338: ByBit CEO Ben Zhou On Building A Leading Derivatives Exchange

Ben Zhou is the co-founder and CEO of Bybit, a global crypto derivatives exchange. He previously ran a retail forex brokerage for almost a decade. In this conversation, we discuss Bybit's founding story, how they used affiliate marketing to grow so fast, mobile trading trends, the World Series of Trading event, and what Ben thinks about the Chinese digital currency plans. =============================== Blockset by BRD is your hosted blockchain infrastructure. Blockset enables enterprises and developers around the globe to deliver high-quality blockchain-based applications in a fraction of the time, at a fraction of the cost. Using the services provided by Blockset, businesses can build professional custody solutions, accurate and near real-time portfolio management solutions, auditing platforms, commercial block explorers, and much more: https://www.blockset.com =============================== The Helium Hotspot is a new product that enables the people, not the telcos, to own and operate a wireless network in their city for Internet of Things devices. You can literally earn crypto for helping to build the network and providing connectivity to Internet of Things devices sending small bits of data. Join the movement and get your Helium Hotspot today with $50 off using the code POMP at helium.com. =============================== Pomp writes a daily letter to over 50,000 investors about business, technology, and finance. He breaks down complex topics into easy to understand language, while sharing opinions on various aspects of each industry. You can subscribe at https://www.pompletter.com

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Anthony Pompliano?

  What's up everyone, this is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Let's kick this thing off.

• 0:11Anthony Pompliano?

  Ben Zhao is the co-founder and CEO of Bybit, a global crypto derivatives exchange. He previously ran a retail Forex brokerage for almost a decade. In this conversation, we discuss Bybit's founding story, how they used affiliate marketing to grow so fast, the mobile trading trends that they're seeing, the World Series of Trading event, and what Ben thinks about the Chinese digital currency plans. I really enjoyed this conversation with Ben, and I hope you do as well. Before we get into the episode though, I want to quickly talk about our sponsors. The first is Blockset by BRD. You probably know BRD or Bread because they had one of the first Bitcoin wallets in the App Store back in 2014. They've now launched a new product called Blockset. It's a hosted blockchain infrastructure business.

• 0:56Anthony Pompliano?

  Exactly what AWS is for Amazon and the traditional internet, Blockset is for the blockchain world. Blockset enables enterprises and developers around the globe to deliver high-quality blockchain-based applications in a fraction of the time at a fraction of the cost. If you're building in the blockchain world, you gotta use Blockset. So go check them out at blockset.com. Again, blockset.com. Our second sponsor is Helium. The Helium hotspot is a new product that enables the people, not the telcos, to own and operate a wireless network in their city for Internet of Things devices. Historically, the telcos have had a monopoly on owning and running wireless networks. What they say goes.

• 1:37Anthony Pompliano?

  Helium is changing that. They've created the Helium hotspot. If you buy one and you set it up, you become part of a decentralized network that's taking back power from the telcos. Democratizing ownership of the wireless network is good for everyone. So you can earn crypto for helping to build the network and providing connectivity to Internet of Things devices by sending small bits of data from the device in your home. Join the movement and get your Helium hotspot today. I've got one, so join me. You can join today at helium.com and if you use the code Pomp. P O M P, Pomp, you'll get $50 off. I promise it is super cool, super easy to set up. It literally took me three minutes. kilium.com, use code Pomp, get 50 bucks off.

• 2:23Anthony Pompliano?

  Lastly, I read a daily letter to over 50,000 investors about business, technology and finance. I break down complex topics into easy to understand language while sharing opinions on various aspects of each industry. You can subscribe at pompletter.com. Again, pompletter.com. All right, let's get in this episode with Ben. I hope you guys enjoy this one.

• 2:44Speaker 01

  Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions of Morgan Creek Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only.

• 3:09Anthony Pompliano?

  All right, guys, bang, bang. I've got Ben here with me, super excited to talk with him. Thanks so much for doing this, man.

• 3:16Speaker 02

  Thank you for having me. It's a pleasure.

• 3:18Anthony Pompliano?

  Absolutely. Coming to us live from Shanghai.

• 3:24Anthony Pompliano?

  For those that don't know you, let's just start with with your background. Kind of what did you do before you got into crypto?

• 3:30Speaker 02

  So I was in the retail forex business. I sort of, I was the starting member of a current retail FX broker called xm.com. Right now, it's probably one of the top five for sure, retail forex platform. Have business all over the globe. So I was in there for eight years in the end. When I left, I was managing the sort of the Greater China region. Was close to 100 staff. I left in late 2017. So I was in charge basically of overall operation, marketing, customer support, business development.

• 4:15Speaker 02

  Just all aspect of the forex business.

• 4:19Speaker 02

  So I guess it sort of gave me a edge, you know, I was running a platform and now I'm running Bybit. So I believe I could use a lot of my previous knowledge, especially on how to handle retail clients, deliver a product that really built for the retail and collect feedbacks from the users and how to, you know, give them the best support and overall trading experience. So I guess I'm particularly lucky in that aspect, yeah.

