[Coinlive Interview] Lennix Lai, Financial Markets Director of OKX
Coinlive: Good morning, Coinlive is at GWEI Summit 2022 in Singapore. And I am chatting with Lennix Lai from OKX. Hi Lennix Lai, good to meet you! For our audience that are not familiar with what you are doing, could you introduce yourself and explain to us what OKX is all about?
Lennix: My name is Lennix. I am the Financial Markets Director of OKX. Right now, I am the head of institutions that manage institutional business for OKX. OKX is a mega size cryptocurrency platform and also blockchain platform globally. We are having 2,600 employees around the world globally. We got 20 million users and also, we are one of the cryptocurrency partners for Manchester City and also the F1 racing team McLaren at the same time. What we do is basically building infrastructure for blockchain, Web3 and NFT marketplace. Aside of cryptocurrency trading business, our general idea is basically putting financial ecosystem on to crypto first, then gradually expand to blockchain and Web3 marketplace.
Coinlive: That's amazing. OKX is currently amongst the top 20 crypto exchanges with Binance & FTX taking the top spots, what is the plan to surpass them? Or is that not one of OKX’s current priorities?
Lennix: We are top three exchanges in the world together with Binance and FTX. In terms of trading volume, we're number 2 in global volume. I think the industry is big enough to have even more platform than FTX, Binance, OKX or any other platform, because everywhere is growing. We respect our competitors and also learn from each other a lot, and likewise, I believe Binance and FTX also learn from OKX a lot. We are building the industry all together and I don't think it's our plan to surpass anyone because the industry is big enough for everyone.
Coinlive: Alright. so how do you feel that OKX actually stands out from all the crypto exchange in the competition?
Lennix: The most iconic competitive advantage of OKX is that we have a complete crypto financial ecosystem in OKX. So whatever financial instruments from derivative contract, option marketplace, OTC platform, institutional player, and prime brockage, everything you can find in OKX platform alone, that's one of the advantages.
Another advantage is risk management. We have many years of risk management experience, especially on highly leveraging instruments, for example like derivative contract. If you want to run a good derivative platform, you need a lot of data for risk management. Luckily, we have it and we built a really robust and scalable risk engine to protect our users. That's how we stand out. Right now, we are building the industry together. We're providing basic technologies for builder on Web3 and NFT on dApps, across whatever chain that you would like to use. We still want to position ourselves as technological enabler for the industry.
Coinlive: Sounds great! I would like to move on to my next question. With so many features and services that OKX has, which specific product or service has been the significant part of business for OKX?
Lennix: In terms of volume and revenue perspective, I think perpetual swap, which is one of the derivative contracts, it is a very significant business for OKX now. The another that's iconic is our Web3 wallet because we support all multi chain, and getting a lot of users. Because of the convenience reason, they're using it a lot to interact with all the other chain. The third part would be our own product because of the crypto winter for now, people are not looking for speculation investment, but they are looking for passive income. They want a safe place for a passive income, so what we provide is a product that so you can safely stake and earn your token in DeFi space, via the due diligence process in OKX team.
Coinlive: Sounds amazing. For my next question, in the current bear market, how is OKX coping and what is the company mainly focusing on?
Lennix: We have experienced different kind of market downturn for so many times, like at least three times, since the beginning of the company. Right now, we're building a basic infrastructure, it’s good that the bear market gives us time for building a management system, for building our basic infrastructure on tech, for improving the latency scalability of the platform. It gives us time to, for example improving the scalability of our very own chain – OKX chain (OKC). For the business perspective right now, with mostly targeting user that are looking for yield generation, passive income generation, we are looking to expand a lot more on our own product, like savings product and maybe structured product.
Coinlive: That’s amazing. So, are there any upcoming product or service that you are excited for OKX to launch? Any sneak peaks or hints for us?
Lennix: Yeah, a couple of things. We already launched a really big OTC platform that support all kind of institutional player that can execute their trade on it, that's one of them. And another one would be likely to launch our very own DEX, that can support different kind of chain. You can stake, you can invest, you can earn and interact with all kind of DeFi smart contract in multiple chain within OKX. I think that is an upcoming product that going to be a lot more exciting for us.
