TRON 4.0 Online Conference: Lennix Lai — OKEx Director of Financial Markets: Evolution of Crypto Exchange
I’m going to talk a little bit about the financial markets. I’m quick to exchange financial markets on crypto. So precisely for this. I will share my powerpoint. My name is Lennix and I’m the financial market operator of OKEX. 3 years ago we started OKEX, Back in the time when crypto was very scattered. We do see that the crypto world, decentralized global nature is exciting, so that is why we focused on it. It is one of the hard core challenging problems, what we call the unbanked.
So the reason why we are putting a lot of effort on Stablecoin is that our core mission facing the unbanked is a global challenge. Right now, we have a lot of population without any bank access. We think the proper banking access is the very root cause of the gap between the rich and poor, because its really easy if you don’t have money you don’t have access to the banking system.You can not invest, you can not apply for a loan etc, you can never be able to change your destiny.
So a proper financial ecosystem, a banking system or investment ecosystem is very important to the population. Right now, we don’t have that. Around 2 billion people we doubt this very basic infrastructure. So banking finance or the access of finance is now being taken for granted. We did a little bit of research on why the operation of the bank is actually very very expensive. The world bank talking about financial institutions opening accounts is very far away, the operations are so remote. I can’t get a bank account without getting all the paperwork done. So there is a lot of restrictions on having a bank account. For example without a good council and if I don’t have enough money I can´t open bank account for my company because the bank needs you to have a minimum account balance in order to open a bank account. So that’s a lot of restriction to just having a bank account, not to mention that I want to open an company and I want you to have a good concept on raising funds in the crypto world because a good council.
Not to mention, I want to borrow a debt, when we have to borrow a quick credit. So we know that poor people will eventually suffer. We are also talking about the remittance cost which is sending money across the board. So the population is working far away from their hometown and they want to send money back to their home. It takes around 7 percent just in remittance. So everything, if you know about the global fund, you can know our financial industry or financial ecosystem is very very inefficient. It’s not serving what the population really needs. Just the simple basic idea or basic feature or basic benefits.
So right now, we’re going to talk about finance and this is mostly related to the complex financial network and they don’t have the choice, the banks and the brokers don’t have a chance as well.
Because the operation of one single FI is so expensive and not to mention the increased compliance requirements and capital requirements across every single jurisdiction. So we as a business, have to focus on whatever that can enable us to manage and generate the money. So we do need a change. The very first one is to — how about combining a basic financial layer to the balance of people without all of the costs involved that is incurred and the financial institutions right now and at the same time, fulfilling a majority portion of compliance requirements in each jurisdiction.
It sounds perfect, right? But thanks to crypto and Blockchain technologies, we manage to somehow create a fresh new economy, somehow have the defective manner. For example, today’s Stablecoin is that currency. You can see, you didn’t really spend it. it’s carry it around. similar buying power with your local government issued tender but at the same time, because it’s on chain. If you send it, trade it with a smart contract, this can all execute it on chain. And substantially, offer 99 percent of courses or even manage the risk of lending through smart contract.
So the entire cost involving the trade or the transaction will be substantially reduced by the Blockchain just by these technologies. You can enable every single person that can transfer money globally with their own local government tender, issued tender with a fraction of the cost.
So we save 70 percent just with the people, population, to risk 500 billion liquidity. So with crypto, token, you can carry the similar feature as stock as well. You might not necessarily have issued a token with the — corporate shares but you can use token to raise fund by simply involving or inviting all of the stakeholders within your company. Your supplier, your customers, or your friends or your family or friends or whoever is your long time customer. They can be holding your own token and you can just buy everything in the whole ecosystem surrounding you you will be incentivize and motivated by the token.
This is another beauty of the token economics and I think this is a better form. Finally, the DEFi project, a frictionless economy about financial instruments, mostly related to lending, borrowing protocol as well as something about decentralized financial instruments.
That can be of trade, praise and economic trade and hedge within a decentralized way which means the permissioness manner.
So everyone would secure a loan in the global marketplace, everyone can hedge — any of this, we have — cons and in the global space. So there’s three just simple three elements, Stablecoin, token/crypto or Defi protocol. You can defiance and every single person will have a unified access for sending, remitting, investing, fundraising and also trading and settling and in a fair and transparent market.
That is what we call a fracioness global economy and that technology and the economics is already there. It just, we just need to work and promote the work of it.
So right now, what we’re going to do right now it to have a different venture experience where you have a OKEX wallet and you stake the token in USDK which is already excited and you already allow money which is around number 16X global hash power so you can stake your hash in power in generating time.
So this is another way to generate a return for a global population. Imagine if you don’t — we’re talking if you don’t have a bank. Five minutes ago, but right now, you can generate a return with just your mobile phone. And this goes from 9 to 10 percent in some cases so this is getting a lot more exciting.
Even if you talk about the CB banked digital currency right now, the government should endorse it because they already see the beauty,if you put central bank would put the tender into the Blockchain, and potentially has money through a policy and you can track your spending and effectiveness on the monetary policy not to mention the AML of the compliant perspective.
So finally, after we talk about how to de-Finance and how to put your government tender and government money to drive the course of remittance. I would say, even if you raise a token, even if you raise the token, you need an exchange because a centralize is sort of the discovery premise. You need several participants to make sure your token is properly priced. You have a long term investor. You need to speculate all of the working organically so to help your token that you just issued to find your price. That is what okex is building right now, it’s really focusing, it´s okex‘s the core business right now is to create a really fair and robust market with a variety of financial instruments that help all of the traders to price and find it to discover the fair value of the certain underlying token.
So we spent a lot of efforts because like OKEX’s matching engines , it’s already the top in terms of the business or stability of the ecosystem but at the same time, the potential latency right now. So finally, to put it expended, whether or not the similar mechanism of OKEX which we’re talking about the entire trading of the matching engine will be potentially put on Blockchain and we have to be endorsed at this market trend.
Because right now, we do have ventures called OKCHAIN called the OKDEX. So basically, it’s a proprietary based chain that is available or specified in the sign for the DeFi project and issue their own project DApps on to the OKCHAIN and OKDEX is one of the the very first applications that is available for anyone to issue the tokens and trade the token on the OKDEX.
OKT and OK token will be acting as gas as a trade settlement on OKDEX. So OKB which is our platform tokens right now would be one of the very first experiments that we have been mentioning. So we believe OKB may be even the better form than holding the shares of OKEx because OKB contains a really big ecosystem that is not just a representation of a portion of revenue of OKEX but also, we can use it, you can stake it for different kinds of benefits that are available on OkEX. For example, you can stake OKB for benefits and stake OKB for voting power and voting rights for any kind of oken. You can stake OKB to receive revenue payment, dividend payout directly from the markets and you can also spend and remit via the OKB system.
So imaging that the token is actually a better form of equity, compare and share of the OKEx.
So right now, OKEx is a global company. We have offices everywhere. We have millions of users that happen to be trading the public tokens. So we’re hoping that the vast global ecosystem would be managed to integrate with all of the stuff, parterned the Blockchain partners all over the world including everything like DeFi project, destallized dollars, securities the cyber securities and all of the related project that could potentially work with us to build the ecosystem altogether.
Thank you! I think I don’t have too much to add. I think I managed my time really good. So really nice to share with you about our vision and our idea and I’m looking forward see you guys again. Thank you very much!
>> MC: Thank you, Lennix for your exciting speech.