Another year of Binance Blockchain Week has come to an end, and Bitcoin has also set a new historical high after the expectations of Trump's election were realized.
Under the market volatility and excellent sentiment, as the world's largest cryptocurrency trading platform, any operation by Binance will have an impact on the industry. In terms of trading, in addition to the large base of retail traders, institutional investors are also an important part. On the eve of the Binance Blockchain Week event, the Binance VIP and Institutional team announced the launch of Binance Wealth, the first crypto trading platform technology solution for wealth managers, which greatly lowered the entry barrier for wealth managers and their high-net-worth clients seeking crypto asset investment.
BlockBeats also had a chat with Catherine Chen, the head of Binance VIP and Institutional, during this Binance Blockchain Week. In addition to a deeper discussion around the newly launched product, Catherine also introduced the operation of Binance VIP and Institutional business, and shared with us the changes in Binance after the post-CZ era, the impact of the election, and the views of institutions on Crypto.
How does "Binance Wealth" "bridge the gap"? What are VIP and institutions doing?
BlockBeats: First, Catherine, please introduce us to the latest release of "Binance Wealth".
Catherine Chen: Binance Wealth is the world's first technology solution designed by a crypto asset trading platform for wealth managers and their high-net-worth clients. This is a pioneering initiative connecting traditional finance and crypto assets, using Binance's industry-leading security technology to create a clear and intuitive platform for wealth managers to monitor their clients' crypto asset investments on the Binance platform.
It can be seen that for a long time, institutional and private investors have shown an explosive growth in their interest in crypto assets, and they are seeking a secure and reliable way to integrate their wealth management products. As an industry first, Binance Wealth has opened up a new path for high-net-worth clients to access crypto assets, allowing them to open accounts on the trading platform and manage crypto currency investments through the wealth management companies they trust.
In general, Binance Wealth has the following three advantages:
1. Binance Wealth meets the huge demand of wealth management companies and their high-net-worth clients who want to access cryptocurrencies with the support of their trusted wealth management companies.
2. Binance Wealth provides wealth management institutions and their clients with the traditional financial solutions and experience they are already familiar with, thereby lowering the entry barrier to cryptocurrencies and promoting the inflow of private wealth.
3. Binance is the first crypto asset trading platform to provide this infrastructure solution, demonstrating Binance's knowledge and expertise in bridging the gap between crypto and TradFi.
The launch of "Binance Wealth" is to bridge the gap between cryptocurrencies and traditional finance. For a long time, the private wealth sector has lacked the traditional infrastructure to access cryptocurrencies. Binance Wealth will lower the entry barrier for more market participants to enter this new asset class. Against the backdrop of "unlocking capital inflows is the key to making crypto assets mainstream", I believe that "Binance Wealth" has actively pushed the industry forward.
These are things that no one has done before, and we have been working hard to launch the product solutions that the industry and the market need in a timely manner.
BlockBeats: From your perspective, what are the differences in investment preferences between retail and institutional investors?
Catherine Chen: Let me first introduce Binance's VIP Program. All of Binance's systems, departments and activities are very transparent, including the VIP Program I am responsible for. Binance VIP is divided into levels 1-9, with different dimensions of division. Ordinary users (i.e. retail market) are level 0, and basically anyone other than ordinary users can be called VIP. Whether you are an active trading user, a large holder, or investing in Binance products, or doing lending on Binance, as long as you meet the threshold standards, you can become our VIP.
Among the VIPs in levels 1-3, we call them high-net-worth clients. Many people don't know that, for example, having a holding of $100,000 plus a certain amount of BNB can make you a VIP 1. From VIP 3 onwards, there will be more and more institutional clients, and in VIP 8 - VIP 9 there will be a lot of high-frequency trading institutional clients.
Institutions usually use programs or APIs for trading, while retail investors do not have technical advantages and usually trade on mobile phones. The vast majority of ordinary trading users usually participate in range trading, new coin offerings and wealth management, with relatively simple investment behavior. Institutional users have more diverse participation, in addition to pure trading, they also do lending and other investments to maximize the utilization of their funds.
After the election, the global regulatory perspective from Binance
The 2024 bull market cycle is kicked off by the narrative of the Bitcoin ETF. After the favorable news was realized, regulation became the first hurdle for cryptocurrencies to integrate into the mainstream market. Whether it is the SEC's FUD on certain tokens, or the successive approvals of ETFs, regulation and crypto assets seem to be a pair of happy enemies. At the same time, Trump's victory means that the process of cryptocurrencies integrating into mainstream assets may be accelerated in the future. Catherine provided us with the institutional perspective and views on regulatory issues, and she believes that regulation is a positive thing for Crypto, and Binance will also actively cooperate and embrace regulation.
BlockBeats: As Bitcoin and other major cryptocurrencies are gradually being accepted by the traditional market, how do you view the regulatory issues of Binance and crypto assets at the moment?
Catherine Chen: With the approval of the BTC ETF, regulation is the inevitable path for cryptocurrencies. Regulatory certainty and a clear regulatory framework are necessary. I think the crypto industry has reached this point, and if we want this industry to continue to shine, embracing regulation is an inevitable choice.
As for Binance, we are also actively operating in compliance in regions around the world. Because the certainty of the regulatory framework is very necessary. And as a global exchange, compliance is very important for Binance. If Binance wants to serve the next 1 billion level of users, it needs to provide them with the trust of regulation.
Originally, some government officials did not quite understand Crypto, but since they have taken the step of regulation, it shows that they are willing to understand Crypto and accept Crypto. In the big picture, regulation is a good thing for the crypto industry.
