Why Catherine Coley Isn't Worried About BNB Being a Security - Ep.154

Transcript

hi everyone welcome to unchain your no hi free source for all things crypto I'm your host lorrison Unchained held a little giveaway recently for some of the swag we got or produced in 2019 and we are announcing our giveaway winners Rob Fox won a ballet crypto wallet crypto Chi won the book the coin billionaires so hum Fatiha when a Bali crypto wallet sample and an Unchained rabbit full sticker ed rod won our old school cap Stephen Applegate when a black Unchained crypto Ravan will shirt for his kids he goooneee a gray unchain crypto rabbit hole shirt and an Unchained rabbit hole sticker David Orlov won the little Bitcoin book and Kari Ellen won and Unchained rabbit bug and in black Unchained logo sticker congrats to you

all and for the rest of you listeners if you don't yet have any unchanged swag check out our wares at shopped on Unchained podcast calm crypto calm the crypto super app that lets you buy earn and spend crypto in one place get a metal MCO Visa Card with up to 5% back on all your spending download the crypto comm app today Kraken is the best exchange in the world for buying and selling digital assets it has the tightest security deep liquidity and a great fee structure with no minimum or hidden fees whether you're looking for a simple Fiat on-ramp or futures trading Kraken is the place for you cipher trace cutting-edge crypto currency

intelligence powers anti-money laundering blockchain analytics and threat Intel leading exchanges virtual currency businesses banks and regulators themselves use cipher trace to comply with regulation and to monitor compliance today's guest is Catherine Coley CEO of finance us welcome Catherine hello Laura how are you doing today good happy new year I'm so glad we could finally do this chat i 20/20 can't believe it's here you worked for five years at Morgan Stanley doing foreign exchange trading in Hong Kong in London and that was kind of what you were focused on before you got into crypto so I was curious to hear about your transition from tradition

financed a crypto why did you make that switch and how to me it was almost inevitable I I spent five years really focused on the macro factors that changed how the world really operated and how people bet on different news headlines different fundamental factors different technical factors and really kind of moved their weight of their own wealth around to realize how markets could be beneficial to them so when you introduce something like a new asset class our kind of trader brain just automatically sees something that we can buy and sell you know common phrase of understanding how markets work so we saw

Bitcoin kind of come into this space for me it was around 2013 when hedge funds that I was covering started you know buying this as a PA which is kind of your personal account trading just to get a little glimpse of the technology and that's really where we just began to realize that this was just going to be another asset class that we could trade so it was very natural for me to move into crypto and very obvious for me seeing the space itself of traditional finance where foreign transactions the margins were all being compressed and understanding just the cycle that I was in the opportunity to be on the front line of crypto was one that I had to

seize and now that you've worked in this face for about two or three years how would you say crypto and I got some particular crypto trading compares to foreign exchange trading or engine or more broadly to Wall Street in general I it has the same adrenaline factor that I fell in love with when I first moved out to Hong Kong on the trading floor there of just understanding that we are on the first and early days of this market behavior understanding recognizing patterns these are all ones that don't come with decades or centuries of existing data points for us so being able to have new new technologies be built on top of it is fascinating being

able to see new behaviors and new you know consumer behaviors take place around it fascinating and one that I just continue to kind of keep my eyes open and forward-looking to make sure that we can build this in the best way possible and so tell us a little bit about how you made the transition specifically from crypto I'm sorry from traditional financial in secret oh yeah so it was probably what was right before brexit was taking place or so we thought it was taking place when Morgan Stanley really kind of did a real quick look and said oh no all of our all of our expats and 40% of our fixed income workforce or we're gonna you know we're gonna get rid

of that and you know what an opportunity that actually was for me to really lift up out of my seat and say I can go anywhere in the world I can do anything I want right now what is it that I really want to learn more about and for me that was learning how to navigate between a traditional hedge fund macroeconomics world and that of tech I was I was an early adopter of you know any app or technology that I could get my hands on and I wanted to know exactly how that world worked a little bit more so the natural gravity was to San Francisco to just kind of learn the language understand how they think versus how I thought and do the largest financial centers in the world and really kind of break it down and see where I can be in it via you know

helpful citizen of that that world so I came over to Silicon Valley Bank actually and all my clients were these great startups and I just it felt like I was sitting on the sidelines I was watching some of my clients just do vertical growth and you know really exciting products they were building out an attraction that they were growing and I said I can't sit on the sidelines anymore being a facilitator to these customers so I said ah right I had a Alert for a while on Ripple oddly on LinkedIn and finally the day came where a job role lined up exactly with my expertise so knocked on their door and within two weeks was working a triple so

that was the first full two feet dive into crypto that I that I took with my career and there you were ahead of XRP institutional that's correct and so what did that role entail that rule was you know every aspect you can think about an asset in this market I was involved in so whether it was understanding xrp trading on exchanges the global exchanges getting getting the listings there understanding who is trading this whether it was your market makers whether it was your retail and institutions understanding how liquidity can grow what type of financial products we actually needed to provide to users to make sense of this

so OTC markets were picking up people wanting like large block or tranche trades in an X RP and then understanding just our impact on the the larger crypto environment with introducing XRP and and what other aspects could be built upon it so if you think about every component that I worked on that's really what helped me take on this next role because anything from custody to market makers to trading liquidity to apps to you know OTC I was involved in understanding who were the key players at that time and then so why don't you tell us the story of how you became a CEO of finance us

