Exclusive Interview with Huobi CSO & Head of Public Chain: The Exchange's Road to Self-Disruption
Text | Lu Xiaoming
Editor | Mandy Wang Mengdie
Text | Lu Xiaoming
Editor | Mandy Wang Mengdie
Centralized digital asset exchanges are on the road of self-subversion.
Under the pattern that centralized exchanges occupy the top three in the industry and giants carve up market share, new players enter the crowded exchange track from time to time. Among them, decentralized exchanges are pinned on hope, and many startups hope to borrow Overtaking on this curve.
Compared with centralized exchanges, the code of decentralized exchanges is open source, the rules are open and transparent, and there is no moral hazard of the exchange; at the same time, the wallet is controlled by the user, and there is no danger of losing coins due to the exchange being attacked.Although it "looks beautiful", the fact is that its liquidity is not competitive with centralized exchanges, and its security and user experience are not satisfactory. The smart contract system itself is not perfect, and there is a risk of being hacked; in addition, for most users, it is better to store assets in a large exchange with a brand guarantee than for most users. There is a lack of fiat currency channels, complex wallet operations on the chain, and non-matching transactions. The experience is also somewhat "anti-human".After all, users prefer the simple operation of "Dont Make Me Think".
According to media statistics
, At present, there are more than 1,000 digital currency exchanges in the world, and less than 5% of decentralized exchanges occupy a small market share.
But what is interesting is that the giants of centralized exchanges, who are clearly in an absolute advantage, have decided to "build their own competing products" one after another to prevent being cannibalized by others. This is an unanimous self-subversion.
In March of this year, Binance announced that it will develop a public chain and build a decentralized exchange. Binance believes that in the near future, centralized exchanges and decentralized exchanges will exist at the same time, and the two sides will complement each other and jointly undertake the transfer and transaction of blockchain assets.
More than two months after Binance announced to build a public chain, Huobi’s public chain plan also came."In the future world, it is very likely that autonomous systems will replace companies. If this form appears, we hope that we will lead it, not the one that will be replaced in the end."www.huobigroup.com）。
At the press conference in Singapore on June 6
, Huobi announced that it will mobilize community forces to build a "self-finance" public blockchain Huobi Chain. Various assets and warrants will be generated, circulated, notarized and confirmed on the public chain in the form of tokens. At the same time, Huobi introduced Huobi Ecology, Huobi Capital, Huobi Labs, Huobi Mining Pool, Huobi Blockchain Application Research Institute and other group business sectors at the meeting, and announced a new group domain name (
"I founded Huobi because I saw a gap in the market where digital asset services are not perfect." Li Lin said in the live video. Back then when digital assets such as bitcoin first appeared, Huobi was not the first bitcoin exchange, but it was the first free bitcoin exchange in China. Just like Taobao was criticized for "free is not a business model", free has attracted a large number of users. Huobi rises, Bitcoin China gradually dies.
Until now, the blockchain field has progressed from speculating on coins to pursuing commercial applications, and Huobi is not willing to confine itself to exchanges.
From exchanges, mining pools to wallets, Huobi has laid out the industrial chain of digital assets, which is the traditional "currency circle"; from capital, information, to blockchain application research institutes, plus the current public chain, Huobi Coins are also gradually entering the application field, which is the so-called "chain circle". This press conference is also intended to change brand perception: it is not only an exchange, but a "digital asset financial service provider".
However, a company's DNA is its strength and will also be its imprint.
Just as Baidu has been trying to transform itself from a search company to an artificial intelligence company, every time Ali publishes a financial report, it emphasizes the rapid growth of internationalization, Alibaba Cloud, and the entertainment sector. Speaking of these two companies, everyone always thinks that the former is search and the latter is e-commerce. The same is true of their income composition. Huobi, which started as an exchange, is no exception.
