that's happened this past year with exchanges with regulation there's been a lot of hurdles a lot of loopholes a lot of things we've had to get through as a crypto Community but today we're here to discuss the future of what this wonderful world is going to look like regarding exchanges so without further Ado I'll allow my panelists to introduce themselves and then we'll kick this right off hello good uh I think it's still morning good morning everyone I think I attended I actually before I introduced myself I'd like to comment the panel it's you know majority female which is unusual in crypto um so we have an only guy here little Moritz uh so good afternoon good morning everyone I'm Jen from coins.ph we are the biggest regulated exchange here in the Philippines um and you know my background is in investment banking so I never really believed in anything related to crypto until I went in and raised a couple of funds for some of the projects I work with and now I'm a convert and I'm a believer of uh webtoon crypto so pleasure to be here thank you hey guys good morning everyone thanks for being here my name is Cynthia I'm head of relationship management of hobby so I'm currently you know mainly taking care of building relationships and Partnerships through you know talking listing um post positive Services as well as in management um so I basically like you know during cryptob in 2017 so it's one of all Jews here um it starts with having my friend building a paper project and then play then it was like Ico bubbles um and then after that I have organized a several in a big crypto conferences probably thank you thank you my name is Moritz and I run operations for binance in Asia so thank you very much for having us and thank you very much for putting this panel together um as for me uh very very similar to Jen I was actually a banker for the most part of my life and I kind of stumbled into crypto at some point but I've been in the space for now uh close to two years and I've seen the opportunities that exist across Asia I've seen some markets where it works extremely well other markets where there's still a lot of hurdles so but that's given me a lot of conviction to kind of like go all into the space and really like through the lens of binance help people out in Asia that's so cool it's cool to see that so many people are coming from the traditional Finance bridging over to the crypto world that's amazing to see and with that being said we're gonna kick right off into our panel with the first topic of discussion which is Weighing on a lot of Minds as of late regarding what happened with FTX and the collapse and and you know the hacks and decentralized exchanges where do we go what do we do from here how do we pick up the pieces so right now I'd like to discuss the differences between centralized and decentralized exchanges and the pros and cons which ones should investors and Traders choose and why um I'll go ahead and let you guys kick that off whoever wants to start all right so I think okay if you're uh I'll I'll answer this in two fronts right so for any new technology and I'm a student of history for any new technology and any new um thing that is presented to finance um you know when when Fiat was just introduced a lot of especially a lot of the early adopters you you probably encounter Bad actors right and I think in crypto it just got accelerated in in that way having said that a lot of the things that happened um you know uh to answer your first question regarding FDX it's the Tale As Old As Time wherein you don't commingle funds that's the most important thing if you're running an exchange and if you're running a bank it doesn't matter what kind of institution that you have you need to have a fiduciary duty to take care of your customer assets that's one second I think the most important the difference between dexas and Sexes we are a centralized exchange we are regulated by the Banco Central of the Philippines and what you need to do is make sure um so the difference between the two is that centralized exchanges you are governed by uh your this is custodian meaning the assets is under one entity and then that particular entity makes sure that your your trade gets executed we're adding decentralized that's just on a very um top level view decentralized you hold your own custody anyone can put in liquidity um and then anyone can trade against you so it's like the market making side of things is automated right that's on the decentralized exchanges you see that in uni swap anyone can put liquidity in you the swap anyone can remove liquidity in uniswap whereas with us I think the reason why centralized we see moving forward centralized exchanges taking the center stage because of two things number one in order for us to gain Mass adoption you need for people to trust who are they um interacting with and that's where a lot of the government intervention maybe not a lot but that's where a lot of the government oversight kicks in because at the end of the day what you need is government to make sure that customer safety is there and I think on our perspective um we we follow the strict rules of the any jurisdiction that we're in the way that we approach this is we want to get the license second um bsp here has a very clear rule that there should be one is to one in terms of customer funds and we do that as an Emi digital wallet and as a raspy it's called the virtual asset service provider and we're seeing those um regulations we're seeing those countries uh that may be in the gray area before but implementing now rules because they know that they cannot just Overlook crypto people need it as a as a natural evolution of finance and in which case uh because of that um there's no regulatory Clarity in all areas regarding um not all areas but over time you see that in crypto maybe that is under Central of the bank essential which is Central Bank of any country or the SEC uh Securities and Exchange Commission of that particular jurisdiction good so what you're saying as well is the centralized exchange providers will get better is regulations become clearer as we all understand how this is going to work as well as we evolve as an industry right good thank you would you like to weigh in now yeah I've seen the you know make difference is custodianship and another Equity as well so like indexes basically you know users to