yeah so it wasn't a short story but the I was I was over in Singapore with Cumberland which was one of the OTC desks that we worked with on X or P side and they're hosting one of their first big summits where they brought in the likes of Qi Han cz the wink of I Josh Joe Lubin you know all these greats of crypto that were seemingly on opposite sides of every table they finally brought them into one room and it was you know what a spectacular opportunity to be in that room and really understand how we were going to move forward as an industry and also recognize that some of these folks had never met in real life

before and so with that I ended up sitting on a bus next to a guy that it turned out to be the CFO of Finance so we shall i sat next to and show away and it we kicked it off in a way that was kind of serendipitous and and also one that once you have an opportunity where you see eye to eye with someone from different sides of the world you kind of always hold on to that so I stayed in touch with we on a multitude of things you would be asking me about different market participants understanding what you know what they were thinking about her going into and we just shared this kind of common bond and respect for the market and where we

were both growing and going as as you know stewards of this space and so then about a year later it actually came to fruition so if you you know kind of tapped me on the shoulder and said you know what are your thoughts around you know coming coming to to buy Nansen and where you can really add value and to me that was really providing that impact to my own local market in the United States so being able to bring their global technology and package it up in a way that was useful and productive for American users was something that just was a really important part for me to really figure out how we can fix the

infrastructure in the United States to accommodate users to be a part of a much larger global story yeah this is actually a theme that I want to ask you about but first let's just cover the basics so what is finance us and how does it differ from finance sure so by Nantz us provides a you know the fast and convenient way for you to bring dollars into crypto markets with a large variety of selection across the tokens that you can buy and sell and so we have 25 tokens plus listed with dollar and USD T and BTC pairs and we have an app available on Android and iOS so you can

do this from anywhere you are traveling around and it's really catered for a u.s. user being able to provide them the compliance necessary within the US regulation within a vetted platform that really lets people feel comfortable about being part of a global community while also knowing that they're being looked after from a US users perspective so finance previously did operate in the US and then it closed off finance to us users and then finance us replaced all that is hopefully the way I've praised this is not confusing to people but so why was it necessary for finance to create a separate entity for

the US market mostly because the US market is so unlike other markets that they were already in if you think about just blanket marketing to a global user that's nearly impossible so you've got different aspects of understanding the local regulation understanding the different consumer types really being able to cater to that audience that really make more sense on making this a specific product for the United States you know that's really where we saw the need and Finance has done a wonderful job of facilitating global economies to help this out I mean you think about the other regions that they're in from a

Fiat on-ramp perspective they've got by Nantz Jersey they've got finance Singapore and so spinning up these ways for getting local currency access into these global crypto markets has really been an important factor for for finance to kind of progress in this space and so for us in the United States this was the opportunity to bring US dollars and and Fiat on-ramps into you know a regulated entity that would be up to par for the everyday American user so finance famously launched in the summer of 2017 and then it became the number-one crypto exchange by the end of the year finance us is launching during a really

different time not during you know the crazy mania or a market that's similar to the crazy mania of 2017 it's more of a downturn and also of course you have a lot of the regulatory restrictions that the original finance did not have so for by Nantz us how do you plan to counteract some of these headwinds there's no better time than the present now we've had almost ten years of learning how exchanges and marketplaces in the United States have been operating so for us to be able to come in and understand what has worked already and what hasn't worked our consumers right now and customers are really really opinionated in what does and does not work for them so one

of the big components of Finance us is that we really are listening and building for our users here in the US there's something that I think is very helpful for our team but also you know quite humbling and that's be careful what you wish for is often what we say because we'll build stuff that you we hear our customers meeting this is a time where they actually know what products they want are understanding where the burden and the hurdles were earlier and we're really here to lower those barriers to entry to really include more people into you know this digital era rather than exclude them or complicate the process anymore finance is operational I believe in all except

12 of the states and those 12 states are some of the big states like New York Texas and Florida so what I'm curious to hear what your regular what your take is on regulation in the US yeah it was it was pretty hard to realize that I was going to be building something from scratch and not able to provide it to any of my existing network back home so it's surprising Florida I grew up I grew up in Florida I went to school in North Carolina my sisters in New York so for realizing that you know there's big hit home states for me you know I didn't have a home court advantage for sure but there there's a the great aspect is we were able to get up and running in 37

states in the u.s. operating and being able to provide our services the states that are remaining and I get this question actually every day is you know when is my state going to be listed and we're going through the process of the money transmission licenses that is a requirement for anyone to be able to conduct the style of business in in the 50 states so when we realize that our you know peers and if the industry have had seven years advantage of getting these licences in place before they're able to operate we're definitely you know playing catch-up in that aspect and people need to realize that it is a you know it's a it's a long process to go through but one that we're really

excited about doing because then that lets us really have a little bit more autonomy in the business we can provide to our users so hang tight but also I think it's wonderful that we've had the regulator's be able to see now what these businesses are there's a little less skepticism of you know are they profitable and productive businesses to run a marketplace for digital assets so the state regulators you know this isn't the first time they're seeing a our business plan it's it's a common common practice by now for them to be able to look at these businesses know the risks ask the right questions understand you know where what standards we need to be holding and and what value we're really adding to their state so I'm pretty

