Hi everyone and welcome to another episode of Living on Blockchain. Today we are speaking to Alex. Alex earlier was the General Manager of Binance Dubai.
Currently he is using his expertise in navigating the regulatory complexities of the crypto industry and is also focused on leveraging his expertise again once again in blockchain, decentralized finance and contributing and helping other founders. So considering he’s played quite a pivotal role in establishing Binance’s operation in the Middle East, this was a very very interesting conversation from the perspective of regulation, compliance, also just building and scaling. I can’t wait for you guys to hear this.
Let’s deep dive right in. Hi Alex, thank you so much for making the time to speak to me today. How are you doing? I’m very well and thank you for having me in conversation.
The pleasure is all mine. I’m glad that you know we can both make the time to do this conversation. For our listeners, let’s set a little context.
Can you tell us a little about yourself and your journey into Web3? Fantastic. So I was a physics grad moving into finance, worked in London, trade interest rates, did that for a while. Traded a few other products, my trading career, oil, gold, index futures.
Then after witnessing the credit crisis where Bitcoin was born, Bitcoin was obviously an answer to some of the problems. So I was aware of it very early, unfortunately didn’t invest very early, but we were aware of it, talked about it, interesting conversations about his money, which is very philosophical. Moved into setting up a trading brokerage on Cypress Shore.
And then in 2016, I exited a company in FX and decided that I should be getting involved in production. At the time, becoming a little bit more mainstream, the post-Ethereum, during the ICO boom, where people were creating tokens, creating excitement, looking at new ideas for a centralized network. And yeah, the first explosion of mainstream trading as well.
So then Bitcoin went to start trading futures. So I helped a few businesses set up their interaction crypto at that point. And then in 2018, ADTM Abu Dhabi Global Market released guidance to adding crypto into their framework.
So I went to go set up an exchange, crypto exchange and MTF in Abu Dhabi. And then in 2022, I joined Binance to help them set up their exchange in Dubai. That was an interesting journey.
So, you know, I’ve been involved as a crypto introvert for quite some time, but I loved learning about new themes, the activity, just the crypto ecosystem moves so quick. Absolutely. I think this is one of the more dynamic industries.
It does move very, very quickly. And so, you know, you’ve been there at the helm of perhaps helping Binance with setting up their operations as well in the Middle East. Can you shed a little light on your advocacy work, which is what you’re doing currently? So I am helping a number of different projects in the Middle East.
So I left Binance last summer and Binance moved to the Middle East, the UAE specifically, because there’s alignment from top down to really enable Web3 and blockchain businesses, because they can see that this is a technology for the future. And here in the UAE, we’re always looking to build. And so it’s important that you have long-term vision when you want to grow business.
So that’s what led Binance to establish probably the largest number of people in the country, because of the long-term alignment. That’s important. So now I’m helping a lot of businesses come to Binance and choose from the various non-regulated sections, the ones that work for you.
So here we’re looking at regulation as a name. So, you know, there’s a lot of different options to come grow businesses here, but easier to grow just because of the infrastructure. It’s easy to live and move here.
It’s also easy to service global economy. This is a crypto blockchain. It’s a global business, much like the internet, right? You can serve people from everywhere, very clean, very traditional business.
Being in the Middle East, time zones, fantastic service, Asia, Far East, and Middle East and in Europe within a day. So it’s an exciting place to be. And I think we’re pushing for it to be the central point, focal point of blockchain innovation.
Right. Yeah, I think you’re right. Being in the Middle East comes with its own advantages and the way it is kind of creating that perception in the world as a hub for crypto.
I think that has done wonders for, you know, just the way I think a lot of people had used to perceive Middle East now that it’s changed and how, you know, the kind of investment that is coming in, the builders that are moving there, all of that is obviously adding to that particular narrative. Yeah, I mean, I moved here a decade ago now, 10 years, and I am always, well, towards the start, very astounded by the level of innovation and growth. And now I’m not so surprised that we’re aligned and predicting that we’re going to continue to see that.
So, you know, it’s an emerging market, and so it’s easier to grow emerging markets than more established markets. And that’s, again, one of the things that the region aligns well, blockchain and crypto, the growth industry, growth market, and it’s like a symbiotic relationship, we’re able to benefit from the growth establishment, this new industry. Yes, absolutely.
I get that. So, Alex, your voice is a little muffled. Can you do something about that? Hi, are you still here? Yeah.
Yeah, your voice is a little muffled. Is there something that can be done about that? I’ve increased the volume now. Okay.