• 4:48Anthony Pompliano?

  Yeah, what was some of your biggest takeaways from having run that kind of global Forex product, right? Because I think that's a pretty unique experience. Any takeaways you had from that?

• 4:57Speaker 02

  A takeaway, I guess, is one thing, which is one of the reasons I started Bybit is that, at least in Forrest, the whole business is very mature, is very matured. And so the overall trading experience is actually very, very good if the platform is doing the right thing. There's all the different tools you can provide to a client, whether it's customer support, whether it's the trading product, whether it's a indicator or a education sort of platform and all of that.

• 5:33Speaker 02

  It was very established, so there was nothing too much to worry about in terms of the product. But looking into crypto, when I first got into it by end of 2017, it was, it was just the overall experience, I felt like it was a kind of very behind in the total overall kind of experience, especially during volatility. And that's one of the reasons I decided to build Bybit is I figured with the knowledge and the standard that I can take from Forex, I can build a product that's kind of matching the, you know, the trading standard I believe the trader can deserve.

• 6:13Speaker 02

  So I believe for me, the biggest takeaway is I know what exchange could be and where the standard should be. And that's what I want to push the limits and sort of build the Bybit platform to, to the standard I'm used to and even beyond, yeah.

• 6:28Anthony Pompliano?

  And when you say that the crypto space was behind in terms of infrastructure and technology, like what were they lacking or where did you see the opportunity in terms of things that existed in the global forex market that didn't exist in crypto?

• 6:41Speaker 02

  It was overall trading experience. So when I looked into it, there was only Bitmax and OKEX at the time. So I was also checking out majorly on Bitmax. And first of all, the UI UE, it was hard for me. Coming from retail, I know that this platform, the whole user experience could be improved, more user friendly, the whole layout and all that. And I was doing a little bit of trading, especially during volatility, there was a lot of these type of issues with either overload or servers not available. It was just hard

• 7:24Speaker 02

  during the time. And I figured the industry is too small. What if, really, we're talking about mass adoption, and if the mass adoption happens, no exchange can handle the type of volume. And so I figured the opportunity is for sure there, even just from the underground sort of infrastructure perspective, but also from customer support, it was no live support. And also, just here and there, the detail, the small parts, I feel uncomfortable. And I figured there was a lot of room to improve. And even now, I start to see the whole industry is getting more mature. For example, we start to see a lot more algo platform or more sort

• 8:05Speaker 02

  of copy trading platform, which is vastly available in FX, in traditional, I guess, industry. But now it is getting more popular. People start to see them as a new thing, but it's actually really not. Copy trading, this type of stuff has been happening a lot in FX for a long time. But you start to see crypto. So I guess as the industry grow, and as we get more mature, different sectors will get more professional and different product will come out in the form of the traditional space.

• 8:40Anthony Pompliano?

  Yeah. And so I guess, why start a company versus just go join one of the existing ones that helped them improve? What was the impetus to actually want to start a brand new company?

• 8:51Speaker 02

  Well, hello, can you hear me?

• 8:55Anthony Pompliano?

  Yep.

• 8:55Speaker 02

  Oh, sorry, I thought it got cut out. Yeah, yeah, this is a very good question. To be honest, number one is I didn't know anyone. I was completely fresh off the boat in the industry. And really, realistically speaking, if I did know, let's see, any of the major guys in the crypto now, I don't know. You know, the whole Bible story might change. So I didn't know anyone. And number two is, you know, there is a huge advantage being a latecomer, especially in 2018. And now, looking back, I think a major part of Bybit's success attribute to the fact that we were not the ones eating the crab, the first person or the first guy who invented the whale.

• 9:39Speaker 02

  So we were able to take a model of, say, Bitmax or OKEX, is a concept of perpetual contract and sort of built on it. So from the infrastructure level, we can actually bear in mind that solving the overload or the service stability issues is what we're planning for. So from the very bottom, we can actually build something more solid. So that gives us a huge edge. Well, thanks to the, you know, the first guys that designed this whole thing. But we were able to take it and sort of build on it. So that gives us an edge as a latecomer. And now we can do more with it, you know. So I think this is one of the things.

• 10:23Speaker 02

  And also, at the time, I found a few very good partners that can help me to achieve this Bybit project. And that's how we decided to go with it.

• 10:34Anthony Pompliano?

  Yeah. Got it. And so when you got started, like, what was the idea in terms of, what did you guys set out to build?

