In the aftermath of FTX’s collapse, all eyes are on centralised exchanges to see how they are reacting – and responding – to the major industry shakeup.
The Block sat down with the CEO of crypto derivatives exchange Deepcoin, Ego Huang, to get a preliminary glimpse at some of the topics being discussed at Blockchain Expo Global on 1-2 December.
The Block: We may as well start by addressing the elephant in the room, FTX. What has Deepcoin learned from this debacle and what steps have you taken as a result of its collapse?
Ego Huang: Fortunately, we operate in a bit of a different world than FTX, and we didn’t have any stake in FTT or FTX, so we weren’t that injured. But of course, it has made investors and traders less confident in the industry.
A drop in liquidity is never great for any exchange, but we’ve managed. We’ve taken some steps to empower our users and communities to feel comfortable continuing to engage with our services by sending out transparent notifications, subsidising withdrawals, and even doing a lucky withdrawal contest. We reward withdrawals with an entry to win an SPF hardware wallet. We are continuing to play the long game and do what’s right to protect our traders.
TB: How does offering derivative trading differentiate Deepcoin from other crypto exchanges?
EH: Over the past three years, Deepcoin developers have worked hard to differentiate the app as a trading platform for day traders, which means there has been significant development into K-line charting capabilities.
Right now, our K-Line Quick Trading function is the most powerful visual transaction function in the market. Users can place and edit trades directly on the K-line at a precise price point. High leverage options, efficient charts, and robust tools, like Reverse Order, allow users to get the most out of their trading experience.
TB: Could you expand a bit on Deepcoin’s recent ‘proof of withdrawal’ announcement?
EH: Like any other responsible exchange in the industry, we quickly adopted new industry standards to ensure traders and investors of our continued strength and expansion during this bear market.
While FTX and other exchanges closed withdrawals, we decided to make it even more clear how we would not pause withdrawals at any time by gamifying the experience.
Beyond subsidising the withdrawals by paying for chain transfer fees (TRC20 only), we are also giving away DTB (Deepcoin Trial Bonus) for withdrawals and Safepal hard wallets to winners in our withdrawal contest. We wanted to reward users for taking smart steps to keep themselves safe with their assets as we feel it is our duty to help users through this challenging time of uncertainty.
TB: What is Deepcoin’s philosophy on risk and transparency?
EH: The most important and basic tenant in finance is defining & managing risk controls. For Deepcoin, first of all, our philosophy is to only be a trading tool, and the platform does not participate in any investment, not even bank current interest.
In addition, we have a complete risk control system. Almost half of the development of the platform is invested in the field of risk control. There are a lot of risks in the security of the underlying wallet, the system stability at the operation and maintenance level, the risk control of the transaction mechanism, and the market operation level.
In regards to transparency, we also announced our dedication to Proof of Reserve with the development of our Merkle tree and MPC mechanism which we will be releasing in a few weeks.
TB: How is Deepcoin working to improve accessibility to cryptocurrency?
EH: We mainly focus on contract trading currently, which can be relatively complicated for most retail users. We have made a lot of improvements to the interactive experience and will continue to focus on this in the coming year.
We will roll out more leadership guides and direct education inside the app for users to more easily understand the different functions and options for trading. We also look to give out as much DTB as possible for new users to experience trading risk free, and take home the profits should they win.
As a CeFi exchange, it’s important to continuously lower the barriers to entry for users with simple tools and education in a complex industry.
TB: What does 2023 look like for cryptocurrency?
EH: Global recognition and adoption of cryptocurrencies have been on the rise over the past few years and will continue to grow in 2023.
Recent events from big industry players have caused regulators globally to quickly assess and demand some changes to the industry, but it has not stifled its growth. Tokenisation is continuing at a rapid pace in TradFi, with banks and other regulated players looking to take a larger role in the development of the new world of finance utilising blockchain technology.
Regulatory pressures, coupled with the bull market and a possible global recession on the horizon, will cause crypto to evolve away from hype and more into utility, which is the ultimate goal.
On another hand, CBDCs currently in pilot programs will be launched, which will allow the government more control over your assets. I think crypto CeFi and DeFi platforms will have to work together to ensure a financial future that protects privacy and doesn’t allow the few to take advantage of the many.
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