3 Days With the CEO of a Crypto Exchange | Cointelegraph Documentary

There's something I wanted to show you. Really interesting.

I feel success.

She's a mother of cryptography.

Do you know who Satoshi is?

Me. Everybody's gonna go to the pub, face the ship on Thursday.

Is this your yacht over here?

Oh, yes.

Here we are in London, England. We're right near the Tower Bridge and right on the Thames and we're here to meet the CEO of a crypto exchange. Maybe it's his yacht over. Or maybe not. We're going to go ask him. One thing that I really love about this city is the kind of architecture. Some of it's very, very old and some of it's very, very new. But there's not a lot of contrast between them. It really flows seamlessly together. I love this city. Okay, here we go.

Do you feel crypto success?

I feel success. Hey, George. How are you? Wow, what an awesome place.

Oh, we have a. We have a beautiful weather today as well in London. I can see.

So what, this is kind of your typical morning here. You come out here for your coffee.

And when I stay here, in between the travel, when it's easy to commute and we have lots of people coming over from different places, we figured we'll save a lot of money by having.

An apartment versus got a great view of the London Bridge over here.

Yeah, it's really beautiful here.

So is this your yacht over here? We were wondering.

I wish. Yeah, yeah, I'm saving on it.

Touch up my coffee.

Refresh.

Yeah, warm it up.

There's no rum there or whiskey, just.

That's okay.

It's a little early for that, but I was here last year actually and I noticed, you know, Brits like to drink pretty early. Actually like 4pm, 5pm if the sun is down.

It's like it's a big myth that Russians drink a lot. I mean, when I saw the. How much Brits drink. I think a pint for lunch is absolutely normal.

Really?

Wow. It's, you know, liquid diet type of thing, so. And today's Thursday is a big. Is a big night out. Everybody's. Everybody's gonna go to the.

Do they work on Friday?

Oh, yes.

Really?

Well, if you can call it work, yes.

I see. So where are we headed?

Going to the office.

Okay.

It's a short 15 minute walk through St. Catherine Dogs. We had a meetup in our office and that happened to be the warmest day of the summer.

Really.

It was like 34 degrees. That was in July. And that day at around 2 o', clock, our air conditioning went off. It Died on us. In the office. In the office. When we had the meetup in the evening, our friends from Craft Beer Coin, they brought in a keg of ice cold beer and it saved the night, actually.

Yeah.

Oh, wow.

Who are these guys? Is there a parade or something?

Yeah, it looks like a parade.

Yeah.

I'm not sure if there's anything going on in particular today, but that's the St. Catherine's docks.

It's out here.

Yeah. Well, there's been a lot of wharfs and you can see the cranes are still operational hanging out there, although it's probably been taken up by WeWork or some other fintech company or something like that.

So.

See, the. The names of the boats here are very much in the. Very much English names. Moneypenny, Ship faced. Well, it's Thursday today.

Right, right, right.

So our office is just right outside of the wall.

This was like the. The old city center.

Yeah, Correct. Yeah. You know, that's where Jack the Ripper has been operating and. And all these seedy parts of the. Gotcha.

The underground. Yeah.

Yeah. Welcome to.

This is my ringtone or like my alarm really.

It's time to wake up, Max.

Oh, it is mine.

Okay. So welcome to Bequant.

Be Quant Group.

Oh, look who's here. One of our contractor employees as well.

And I'm a huge dog guy. My dog at home. I've been missing him. Him or her?

Pippen. Pippen, come here. Oh, We see. We were very pet friendly and we have a ping pong table. So that, that allows for people to kind of, you know, work and relax and do their best. And. Yeah, this is a little symbol of the. Of the industry, I guess. The, the dog years, I always say.

It's.

The industry is moving so fast and it's. It's more like, you know, we're living one year like a dog year. Things you do in the span of one year, same as in traditional world for seven years.

Yeah, yeah. Just seven times as fast.

Much more dynamic, for sure. Yeah.

Right. I wonder, how does the traditional financial markets, you know, here in London, all the old guard, if you will, how do they see disruptive crypto businesses?

Yeah, that's a great question. And just to go back to your point about crypto world in terms of the language, for me, it's an additional asset class to learn. Crypto versus equities, bonds, FX, etc. So there are a lot of similarities, but there's a lot of unique terminology in crypto world because it's very, very high tech and There are a lot of nuances you have to learn. So that's what I'm spending time learning after my first month of being here. To answer your question, people don't wear suits in this business. It's much more casual, there's more flexibility in terms of working hours and how people work. It's much smarter now. And the crypto business isn't so heavily regulated yet that it has so many barriers to doing business. I think people are very pro business in this new world. They want to get things done, they want to get things on board and fast.