• 10:41Speaker 02

  The very first version was we want to build a platform that offers derivatives, starting with perpetual contract and then gradually moving into all different products. As we are doing now, still, we're working on our expiration contract and given options. And also, just to refine it, we want to sort of copy the model. If you say someone who invented the car, but the Japanese took it and really sort of refined it, and that's our model, is to really build the product and more design for retail. We, our pure focus is on retail. So the baby product, whenever you see we have a new product launching, it's already

• 11:26Speaker 02

  sort of everything out of the box. We want, we want to give to our customer the feeling that it's like getting a new iPhone. We opened it, everything is ready, everything is already packed inside, it's already been polished and very retail friendly. So this was the idea. It was purely retail focused, the derivative exchange, built for the retail. And even now, we have been pushing out our mobile app for half a year and putting a bunch of new features into our mobile app. And we start to see that a lot of our users, you know, are turning and changing their trading behavior into the mobile app. So the original assumption that you cannot do professional trading on mobile app, we

• 12:07Speaker 02

  believe it's, the whole reason is because there wasn't a mobile app available for people to do so. So all, most of the exchange offer the mobile app as a supplement or a easy way to trade. But we want to focus on the mobile app as we see the trend and really make, make it a weapon sort of because crypto is 24/7 and it goes perfectly well with a mobile trading equipment. So we want to take advantage of that and really devote our energy into this type of retail focused apps and products.

• 12:38Anthony Pompliano?

  Yeah. So for the couple of people who are listening who don't know what a derivatives exchange is, maybe just explain what that is.

• 12:46Speaker 02

  Yeah, it's a, you know, a kind of a margin leverage trading using a margin to trade Bitcoin or Ethereum or Ripple. We currently offer four different peers, both linear contract and inverse contract, linear meaning you can use USDT, USDT to trade and it's settled in USDT. You can go up to 100 leverage so that if you have, I don't know, if you want to trade $10,000, you can use literally $1,000 of USDT to trade. And so you can, you can limit sort of the counterparty risk by not putting too much coins on an exchange by using leverage. I heard a lot of people using that. Yeah, so, yeah.

• 13:32Anthony Pompliano?

  Got it. And so you guys go and you launch and you kind of took the world by storm, right? In terms of you really hit marketing and the affiliate programs and all of that in a kind of a big way. Maybe talk through a little bit, once you guys had built the product, what were those things that you did to kind of get the word out and really start driving adoption?

• 13:51Speaker 02

  Very good question. Actually, it's one of the question I haven't talked about so much.

• 13:57Speaker 02

  It's, I think what we very original stage that early stage that we did sort of something that changed the industry is how affiliation system works. So when we built the, launched the Bitcoin perpetual contract in December 2018, after about three months, there wasn't so much volume and interest coming in. We realized we need to focus on really getting people to know our product. So this is again, based on my previous FX knowledge, which is very developed in the affiliation system and program. We looked at the competition across board. There was Bmax,

• 14:38Speaker 02

  OKEX, and even Binance. The affiliation is more of a referral program. It's a very simple page with your link and that's it. So, and then we sort of talked to all of the KOLs at the time, YouTubers, Twitter guys, and, you know, across all over the globe. And their feedback was that their main source of income was mainly from a shout out. Well, I I give you a shout out, I charge you, you know, two hundred bucks and this type of deal. Um, I realized, well, they could be making so much money and utilizing their their their conversion and their their traffic. By simply working on a affiliation deal. Uh, but they couldn't do so because the data was not there. The data was not transparent. They could not a- and analyze their action.

• 15:21Speaker 02

  So what we did is we basically built a affiliate CRM. Uh, for them to be able to at least to see, uh, they can create different campaigns. So they, for you, Palm, you can create a YouTube campaign, a Twitter campaign. With different campaign, you can use different links. Uh, with different links, we give you all the chartings, all the clicks, how many clicks, how many conversions, how much, uh, how much, uh, traffic was coming in. Uh, so in a way, you cannot, you can, you can start to see the, the testing their behavior. So they could be saying, uh, buy a bit, check out buy a bit, uh, it's no overload. And then they leave it for a week and the next one they could say, check out buy a bit, uh, there is, uh, uh, no KYC, for example.

• 16:02Speaker 02

  Uh, so whichever link has more traffic, they will be pushing that link more and then sort of. Uh, uh, really develop their whole energy into, into promoting a exchange. So after we launched that, uh, along with that, there was a, uh, also a spike in price movement in April, uh, two thousand nineteen. Uh, that really, uh, uh, gave us a huge, uh, uh, a lot of client acquisition. Uh, and you can start to see that what we changed is that from being, uh, charging shout outs, uh, affiliates are now. Fully being a, a buyback promoter and actually can earn the income. So the, so this is the way. Uh, we originally started the, the, how people get to know them.

• 16:43Speaker 02

  But obviously, once you get people to know them, retention is the key, is to actually have a solid product. So that client try you and they like you, they stay. So we actually have one of the highest, uh, retention in the industry. Uh, uh, we, we have, I, I think almost a sixty percent. So every ten people who. Uh, register by a bit, uh, would end up making deposit, I mean, sixty percent of them. So, um. Um, uh, this is because our product is, is user friendly, is built for retail and they can find us twenty four seven for the, for customer support. All of that whole package. So in the end, it is the whole package. But in the beginning, this is what we did to get the initial, uh, ball rolling. Yeah.

• 17:23Anthony Pompliano?