excited for for being able to roll those out you know when the time comes but it but it is it's wonderful to just also hear the the roar from those states of how vibrant their crypto communities are and how much demand there is for our app or you know other features that finance us has on our trading platform but do you feel that going state-by-state is more onerous than it needs to be like if you could change something about US regulation particularly around this issue what would you want to see I mean the OS always wanted to make someone else's job easier than it is but I think they're doing a great job in terms of understanding what they need to be comfortable with and of course time will

tell you know I say they've had seven years to understand what a crypto a marketplace looks like but that's only 7 years that if it doesn't make an expert out of out of anyone so we're still really in this state of evolution of understanding what regulation is necessary to you know to keep consumer protection to really follow up and make sure these are sound businesses and the protections are all in place for the for the marketplace itself but at the same time where can we allow this innovation to grow where can we recognize that the you know there are a slew of jobs that could be over when these states really recognize that we can be operational there you know there's no I think we're seeing it more and more the the reason for people being

based tech wise out in California is oftentimes just because the the regulation does allow for you to take part and businesses sooner and so some of you know some of these states I think that's exciting to see them welcome innovation and with that we want to reward them for opening their doors so going back to that very fast growth period I mentioned that finance experienced when it launched part of its success came from the fact that first of all it launched as a crypto two crypto exchange and also that it mostly played regulatory arbitrage kind of sometimes avoiding regulations in certain countries that would be pretty onerous other times you know especially more

recently going after jurisdictions that are more crypto friendly especially to establish these fiat on-ramps but obviously by Nance I don't think can follow the exact same playbook to grow its market share so what is your strategy there yeah I mean we're here really able to cater to the u.s. user and that to us is one that is a different playbook than we've seen before with finance you recognize some of the perks or features that would be on a on an exchange that globally would be allowed are not necessarily the same that you'll see in the US but the burdens that a u.s. user has whether it's taxes whether it is you know kyc and understanding market regulation if we can make those features easier and

more seamless for our users then they can start beginning to participate in in that kind of global phenomenon or beyond phenomenon global industry that is crypto so you know I think it's it's it's great to recognize what has worked really well on a global scale and then it's my job to translate that and understand how we can cater and build it for for the US and that's you know we're taking that head-on and when you talk about the u.s. customer obviously within the US there is a range of different customers and we're seeing some of the other exchanges like coinbase you know cultivate a different segments of the market so who is your tart customer or who are your target customers target customers right you know I think we've we've there is not

one customer and that's something that I often worry about is the generalization of who's using crypto but the the idea that we have not only a wealth of capital markets and an able investors from an institution side whether they're waiting on the sidelines for more clarity or they're just trying to understand this market before they dive in they're still here and based you know based largely in the US whether it's Chicago in New York or even West Coast you know there's some serious amounts of capital here that are active traders in capital markets that could see this as a very you know plausible next step for them the other aspect if you break it down are people that are crypto native or this is their their first foray or

their second foray into day trading and you know a routine awareness of these markets we're really aware of what they need and that's a lot more than the brand new customer they would need an inny crypto market those guys are already advanced in trading in the futures you know wanting to see more products more order types more charts etc first a new customer is just maybe beginning to learn how to dabble what is it like to hold it what does it like to feel that risk in your hand of understanding that the price does go up the price does go down how can you monitor that how can you access it quickly and not be burdened by a huge amount of fees just learning about the technology so we've broken it up in a way that we can

provide a you know an easy on-ramp for first-time users we've got a one-click buy sell on our home page so you can just say I want to spend dollars and buy Bitcoin to an amount click go you've got it sits in your wallet you can monitor that any you know every day watch it trade it across 25 pairs that's a really easy system for folks that are just wanting to get in learn about the markets and go from there the next kind of stage that we offer is our basic and advanced trading platform on our website and that really breaks it down you've got trading view charts you've got more technical analysis available you've also got you know that's where you're gonna

be leaving market orders that's where you're gonna be really engaging with the market understanding their order book understanding the order depth and that's that's familiar to a lot of folks that were fell in love with how simple it was but also how straightforward it was from a training perspective and then you bring both of those components into an app form and that allows us for the mobile customer I think about most of the United States and most of the world right now is really on the go so if you've got a mobile component that's really how we're able to cater to our users that are gonna be checking this you know whether it's me late at night you know I can close my laptop now and just have my phone near my bed probably not good behavior but or you can have it

you know on your way to class on your way to I've had truck drivers message me on Twitter that said you know I can't bring my desktop with me on the road and I'm loved trading crypto while I'm hopefully not while driving but maybe at a rest stop definitely not well driving definitely not while driving but I was a Destry and so please don't touch your phone while you drive I hope you're not crossing highways anytime soon the the the aspect of crypto just allows you to have this added layer of financial freedom that can be on top of your day job can be on top of your education components it's just another way to let you participate in a global market and really own and take control of your own

capital and that to me is just something that is profound in in markets we've traditionally had huge hurdles to entry you know in accredited investors had to be a certain threshold I remember every day while at Morgan Stanley like just begging to become an accredited investor I just thought it was so funny but I worked and facilitated some of the largest you know money managers around the world and yet myself I was still boxed out given I was you know two years out of college but yeah those components to me that that discrepancy of inequality was just kind of striking and I understand that there are good barriers to entry as in education first

so that you understand what you're trading but there doesn't have to that penalty for for fees you know it it shouldn't cost you one percent to take a leap into a new technology it should be paying you one percent frankly to try something else so I think that's something that we're really just aware of as a as a as a global organization and one that I'm really aware of for the United States given that inequality is tangible you know I think about the number of peers I have that actually dove into capital markets and I was one of you know thousand that that went into sales and trading and and definitely one of my

only peer set of women that dove into crypto fortunately it's it's such a ecosystem where I found great other peers that are like-minded and we all get kind of revel in the fact that we're you know a little bit rebellious a little bit forward thinking and and definitely stubborn enough to continue to fight for this so I think there's a nice camaraderie with people that do take the risks but we need to make it less intimidating less frightening less scary to understand and that's really what financed us and and you know the larger by Nantz has done wonderfully and one other question about this transition I was just curious if you had any data on how it's a switch affected usage of

