Fireside with CEO of Binance Richard Teng l KBW2024

[Music] hello everyone sorry we thought the seats were a little far apart so we moved him closer I am Jacqueline melani I am the co-founder of token relations and I don't think Richard needs an introduction but he is the binance CEO Richard Tang welcome and thank you for coming on stage today thanks for having me anoo is not my first visit to Korea I know Korea very well so I love I love this country so thanks having me yeah and thanks for being here uh to start off you have been the CEO of binance for about 10 months now what has been the biggest developments for you since taking on that role well so I started as CEO in November last year so once I became CEO I make three commitments globally the first is to our users our users are the most important to us so we have a very user first philosophy and that's our Mantra very strong DNA in binance right so we are very glad and confident I mean we keep building the platform to have best-in-class platform to have the best products and features for our users continuously improving investing in security and compliance and we are seeing the fruits of all those things right so by now we have close to 220 million users globally the first 100 million users took us about five years to reach the next 100 million users took us about two years and you can see the pace of crypto adoption moving very fast on that front we continue to make enhancement throughout the course of this year right so from enhancement to copy trading to our margin products uh to binance earn to web tree wallet uh and the list goes on and also across the different type of clienteles we have enhanced the program including for VIP program where we also roll out things like triara agreement so I think that's the first thing the second commitment I make is really to work with global regulators and policy makers around the world and that is to continue to support the development and crypto adoption globally on that front uh on that front I'm very pleased to share with you that we have secured our 19th regulatory approval globally in India and India is extremely big market so we very grateful for our collaboration with the Indian Regulatory Agencies on that front and the course of this year we have secured licenses in Thailand Dubai and and the list goes on right so we are working through and supporting many countries if you look at today only onethird of global Regulators are regulating this space two3 are not so for those two3 we are working very closely with them to formulate regulatory framework that manage the risk on one hand and support Innovation on the other hand and thirdly given that crypto is still at a very early stage stage of development we are working very closely with Partners Tru the war I'm very very happy to see so many different partners here today to really support crypto adoption deployment because whatever gets to bring about a more vibrant ecosystem is good for everyone is good for us yeah 100% I I agree with you on that and I'm glad you brought up regulation uh given that you were a former Singapore regulator how do you look at the regulatory environment especially given that binance is the world's largest global crypto exchange there's a lot of different facets and regulators and policies that you have to deal with but what are you doing necessarily to kind of propel binance forward given your previous career and the company so I I spent my career in regulations not only in Singapore but in UAE as well in Abu Dhabi but unlike if you look at the banking space and securities or fund management space you have regulations and standards they are pretty much harmonized throughout the globe by today that's not the case for crypto right uh only oneir of global Regulators are regulating this space and of that onethird some are regulating it as a security some are regulating as commodity some said this is a very interesting asset class with different characteristics let's designate it as a digital asset or virtual asset and some de as a digital payment token so depending on which part of the world you are in the rules and regulations are different which makes it challenging for Global deployment so everywhere we deploy we have to really understand the local landscape work very closely with Regulators so what we really wish for is greater harmonization of global standards that at least there's a common standard that users like yourself know that these are the standards that we should look for these are the security standard these are the user protection standards Etc and that's what we are trying to work towards on a global level so I think that's something that we spend a lot of time and energy working with global regul Regulators to highlight to them the potential opportunities in this space blockchain together with AI will become the foundation of future Industries right so if you look at Future industry whichever sector you're in it will be built on the combination of AI and blockchain right you you can't run away from that there's so much talent pool working in this space the best and the brightest so what we need to is to really harness and bring about regulatory Frameworks that supportive of the Innovative and growth aspects of it we can bring in a lot more FDI foreign direct Investments that can bring in a lot more Talent pull into this space and that's what we aspire to so we we actually do a lot of other than for our users we actually do a lot of educational sessions for policy makers and Regulators around the world to highlight to them the potential of it it crypto is a traceable technology unlike Fiat right so if you have 100 million in crypto you distribute that you can trace where it goes to right so it has a lot of usage a lot of beauty and utility Way Beyond what you see in traditional space what do you think the policy makers are misunderstanding about crypto well first and foremost um I started