In this regard, Odaily exclusively interviewed Huobi CSO (Chief Strategy Officer) Cai Kailong and Huobi Ecological Project Director Chen Guang. The former joined Huobi last year and was responsible for the formulation of Huobi's general direction strategy; the latter is the person in charge of Huobi Public Chain. Discuss the reasons and details of the Huobi public chain, how to choose a technical leader, and the future strategic development of Huobi.
Exchanges, unanimous self-subversion
Undoubtedly, as the top three exchanges in the global trading volume of digital currencies, Huobi has become one of the most influential companies in the industry. However, it is undeniable that Huobi does not have an advantage in terms of the underlying development technology and talent pool of the public chain. Moreover, it is still a centralized exchange, and the launch of the public chain project can not help but make people wonder whether it will be a centralized exchange and subvert itself.
Unlike Binance, which clearly stated that it will promote the centralized exchange, Huobi did not mention whether its own exchange business will be on the chain when it launched the public chain project this time.
However, Chen Guang said that after the public chain goes online, there are likely to be related attempts. However, as far as the current situation is concerned, it is very likely that other businesses will be put on the chain first. Chen Guang said that the first listing on the exchange may be related to governance, Hadax’s voting for listing, financing, etc., or it may be a combination of on-chain and off-chain. The reason is not difficult to understand. At present, the three largest exchanges in the world are all centralized. Huobi believes that the current public chain has failed to surpass centralized exchanges in terms of security and user experience. "If these can be overcome, we are also very open." Cai Kailong said.
Judging from the strategy announced by Huobi and Li Lin’s open letter, Huobi plans to build a self-financial public chain, which is even more self-subversive than decentralized exchanges.
Just when Huobi issued HT, launched HADAX, or Binance announced the launch of the public chain, many people speculated whether Huobi would also be a public chain. In fact, at that time, Huobi had not finally decided to build a public chain, and it was still under intense internal discussion. About 2 months ago, the route was gradually clear, and it was decided to be a public chain. Cai Kailong and Chen Guang both told that before launching the public chain project, Huobi had a lot of internal discussions. "Including when to do it, why to do it, and what is the public chain. Just what is the Huobi public chain, we have discussed it for a long time, and finally positioned it on self-finance."
"This concept (from finance) is a bit abstract." Chen Guang said, it can probably be understood as the disintermediation of finance. .
The Internet that "connects people and information" has brought about the most rapid change, which is the dissolution of the mainstream media's public discourse power, that is, "disintermediation of communication", and the advent of the self-media era. Similarly, self-financing may be the extreme of the trend of financial disintermediation. The essence of finance is the optimization of resource allocation, but traditional finance has set up intermediaries/intermediaries on both sides of supply and demand, such as commercial banks, investment banks, private equity funds, etc., from which huge profits have been drawn; under the development of the Internet, P2P, crowdfunding They have emerged one after another, the trend of direct financing is obvious, and the financial disintermediation of the industrial chain has intensified. Behaviors such as ICO and personal currency issuance are another manifestation of this trend.
As Chen Guang said, "If the financial era really comes in the future, there will not even be an exchange on the chain", let alone whether the exchange needs to be decentralized.
Whoever controls the public chain controls the futureThe Huobi public chain project was proposed by Li Lin, the founder of Huobi Group, and Li Lin also attaches great importance to it. Regarding the situation of the Huobi public chain, Chen Guang, the project leader, needs to report directly to Li Lin more often.。
Cai Kailong said that the reason why Huobi is a public chain is very simple.
"Whoever controls the public chain controls the future"
People will always paint a blueprint for new technologies that seems out of reach or full of idealism. When the Internet was born, some people dreamed that it could connect everything and bring equality; artificial intelligence technology made people yearn for the liberation of human labor, and made people fear that machines would rule mankind. Blockchain is no exception.
"From a distance, the dream of the entire blockchain industry is self-government." Chen Guang said that in the blockchain-based autonomous organization, it may still be the same group of people who are doing the operation of Huobi. The incentive mechanism is different. "Li Lin also hopes that Huobi can survive on its own in the future."