Finance in a broad sense in the US was trading volume from US customers you know obviously went after that left financier do you feel like now you have the same level of training volume on Finance us or do you feel like people moved off to other platforms you know when we launched we launched with seven coins only we launched in September late September 2019 so I'll hold you to the fact that if finance started in June they had a three month lead on us but they also had a different environment that they were launching in but but so we started in September with seven coins and then grew that to about 20 27 quickly within our first hundred days of trading so that really allowed us to

bring in folks that felt isolated when they realized it was only seven coins going to be listed one of the benefits of finances it's always been you know open-minded in the aspect of providing a diverse selection of token offerings and it's not there to be a gatekeeper of what you should and should not trade it's really just providing that freedom of choice and that's something we definitely believe in as well but we run through with the rest anding of the US regulation we run through a digital asset risk assessment framework and that's a much you know tedious process seventy five point checklist to go through each token before we list it so we kind of put out our list of what we're exploring and then we spend our

time exploring those and when they pass the framework we list them and you know we summarized kind of the height that top line points that you're looking for in a coin before you list it sure you know the the aspects that you really need to understand from it are yes a their ability to not be a security understand where they are from a trading liquidity perspective community perspective is there a u.s. user growth or is this a u.s. targeted project you know understanding how the facilitation of providing liquidity from the US dollar perspective would be beneficial to the ecosystem that it's growing and then as well you know what is the you know what is what is the component that

this is adding to the American access for crypto so I see us continuing we've got another list of about 20 or 18 tokens that we are exploring and I continue to see more listings be something that's positive for the American user but one that we're also recognizing you know there's less volume trading on these smaller coins so how can we still maintain adequate liquidity on our platform so that people are you know it incentivized to come to a healthy market rather than one that's quite dry or a liquid so I think they're components that we've heard good feedback so far if you know more BTC pairs one of the aspects as you said finance launched was crypto - crypto

only so when we consider people that are now using dollars as their on-ramp that might not be the same audience member that you had on a Bitcoin to another altcoin pair trading so we have to really remember that there's a life cycle of a trader that might be cryptid a crypto or might be Fiat to crypto and we need to bridge that for both of them all right and a moment we're gonna discuss more about regulatory issues of course you guys I'm sure you knew that I was kind of really really it was Zone in on that but anyway I'm first a quick word from the sponsors who make this show possible will the world follow France and advocate banning privacy coins will government backed stable

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crypto fundraising platform at the syndicate there is a 50% a stellar listing event on january 15th 2020 on the exchange now and stay tuned for more listings back to my conversation with Catherine Kohli of finance us when you launch why did you choose tether as your stable coin we chose tether as our stable coin is largely it was one of the one of the largest stable coins in the market being traded we understood that a lot of the users globally enjoyed moving their you know whether it was a profits or taking themselves out of a trading market into stable coins USD T was was you know broadly adopted and so that's you know really one of the components

that was early on that we factored in I do see us involving more around the USD V USD is a stable coin that can be listed on it what's listed on all the finance exchanges but also on a good slew of other exchanges out there and and still will just allow for one to one conversion and really allow for an easy wave to have skin in the game but maybe not in a volatile asset so I think that's an important step for people to understand is that moving your funds into a digital asset that is a stable coin is a great progress and a great step that you're taking if you're not comfortable yet understanding you know

or deciding which pair you want to be investing in our around and I was also you know just since we were discussing regulatory issues I was curious it has by Nancy was applied yet for a bit license so we're in the process of applying for all of the states that we're missing so that's the thirteen there so going through the steps of preparing for those applications and understanding you know with the steps that we need to take from both you know an internal perspective but also a market and external perspective going through all those steps for every single one of them so that's that's all I'll tell you now it's it's quite an arduous process but one that we take very seriously it's being led by Chris Robbins in our DC office

who is an extensive regulatory and legal background specific to getting these licenses for digital asset companies and so it's you know wearing we're in great hands for that process but but one that is its extensive you know it is really something that you have to think through clearly and there's a reason why you see companies leaving the u.s. it's not a you know it's not an easy easy space to just pop up and begin business but we knew that going into it and you know we're not not giving up fighting we've only just begun and they've actually proposed some changes to the bit license I think just from a high level one is

that for exchanges that operate in the state they'll be able to list any coins that the regulator approves for listing in New York and then also the New York Department of Financial Services will publish a model framework for coin listings that exchanges should follow what do you think of these proposed changes I mean it's fantastic the more clarity that we get around regulation and more guidance just shows that they're understanding our process even more so I think the most that we can do is just teach them our business share with them what we're working on come and meet in the middle of the road of where their concerns are and what we can do to address those head-on you know we've run through as I mentioned that digital asset risk