have like good control there are assets where it's like sex is whatever you know and is it a person taking care of your assets which means you know if and I could change 89X fpx you know use you know user access in property so or you know and sex being hot which means like always it could be you know not right and another thing is like really pretty right so in centralized exchanges basically recorded is much better um you know good market makers providing new qualities and in the city page is much more compared with um Texas um and then also you know when you're trained on Texas you know a any translation just you know execution by blockchain which means you can run down if you come like you know make a tree and you want to have like you know made a mistake or something you probably lose a lot of money because of the security page you know in central thank you Maurice I think a lot has been said already but I think to me if I take my binance hat off for a second I think to me it's a lot about user experience right it's because as much as I'm sitting here representing a centralized exchange I'm personally a big big fan of decentralized exchanges simply because they are a bit truer to the actual core of the initial Bitcoin paper or Bitcoin maximalists of really like a decentralized environment at the same time though if you look at actually the decentralized exchanges that are existing today I think the overall user experience is still very clunky right so for Mass adoption for the average customer to really use decentralized exchanges I think the user experience has to significantly improve the onboarding experience has to significantly improve and I think that's exactly where centralized exchanges are coming in and if you just think about the regulatory challenges with centralized exchanges already imagine that to come in with decentralized exchanges to think that there will be no regulatory oversight for any of this I think is very very foolish and I think ultimately in the next I would say year especially now with regulatory action actions happening all across the world I think the industry automatically is gonna be pushed more into a decentralized Direction but at the same time that will push the decentralized players to become a bit more user-friendly to become a bit more like like obviously spend more on marketing get more known by the average kind of like crypto Trader but this is not to say that the centralized exchanges are going to go away on the contrary my personal opinion is that I think both will grow steadily because there's still a large Market that none of the two have actually captured wow I would largely agree with Maurice being deeply entrenched in the crypto world and web 3 world myself of course the ethos is to have custody of your coins to take control of your assets and to not depend on centralized entities however one of my main concerns is adoption and onboarding and I myself use centralized exchanges because somebody on the last panel just said we need to be able to onboard to to get our Fiat in and out and and so I would largely agree with that although we're pushing toward decentralization with the years the exchanges are playing a very critical crucial role right now in making new users feel comfortable and allowing them to onboard their Fiat to convert to crypto and so user experience is everything and I think that's a really good point we need to find some intermedium and some kind of you know Middle Ground to where we can work together to establish that mass adoption and build that trust up again which now brings me to the next question during this Market turn down which I would agree we're in the very I would um argue we're in the very initial stages of a bull run now the very beginning but during this whole last year of a market turn down how are centralized exchanges how are they able to continue to grow and Thrive and survive during those conditions and what kind of changes or focuses do they have to make during that time I can maybe kick us off there um I think we are still at such early stages just this week been celebrated its uh six year anniversary across the globe so if you think about it like six years is actually not that much time and within those six years we've actually experienced like so many like bull runs we've experienced like weak market conditions I would still say that's what we're experiencing at the moment so in the grand scheme of things for those that have been around for a bit longer I think and obviously CZ always like famously says that but it's really about like putting your head down and focusing on as I said building better products better user experience making sure you meet the the needs of the customer everything else in the grand scheme of things does not matter like we have to put our heads down and overall attract more customers to really compete with traditional financing institutions attract more customers into the crypto ecosystem attract more customers to binance so I think from our perspective it's merely a blip in the road like we're going to continue to focus on building better products building a larger exchange obviously complying with regulatory requirements all these kinds of things and I think over time that's going to end very very positively yeah thank you for that and I think Finance is doing a fantastic job at building those relationships establishing the trust and it's about playing the long game right and being around being one that stands the test of time because of that user experience um thank you very much Cynthia did you want to weigh in on this yeah I think like um so like you know Market psychos you know this will happen in a crypto Market but also for you know in a traditional financial markets as well which is actually longer like maybe five or ten years where it's just four years you know crypto um so I think like as a business operator we actually love Fair markets because it is the best time interview right because in a program you don't have time to take a break because all you are you know competitors like including Finance they are everyone's running right so James break you can like you know restructuring your company and building better products and then also providing better surveys and then building you know like getting more users just be well prepared to get ready for the next round right um and then also you