  And I think one of the other things that I've heard people talk about with Bybit is not only was it really built for an analytic standpoint around the affiliate program, but also the way that you compensated people in that affiliate program was kind of unique. And so I've heard a lot of people come to me and say, hey, look, like I make more money with Bybit than any other exchange that I work with. Maybe talk a little bit of just about that, that compensation structure and how you guys thought about that and built it.

• 17:53Speaker 02

  The compensation is rather simple, but people I get, I guess, once you give them full data transparency, we don't give them the client information, of course, but they can actually see that if a UID is registered, because the UID is an internal Bybit number, so there is nothing conflict about that. They can see a UID registered, how much has been traded, either is taker volume or maker volume, and then how much commission they've been made from that client. And if they create a different campaign, they can actually target, let's say if I'm in the Signal group, I can see the ROI on my Signal group or versus the on my Discord group, let's say.

• 18:34Speaker 02

  So with the data transparency, it gives a lot of affiliates ideas that they can make more and all that, but I believe true, they probably could make more because the product, the retention, all of that. In terms of payment, we just give them a cut on the other fees we collected. So we charge our clients a taker fee of 7.5 bips, which is the same as the industry standard, and we also give a rebate on whoever providing us liquidity by giving a 2.5 bips rebate on the maker volume. And affiliates would share that taker volume,

• 19:15Speaker 02

  share that taker volume fees. Another reason is because the platform is overall is built for retail. A lot of retail clients tend to use a taker strategy. So that is why if they compare with, let's say, BMX or FTX, maybe I F T X has a lot of quants or A P I traders, which can be a lot of maker volume. So I guess that whole thing we built for a retail and they have retail audience. That's what makes Bybit is very good for conversion. So I I don't think is the actual payment structure, but is the product is built for their clients. So they have a better conversion. In the end, they get better paid for for for the commission. Yeah.

• 19:58Anthony Pompliano?

  Yeah, that's awesome. And then you guys have been spending a lot of time on your mobile app. You said earlier that, you know, you saw kind of some trends where people wanted to use the app. Maybe talk a little bit about those trends and and kind of what drove you to to put so much time and effort into building up the mobile app.

• 20:15Speaker 02

  So originally, we built a mobile app purely for our Asian users. Because there were so many requests from Japanese, Korean and the Chinese users of Bybit asking for a mobile app. Before the mobile app, we had a mobile website. So when you visit from a mobile phone, it will show a web dot bybit dot com, a sort of a new layout and structure for for the mobile. But they they want a mobile app. So what we did is, okay, let's build this product. And we can use some the a real cool function of of a mobile app that is the notification features.

• 20:53Speaker 02

  So what's the best thing of of a mobile app is that you can find the user anytime when they are, you know, I don't know, go to the toilet or people take their phone with them. So that's the only thing you can find your client anytime, pretty much. And push notification, you can utilize that. So in the original version one of the mobile app, we we already had a very simple price alert function, where if they can set if Bitcoin price reaches, that will be pushed, we give you a notification. But recently, we pushed out a strategy alert that is one much more step ahead on top of the the simple price alert. You can actually set different indicators, meaning if you have moving average,

• 21:38Speaker 02

  you can set two moving average with different period and ones when they cross each other, we will. Send you a notification, uh, let you know that movement is happening. Or a lot of people, let's say, they care about the exchange funding fees or the funding rate, especially the predictive funding rate, meaning that how many uh, people are overselling or oversold uh in our older book, uh, so we can give them a notification based on that factor. And also, we plan to put in much more indicators such as Fibonacci, uh, MACD and all that useful ones, um, so that people can uh rely on these things to tell them when the market is moving. And and as far as for the trend is going, uh, uh, yeah, sorry, I got distracted a little bit.

• 22:21Speaker 02

  Uh, in the beginning, it was built for the Asian users. But uh, right now, for example, eighty percent of our Japanese users are on our mobile app. Uh, I would say seventy percent of our Korean users are mobile app. Uh, but our uh, mean English European markets are now slowly gaining market share on the mobile app. From originally thirty percent now to about fifty percent. So you can see a big trend of everyone started using it as we give more capability onto the mobile app. Uh, and they like it a lot. And that's one of the most feedback we get. Uh, a lot of people choose IP is simply because our mobile app. So um, uh, we intend to invest much more onto the development of that.

• 23:05Anthony Pompliano?

  Fifty to eighty percent of users in certain countries using the mobile app is insane. Like I, I would not have expected it to be that high.

• 23:13Speaker 02

  Japan is insanely high. I would never expected that. Uh, but Japan, it was, before we offered the mobile app, everyone was using the the web version. But once uh, we have the mobile app, everyone switched. So it was, it was, it was very surprising and surprising to me as well.

• 23:29Anthony Pompliano?

  Wh- wh- why do you think that they are using mobile app? Is it literally just because they're on the move, crypto is twenty-four seven, and this is an easy way to do it? And the app has uh enough. Functionality to to kind of do what they need to do or is it something else?