assessment framework is one that we you know vet through it seriously and and are able to kind of reminds me of math class like proving your work show the work that we've done in order to to be comfortable listing these items or tokens on our platform so a lot of what regulation entails is just showing that you've done the work in order to do the business and that's that's what we're really here to show our work to do what we're thinking or we've constantly have our consumer in mind because I'm one of them and you mentioned Christopher Robbins who leads your legal and regulatory team one other thing that you

have done on the regulatory front is you recently joined the chamber of digital commerce is executive committee and I just wondered you know it seems like obviously regulation is the focus for you guys if you could present a wish list to regulators and lawmakers what would you put on it I have a wish list but I you know I was waiting until next week to share that with them they the the components that we really want people to come into this space when they are looking to be you know the authority in it is understanding where both the consumer and these companies are coming from in terms of the products we can provide folks the ability to let American users compete in a global

marketplace is really an advantage for the u.s. itself you're able to not hold back your customers or your citizens from from partaking and understanding what is affecting the world at large so the aspects of pain points that naturally drive people towards using crypto as a solution don't necessarily affect us directly in the u.s. given that we don't change currencies between state lines but when you recognize that every flight out of Singapore is an international one and you you can't use your same currency any time you land in an airplane that's when you recognize that there is a significant advantage to

crypto currencies and and and this component that allows for a you know a digital representation of value as we know it so I think that the components of understanding the and the benefits on a global scale and then bringing that into why the u.s. still needs to be an active participant in this industry is a really important one and one I've spent my whole life doing being a translator for on-the-ground understanding you know a global market and bring that in to why it's relevant in to a u.s. user so I'm familiar I'm familiar with you know navigating the unknown and and providing a digestible answer to people who may

never ever see what is over on other sides of the world and that's something that I really think that were in the right place here with finance us well this is actually what I was curious about because I saw I mean it's it's obvious if you look at finances strategy overall but you know they have this very like global strategy in the sense like you can tell that they see these kind of like global financial markets in the future and I saw multi Cohen Capital how to report on how finances blitzscaling as they called it and one of the lines and it was - is competing to be the centerpiece in a global open financial system so you know when I was looking at

that and thinking about finance us I was just wondering like where does finance us fit in it is it being excluded from that global open financial system no not at all okay I think we're just catering towards I mean you could call the u.s. a global open financial system inside of the US borders practically you know there's a there's an mancine amounts of I call it like topography within the u.s. of various user types various understandings of sophistication of market products and that to us is the bubble or the world that we get to work inside of what I get to make sure is that that product and that community is

not left behind so we have a fascinating aspect they're called finance angels and and they're really just global volunteers that want to be you know committed to updating everyday users about or understanding or helping facilitate an understanding of how by Nance can really cater to the needs of individuals all over the world and so we have that component already in the US as well with the by Nance angels just being able to welcome all types of folks through with our community channel understanding their pain points even understanding you know how does this work I don't understand it you know the ability to listen to people from all walks of life

is best when you're building it with everyone in mind so for us at finance us I mean I think one of the fun components is our team is really made up of what we see right now in the United States so you know it whether it's welcoming you know diversity of thought perspective or background whether it's really just addressing you know the different model of who we see coming into krypto we're building that as a component within our own team and within our own product and that's something that the blitzscaling you mentioned I mean what four hundred plus it employees in 40 countries that's an amazing advantage when you've got that amount of perspective being

able to be behind the product well but so then how will finance us be connected to the wider world of things going on in finance like will they always will the u.s. customers just be trading with each other or you know I mean well let me let me ask me like a more specific question around this I noticed like in C's 2020 New Year's message he had this little section on degrees of decentralisation and in one of them he full-on admitted quote finance chain slash Dex is definitely less decentralized than aetherium and as some examples he said that the code is not open source and there are a limited number of validator

nodes but so for instance you know finance here is working on this finance tax but then is it hard for by Nantz us to offer things that could be closely tied to that Dex like you know could you list the BTC betoken that they have on Finance test Dex which is essentially a token that's pegged to the value of vtc just so people who so people can trade easily trade cryptocurrencies that are not on the finance chain like could you offer that I mean it's certainly something that we can look into one of the benefits of being a local partner to a global partner that is by Nance is the technology that they're building we're

able to license and end use and provide for our users so every every day practically when finance build something new it's kind of another component that I can factor into our product here in the US so that's really how we see the benefit of a US market being able to still take place with a global ecosystem so understanding whether it is components of Finance Academy or you know you we see their growth of you know decks with futures with blending with staking like all of those components in the build out that finance is working on we absolutely can process and bring in it's just up to us to make sure that

we're doing it in a way that is within the US regulation with the u.s. user in mind and that will build that bridge between someone that is a bi Nance US app user someone is a bi Nance comm user they'll have a lot more things in common than they think but they're both protected and they're there the right ways of where they're operating so I think that's more of this global phenomenon that I see is a huge benefit of Finance and it's huge benefit of Bitcoin it's something that we're we're bridging the barriers that people have normally had and why things have been unknown and so if you can have a common bond around the world based on the fact that you trade your digital assets on something that is you know black and