However, since you want to seize the future of the public chain, you must be prepared to subvert yourself.
"In the future world, it is very likely that autonomous systems will replace companies. If this form appears, we hope that we will lead it, not the one that will be replaced in the end." What Chen Guang said, maybe It can even become a footnote of why Huobi is a public chain.
Li Lin also publicly stated: "During the five years of operation, Huobi has gradually realized that the existing trading platform is probably only the primary form of financial asset transactions. With the continuous development of blockchain technology and consensus mechanisms, future The form is more likely to evolve into a brand-new distributed system. The generation, circulation, notarization and confirmation of all assets and warrants are carried out on the public chain. The future will be a brand-new self-finance world based on blockchain. He said that based on this, Huobi gradually began to open its business to the community for self-government ecological attempts.
Blockchain speed, more urgent sense of crisis, faster self-disruption
After all, both Binance and Huobi are self-revolutionizing; however, as a latecomer, Huobi has made this revolutionary goal more thorough. If the Binance public chain is to subvert the centralized exchange, the Huobi public chain is to subvert the exchange and even the entire financial system.
These two exchanges, which are at the pinnacle of the industry, have just taken advantage of the ICO trend and regulatory turmoil, and started preparing to subvert their own plans. Does this awareness of "living in sorrow and dying in peace" make Internet people feel ashamed to plan for a rainy day?
This is blockchain speed.
In the commercial society, it is definitely not another you who subverts you. Any company that wants to be "built to last" needs to "self-disrupt".
It's just that the rate at which companies rise and fall is accelerating. The linear increase in productivity increases efficiency, accelerates the pace of the next era, and shortens the life cycle of a business.
In traditional industries, there are still centuries-old shops in this world. In the Internet world, the iteration rate of the masters of the era has been accelerating. Nokia's Symbian mobile phone was the overlord for 10 years, and was eventually replaced by Apple and Android. Google, which was established four years later than Yahoo and was once its supplier, eventually sent it to prostitution.
In the blockchain world, the speed of this unit will only be faster, making people unprepared.
It took less than two years for Huobi to be included in the top three. Binance coincided with the "94th" and became the largest in the world within a few months.
Since then, practitioners who have entered the game one after another have also dreamed of getting rich overnight and subverting the pattern. Looking forward to it, when the next opportunity comes, they will naturally become the "next Binance".
The Nasdaq used to be ridiculed as "garbage stocks get together", and in this world, what subverts you is often what you once underestimated. The self-made "grassroots giants" understand the truth better than anyone else.
So, at that time, Binance decided to build a decentralized exchange that seems to have no advantages today; this box Huobi launched the "self-finance" public chain that seems to be far away from us.The future is coming sooner than you think.Maybe the things discussed above seem unimaginably far away to you. If you look closer, you will find how the Huobi Chain will expand the circulation scene of HT.
Huobi HT Zone
It was launched yesterday, including trading pairs between HT and 7 digital currencies; Huobi’s ecological scenarios that are easy to think of after that include: projects use HT to raise funds, use HT to pledge to vote for listing before listing on Huobi Hadax, use HT to participate in Huobi Do development on the chain. This forms a closed loop.It is impossible to build a public chain with the power of Huobi aloneThe gameplay of Huobi Chain's "elected CTO" is similar to the EOS super node election.
The reason why EOS community building is successful
, in short, BM+BB (the CTO and CEO of the EOS development team Block.One, respectively), representing a technical genius who can mobilize the community and an amazing operation method.EOS is the largest ICO project in history. Its crowdfunding process lasted for a year without setting a limit; and an election mechanism was set up to make the supernode election a community mobilization. The former makes the distribution of tokens more decentralized and prolongs the project fermentation time; the latter allows candidate nodes to become evangelists to promote the project and expand the radius of the community. Now the Huobi public chain is obviously using similar methods to build momentum through elections; the momentum will naturally expand the community.