• 23:42Speaker 02

  Uh, I I think that's that's exactly probably what it is, uh, especially during the weekends. Uh, I guess people cannot be staring on the in front of the PC all the time, yeah? And that sort of give you the habit, once you start to using the mobile app, because maybe you're using to PC version quite often, but at one weekend you have to go away, you start using them. But you realize, oh, it got all the tools I need, it got everything, then he start to rely on it. It's like how you start to use TikTok, you know, it's uh, before you install it, you never knew you liked it. And then you start to give you the hook, you know? Yeah.

• 24:17Anthony Pompliano?

  Are are you on TikTok?

• 24:20Speaker 02

  Uh, you know what, I recently just deleted because I I find it it is such a addictive thing. I actually deleted it last week because uh, it's costing me too much time.

• 24:31Anthony Pompliano?

  I love that. So one of the other things that uh, that I know you guys have built into the mobile app is almost this like a predictive type uh, functionality, right, where I can basically say, hey, uh, tell me when a certain uh asset hits a certain price, or tell me when, you know, some event happens, send me a push notification. That's kind of like an alert system, but it sounds like you're you're kind of moving towards maybe in the future, you'll be able to actually um, you know, kind of know what the user would want to know, even if they didn't set the alert and and uh, and kind of send a push notification. Is that accurate or or is that a little bit farther out?

• 25:05Speaker 02

  Yeah, i- i- in that system, we want to advance into more even automated trading uh, for our mobile users. For example, if you we we we, if you start to use different indicators and you want us to let you know that when this indicator is happening uh, or certain price hits the trigger point, we can, the next step is to connect the conditional order or limit order system into the notification. So, once, let's say, your Fibonacci hits certain resistance, you want to do a conditional ordering, uh, we can set it out for you. Uh, and of course, the the amount and all that you can set yourself. So, uh, this is one more step towards the the mobile app. And that's sort of where eventually we want to take this whole thing is that

• 25:49Speaker 02

  people can really don't need to monitor the phone anymore. Uh, it it becomes completely automated and you can do all these. You can, we we can empower our user to become sort of a quant trader in a way that uh, you don't have to know code to be able to do this type of automated, simple automated trading, yeah.

• 26:07Anthony Pompliano?

  Yeah, it makes a lot of sense. And then when your team reached out to me to do this, they were reaching out because they wanted to talk about the World Series of Trading, right? And so we're go ahead and promoting that on the podcast in terms of the sponsorship. But I said, hey, I want to talk to Ben, right? If we're gonna, if we're gonna do this, let's talk to Ben, get him on here. So tell us a little bit about the the World Series of Trading and kind of what you guys are trying to accomplish with that initiative.

• 26:35Speaker 02

  Yeah, so we started, we were the first one that started a global competition in 2019, and that reached one a huge scale, close to 8,000 people. It was a team based where we had, I think, 30 to 40 teams from China, 20 teams from Korea, 10, 15 teams from Japan, and then the rest 50 different teams from, you know, our main markets, which is English, European markets, YouTubers, Twitter guys, leading different teams. So it was a battle, and it was sort of a hype at the moment where people was talking about it and discussing strategies and all that. And this time, we want to make it sort of even bigger and make

• 27:19Speaker 02

  it into a regular occurring event. So we changed the name from a simple BTC competition to WSOP. This is a reference to Pokerstar WSOP, you know, that kind of idea. And we want to make the big prize. So this time, the maximum prize prize pool is 200 BTC. And this time, it's still similar concept with different teams, different countries will join. We want to make it a truly global event and also let our clients see that we actually have global huge presence all over the place, different countries. But this time, not only crypto, we actually got some poker people joining us, leading some teams. We've got

• 28:02Speaker 02

  Doc Park is going to be leading the team. Mike McDonald is going to be leading the team. And of course, your regular poker, your regular Twitter guys, YouTubers. So with that being said, we want to sort of use this. Event to make a social event so everyone can communicate and discuss and have a little bit of fun. So we're gonna be also launching a chat room function that our clients be asking a lot. So people can actually chat among each other and even trash talk if they want to show off their profit and ROI and all that. Yeah.

• 28:38Anthony Pompliano?

  Yeah, that's awesome. When you're thinking about kind of where we are in the life cycle of crypto, you guys have been working on the business now for kind of three years, give or take. You've grown into one of the larger exchanges in the industry. How do you think about kind of the last three years of price movement of kind of the building out of infrastructure, of seeing some of the larger financial organizations come in? Like, how do you think we're doing and how do you just think about like where we are in crypto today?

• 29:10Speaker 02

  I think definitely there has been a lot more product focused team and product orientated people coming into the space. So it's a good thing. I think after the whole 2017 ICU, it got a lot of hype and a lot of people are interested.

