Emma Cui, the chief executive of blockchain incubator network Longhash’s branch in Singapore, believes that the city-state is positioned to capture the growing deal flow of the sector and sees a strong push for decentralisation among stakeholders in the industry as the investors and enterprises in the space mature.
Cui, whose background includes stints as a general banker with ANZ Bank and as a consultant with McKinsey & Company, joined Longhash in April 2018. The global incubation platform accelerates the development of blockchain technology ventures and offers services that range from a mentor network to investor outreach and technical delivery capability services.
In an exclusive interview with KrASIA, Cui shares Longhash’s perspective on the blockchain space and its evolution in the Indo-Asia Pacific (Indo-APAC) region, digital token sales and the evolution of distributed apps (dApps) that dominate the blockchain sector.
What’s the outlook at LongHash for cryptocurrency and blockchain businesses in Southeast Asia?
Though countries like Thailand, Vietnam, and the Philippines are heating up, Singapore remains the undisputed hub for blockchain projects and ICO’s in Southeast Asia region, ranking top 3 in number of ICOs globally. In fact, a recent study by Breaker Mag found Singapore to be the #1 blockchain city globally.
We based out of Singapore, but we’re not limited to the Singaporean community. We currently have offices in Shanghai, Tokyo, Hong Kong, Berlin, and Singapore, which provides a global network of support for blockchain projects.
In terms of investor interest, what’s the outlook for the blockchain sector?
There is a lot of speculation at the moment. We feel there is a need for more real-world adoption to offset that, but it is great to see that interest in blockchain has exploded over the last couple of years. Even though the average amount raised by each ICO has decreased this year, in absolute terms the volume of funds pouring in has surpassed 2017. By April 2018, ICOs had surpassed the $5.6 billion raised in 2017. We think that interest will continue to grow as more people realize the potential of the blockchain model, and join the community.
Looking at the number of blockchain-based projects in Southeast Asia and China, which are the main sectors drawing attention from investors and entrepreneurs?
Right now blockchain infrastructure projects – public chains and protocols – are drawing more attention from investors, especially from the crypto funds. This is rightfully so because they are laying the foundation for the actual applications to be scalable, secure, and user-friendly. But as for dApps (distributed apps), the applications cut across all industries from the financial industry to real estate to art.
How do you see the current hype cycle surrounding blockchain playing out?
The current hype is a result of people realising that there is potential for decentralisation, and of course, many others are simply riding the wave of funds being poured into the blockchain space. However, this, like any other hype cycle will eventually subside. We already see the community becoming more mature in demanding more concrete progress before investing, self-regulating in terms of KYC/AML, and focusing more on education/ adoption.
Additionally, there is a continuous push to uphold and work towards decentralization, such as having decentralized exchanges. Right now the centralized exchanges have incredible power and are profiting from it. While they are also helping the community with their services, we expect the community to continue shifting towards an open, peer-to-peer model. Hence we see our partner ecosystem with Cybex, a decentralized exchange, as critical to this mission.
In terms of ICOs, where do you see this element of the cryptocurrency space evolving? Will we see more traditional equity capital markets tap the liquidity of cryptocurrency markets over time as the crypto-finance sector matures?
I think we have already been seeing the traditional equity capital markets tapping into the crypto-space. But it is important to note that between equity is completely different from cryptocurrency. Coins like bitcoin are currency, but also a “store of value”. Utility tokens like Ethereum are commodity-like but also possess a utility value by being able to pay for computation on the Ethereum blockchain.
Other utility tokens from dApps are neither security nor commodity nor currency but a hybrid of utility and equity/security tokens. While they can be used for the exchange of value within the ecosystem, it also represents buy-in to a community that we generally expect to grow in value.
It ‘s a new asset class which will attract participants from various parties including traditional capital markets, grassroots communities, and idealists/ technologists. It aligns the incentives of the founding team, the investors, the community and all other partners in the ecosystem to grow the community, instead of extracting value.
It also gives online communities the opportunity to leapfrog existing structures and create a rich ecosystem where the exchange of value can happen freely. That’s what we’re here to nurture a major driver behind why Longhash was established.
Editor: Ben Jiang