know hobby is one of the orders exchanges you know what we have like 10 years right you know you know since 2013. so we basically good you know psycho printing I would say right so we know like what are we going through in a bear Market which what we should do during the bear Market to begin the most in the blue market right and also like you know for a long-term you know perspective I think you know bear Market is actually good for the whole crypto industry because I think in a bull run everyone's basically like all like outside that coins are coming including mean points right so there's a lot of money and because for Market everyone just you know buy everything right where it's like you know bear market like basically you can see you know who are the you know skinny dippers you know you know okay um and they say okay they are building you know any you know Partners or don't have like solid community so which would like you know you can see during the market and after this all these like you know streaming projects dying out and then we can start another enroll yeah I think it's very healthy I think that's a wonderful point when the Music Stops and you know everything is quiet during these bear markets you really get a chance to see who's still here and you make some of the best relationships connections and building of all time and so when the music starts again it's hard to differentiate between the exchanges that are just there to pop up to you know be there for a short time versus those who stand the test of time that are on this panel today so thank you for that point um Jen would you like to weigh in on this yeah so uh just to add on to their two points right so you keep you need to keep on building but at the same time it improve the product itself so you you put the you lay the groundwork for for you to grow whenever that bull market arrives right so I think it will we will definitely have another bull market and and then you just continue on getting good products out improving your product a user experience and second I think most importantly is um also getting all of the key as she mentioned we're getting the key Partners in uh when the when you you eat out all of the actors who are just here temporarily and you can really talk to the builders who are still creating their own projects Etc and who are what who wanted to tap into the networks or tap into the customer base that we have and third actually um a lot of players are retrenching uh whereas for us we're actually opening up in different uh countries as well so actually we're doing the reverse because we think that this is this is now the right time to gain ground and uh open up in different countries where maybe some of the players are falling by the wayside yeah and that's a very interesting point about now gaining ground during these times we've seen that regulation in certain countries um meaning one of them my own the USA and Hong Kong have been completely different approaches to the rest of the world do you guys think this is bullish or bearish for a centralized exchanges please uh let us in on your thoughts on this yeah I think well I think like we all have like you know love and hate relationship with Regulators um but in general I mean we love Regulators because you know if you really want to have like you know next adoption in a crypto space we basically need to get more new users um get like nearby in the community right so which means like we need to have a you know Regulators step in um to regret like you know like exchanges and then like repair investors to have a confidence to buy and sell crypto new movies like you know in a safer way right um especially like you know we have a server like you know place was eventually including an iftx cross right a lot of like you know people also have a crypto space they see oh my God like you know I told you right it literally like you know my traditional inner Finance friends that I call me I told you that you know cryptosystem them right so they don't believe that and then I think you know this space is not very regulated which means a lot of like Nico you know you know activists taking place in this space um so with like you know what we want to be a bigger community and with more people using crypto um we really need to work with Regulators um you know take you know for example Hong Kong um so Hong Kong has been quite aggressive in terms of you know um you know have like offering like new lessons to crypto exchanges um to providing service to repair investors in things like you know in a park right so with these new process because I think like Hong Kong used to be like one of the top Financial Centers like I would say before Kobe started um because all is like quarantine and current policies um Hong Kong road is important role in terms of like it's a it's a financial center so homograph has been trying hard to catch up with the war and let's see you know like where Paul is the trend it's in the future so why don't we catch up this rain and then to review our you know Financial Hub um to crypto right um so I think like with all these you know crypto friendly regulations um we can you know basically you know have a better you know image I would say like PR to educate our you know users are getting new people get into people space um especially you know Applebee we actually launch you know hobby Hong Kong 19 months ago because we're trying to get you know lessons from the Hong Kong government and providing you know um you know trading service through local citizens um for us it's like okay you know right now we have a Regulators you know supporting us while we just need your trust our exchanges with you know lessons right you don't need to scare the you will lose all your money because you know operator of right so I think like it's very bullish in general yeah thank you um I think that's a good point about the regulations I mean in the midst we're in the midst of a war right now around the world and trying to establish this regulation to to start this new changing of the world order and to introduce this new technology and we don't necessarily have the system to be able to regulate that yet so we're in the midst of creating that as we go and exchanges and people in the crypto industry have to do a really you know difficult job in navigating through all that to make sure that everything complies and