Technically, the Huobi Chain this time,
Probably hope to rebuild an EOS in the way of "popularly elected CTO".
The selection of "technical leaders" of the Huobi public chain also uses the concepts of election and voting. Cai Kailong said that Huobi did learn from many public chain practices during internal discussions, mainly in terms of community operations. "The success of EOS has touched us a lot."
The exchange is not a technology-driven business, and the development of the public chain continues to have a large number of technical talents. Cai Kailong also admitted that the underlying technical talents of the public chain are one of the shortcomings of Huobi's public chain. The public chain project focuses on the underlying technology and community operation. Therefore, "There is no way to do it with the power of currency alone, because this is a public matter that requires the power of the community."
However, relying on this kind of democratic audition method, can the most suitable technical leader be selected for the Huobi public chain?
"I personally think, frankly, I'm also worried, is it really feasible? From Huobi's perspective, we are going to do a social experiment."
Whether it is Chen Guang or Cai Kailong, they personally believe that the future society may not be completely decentralized. It may be after games and collisions that they will find a balance between centralization and decentralization. This takes practice and time to find.
In order to avoid the disadvantages brought about by "excessive democracy", there will be a council to formulate the rules for leader election and supervise the progress of the project. The council should formulate reasonable thresholds and standards to ensure that candidates meet technical standards; however, as a public chain leader, technology alone is not enough, and mobilization and leadership skills are also needed to lead the team and community to build a public chain. Therefore Voting is also essential. The council also needs to establish voting rules.
In short, the Council is sort of like America's "Federal Election Commission." Chen Guang said that the members of the council are appointed by Huobi, and they are looking for technical experts with profound knowledge in the blockchain field around the world. Huobi Group will have two seats in the council. It is not ruled out that there will be existing public chain sponsors in the council; Huobi may also invite technical talents to participate in the public chain leader election.
Similar to the EOS development team, BM includes 10% of EOS, and has also formulated a large number of rules. As one of the public chain participants, Huobi also reserves a certain right to speak for itself. Of course, as the initiator of the Huobi public chain, Huobi will devote its own resources to the public chain. This is also the advantage that Huobi believes in building a public chain. "We have enough resources, and it is easy to form a one-stop service." For example, Huobi has its own business sectors such as capital and ecology, which can provide financing and application scenario-related docking services for the public chain.
Huobi US already has a local currency trading license
The public chain seems to have added a few key links to Huobi's industrial chain layout, but don't forget that this exchange is also doing what most Chinese Internet companies are doing, but it is difficult: internationalization.
Cai Kailong told Huobi that the current strategic focus of Huobi can be summarized into two dimensions: horizontal internationalization - enter more countries and serve local customers; vertical full ecological, industrial chain - with the exchange as the core, develop upstream and downstream product.
On June 4, Huobi announced its positioning as a digital asset financial service provider. Before these words, there is the modifier "global leader". However, the leading transaction volume is related to China's population and the high proportion of Chinese investors in the world. At the press conference, the audience was full of Chinese people, and there were occasional Western faces; the guests on the stage would also directly say, "The audience is all Chinese, so I will speak Chinese directly." The same is true of the blockchain conferences held frequently in Japan, South Korea and other places.
According to the roadmap released by Cai Kailong, Huobi has established offices in 10 countries and regions including the United States, Canada, and Germany. In the future, it will enter Russia and Germany. The inevitable choice of a global digital currency exchange, Binance registered in Hong Kong. In September 2017, Binance moved its office from Hong Kong to Tokyo, Japan. Later, in March 2018, due to a warning from the local Financial Services Agency, Binance moved its headquarters. to Malta; Binance has also reached cooperation with Bermuda and Uganda.
I am Lu Xiaoming, editor of Odaily. I am exploring the real blockchain. Please add WeChat lohiuming for breaking news and communication. Please note your name, unit, position and reason.