We do a daily publishing of the quotes and our crypto and coffee publication is printed here. Just telling people what's happening today in the, in the crypto world there's always something happening and a lot of things we do is about bridging the gap. So it's the gap with the traditional finance, with old money and we're bringing in obviously new technology and the.

New.

Way of doing business.

Quite different obviously because it's crypto. I mean, I've only been in crypto for 11 months, effectively prior to that, a number of years at different institutions, exchanges and sort of big banks. So it's a different atmosphere, it's more relaxed, but also a bit more high pressured because you've got quite a lot of stuff going on. Obviously we're trying to do things quicker than probably the bigger companies would normally do. They tend to have a lot more processes, a lot more people, not in the way, but almost creating barriers sometimes. Whereas here we're a lot freer to do what we would like to do and try and do it quickly. But obviously that means you've got a lot more things to try and juggle. But it's good fun, it's nice, it's a good atmosphere here.

I guess. One question, I mean, why aren't these institutional players doing essentially what you're doing? I mean, are you nervous that they're going to swallow up this kind of industry and just keep it in house?

I come from the traditional prime broker and I've been building electronic trading desks for different banks. And right now it's basically, it's another market. It's another emerging market, in fact. So I'm very much in a familiar kind of situation. It's another startup, it's another emerging market, it's the same product and actually the clients are the same as well. So we talked to the same guys I talked to 10 years ago. In fact.

I am just now leaving the Bequant office, got a Behind the scenes, look at this exchange and what they're trying to do. And you know, what they've been saying is that they're trying to be this bridge between the traditional financial system and the crypto industry. You know, Vitalik, Buterin kids in hoodies, everything like that. So I can say it seems to kind of fit that mold. I didn't see anyone in a tie. I didn't see, you know, no one was really busy and always on the phone. It seemed relaxed and professional. So, you know, it was kind of a mix. They had ping pong and pool, but not beanbags and, you know, video games to play. So I think it's really interesting and I have to say my favorite part was the dog. I think having a dog in the office that cute is definitely going to help everyone have a better day. So, you know, that's what we were doing today and George invited us out tonight to check out some London pubs and we'll see. It's Thursday, which he said is kind of a heavy night here, so we're going to check it out and see what there is to do. So how's the rest of your day?

It's not over yet. It's not over yet. We have a, we have a call in in a few and.

Oh, really?

And then we can, we can go.

Back to the pub.

Okay.

All right.

That works. Get to the business.

So got kicked out of the pub. Yeah. Yeah.

I should have probably asked permission first.

But not the first time.

Sorry. We can film on the street and. Hey, we can drink on the street too.

Right?

Cheers.

Cheers. So, yeah, I mean, it's pretty noisy.

For what, a Thursday?

Is it common?

It's very common. Thursday is the big, big night out.

Yeah. More than the weekend?

Absolutely. Well, I mean, why waste the weekend for, you know, for hangovers when you can get, you know, face t. Face the ship on Thursday. Gotta finish this quick as I got a call in 30.

In 30.

Okay.

Legal and it's final preparations for a meeting in with the regulator.

Right, right.

You got it.

So, yeah, so I'm going to Malta. Let's go to Malta.

You're going to Malta? When's that?

Tomorrow?

Yeah, tomorrow. You just want to go to Malta tomorrow?

Yeah, sure.

Can we go to Malta?

It's a quick, quick bus ride. Yeah, let's. Well, let's.

Okay, let's try. Let's try to do it. So let's drink up and. Yeah, and then let's get some tickets, I guess.

Welcome to sunny Malta.

Yeah, quite a bit better than the weather in London.

I'd say definitely some something.

So how, how often are you here?

About once, once a month for about a week. We have to wrap up a lot of things on the regulatory side of things and the team here is getting bigger and bigger. So this is our office.

Great.

So let's go check it out. London is very expensive, you know that, Right. So Malta has the, has all the perks. Right. The sunshine, Italian food, the sea. So we're going to meet the regulator in a couple of hours presenting the business plan for the two of our businesses, the exchange and the prime broker. So we are very excited about today because the process finally is getting kicked off.

So your presentation bridging the gap between traditional finance, emerging digital asset class. Yeah. You're just going to be introducing your business model to the regulators today or.

Exactly, yeah. Part of the process is presenting the functionalities and the operational, the management team to the regulators. Explain what we're looking to do, how we're looking to do that and get the process rolling.

Yeah. Are they kind of concerned in the main vision or they just kind of want to see the structures?

I think one of the main first steps for the regulator is to filter out the professional out of non professional and trying to understand the general direction of where the business that we are looking to bring to the island is gonna go.

So this is kind of like a handshake test, you know, just to see if you're.

A very solid handshake test.