that they're helping shape that narrative and you're all doing a fantastic job at that I'd like to discuss the last question now briefly as we come to an end uh how what do you think will be the future for centralized exchanges and how important is education in that role sure I can kick that off I mean to pick up your last point I would say like for binance specifically through our binance Academy like we've put a huge effort on to education also specifically in Southeast Asia where we really we're comparatively let's say the market compared to let's say some central European countries um yes there is a lot of adoption but I think overall the sophistication of the tools that are being used are still lagging behind so we're putting a lot of efforts onto how do we actually financially free people here through education right so we're putting a lot of effort and a lot of money into teaching people the benefits of crypto of binance whether that's through University Partnerships whether that's through government Partnerships that we have done like through many many other avenues so that's obviously something that's absolutely key for us but to to briefly uh come to your point on the future of like centralized and decentralized exchanges I think um overall the regulation or like kind of like scrutiny that's happening at the moment across the world is good it's because that is simply accelerating the adoption of crypto it's accelerating the creation of Frameworks that we need to follow I'm personally of the opinion that they will there will be no world with zero supervision or zero oversight so it's better that at the moment at least that's really being accelerated and the exchanges will need to follow in one way or another and binance will need to follow in one way or another and it's very very important for us to like really do that to be able to focus on what's really important which is customer protection building new products and really giving products to customers that I really like match to their needs so I think um it will heavily depend in terms of time frame I think will heavily depend on when we are actually reaching the next Bull cycle of course everyone's hoping for that to be Q4 this year um I'm not in the game of doing any predictions but obviously we hope the same time but um once I think the market is picking up again overall the noise will kind of die down a bit and people will focus back on okay let's build something there's an opportunity so as soon as that happens I think like everyone will focus on different things again so I'm very much looking forward to that but I'm also very interested to uh to hear what other panelists have to say thank you do you guys like to weigh in on this sure so um actually education has always been the key in terms of driving adoption in any in in any new technology but I think more than that I think once we get we see a lot of now governments giving the framework in terms of how to operate an exchange actually uh just I like to chime in on the previous question um we've actually grown enough for The Regulators to really notice uh the web 3 crypto in general so that's a welcome um development on our side so I think um regulatory Frameworks will be coming maybe um a lot of countries will be uh releasing all their irrs implementing rules and regulation regarding uh centralized exchanges and I think over time you'll be seeing um a lot of the traditional Financial scene to be imported into crypto because um at the Crux of it um web 3 in essence or what blockchain allows is a tokenization of any financial asset right uh be it through like the usual digital assets or even the underlying like usual brick and mortar assets that we have and we see that as a way that a lot of these government uh regulate bodies should be able to find a way to work with this new technology so I think um you see in terms of centralized exchanges create having a more broader role in terms of the financial aspect and the financial industry as we get more um green light and go signal from uh Regulators regarding it it's maybe not just um web3 Native digital assets right so you will see a lot of variation of that be through fractionalization of assets by the form of an nft or even you know fractionalizing several stocks maybe that's the next Frontier so uh we see that and uh on our side a lot of centralized exchanges will have to follow um what the government dictates them to do and then over time you'll see the centralized exchanges as more it's mentioned earlier is to improve the user experience as well so maybe some some sort of a merge and then um centralized exchangers should be able to on-ramp and off ramps yet easily in that regard not just using like peer-to-peer networks they should use like traditional um ways of in terms of cashing in and cashing out into your wallets okay that's a very interesting approach thank you uh Cynthia did you want to weigh in before we close the panel now final thoughts in general Egyptian is for sure I know you know purple space because basically you know crypto is all about community so doing education is not to support our users but also for The Regulators as well um especially a lot of like let's say you know SEC you know all this like you know I would say like oh people they don't really understand crypto and then they always think my crypto is all about you know illegal activities and that's why people want to use it right so education is taking place like anywhere and I'll just you know you know for users but also for Regulators yeah thank you being an educator myself it really does make me happy to hear that the exchanges are focused on that now because that's so essential in this stage of the adoption of this technology to get people excited not only to learn but to tell their friends to tell their family to get involved in this movement because there is just so much opportunity here and the best exchanges and and people representing this community here now so please take the opportunity to network with them ask them questions we'll be here we'll be around and I just wanted to thank you guys all today for such a wonderful conversation and for being here and uh that'll be all thank you so much [Music] foreign

Channel: AIBC World

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Id: hfou_poOKW0

Length: 28min 51sec (1731 seconds)

Published: Wed Aug 09 2023