All right. Okay. On to the next question, then.
I am, you know, we’re talking a lot about basically the advantages that are there currently with the kind of policy that the Middle East is coming up with and the way it’s coming up with, encouraging innovation and startups. But I’m sure that there are some unique challenges as well that, you know, you must have encountered while operating in the Middle East. Would you like to talk a little about that and how did you overcome them? Yeah.
So, I think the challenges are, again, you know, going back to the same thing that we have going for it, but because it’s an emerging market, not everything is as well established. So, you know, the things that have been established and the infrastructure that’s new is obviously easy to use and help one quick. But, you know, you don’t have that established labor pool, for one.
You know, you need to sort of import people because it’s not so much of a native workforce, especially for sort of new products. So, it’s scaling and human capital is the most difficult thing to overcome in this region. But, you know, as we mentioned, you know, there’s been a lot of work from the authorities here to make it attractive to become.
So, new schools, sports facilities, infrastructure, hospitals, transport supply as well. So, it’s important, sort of easy for people to come. And as you mentioned, 10, 20 years ago, it wasn’t on people’s radar.
But luckily, you know, sport sponsorships and things like that, you know, UAE is on its radar globally and it’s being talked about. So, it’s easier to bring people here. Okay.
I think that that is true. But, you know, that is rapidly changing as well, like you mentioned also in your answer. So, what were the kind of biggest takeaways from leading, you know, Binance Dubai and how has that experience kind of shaped your perspective in the industry? I know that you’ve kind of touched upon this in the earlier answer, but I would love some specific pointers that, you know, which were your biggest takeaways because you work with Binance Dubai.
So, for Binance, it was important and, you know, this from the previous CEO, CZ, once you become the market leader, especially in this industry, it’s important to lead with example, by example. And so, this was important, you know, Dubai, the regulator was established and virtual assets specific regulator. We work very closely with Ibarra.
And so, it’s important to understand that, you know, the regulators goal as well as Binance goal, consumer protection and making sure that people have safe trading environment and have the experience that they accept. So, it was important for Binance to, especially, you know, where sometimes it’s negative perceptions from people that don’t understand, it’s important to lead by example and to educate. And so, this is something that everyone can look at.
So, it’s important to educate customers on blockchain, on crypto, and for them to understand the benefits that you can present to them and why they’re using crypto. Not everything needs to always be decentralized, but, you know, where you have decentralized systems, there are advantages to that. So, making sure that people understand and educate it is super important to the success of it.
Right. I totally agree. So, you know, we’ve kind of touched upon, obviously, the takeaways.
I would love to know a little about your perspective on the regulatory landscape when it comes to decentralized technologies, because that is something that is constantly evolving. Based on your experience, what are the kind of key ingredients for regulatory success in emerging markets? Because I think, obviously, the Middle East is pioneering and kind of championing it, and moving forward in the right direction. But there are many other countries that are lagging, and they would perhaps want to, you know, create a regulatory landscape in their jurisdiction, which would, you know, foster innovation.
What do you think are the key ingredients that enable policymakers to do that? So, the same thing, as we said to our businesses as well, it’s education. So, it’s understanding the infrastructure companies’ products allow you to make better, more informed decisions. Right.
So, often, when you have an ill-informed decision, you know, it’s a lottery of whether you make the right choice, you know. So, for any new jurisdiction, it’s important to bring in, understand this crypto product, and understand what you’re trying to do. And again, you know, regulation should be an enabler, and it should be helping to build your economy.
Right. So, if you’re looking to have people set up businesses within your jurisdiction, it’s important you give them a place for them to operate in a way that’s beneficial for everybody. And so, it’s all about sort of win-win, you know, having regulation to give external, give people comfort that you’re regulating business, and having those rails protection.
And it’s important that, you know, the regulators, you know, get involved with crypto, trying to regulate from arm’s length, academic standpoint, I don’t think work. I think, you know, you need to experience, play with the technology to understand purely academic interactions with crypto, I think that. I think that’s a very good perspective, very insightful as well, where you said that, you know, the government cannot really regulate from an arm’s length, you know, distance, they need to get involved, they need to understand it better.
And then, you know, they create policy around it. Talking of policy, I think I’d be remiss if I, you know, we didn’t touch upon the new precedent in USA, and how Trump is aiming to, and I think he has just a few hours ago, signed on some executive orders, aiming for a strategic reserve of crypto and allowing banks to get, you know, who have custody of crypto, and many other favorable things. What is your take on that? How do you think this is going to have an impact on the market? So it’s very positive.