Right, I got you. So we're on our way to the meeting with the regulator. We're with the team. There's another taxi with some of the rest of the. And yeah, we're gonna go wish them luck and see what happens. Does it kind of feel like a first date, you know, like with the regulators?

I guess. I'm an experienced dater. I don't get the crumbs in the stomach anymore with going on a date. Yeah, exactly.

Yeah.

I don't get as nauseous, you know, or anything like that.

So only the regulators can put butterflies in your stomach?

Exactly, exactly. Yeah, we're well prepared. We've been working for it for a year. We've been preparing for this. So it's just now we have to go with the flow and show who we are and ask questions and get the ball rolling. I'm excited about it.

Could you even go through this in London? I mean, is there.

Not at the moment, no, not at the moment. But a lot of regulators are now looking into it. Maltese have gone probably A step ahead.

With these, you know, other regulators, like in the UK or in the eu. Do you think they're going to look at Malta as a path?

Absolutely. Well, you have to piggyback off something. Right. And these first steps, the practical steps of the Maltese regulators taking, is definitely going to be put into the textbook of crypto regulation to teach the kids.

And your name right here as the footnote, you know, the financial history textbooks of the future.

Exactly, yeah.

Are going to be written about moments like this.

Yeah, absolutely.

So I guess this is where we'll leave you. Yeah. So good luck. Thank you. We'll talk after. We'll get a play by play after.

So.

Awesome.

All right, good luck. Yeah, it was kind of an interesting road to get here. The sidewalk was kind of disappeared for a little bit, but we figured that's kind of the, you know, the way to success. Sometimes it's a little bumpy at first, but that's how billion dollar companies are made. So while George and his team are meeting with regulators, we have some time just to kind of walk around. But I can tell you a little bit about the regulatory system here in Malta. So in November 2018, the Maltese government signed into law the Virtual Financial Assets act, or vfa. Pretty much it was the first of its kind legislation and it's an attempt to try to regulate a system that for most of its history has been kind of unregulated and not really monitored. But what's happening right now, it's all brand new and companies like George's, they're a part of the process, they're working with regulators, trying to figure out the best framework and those things are going to be set as precedent for future companies. So it's actually pretty exciting to see.

What'S going to happen.

So we were able to get a little bit of a behind the scenes look into this process. Now this isn't the meeting with the regulators, but this is a post meeting meeting with their legal advisors and they're kind of discussing some of the issues that were brought up in the first meeting, some more details about the specific parts concerning like insurance or which assets.

They'Re going to offer.

You know, everyone seems to be in a pretty good mood, so I'm thinking that the first meeting went pretty well.

When do you think is the right time for regulation to step in?

Time is absolutely now and we've seen that with the recent announcement from the German regulators allowing German banks to hold digital assets on the books and generally regulating the space, we've seen UK coming up with the sort of a preliminary, preliminary regulation regime where the following AMLD5, the participants have to register with the FCA. So we see the first steps of getting things regulated now. And that's gonna extend to other European. Major European economies as well. So come on in here. This is another office where we get to use once in a while for our friends. This is something I wanted to show you. Really interesting. Cool. It's the original Second World War Enigma machine, which is, as we know, is one of the. Is a mother of cryptography.

Oh.

It's what brought us here, basically. The cryptocurrencies and the regulation. And I was so excited when I. When I saw this piece. Yeah, so it's one of. One of the original pieces. You see, everything is in German here. And, yeah, the guys told me that the codes from the machine cost about the same as the machine. Really?

The codes themselves.

You can actually buy the codes. Wow. So, yeah, that's a really cool piece.

And so can you take. What was it actually used for during the war then?

Yes, it was an encryption device for Germans to communicate between each other. And everybody watched the Turing movie about Alan Turing.

Cumberbatch.

Yeah, yeah. And decoding and breaking the code of the Enigma machines that changed the Second World War quite a bit. So, yeah, it's an interesting thing. Again, we're 100 years later in Malta with the Enigma machine, the mother of cryptography. Talking about regulation in a digital asset space. In the cryptocurrencies, I always picture this kind of evolution of the crypto finance. You know, you have those homo sapiens, the monkey, and then it grows into a sort of a more human being. So it's like, you know, the monkey, a guy in a hoodie. And then you basically envision an investment banker. I think that's where the evolution is moving towards the sort of more professionalism and more professional talent coming into the space.

So, I mean, what is it for you, then? What's the. You know, what's the reason that you're doing all this?

Making money for the sake of making money is not really my thing. So I enjoy what I'm doing. I like building businesses, and I love to see it grow, mature, becomes, and bring value to the clients and investors and become a sort of a mature business. So for us, or for myself, the goal is to make my baby a mature adult and go into a life of big finance and be successful.

Crypto parenting.

Yeah, exactly.

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