in crypto around 20 2017 uh where I got to know crypto in the states and that's where I really believe crypto is going to be the future of Finance but for f for crypto to really gain mainstream adoption my hypothesis and thesis then is that you need two Dimensions to come into play firstly you need clear regulatory framework because it's only with that that many users have more certainty what they're dealing with you have uh the different types of clients from institutions to corporates to high netw worth believing in this asset class and secondly you need institutional adoption because institution bring with them different liquidity you can bring about greater structuring so 2024 has been a landmark year because you see those two Dimensions coming into play more and more firstly you are seeing more countries embracing giving more clarity on the regulatory framework applicable to this space and then secondly if the lik of Black Rock Fidelity Morgan Stanley stage Street and the and the list goes on if you look at 2017 compared to now or even two years ago compared to now where most of the traditional financial institutions in the world are not in this space if you look at today is the landscape has shifted quite drastically right so all the top financial institutions around the world has a crypto strategy has a crypto agenda has a crypto program Morgan Stanley allow Is wealth planner to really allow for the promotion of crypto to their clients you see much greater allocation among the institutions uh family office traditional financial institutions and traditional trading firm that used to only trade Commodities and securities now adding a crypto desk to trade into this asset class I think all these are exciting developments and we are still at the beginning of the journey and crypto adoption is very low by global standards you can only go faster from here and give that we are in Korea what is binance's maybe latest updates or developments on establishing a place in Korea as well so I think many of the um our our community and audience knows that we have a proposed acquisition of goex is really to try to rescue the GOI users we are committed to that we are working with the different stakeholders from policy makers to Regulators to potential Partners to see what's the best solution and resolution for this outcome putting in mind we always put users interest first right so I think whatever resolution uh we we try to make sure that users interests are always protected I also want to talk about uh maybe the elephant in the room and something that put binance in headlines months ago about the $4.3 billion plea deal and with the US Regulators what do you have to say about those allegations of breaking anti-money laundering rules and violating sanctions so I there are few things I wanted to stress here right so firstly we acknowledge our past mistakes and missteps on that front we have underinvested in compliance in the very early days but if you remember if I map that landscape for you I mentioned 2017 and this that's where I got first involved in crypto and that's where binance started in July 2017 the landscape then was almost nobody other than retail believed that this asset class is going to stay Regulators underinvested they they do not believe they come out didn't come out a framework on this space institutional or not adopting so there's underinvestment in those early days we have a knowledge our past mistakes we have paid a heavy price like all financial institutions we took ownership of it so what's important I mean breaches of AML rules if you look if you Google it you see many financial institutions even those with decades and centuries of of uh track record and experience will trip over from time to time because the rules are ever evolving but what is important is for us to acknowledge those mistakes continue to improve and get much better right so on that front in the past two years we have made significant investments into our compliance program in 2022 investment into our compliance program was at $158 million us that went up to $213 million us last year and this year we get even more U our compliance function today our compliance hit count stands about 500 people we have another open hit count of close to 160 170 people for the rest of the year and binance itself is recruiting globally right so for this year we have recruited additional 1,000 hit count we still have about 600 open hit count for the rest of the year and this shows our confidence into this sector our our continue deployment globally into this sector and our optimism for the future what we have to do is to continue building a sustainable a best in-class platform to serve our users 100% following that how is CZ have you spoken to him what kind of relationship you guys have I've not spoken to him recently I mean CZ is a very dynamic leader I have the fortune to work with him for about two years two years plus coming to two years uh I joined binance in August 2021 a very very Dynamic very transparent leader is uh is a learning experience a huge learning experience I'm very humble and honored that CZ and the rest of the leaders Place their confidence in me to really bring about the pivot of binance into binance 2.0 so other than being user focused uh we also invested quite heavily into compliance and the aspiration is really to build this into a very vibrant a very sustainable platform to serve Global users to I mean the three commitments that I mentioned to work with global regulators and to work with Partners throughout the world to continue to support deployment and adoption on that front we are still at a very early stage so we are very happy to see new deployment new projects uh new area of use cases and utility the more we have that the better off it is for the entire industry and Community oh 100% I so I assume he's doing well he's he's doing well okay good good and I'm sure once he's uh out and everything