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From Morgan Stanley to crypto: with Phemex’s founder

No one said it was easy. And running a crypto exchange may appear impossible.

Phemex is a crypto derivatives exchange based in Singapore. In less than two years, it rose to the top ten global exchanges, with daily peak trading volumes exceeding $12 billion. Jack Tao, founder and CEO of Phemex, spoke to Bitcoinsupports about the challenges and risks of running a crypto exchange and his future ambitions.

What was it like to build a trading platform during the crypto winter?

Phemex’s tale tries to address many of the difficulties I see in traditional finance. When I first learned about crypto, I was ecstatic because it looked to address the inefficiencies of traditional finance.

Blockchain is one such technical solution. My initial motivation was to just try it out and learn more about it. So I started little mining operations and tried out numerous exchanges and trade sites.

My initial foray into cryptocurrencies resulted in losses. Despite the huge potential of cryptos, I concluded the sector had a long way to go. My previous exchange had several technological concerns, resulting in regular outages and hacking. There were no norms and little confidence. To fix this, I used my Wall Street financial and technology abilities.

Phemex is the outcome, a powerful and efficient platform geared to assisting everyone, not just a chosen few, in reaching financial independence. For more information on Phemex, click here.

Decades at Morgan Stanley assist you manage your company?

I was the worldwide development VP of MSET Benchmark Execution Strategies (BXS) at Morgan Stanley before co-founding Phemex. My background in finance enabled me to develop Phemex.

With over ten years of expertise designing large-scale algorithmic trading platforms, I knew the TradeFi sector’s main issues. Because I could see the issues, I only had to establish Phemex as one of the most trustworthy cryptocurrency and derivatives platforms.

Phemex has evolved rapidly since its inception, and currently offers a wide range of crypto spot markets and derivative contracts with up to 100x leverage. On average, we trade around $12 billion each day, putting us in the top 10 global exchanges.

How tough is it to run a crypto exchange? Does it matter where it is?

It’s not simple running a bitcoin exchange. Concerns about user safety and security are major difficulties. We have built and deployed a Hierarchical Deterministic Cold Wallet System that assigns different cold wallet deposit addresses to each user.

All Phemex deposits are periodically gathered in the company’s multisignature cold wallet. This allows us to immediately identify harmful behaviours and take action to protect our users’ assets and the platform. Qualified withdrawal requests are likewise processed offline, ensuring that all assets stay in a cold wallet system with no online transactions.

Picking a location for a bitcoin exchange is similar to choosing a location for a regular business. An inventive and entrepreneurial personnel pool, as well as supportive rules and regulatory procedures are all factors to consider.

Singapore satisfies these criteria. Asia’s main bitcoin hub, Singapore. To support Phemex’s rapid expansion, Singapore has built a crypto-friendly atmosphere that benefits both the financial and geopolitical sectors. Our staff in Singapore is fast increasing, and I am thrilled about the future.

How is doing business in 2022 different than in 2019?

The bitcoin and blockchain industry has evolved from 2019 to 2022. Here are a few instances.

The crypto market cap in 2019 was under $200 billion. The market cap is at $1.6 trillion and reached $3 trillion in 2021. So the distinction is clear. There is increased industry attention, more investor interest (both retail and institutional), and more acceptance. Doing business in a more demand-driven climate has been incredibly advantageous.

The number of cryptocurrencies on the market has also changed since 2019. Keep track of the top 50 cryptos each year and compare them to the previous year. It’ll be like comparing technology eras.

Although the business is rapidly changing, Phemex will continue to innovate and provide our investors with the greatest cryptocurrencies available.

The reality is that many businesses have merely adapted traditional business models based on profit and self-interest to a new space. What does our motto “Break Through, Break Free” mean?

After over a decade in traditional banking, I became disillusioned with the constraints and injustices I saw. Unfair pricing and inefficient systems plague the industry. These all favour the wealthy and oppress the poor in some way. That’s why I mentioned many firms today just use fundamental crypto and blockchain principles. The reality is that many of these enterprises are simply rehashing existing business ideas.

“Break Through, Break Free” encapsulates our company’s values. To enter a better system where actual financial liberty is not only encouraged but built into the system’s core, Phemex has all you need. We think that everybody may transform their own life and create their own reality.

Phemex: what’s next? What can your community expect in 2022?

We’ve come a long way from creating a new currency to enabling decentralised transactions to rebuilding the existing financial system on-chain. In the following level, we will design any service or procedure, not only financial ones.

I’m also excited with recent patterns. My interest is in the metaverse and nonfungible tokens (NFTs). Undoubtedly overblown, the present increase in NFT collectibles and art signals to a potential future. We’re redefining ownership and exploring new uses for on-chain assets.

Like GameFi, the metaverse has revolutionary wealth distribution and play-to-earn methods that could dramatically transform our digital habits. And this is just the beginning of what’s conceivable.

This includes AXS, MANA, YGG, SAND, SLP, and many more. We’ll keep an eye on this tremendous megatrend.


Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.

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