And this is what we were expecting. There was lots of positive discussion prior, and from this administration coming in, so that expectation, and previously for the last administration, for four years, crypto has not been looked at favorably, it has been stifled, innovation has been stifled. And what’s happened is lots of people that were in the USA have moved abroad and built technology companies, businesses outside of the US.
That’s not what President Trump wants to see, right? So he wants to see things refactorated, he wants to see America leading this crypto economy. So he’s removing a lot of the problems that were in, regulatory problems that were in the US. So you rightly said that the executive order came out, signed yesterday, and it’s to promote access to public blockchains, supporting US dollar stable tokens, they prepare banking services, and a big push to create regulatory clarity for blockchain, which he’s looking to replicate what’s happened in the Middle East, where people have moved here and building businesses here in the economy.
So that’s the aim of what’s happening. Yeah, I do feel that these are positive signs for the industry, because it helps with the perception problem that decentralized technology and crypto has kind of always battled over the years. I would also like to touch upon, on a macro level in the market, because you’ve been around for a while, what are the kinds of niches do you think that are very exciting at the moment, and you see the most innovation and more substance being created in these niches? So there are, I guess, three sectors that are looking to really capitalize, to have great years this year.
So the first sector is RWA, real world assets. And again, this is something we looked at trying to do in 2016, 2017, where, you know, putting property on the blockchain, or asset on the blockchain, and I think we’re a lot closer. So I think the legal frame is catching up, because this is probably the main thing that’s hindering some of the innovation.
And so we’re seeing announcements the UAE about big development, putting your assets on the blockchain. So RWAs are a big narrative. The second narrative, I think we call it the D-PIN, the decentralized physical infrastructure.
And so what that means is individuals via crypto can provide infrastructure, so compute, so using their computers, using some of their data. We have wireless carriers in the US, where people are sort of sharing their data touchpoints. And we have mapping, and cameras, and all of this information being fed into the digital economy by crypto.
And so the consumers of this information are paying by crypto, where traditionally, you know, a centralized or third party would be involved, right? So we present information to that party, and then third parties sell it to them. So we’re abstracting away that intermediary by putting things blockchain. So that’s something that now these projects are starting to, they’ve had experimental phases, they’re starting to get to the right size of network, and they’re profitable.
So that’s super exciting. And now we’re seeing, you know, large language models, small language models, AI agents. So, you know, as we saw the birth of ChatGPT, I think in 2021 or 2022.
So we’re sort of three years in, two different generations of AI agents. We have AI agents X. And so we’re seeing these AI agents integrate into the crypto ecosystem, and they can then interact with Wallet and become sort of participants in these economies, right? So they can pay for things, they can pay for data, pay for whatever the agent wanted to do. If you empower an agent to do something, if they have a crypto wallet, they have the ability to interact inside of their environment.
So we’re seeing that. So I think these are three main sectors that excite us. Right, I do feel that, you know, I kind of agree with you, RWA that I’m seeing now, as against when you mentioned initially talked about, there was no framework around it.
And Deepin seems to be getting momentum as well. And, you know, with the more and more advent of AI and now AI agents, I think the use case, like you mentioned that, you know, the agent becomes a user themselves in this transaction, I think that is going to create some very wonderful use cases. Are there any particular use cases with, you know, AI and Deepin LifeTech that actually exist at the moment that are very exciting to you? I think for the AI agents, a tiny bit too early.
I think, you know, the thing, the crypto, you see things as soon as they’re built, and then it takes some time to develop. I’ve seen, you know, talks about having trading and investment and risk management built into a group of AI agents as a sort of experiment, because again, that’s a cluster of all forms of agents can interact and act accordingly on their decision making. I know I’ve seen in the US food ordering AI agents that helps navigate that is ordering, collection and delivery of food.
So just as a use case, testing out the Interact Coinbase wallet. But yeah, I think that AI agents, we’ll see them better defined. I think it’s still a bit experimental.
Same crypto, right? It’s still experimenting. Crypto comes from the individual retail. Normally, when we see products, they’ve come from institutions and been well tested and vetted, and then it’s deployed on us at the last mile with very clean and polished.
Unlike crypto, which often has lots of bolts exposed, maybe user experience polished. Right. So now let’s talk a little about, you know, the talent issue that the blockchain industry continues to face in terms of attracting non-technical talent.