• 29:30Speaker 02

  Now from 2018, they're joining into the industry and you start to see different teams build a different product. A lot of teams are very team product focused. So I would say instead of only focusing on the white paper and concept stage, we're actually moving into a very solid, people are building product and delivering product at that type of a stage. Like you said, we also made some investment recently into different projects. One is being a paradigm, which is a sort of RFQ OTC type of software. We were very impressed with the team and the product. So we think there's some synergy going on there and that's why we made some investment and hopefully we will be integrating to them version.

• 30:16Speaker 02

  And just from a exchange perspective, there are a lot more institution coming in now. Even talking to Bybit, trying to connect to us, you know, give us liquidity and trade with our API. So I think it's definitely that, you know, we see some good progress in crypto. And to be honest, for myself and for my team. Even through this whole epidemic, we is almost like a a belief top up. I I tell my team that through this epidemic, the whole teams believe in blockchain and crypto just rise through the ceiling.

• 30:57Speaker 02

  The reason being that you start to see that governments are shamelessly printing money. Like before, you think they are kind of still hiding, but now they just, you know, they're just printing. And you start to see that because of that, the consequences are the rich are getting their billing out, but the poor, the inequality is so bad. And you see that stock and everything is going up. But if you're living on, if you have no access to capital or you're just working on minimum wages, that fourteen fourteen dollar, fifteen dollar per hour is being diluted like hell. So you start to see there's a huge river in between people who have access to capital and people who are just basic labor. And and there has to be revolution.

• 31:40Speaker 02

  So a lot of people say the first age of revolution, the first part of the internet age is the revolution of information, decentralized whatever of information. I I believe the second part, the second age is the revolution of of capital, of of money and of of the whole financial system. So we we think we want to make sure that we stay in the game and we we stay solid. We built a product that's ready for mass adoption. So we're ready for when that comes and and contribute to this. And on the hand, crypto is something completely, the whole, the whole, about the whole society, about the whole, you know, everyone gets benefited. So this is why we believe in so much. Yeah.

• 32:23Anthony Pompliano?

  Yeah. And and what about in China and kind of greater Asia, right? So a lot of people listening are in the United States and about fifty percent of people listening are going to be outside of the United States right now. But you've got kind of this unique seat where you sit in Asia, but you've got clients are kind of across the world. So how do you look at the development and adoption of crypto in Asia versus maybe other parts of the world?

• 32:48Speaker 02

  I'm actually surprised in Asia is, I would say is more, more adopted. We were entering into Indonesian market was one of the market you would assume is not so developed in terms of crypto and all that. So we went in with this assumption of assuming we need to do a lot of things. And then you go and you start to see, wow, all these exchanges are extremely well structured and they have their own Indo-Seter. They have their regulations completely legalized and all these companies. I think the largest one is called Indodex. So people can actually go to Indodex, the counter, and actually buy crypto. And it's completely legal and the government accepted.

• 33:33Speaker 02

  So that's took us by surprise. And then you go to Philippines, we have actually an office in Philippines. Also crypto is legalized and you can get licensed there. And for China, I guess everyone knows the, there's a stablecoin that's been releasing, the D C, D E C P, whatever it's called. So I think China wants to take this advantage to sort of, you know, change the current structure of USD. USD and put sort of the Chinese R and B into the world stage by combining with crypto and blockchain.

• 34:13Speaker 02

  So overall, I think the hype in Asia is bigger even and people have stronger beliefs. And there was also recently a blockchain wake happening in Shenzhen in China. Where there were a lot of people went there and you can see the hype even, you know, you never saw, you see so many people after this epidemic, but everyone is there. And everyone is talking about, you know, DeFi and everything. So I think definitely Asia is where the action is happening, actually.

• 34:47Anthony Pompliano?

  Yeah. And what about like just people who are not in the crypto industry in China or other parts of Asia? Like what do they think about the Chinese digital currency that the government there is planning to launch? Is there people talking about it? Do they know about it? Do they not care?

• 35:03Speaker 02

  To be honest, I think the whole Chinese stablecoin is very murky right now. Nobody knows. Even the people in the industry I talked to, everyone's just guessing. Nobody knows what the central bank is doing or the Bank of China is trying to test.

• 35:20Speaker 02

  I still think at this stage, people in the crypto industry are still unclear. But we definitely start to see that we're doing a lot of hiring right now. And we see a lot of good candidates and they sort of, they come into the interview being that, "Oh, I see that China is sort of bullish on their whole blockchain and crypto industry. That's why I'm coming here for this interview." And they always bring out this news that, "Oh, the central bank is coming out with a stablecoin." But if you ask them, what do they know? They don't know anything. But they at least, they take a signal that is positive, the government is going to move ahead with it. So they want to be the first in the industry to find out.

• 36:03Speaker 02

  So they want to join to find out what's going to happen. But they asked me and we were like, "Well, we still don't really know at the moment." But we also, I know as much as you do. So this is what's going on.

• 36:15Anthony Pompliano?