Binance will definitely embrace regulation and compliance, and we are also very actively doing this. By now, we have obtained licenses or registrations in 20 jurisdictions globally, ranking first among all centralized crypto asset trading platforms, and we hope that more friendly regulatory measures can be introduced in all regions. Faced with more and more regulations and rules, I think this is a process of "educating" the traditional Web2 market. Currently, there are still more native users in the crypto industry, and we are also actively collaborating with various regulatory authorities, hoping to bring more people from outside the industry to Web3 to explore the new continent!
BlockBeats: The biggest narrative now is the US election, and the market is expecting positive news from a Trump victory. In your opinion, what adjustments will there be in the regulatory direction if Trump wins? What impact will it have on Binance? (The US election was not over at the time of this interview)
Catherine Chen: Regardless of who wins, Binance will continue to invest in compliance. Because compliance and regulation are not only important for Binance, but also for the entire industry. Everyone is talking about the era of institutional investors to come, and if Binance does not have a solid compliance and reach the same level as traditional finance, it will be difficult to gain the trust of traditional investors.
Of course, Trump has shown a friendly attitude towards cryptocurrencies in some public occasions, and we are also optimistic about this. If Trump is eventually elected, we also hope that his statements will be consistent. In general, we are looking forward to it, but for Binance, our path is unwavering regardless of who is elected.
What changes will Binance see in the post-CZ era?
BlockBeats: You previously worked at top-tier traditional finance institutions like Morgan Stanley and JPMorgan. Why did you choose to join the Crypto industry and come to Binance?
Catherine Chen: I have always been dealing with derivatives, so "cryptocurrencies" is a very easy concept for us derivatives professionals to accept and understand. But I may be a bit different from the typical traditional finance people. In fact, I have never been involved in trading operations, such as placing orders in the trading room. I have always played the role of a "micro-entrepreneur" in the company. Before officially joining Binance, I was constantly launching new products and services at Morgan Stanley.
The reason I left traditional finance and came to Crypto is that I felt that there was no innovation in banks, and they maintained an extremely risk-averse attitude towards new businesses. In the first 5 years of my time at Morgan Stanley, I was able to smoothly implement new businesses, but later, it became very difficult to push through new projects. The bank's committees need to consider all kinds of things, and no one is willing to lead or make decisions on new businesses. Everyone is unwilling to take on the responsibilities and risks brought by new businesses, and there is no way to truly innovate in traditional industries. So I resolutely decided to leave the traditional financial institution and devote my passion to Crypto.
BlockBeats: CZ is no longer involved in Binance's operations. What do you think are the differences between Binance in the post-CZ era and before?
Catherine Chen: Binance is different from many other exchanges, as we started internationalization very early and have also brought in a lot of non-OG talents to build the company. I have been with the company for three years, and I joined Binance in 2021. The company's level of internationalization is already very good, and it has indeed continuously introduced very experienced talents.
In the past three years that I have been here:
First, the "core values" of the company are very clear and have been continuously passed down from the early days to the present. These "core values" can be inherited and continued, and will not disappear due to the departure of the founder or boss. Importantly, most of Binance's early co-founders are still in the company. This is something I find very admirable, because to be honest, they have already achieved financial freedom, but everyone is still here, still working for the BNB holders, because everyone feels that there is still a common goal to strive for and fight for. So even though the boss can no longer come back to lead the entire organization, under the leadership of the professional management team, the core values established at Binance will continue to be passed on.
Second, the company has actually internationalized very early and has brought in a lot of diverse talents from different professions. After I joined Binance, I was essentially a cross-industry transfer from traditional finance. The bosses appreciated my experience in traditional financial institutions, "Binance needs talents like you to lead Binance's VIP and institutional business." In fact, the company already had a very good talent echelon during that period.
So to be honest, Binance's changes after CZ's departure are not that big. We will not stop our forward momentum because of CZ's departure.
BlockBeats: As the industry's leading exchange, what social responsibilities do you think Binance should shoulder?
Catherine Chen: I think the first thing we need to do is to "lead by example." That's why Binance is now taking the lead in compliance, including other things that Binance is taking the lead in doing, and we hope to establish the true market gold standard.
At the same time, no matter what Binance does, we deeply understand that we are responsible to the vast number of users. So I believe everyone can see that in launching new products or various activities, Binance is deeply aware of its social responsibility to users. And as a market-leading exchange, we actually need to be more careful and cautious. Binance's main focus now is how to enable this industry to have the next 50 years or 100 years.
Binance's ambition is not just to be the leader in this industry, although we already are. But we need to promote the entire industry to the next stage and make the industry grow bigger. Binance will not stop innovating just because we have already grown big. We are always thinking about how to bring more investors into the crypto asset investment field and provide them with a smooth transition process.
BlockBeats: From the perspective of VIP and institutional trading, how do you see the future development of Bitcoin?
Catherine Chen: From the perspective of institutional clients, I think Bitcoin's current positioning is still relatively clear. As the most widely recognized investment target in the entire crypto industry, in the eyes of large institutional investors, its positioning is "digital gold", as an asset for risk diversification. From the perspective of institutional investors, I think they will continue to move in this direction.
Although everyone is currently working hard to give it more valuable applications, and of course there are many ecosystems and many capable people doing build-outs, I still feel that it is "unfinished", and it is worth paying attention to. If Bitcoin itself can find native applications, that would of course be better. But from the perspective of institutional investors, there shouldn't be too much change. Bitcoin is usually used as a risk management tool to provide different performance returns for the investment portfolios of institutional investors.
Bitcoin not only has no high correlation with many mainstream assets, but also has the characteristic of 24-hour trading. The 24-hour trading feature allows institutional investors to better coordinate their investment portfolios and manage their positions better when facing the traditional market's weekend closures.
As for the future of Bitcoin, although I am not a Crypto OG, I am also a firm believer in the future of Bitcoin.
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