What are the kind of ways you feel that we can become more inclusive for people outside of tech? And what are the skills that are very undervalued, but essential for building a sustainable business in this space? Also, we talked about education. I think as crypto now is moving into the mainstream, Donald Trump is bringing these conversations front and center. So it allows us to have a better perception.
And so when people are leaving school or university, there’s not such stigma towards the industry. So I think that that’s beneficial. So I think it’s just continuing to paint the industry in a positive light.
And then, you know, the specific skill sets aren’t too dissimilar to any business, right? Most of these businesses are sort of consumer-facing. So you need the full range of talent, right? So it’s not just the blockchain developers, it’s people in user experience, handling the journeys, handling the interaction between dialogue, messaging, email, marketing, brand perception. So at the end of the day, crypto is the infrastructure for consumer-centric tools.
So much of the same skill sets that we’ve seen for some of these large Web 2.0 companies, this is valuable Web 3.0, except the push is the consumer isn’t the product. Web 2.0, your data, your information was given to the centralized counterparty. And so now Web 3.0, we compensate users for the activities.
So I think it’s much more equitable. Right. That is something to think about that gives you a little to ponder upon.
If you could design perhaps the next major innovation, what problem would you aim to solve? It’s a tough one. Yeah. That’s the multi-billion dollar question, right? Because we’re all racing so… I think anything to do with data, right? I think, like I mentioned in my last answer, where Web 2.0, the consumer is the product, right? And so I think we can start rewarding people better for their interactions.
I guess something people are more familiar with, like loyalty. I think loyalty and interaction with businesses can be better administered. So much more direct.
It allows you to have these sort of micro-payments. It allows you to, as a business, you can airdrop people value, whether it’s tickets, information, or all points, and have less value loss, right? This is one of the particular sticking points for building in crypto is they want to reduce the flow of the intermediaries, right? Too many intermediaries dilutes the value that goes down to the end user. Crypto allows peer-to-peer mechanism, decentralized mechanism, low overhead.
And so giving people a better experience at lower cost. Right. Yeah.
I think those are interesting inflection points to sort of work on. And these are pointers that kind of have, they’re still the test of time. And as you mentioned before, like as crypto is becoming a little more mainstream, I think that these would become super relevant again, because data is ultimately what kind of makes the world go round.
So I think I concur with you there. What has been perhaps the most surprising lesson that you have learned about this industry that you didn’t expect when you just got around started? I mean, I’m surprised how many products get built for your user experience. I think it’s a big rush.
And because of the speed of innovation, things and products get released with like poor user experience. And that’s turned people away, right? So I mean, if you look at wallets, they’re a bit clunky and difficult to use through the lock, but having your assets on a device that you can lose and not recover is something extremely tough. People need to be consistently warned, their traditional services, banking, socials about have phishing attacks, have good digital safety.
Crypto is extremely more problematic because the assets you can transfer them back. So that safety net gone. So I think industry needs to be a bit more careful with what we build and how we build it, because it’s difficult for the average user to interact.
Okay. In terms of your own personal journey, where do you see yourself? You are obviously startups at the moment, but where do you see yourself in, say, the next 12 months to 18 months in this space? What would define personal success for you? I think interactive. Well, I think just the growth of the industry in region alone, right? I think that we should see a mainstream crypto project becoming sort of a global leader in whatever it does.
I think we’re at that point technology is kept up to be able to enable things like account extraction, which allows you to set up wallets, recover wallets using Web2. I think that that’s a big thing. And yeah, just looking for a big positive year.
Global crypto regulation in the US becoming net positive or having a big positive bias. And so that should increase the speed of innovation. I see America unlocked.
Middle East making a big pitch to grow an established business in here. I’m just looking at expansion. That’s interesting, I think.
If you could mention one startup or project in the Web3 space right now, what qualities would you look for in the team at the concept? So within the teams, the team needs to have a focus. Often it’s across any industry where you have people raising money and deciding to do later. A bit of a problem sometimes.
So a focus on a particular product. I have the background to be able to do it, I guess. A bit of track record.
Again, a lot of crypto founders.
I’m much younger than the additional founders. Normally, when you do a normal journey for a founder, traditionally, you would have worked in the industry for 10, 15 years, in a similar sort of business, and then you decide to set up yourself and go raise some money or bootstrap it and then grow the business. But crypto, it enables people from day zero, living co-op, being a teenager, you can start smart contracts and raise money through a myriad of business.
So the threshold to raise generally is lower. So I would look for slightly more established people, maybe build one or two projects. Crypto has been around for not long enough now, three crypto startups, and I think that experience would help.