We're also building our institutional business, because right now due to crypto winter, we see the trend of crypto is getting a lot more professional, alot more sophisticated and a lot more institutionalized, so we provide a full suite of institutional platform for even a regulated bank customer. Even for a bank right now, we have a regulated marketplace and product to serve them.
Coinlive: Alright. For my next question, how do you foresee the crypto exchange scene in the next few years? What will determine who stays on top or who will be surviving?
Lennix: The best platform or whoever survive, the product wise pretty much looked similar, the exchange product precisely. Of course, there will be more innovations, but the exchange platform getting to be a lot more regulated, having a lot more transparent in terms of internal control or external control, they're going to be audited or being responsible to the third-party audit or the regulatory audit. There will be having a lot more regulator footprint, and be a lot more transparent to the user and the government, and how they operate internally.
For the product wise, they should be expanded to much more than just an exchange product, more like they're building their technological platform, their blockchain, their Web3 app or dApps, to provide blockchain native product for serving crypto users. I don't think the cryptocurrency exchange would call themselves exchange anymore, we are growing and becoming a comprehensive crypto platform.
Coinlive: So, it's like almost a whole ecosystem by itself, is it?
Lennix: Getting bigger than just exchange product, you can see some of the exchange will become a game developer, we don’t know right? It could be one of the directions too. No matter whether you are OKX or Binance, we want crypto adoption and we want crypto to be part of our daily life. Finance is just one of them, trading is just one of them. We want crypto element be part of our life, as in gaming, as in fashion, as in NFT, or as in many aspects of our daily life. We want to solve this problem altogether.
Coinlive: Also, you mentioned about regulation, do you feel that regulation is very important for us or for the mass to adopt?
Lennix: Yes, it's very important. Regulations is important in 3 aspects, the very first aspect is you need to unify the industry standard. The industry standard will give confidence to general public user, that's the bottom line of how we operate. We want to tell the world and be transparent, no matter the user and regulator, that we are a good boy, we are safe player, it's a safe platform to trade and to interact. And also, it gives confidence to the institutional player as well.
On the other side of this aspect is, the regulator needs to understand the industry too. The regulator needs to understand the very unique operational standards and how we operate, how we interact with the industry, how globalize of this unified operative standard of how the industry work. So, a friendly regulation with a room to adjustment is also very important aspect for regulatory development.
Coinlive: What do you think is the next big thing or narrative that you're looking forward to in the crypto space?
Lennix: I would think the DeFi needs to upgrade, that’s the next narrative. The current DeFi operating model might need an upgrade for the next narrative. The other narrative we're talking about is the hybrid of Web3 and social element, we call it SocialFi. So that is part of the narratives that you can take a look on.
Coinlive: For DeFi, how do you feel that they should be upgraded towards which direction?
Lennix: They need to somehow improve the governance consensus protocol. Right now, most of the DeFi token or the governance token do not have sufficient exercise power or sufficient decentralisation to dictate the direction of the DeFi protocol development, that’s the first step.
And also, for product innovations, even when in crypto winter works well, the landing protocol works well, the leverage protocol works well as intended, but they are still not perfect. For the liquidation engine and risk management engine, in terms of how we decide, they should have a lot of room to improve. The CeFi platform’s experience can help along.
Coinlive: Alright, that's all we have. last question is, where can our audience find you to learn more and support OKX?
Lennix: Follow Twitter, my personal twitter @LennixOKX and OKX twitter @okx. And also, we have a huge resources academy, through there we can learn all the basics materials, from blockchain 101, trading 101 to crypto 101, for the very basic thing to learn. My advice is always to try a little bit first, to learn a little bit first, to buy your very first crypto. then you will immediately feel that you have gained back your financial freedom from technology.
Coinlive: All right, that's all we have. This is Coinlive, do follow us for more crypto content. Thank you!