  Yeah, and it's pretty interesting too, because I think as you get like the rise of DeFi, right? And kind of these decentralized or automated products. Do you think that, whether it's the Chinese digital currency Bitcoin or something else, do you think that the average user in Asia is open to using those products for financial services over like the legacy institutions? Or do you feel like there's still some loyalty to the legacy financial institutions? And crypto is really only for trading and kind of investing, if you will, but not necessarily the more traditional financial services?

• 36:47Speaker 02

  Are you asking about China or?

• 36:50Anthony Pompliano?

  China specifically.

• 36:51Speaker 02

  China specifically? To be honest, my, this is only my personal take. I, I personally take it is uh uh I don't think the Chinese mainstream will be using DeFi uh uh to replace the current, you know, the legacy uh services. One of the reason being that um the existing service, let's say Alipay or, you know, Tencent, all these different financial tools are so convenient. There are a lot of people, I know a lot of my friends that are either Americans or, you know, from, from UK. When they move back to the US, they feel very uncomfortable because a lot of these things are not available anymore. It's so convenient being in China.

• 37:36Speaker 02

  But obviously you give up certain things. You give up the uh your, your privacy. So in a way it's a trade off. You give, you have no privacy. Yeah. So uh but given that being said, uh all these tools, what Chinese are currently using and used to are so convenient. There's no need and there, there's no concept of why do I need to change? And, and you can sort of, uh, also there's the whole debate about privacy. If you never had something, you, you sort of, you don't really know, you know, uh, you know. So if you never had privacy and you, you, you never, also you don't see people on Weibo talking about the different privacy issues.

• 38:15Speaker 02

  But where you see a lot of that in, in Twitter on, on that, which is I, I, I don't necessarily personally agree with, but um, but this is what the Chinese uh uh current state is. So being that um if you're trying to push out a DeFi and sell people that, hey, if you use this thing, at least you get your privacy. And people are like, well, I'm perfectly happy with what I'm doing right now. So this is the uh, the, the dilemma we're facing right now. But uh, should it be changed? Uh, definitely. I, I believe so. I, I believe with DeFi it would change a lot of things. And my belief is that maybe with that whole revolution of crypto and, and that will push the things changing a bit in China as well. Yeah.

• 38:54Anthony Pompliano?

  Yeah, and one of the last things I want to talk about was just building a team, right? So you've done a fantastic job of kind of gathering very smart people very quickly and have built a very profitable business. How have you found hiring, whether it's there in China or globally? Before we got started, you were telling me how you guys were very used to working remotely and using all the different remote tools. But obviously, you're looking for the best people. So talk a little bit about building your team and how you found that hiring process.

• 39:26Speaker 02

  We take hiring very seriously. Actually, all the hirings, the final interviews is definitely one of the founders, even a reception person coming in that one of the founders would sit that last final round. Simply because we want to make sure our people understand the company culture they're coming into by presenting a founder. And normally, that gives them a little bit, a very positive feeling about the company that, oh, you really take care of, you really care about the hiring process.

• 40:01Speaker 02

  But I mean, right now, as far as hiring concerned, we actually find through this epidemic, a lot of good candidate is becoming available. So we actually has been spending massively. Right now, we have globally about more than 250 people. So half of them, more than half of them are, you know, hired probably during this whole six months. So, and we have, we have one interesting round I can share you that normally the first round interview is the hiring manager. And the second round is what we call a culture interview.

• 40:41Speaker 02

  So all we asking is, is this person coming from completely different units? So if you're hiring a marketing person, this person is coming from either IT background or our accounting department. We select them as our cultural representative. And they will be asking questions about what do you like to play? And, you know, what, what's your preference? What kind of people you hang out with? Like this, and also they actually tell the candidate about. What is working in in by bit like? Because a lot of times the candidate is feeling a little bit shy. Asking kind of direct question about the line manager. So they ask the culture interviewer and the culture interviewer.

• 41:24Speaker 02

  Their core responsibility is to find out whether this person have client first mentality. Whether it's been this person sincere. Whether it's a it's a goal oriented person and a few criteria we want to find out and they gave a score. And if our culture interview doesn't pass, this person cannot be hired into the company. Uh we rotate our staff to do that. So they take great ownership on uh. And honor in doing this, uh because they feel, you know, I'm actually the person in charge of. Character and to be extremely um uh you know, careful. So it's a I find that it's very interesting and a lot of good positive feedbacks about that process. Yeah.

• 42:06Anthony Pompliano?

  I love that. I absolutely love that. Um. Before I get into the rapid fire questions to end it, uh what's your number one priority for the second half of 2020? Like, what are you most focused on uh seeing by bit or or your team do?

• 42:20Speaker 02

  We want to expand our current uh product lines. Uh like I said, uh we are launching our expiration contract. And also hopefully by Q4, we want to launch our option product. Uh um so we we want to truly by this year expand our product line. Uh make sure whenever we release a product, it has some innovation in it. Uh and that's why the past two product, the mutual insurance and the strategy alert, they're both uh unique and the the. Uh you know, so uh this is our pure focus that we want to uh lead the industry uh by innovating product. And give the clients what they they they they want. Yeah.