gold that's more common of a bond that you had then you had 10 years ago and I think there's something fantastic about finding similarities around the world in scope of diversity that really crypto itself has done wonders for and we need to preserve that narrative instead of celebrate you know the alienating one or the division of tribalism there's something far more beautiful about being able to understand that you've got the best trading technology in the United States and you also have the best trading technology in a global arena you are not left behind your understanding these

markets crisply you can really gain a lot of awareness around how the rest of the world is working one other aspect of work that finance is doing that looks like it could bump up against some of the regulations here in the US centers around the BnB token which looks like it could be classified as a security in the u.s. just going by the how we test I think people could argue that it is an investment contract in a common enterprise with profits dependent on a third party which in this case would be financed so I know that by Nantz us does enable people to use the BnB token so how did you determine that B & B was safe to use here on by Nantz us yeah I

mean just like any other token that we listed we went through our digital asset risk assessment framework which is you know 75 points of understanding how this token would be both available for our us users and compliant within our measures for maintaining us regulations so you know with with comfort we've been able to see the benefit of B&B offering trading discounts for our users and I think there's an additional amount of utility that we see B&B providing whether it's down the line with finance charity foundation and other aspects where we can really build in and build upon the utility that we see with the chain itself you've seen countless

projects build on top of it and you've seen it the super you know useful in terms of payments mechanism as well so I think there's just you know people can argue many many sides of it we're comfortable with it through our digital asset risk assessment framework and and you know we'll we'll always be evaluating and re-evaluating the coins we've listed to make sure that they're still within our digital asset risk framework based on the regulation at the time but regulatory clarity is an evolving process and we are you know as you know keenly keenly listening and in the right conversations in DC and also part of the chamber of digital commerce

to make sure that we can ensure the acceptance and the use of digital assets in the US yeah just looking at the data points which are few and far between but at least some already exist obviously we saw what happened with kick and it skinned cryptocurrency and I would classify this as an example of a token that was very closely associated with a company where the SEC you know pretty much said very clearly like you know this is a scenario where it would fit the how we test recently we also saw with telegram they published a blog post where they also very clearly dissociated themselves from the gramm cryptocurrency

even to the point of saying that this notice superseded anything that was in the white paper and some of the things they said in that blog post where that telegram will have no control over the ton Network and that the ton wallet will not be integrated with a telegram messenger service and so I just wondered you know when you see these developments does that at all give you pause about the B&B token no and why not it it's a scenario by scenario case you know I think each time you see an example or a case made it's appropriate to evaluate it at that point but these are all you know part of part of the process going forward and I'm still comfortable with

our assessment all right in October several exchanges came together to form the crypto raiding council some people on Twitter especially of course smirked at the idea of such a council they seem to indicate that they thought it was a conflict for the exchanges and that the exchanges could not be impartial judges of whether or not a token as a security what do you think of the idea of the council and our is by Nancy less interested in joining yeah we that that launched right after we had opened our doors so we were not involved in any of those conversations and I think that's you know it's always interesting to be the outside man and one that we're comfortable with our

own measures for following the framework and working with regulators I think that the amount of detail we have in our framework is you know one that is what I'm proud of that amount of scrutiny that we go through for each project is not trivial and so that you know the components that I found difficult with the CRC was around the limited explanations that they had for the the rating and then the the bullet points to follow-up just you know seemed a little bit light for how serious we take assessing tokens so I'm fully confident in those teams individually being good

stewards of the market and I think that they you know probably have the best intentions going through with this but you know it's it's one where we see there being you know strength in individually being excellent at reviewing your tokens first ganging up finance is also offers services like margin trading and it's actually quite popular there with 45% of users on finance engaging in margin trading what would need to happen for by Nancy us to be able to offer margin trading well a lot but but what what button composes that component so every day we're working on trying to as I kind of said translate these attractive products from

a global perspective to a US market and a u.s. user so really breaking it down to what is the component that people are excited about in margin trading and how can we factor that into current licensing requirements register regulation in the u.s. you know aspects of a futures market are entirely different in in the US as well as on a global scale and we see that with you know you can't translate global Global Futures matching engines into the same element in the US goes through a clearing house with an FCM you know their components that are just built differently and we're aware of all those factors so that's something that we just

factored into our recipe and and go forward finance has also started offering lending is that something finance us is looking into I got another component or you kind of look at the laundry list but Finance comm has and I kind of salivate like a kid in a candy store realizing what I can bring to the u.s. user I just have to prioritize where it fits in with regulatory ease and access and you know really what's right right now for the u.s. to gain access I think there's I'm always aware that if you create a extremely complicated product early early early on you won't be able to cater to a larger

market and one of the components that is you know one on one on healthy markets is being able to have adequate liquidity so you know catering to the niche niche point point zero zero one percent of crypto users really is still at a disadvantage this early on into understanding these markets so you know we're building things out in a method that we think is appropriate for getting the most kind of broad scale of us users familiar comfortable with our platform with our app with our you know our trading pairs and then then being able to kind of bring them with this journey of where they want us to go as well so

the the need for a lending or even a product that has yield has been a huge component that we've seen very attractive when people cannot you know time alpha as well as they need in a market so being able to earn yield on a passive amount of crypto Holdings is a fantastic product one that I definitely see down the line is something we'd want to be offering to our users because it makes it makes sense as something counter to the traditional markets which would be holding your money in cash earning nothing or you know not understanding the benefits of compound interest and what about the finance Launchpad is that