That’s what I look for the most, the experience and the team, rather than maybe the shiniest tech. Yeah, I think experience would shine more than the next big shiny thing, which a lot of founders tend to move towards and start building. So yeah, I think experience does matter, especially in the space where there is a lot of learning and unlearning required.
When you are more experienced, you’re better equipped to deal with the kind of issues that arise from building day-to-day in crypto. So I think I would agree with you there. You know, we are really running out of time, so I’d ask you two more questions before we wrap this up.
But I think there’s one question that has been on my mind for a bit. You know, you have had a lot of experience in regulatory frameworks and just sort of scaling a business and creating a sustainable business. How can traditional financial institutions best perhaps collaborate with these upcoming startups? That is one part of the question.
And the other part is, you know, startups usually are low on resources. So how do you feel can they create frameworks from the very beginning to be on the right side of the regulatory framework? Okay, so I guess two things. So often banks and bigger institutions to sort of enter this field, they sort of empower a team who are either at arm’s length or sort of external to sort of build a product and then bring them internally once the product’s in there.
And I think, you know, that speaks to the speed and innovation in crypto. It’s difficult to maintain within a more rigorous, especially financial infrastructure. When you run a regular product, you have to have a very defined control process and change control, which does itself to that speed.
So I’ve seen before this other financial innovations happen within certain sandboxes. And so, again, that sort of nods to understand that within the sort of formal confines of regulatory, it’s to innovate in this manner. And so, yeah, I think banks and other financial institutions need to sort of empower founders through investment grants, that manner of risk to grow businesses and then bring those businesses internally when the product’s right.
And for a sort of startup founder, start zero and break process, before it was more expensive and difficult to manage. I think it’s more due to the fact that the uncertainty in regulations, regulatory standing. But I think now we have a lot more regulatory clarity and certainty.
So you know whether you’re a business. So you need to just make that decision. It’s difficult to think otherwise.
So if your business needs to be regulated, you need to go down that path. Otherwise, you’re taking a large risk. I don’t think it’s appropriate.
So it’s not as expensive as it was because there is more providers that are able to help. I mean, ways that you can. You don’t need to take in people’s time, especially consulting, legal, regulatory, and oversight.
So the mechanisms like we can have fractional CMOs, fractional CTOs, fractional CFOs. All of these sort of mechanisms allow you to do some of these services, but without cost. I think, you know, I kind of agree with you there.
Obviously, earlier it used to be very exorbitant. But now that might not necessarily be the case. And ensuring that at least you’re aware of the regulatory landscape and creating smaller framework so that, you know, you stay on the right path can be very important for any entrepreneur because otherwise the kind of debt you incur, not like tangible debt, but, you know, this debt in terms of compliance that you incur can be really huge and can really bite you in the future.
Yes. So, Alex, it has been such a wonderful conversation. I love how, you know, you made this journey from, you know, somebody who was not into Web3, then somebody who was into Web3, working and leading finance in the Middle East, which is one of the more exciting places to work in, and now, you know, consulting startups.
I think it would be remiss if I didn’t ask you this one question that I ask everybody who comes on this show. Considering, you know, you’ve had quite a dear journey as well, what would be your suggestions for folks who are skeptical about this space so that they can truly start living on block? Like we talked about with the regulators, you have to experience more. You have to use the product.
You have to embed yourself in. It’s very difficult to truly have a judgment on something that’s experience, right? Again, it’s about some regulators having problems with over-academic ideas, but this is the same point, I think, to have an opinion, a strong opinion on this to engage and use the product. You still might not like the product, but you definitely need to, again, create a wallet, use some blockchain dApps, send some transactions.
This is the best way to sort of know what’s, you know, we still, you know, people that have been in the industry a long time, we overlook some of the shortcomings of the business and user experience, but, you know, we’re there, but we’re trying to make it better. So I think it’s getting involved, not for everyone, but it’s definitely an exciting work. I agree.
I think that’s a wonderful note to end the episode on. This might not be for everyone, but it can be a wonderful space to be in. So thank you so much once again, Alex, for making the time to speak to me today.
This has been a wonderful conversation, very insightful. Any last words, parting thoughts before we wrap this up? Thank you for having me. And, you know, podcasts like this are important in a great way.
People are now consuming information and learning. So, yeah, thank you. Thank you so much for your kind words.
And yes, I do believe that ultimately it’s the owners of the builders that sort of correct the narrative and correct the perception. So thank you for agreeing to come on this show. And it’s been great.
I think it’s been very insightful. Thank you.