• 42:59Anthony Pompliano?

  Love that. I finished each interview with uh the same two questions. The first being, what is the most important book that you've ever read?

• 43:07Speaker 02

  Most important book.

• 43:11Speaker 02

  You know what, I recently, I recently took a vacation. And my second son was just born two weeks ago. So I was in the hospital and, you know, holding him. And just on the shelf, there was a book called Tuesday with Maurice. And so I read that Tuesday with Maurice. This is a very good book about this professor, you know,

• 43:38Speaker 02

  dying words and giving a last life lesson about his vision, how to treat life, how to give back to society and all of that. So it was, it was very, it was very refreshing. And for me, it was good to slow down, especially with, in the hospital with my kid just there. It's sort of awakening. I was like, okay, I need to slow down and focus more on life.

• 44:04Speaker 02

  So this is one of the recent book I read.

• 44:07Speaker 02

  I found it very interesting. Yeah. So, yeah.

• 44:10Anthony Pompliano?

  It sounds like a very strategically placed book, right? Is to put that in the, in the room.

• 44:16Speaker 02

  Probably my, my, my wife put it there.

• 44:20Anthony Pompliano?

  I love that. The second question is a little bit more fun. Aliens believer or non believer?

• 44:26Speaker 02

  Oh, a hundred percent believer.

• 44:28Anthony Pompliano?

  Why?

• 44:29Speaker 02

  Especially after knowing that how small we are.

• 44:33Speaker 02

  Maybe before I didn't know, but after we found out the whole galaxy and how small we are. I'm sure there's, you know, maybe not in this galaxy, but in different galaxies, there's something, a being like, either like us or a civilization. So for sure, I definitely believe in that. And yeah, you never know.

• 44:55Anthony Pompliano?

  I think that is a great way to look at it. It's just the world is so big, right? How do we know what, what could possibly be out there? To end it, you get to ask me one question. So what is the one question that you have for me?

• 45:08Speaker 02

  One question I have for you. This is very good.

• 45:15Speaker 02

  What was the one most interesting question you asked? And even to this day, you found it interesting. You kind of think back to, to one of the, any of the people you interviewed.

• 45:27Anthony Pompliano?

  Um, most interesting.

• 45:30Anthony Pompliano?

  Question.

• 45:33Speaker 02

  Or sort of awakening that kind of change. Yeah, yeah.

• 45:36Anthony Pompliano?

  Yeah, I'm gonna give you two, uh, two answers. So first of all, the reason why I asked the alien question is I think it just gives you a, a pretty good, uh, very quick view into like how people think, right? So some people, uh, will come on and they'll say, hey, uh, I don't believe in aliens because I've never seen one. Right? Somebody else will come in and say, I believe because you know, mathematic probability says that, you know, it's more probable than not. Other people will come in and say, I believe because here's, you know, three scientific equations and, and they're very kind of analytical about it. So I think that, uh, it's just like my favorite question because it, it can tell you so much about the way somebody thinks, uh, what they believe. Um, you know, people who want to believe aliens are real versus people who, you know, don't want to and stuff like that.

• 46:21Anthony Pompliano?

  I'm just, I would say that's definitely one. Uh, in terms of, um, like my favorite question, I, I don't think I have one. I think what it ends up being is, uh, there are times when I do an interview and I'll ask a question and somebody is so brutally honest with their answer that it almost makes them uncomfortable. And I, I think that like, when, when, when you see that happen, it's just a really special moment. Like this person is so intellectually honest and, and, and so just transparent that they didn't want to tell me what they just told me, but they did, right?

• 46:58Speaker 02

  Okay.

• 46:59Anthony Pompliano?

  And, and so to me like, it's just this, uh, this vulnerability that, uh, I think a lot of people, they will, uh, you know, if you go on television, for example, everyone is trying to like project some image, right? Hey, I'm the smart trader guy. I'm the smart this. I'm the smart this, you know, whatever. Podcasts are a little bit different that people are, are, are more authentic and kind of just, you know, Conversation. So I think when you see people be like overly vulnerable, especially when they say things that are true, but don't make them look good. You're just like, man, this is pretty cool experience to kind of have those types of conversations.

• 47:34Speaker 02

  Yeah, well, awesome, awesome.

• 47:37Anthony Pompliano?

  Absolutely. Where can we send people to to find you on the internet and find out more about Bybit or the World Series of Trading?

• 47:44Speaker 02

  Well, I'm on Twitter. I'm always on Twitter. So people can find me at Ben Bybit, you know, at Ben Bybit or for WSOT, just go to our bybit.com and you'll be able to see some information. Yeah.

• 47:59Anthony Pompliano?

  It's all over the homepage. Absolutely. Awesome. Ben, listen, thank you so much for taking the time to do this. I really enjoyed it and congratulations with all your guys' success and we'll do it again in the future.

• 48:10Speaker 02

  Thank you. Thank you. Looking forward to the next talk. Thank you.