you guys will kind of strategize and talk about like the future of binance as well well CZ is uh the key shareholder he is the founder and CEO uh but we have pivoted quite differently from the time that CZ was the CEO now binance has a totally different corporate structure is a botl structure so I work very closely with the board directors in terms of our Global strategy deployment CZ of course has sholder res retain shareholders right um so but uh on a day-to-day basis on a ongoing basis I work very closely with the board directors in terms of our Global strategy 100% uh it's also no surprise that binance is the world's largest crypto exchange I'm sure a number of you in here use binance and have been a part of it for many years I think as of today it had $9.7 billion dollar in trading volume compared to coinbase which was the second largest at like $1 billion in trading volume for 24-Hour uh metrics I'm not expecting you to know that off the the top of your head rich I don't think those metrics are right by the way I think we have to check those metrics I what do you think it is I think it's much higher than it's much higher guys um but anyways on that note the question uh I was going to ask is how does binance plan to stay ahead as the leading crypto exchange well I I don't think there's any rocket science I believe that for us from day one we place a lot of emphasis on a few things right so firstly really supporting our user in terms of their crypto Journey building the best inclass platform understanding user needs we have a Advent we have uh fantastic community and inur pool with us working through all those issues with us so I think all those things are things that we cherish and whatever is good for users are good for us so we invest a lot into that space right uh I just give you an example we invested heavily into not only compliance but also security as well right so if you look at what's happening globally security is very important especially for crypto exchanges you see hexs of other exchanges taking place which is why we devoted you know the best talent pool the the best and brightest into this and we actually go beyond our Call of Duty as an exchange right we do a lot of things that other exchanges don't do right and all those are to make sure that we protect our users interest for example we are the first to come out with a safu fund a safe asset for users and that fund stands at northwards of more than a billion dollars now and that is really to protect users in the event something UNS happened to Security on the platform right um this year uh we help users avoid losses amounting to about $2.4 billion US do right uh you know to detection of poison wallet uh to different scams Etc preventing all those transfer taking place we also help users and Global Regulators policy enforcement agencies recover some of the funds that are subject to scam Rock pools Etc I think this year we have recovered close to what 78 million so far last year about 50 plus million again so all these demonstrate our commitment to users and we do a lot of things that we don't need to do and other exchanges don't do for example many users credit uh coins uh to address this uh they are wrong right uh we help our users to recover those coins so in the past two years we have helped users recovered about 4 billion plus worth of coins so so these are our commitment to users and we go beyond the core of Duty doing a lot more things to users so there's no rocket science is making sure we do right with users is making sure that we continue to support Innovation this space mve so quickly is very difficult to have a crystal Bo to look out three five years of what's going to happen so what we have to stay ahead we have to stay Nimo continue to build our platform to the best of our ability before we wrap things up I want to get an update or maybe perhaps I know you did a call to action on this earlier uh in August about tan the financial head of financial regulation at binance he is being held in Nigeria right now there have been updates recently about the trial his health is done well what is perhaps the updates internally from binance and what are you guys doing kind of to get him back home so T is the head of financial crimes uh and his lifetime goal is to really fight Financial crimes so it's an irony that he's detained in Nigeria unlawfully and unfairly unjustly uh I have make a plea I make two or three pleas by now to appeal to the Nigerian government let t go home he's a functional expert he's he's not in Nigeria as a decision maker right he was there at at their request he's a functional expert he goes around the world educating policy makers and regulators and he is one of the foremost person in this field tracing illicit crimes tracing Financial crimes right so he he was mentioned in uh some books as well Tracer in the duck for example he's very very well known in that space so un unfortunate we Appeal on humanitarian ground he's in severe pain he can't walk properly now he has herin this problem um and he's not getting proper care right he's not getting proper access to Legal so we appeal to the Nigerian government we have worked through issues with many governments around the world right so from from the US to places like India um to Thailand Etc so we have been very cooperative with global policy makers enforcement agencies to work through issues to resolve issues there's no need to detain him and what we want to see is continue those efforts especially if he's a US citizen so hopefully the US can designate him as unlawfully detained and get him home to get the medical treatment that he deserves and back to his family and loved ones very soon yeah definitely thank you Richard um and I think that is all we have for time but thank you to everyone for listening in and thank you Richard for the thoughtful insights thank you so much [Music] Kam thank you so much for that rich we appreciate your Insight