something you ever see by Nancy wess offering or you know offering something similar something similar when you think about the breakdown of kind of ayios in in the US and if they've pendulum has kind of swung both ways you've seen it go highly popular to highly unpopular it's you may be coming back in the middle of the road so really assessing where we are with regulation where we are with the comfort of the market and what's the appetite for new coins to be you know watched on to an exchange I think that are really all the factors we consider and so it's something that again on the cards but probably for for q1 I mean when we first launched a large

part of what we were working on was just getting getting us up to par where we were with our peers so getting an app was a huge you know a huge moment for us to be able to now provide a mobile solution for our users I can't believe we launched with just a desktop and seven coins you know that's night and day different to what we are right now it's just kind of incredible when you think it's only then you know roughly a hundred days since we've been alive but how many how many people are you our world nine oh well yeah so we're scrappy group I think that's one of our benefits and

advantages though is that having a nimble team that is catered specifically to the excellence of this product we are keenly listening to our users building in real-time based on their feedback you know being able to target and address each aspects that we need to build in a way that is as fast as finance does operate I mean they're the components that make finance wonderful is that it it always its a go-getter you know I I wanted to be a part of a story that was a doer I'm as much of a dreamer as well but doing doing things and making things

happen is something that is a know a wonderful feeling and Susie's team and the effort that they do and the way that they just constantly build and reiterate and iterate and ship products it's remarkable and and it's unlike anything else I've seen so you know being able to be a part of that story and learning how the ecosystem has evolved within two years to be where they are that's an incredible energy to be a part of and and one that we definitely embody here and are in our team you know we're we're based in San Francisco in DC we come from the likes of previous FinTech I kind of always am looking for people

that have had a couple tours of duty whether it's um you know we've got Robin Hood Western Union bit flyer ey blockchain Soph I like all of all of my team has seen one one rotation from the traditional to the innovative and now we're on our kind of second or third turn to really know how we can better deliver products better you know cater to the users really having a keen ear to what people need coin base has begun offering custody for institutions and staking do you see finance us also offering similar services in the future you know one of the things that we really do pride

ourselves on as well is its freedom of choice so not being the you know there's a benefit to being a one-stop shop that certainly is what the institution's adore with having you know prime brokers do everything for you and that's something that crypto never offered it kind of democratized the prime brokerage model which made them a little uncomfortable because they didn't want to do that much work and I don't blame them they're trading you know tons of assets and huge volumes you don't have time to you know log into your nano and and click a bunch of buttons but the elements that I find most exciting is that there are other institutional custody providers out there that are excelling in the space and for us to

Pete directly with them I think would be just a little bit of a time waste on our part so so where I see this kind of evolving is that we provide a freedom of choice for people to custody their solutions at these various providers but then be able to leverage the liquidity of finance us itself so we've worked we partnered with to go me in that aspect for institutional clients that want to trade in the ways that they ideally would like to but access the the liquidity and the coins that we provide through our systems so I see a similar model working in the custody component I you know it's I also recognize that institutions aren't going to keep all of

their coins in one place and so naturally we don't want to be isolating ourselves from preventing people from having that freedom to trade with us at any time by you know having something locked up with someone they've got a trade they're we more or less would like to facilitate this liquidity for everyone for now crypto exchanges can charge fees like 1% but in the future that's likely to trend down towards zero what other forms of revenue as by Nancy was exploring I mean you think about just in what we've seen with traditional you know retail equity providers with the drop to zero fees I also you know having seen the margins on FX products you think about these things called

non-deliverable forwards which are actually the the way that asian countries had to implement for currency restrictions following the asian financial crisis so so the non-deliverable forward was the the means to which you could not be able to access the local onshore markets and currencies and that's you know component that has brought another or you know another product to the market those used to be highly illiquid and and very different from the spot market onshore and so you'd have huge spreads that you were able to capture trading those and that's also why people didn't trade them is because they lost you know there was a lot of inefficiencies in that market

I saw those spreads go down to Tino nearly nothing in five years of the markets so I see that same thing happening at an accelerated rate here we've dropped our fees to just you know ten basis points and then if you use BMB you have twenty five percent off of trading fees so you know start your day off with you know really really low trading fees that's we're already starting there so you know additional revenue components that we can think about are elements where we see our users what we're do they provide or where do we provide value to them that is worth you know monetizing and I think those components are going to be

ever-changing and we'll see what really that that value comes from but at the same time we really just are focused on making sure that people have an easy access to these markets and that we're not having a barrier to entry to make ourselves or make our business something that's preventing technology from getting in the hands of users so it's a little bit of a different component verse the kind of Silicon Valley subsidized and then you know raise the price on your user our ethos is just different and we can innovate upon that as we build out adoption you worked customer support for finance for three days you mentioned it was not

three days by the way it's still ongoing so it's been about three months or more how long September's a long time ago no I'm still available on Twitter you can still DM me I'll still I'll still chat with the anyone and everyone that is if they're polite and ask questions what are some things you've learned from doing that like what what are you noticing from the users and you know more more than just like what they're requesting oh right beyond that it's the geography difference that I didn't know there were such vibrant communities inside of the United States in states that I wasn't even paying attention to and so kind of refocusing on the United States is really I'm so curious and fascinated and a lot of what 2020 will

be spent on is visiting these these communities and really understanding why it's working or or where this you know where they see the adoption of crypto benefitting their their own lives and communities and I think that's it's just great and fascinating to see pockets of whether it's the University blockchain graduates that go on and now or pursuing crypto and their first jobs and understanding you know maybe their first paycheck isn't going to be in u.s. dollars mine mine was in Hong Kong dollars so that's how I had to learn about FX so quickly but the you know there there's a there's a component to which we're going to be seeing the seeds of native crypto adoption take place earlier on and I

think that's a fascinating wave to be welcoming and and so whether it's learning people who have I love to know what their what their day job is sometimes if they have a day job if they have their day job is just finance and I'm like go for it to the moon trade all day I'm here for you but the you know the the different components that said this is a this is an equalizer for me I'm able to you know pursue a passion of mine that might not be a financial advantage and therefore I can still follow the markets take advantage of my capital and access crypto to benefit my lifestyle or benefit my future or my

generation following so that to me is the really great component the the other one is just to enjoy that people love hoodies so you know I've never seen people actually this is this is a true fact I never wore a hoodie before I came to finance and I haven't taken mine off since I started so I'm due for a laundry day that's for sure but there's there's something that's both comforting but also really nice to be kind of part of a part of a company that has such a culture and being able to bring our our flair to it in the US and you know be able to provide something that I think

people will be not only proud to be a part of but welcoming their friends to understand so that there's again that common bond that we can start beginning to to lower the stigma of vulva in crypto lower the stigma of financial ownership you know I I think it's we've gone miles from where we were people discussing money was so taboo and now I talk about money every day like it's crypto you know there there's a there's a community welcoming the ownership of your own capital the growth and management that that's a huge progression from where we've we've been

and I think that's something that is smart for the world to take awareness of it is engaging to see how it benefits and you know allows for people to do more things and they have previously being in their own financial burdens of their own societies but that's something that's just a huge component that I think it's I enjoy chatting with people they might not even know I'll get this philosophical with them on Twitter until it's like 4:00 in the morning and I'm like all right guys I got a I got a podcast in the morning I got I got a sign-off but that's the human element to which I think I can never avoid and and

I I think we take for granted that we're building products for humans at this stage and we need to make sure that they work for humans and they are that we are human in the process a net last question this is something I like to ask people who I guess have a familiarity with crypto in Asia as well but since you've run a US version of a crypto company that came out of Asia I was curious how you would compare the crypto trading cultures between Asia and the West yeah it's it's fascinating localizing a product into a market that I know natively having grown up here but also have professionally grown up internationally so the light bulb

effects of where the pain points are a little dimmer here verse every day in Asia you were burdened by some form of an FX rate ruining or making your day and so I think that that element of being able to provide the education in the u.s. is super important but there's still there's still the you know human element of enjoying when you're selling something higher than you buy it and so that component is you know Universal the the other elements are around kind of the the referrals or the promotion or how fast things can spread you think about

it's just how viral Asia is as a as a you know community where trends can be set and spread so quickly given the concentration and the density of their cities given the you know the appetite in the awareness of tech and mobile and you know ecommerce that exists outside of the US so I think those are things that are such an advantage for from the Asia focus I think it's interesting to compare that in contrast with Europe as well which is a different beast on its own and one in the u.s. that I take as

well is that you know being being the home for people's digital asset trading is a common you know we're creating a comfortable space for them to know that we are you know building it exactly the way they want and that customization is something that a US market really does care about they're you know we have a plethora of variety for people to choose from but they want to choose the one that fits how they operate exactly and so that's that's really something that is a focus for us and in the u.s. is catering our product exactly the needs of an American user whether that is you know natively our app is in dark mode

you know components of theirs you know it's it's a simple UI you're going to be cleanly understanding what's happening you've got you know really straight for word components that are still top-notch you know part of the technology in the text suite of the globally leading you know cryptocurrency marketplace so I think that's something that we really enjoy but kind of container to making sure that we're you know just keep it simple is is always a nice motto for the US and they get it but they with simplicity does not mean stupidity so you know they do want the

advanced products and features they do want to have more sophisticated products available in the near time they do want to have that diverse variety of tokens to choose from so all of those components I celebrate but it it's it's it's pretty neat yeah great where can people learn more about you and finance us absolutely so easiest place right now we've got a couple I call them bugles or ways that we communicate Twitter follow us on at Finance America we also have a telegram announcements channel which is fantastic just to we you know it's only the announcements that come out so that's where you would have learned about our beta testing of our app and then our launch of our Android and our

iOS app and then any of the you know additional listing components come out through that channel you can also find us on our web site by Nancy us we have a blog that we keep updates on when we have you know new announcements of certain elements you can follow me I'm at crypto kohli my DMS are open if you have any help or needs on the customer support it's at Finance us help and we'll be there to answer so really looking forward to letting the us have finally the experience of Finance but catered for them in the u.s. now and their hands so download the app on the App Store or the Google Play we're

really excited to see you know where the where these communities can grow and be a part of a much larger global story great well thanks so much for coming on Unchained thank you so much really looking forward to shout out to my my listeners United thanks so much for joining us today to learn more about Katherine and by Nancy West check out the show notes inside your podcast player want to show your love for Unchained check out our t-shirts mugs hats and stickers at shop done chain podcast comm untain is produced by me flourishing with help from factual according Anthony unit Daniel nest Josh drum and the team at CLK transcription thanks for listening you

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