In March of this year, Pionex, a participant in the encryption industry, established a subsidiary in Hong Kong and applied for a license, becoming one of the first to do so. Pionex has positioned its business as serving customers with a philosophy of rational investment, whether it be in the industry's first grid trading or in the world of Tian Di Dan. The company places great emphasis on restraining speculative attitudes. Pursuing market share is not Pionex's top priority, but rather using rationality to face the irrationality of the market as much as possible.

BlockBeats exclusively interviewed Guojing Tang, the Pionex US CEO, at the TOKEN2049 conference. He is responsible for overseeing Pionex's North American business and leading Pionex's derivatives business. Previously, he served as CEO of Huatai Great Wall Capital and worked in commodity derivatives trading at Lehman Brothers and Morgan Stanley. BlockBeats discussed with him the development process and trading strategies of Pionex, as well as exchanged views on the current market and future development prospects. Through dialogue, they hope to show the market the efforts of the trading platform to bring rational value to customers and the market through innovation and investor education.

Pionex US CEO Guojing Tang

Translation:

Pionex US CEO Guojing Tang

Quantitative tools have a threshold, but user retention rate is high

BlockBeats: The first time I heard about Paiwang was through grid trading. Recently, I saw Paiwang's coin-to-coin trading section and found that Paiwang has been focusing on this type of product. Compared to other trading platforms, Paiwang seems to have a more laid-back approach in recent years.

Guojing: In the past few years, we have been less proactive in our external communication. As a commercial company, user stock is naturally our core business metric of concern. Our early strategic focus was on achieving good user retention and long-term steady growth through trading tools. This way, on the one hand, we can show customers that there is an opportunity to achieve long-term stable profitability in this market; on the other hand, by helping customers reduce irrational factors in pure speculative trading as much as possible, we can avoid being cut as leeks. Both of these points help to improve the overall customer retention rate of the network and can also play a positive role in promoting the development of the entire industry.

BlockBeats: Why did PaiNet start with a focus on user education instead of pursuing market share first like some trading platforms do?

Guojing: This is mainly determined by our market positioning. The income of grid trading tools is stable, but the operation threshold is relatively high, so we need to do user education. Users not only need good products, but also need trading skills to use these tools.

Many platforms are learning and catching up with trading robots, but in terms of user volume and trading activity, Paiwang is a leader in the industry. Of course, Paiwang is also constantly expanding in other product areas.

BlockBeats: Why are we still doing user education?

Guojing: User education is not a tactical operation in a certain stage, but a core part of strategic layout. Enabling users to achieve long-term stable value through rational trading concepts and good trading tools is not only our starting point for entrepreneurship, but also the fundamental basis for our foothold in this industry. The fact that PaiNet users stick with us and grow together with us, using rationality to face the market's irrationality, is a recognition of our philosophy. We are encouraged by the many voices of recognition we have heard.

BlockBeats: Does Paiwangluo have its own user profile?

Guojing: As far as we can see internally, the majority of platform users are highly educated individuals between the ages of 25 and 40, with a professional background in engineering. There is a certain threshold for using quantitative tool products, but the user retention rate is indeed good. The 3-month user retention rate is 70%, and the average account transaction duration is 400 days, which is far ahead of the industry.

BlockBeats: What is the average user retention time for exchanges?

Guojing: About three months.

BlockBeats: Just like how internet entrepreneurs used to face the question, "Your product is great, but what if Tencent made it?" Do you think Binance entering the grid trading market would be a form of dimensional reduction?

Guojing: Binance's trading volume is indeed very large. However, we have been focusing on quantitative tools and investor education for many years, and our business depth, professionalism, and customer loyalty have reached a considerable level, so our competitive advantage in this area is very obvious.

FTX is not the builder of the market

BlockBeats: As a peer, do you think SBF is a Builder? In fact, FTX has many innovative products.

Guojing: FTX has indeed brought new things to the cryptocurrency industry, but these technologies and models are already quite mature in traditional finance. However, their collapse has caused a great impact on market confidence. In addition to misappropriating customer assets, one of the root causes of SBF's failure is the Luna incident, which reminds us to respect common sense instead of simply relying on technology. It is impossible in traditional finance for a US dollar-pegged coin with a market value of hundreds of billions of dollars to be supported by only a few billion dollars in assets. Common sense rules are constantly being violated, and there is a lack of deep understanding of the mechanisms behind new things. If we rely on technology in such a simple and superstitious way, it will inevitably end in tragedy.

BlockBeats: Do you think the current trading platform market is a red ocean?

Guojing: Definitely not a blue ocean, but not yet at the level of intense competition in the red ocean. The abilities of the members of the P2P network team, our high investment in quantification, and user feedback make me very optimistic about the future of the trading track.

BlockBeats: Regulatory supervision of trading platforms is an inevitable issue that must be faced in the future. How does PaiNet view regulatory issues?

Guojing: Paiwang has always recognized the value of reasonable regulation and actively cooperates with regulatory agencies in various regions to conduct compliant business. It took us more than two years to obtain most of the relevant licenses at the state and federal levels in the United States, and we only lack licenses from New York State and a few other small states to complete the collection.

Walking the compliance path is indeed costly. It not only requires considerable capital investment, but also requires a professional financial team, compliance team, and technical team, all of which are highly valued by regulatory agencies. The time cost and even opportunity cost during the process are also significant. However, we are very clear about the future of the cryptocurrency market, which lies in gradually strengthening the transparency and standardization of the market. By utilizing technological revolution, we can provide investors with new opportunities for value-added while also protecting their interests from the infringement of bad actors. If we can ultimately achieve these goals with regulatory agencies, the investment in compliance by PaiNet is definitely worthwhile.

BlockBeats: What kind of education do you think the users in the current trading market still need in order for the entire market to become more mature?

Guojing: We hope to continuously provide opportunities for rational investment in the market through tool innovation and trading mode innovation. Helping clients improve their ability to receive and digest market information will be the focus of our next stage of work. As compliance business develops further, the strategy of Paiwang will definitely become more transparent and standardized.

Brave Fund of Pai Network Continues Pai Network's Investment in User Education

BlockBeats: During Token 2049, Paiwangluo announced a $10 million investment to establish the Paiwangluo Brave Fund. What is the original intention?

Guojing: The Brave Fund of Pai Network continues to invest in user education, practicing the principle of equality in the field of Pai Network investment, with the ultimate goal of eliminating inequality among investors in the market. We hope that more people will be able to access and utilize Web3 through the Brave Fund of Pai Network.

BlockBeats: What does the Brave Fund of Paiwanglou mainly do?

Guojing: Mainly focuses on promoting Web3 projects with unique innovation and leading technology, and some funds will also be invested in blockchain education for minority groups worldwide.

BlockBeats: As a player in the trading platform, do you feel that participants in the crypto market are the most fantasized group of people who want to get rich overnight in all financial markets? User education is still difficult.

Guojing: The background of cryptocurrency investors is diverse. There are those who have a strong belief in the future of the digital currency market, those who have a strong passion for technology, and of course, those who want to get rich overnight. But where can't you find such people?

Many times, retail speculation is the result of passivity and helplessness. In traditional financial markets, fund managers and investment advisors provide financial services with a relatively high investment threshold. Therefore, professional financial resources are concentrated towards institutions and high net worth investors, while retail investors often have to rely on themselves to make trading decisions. This is what we see as the appearance of retail speculation. On the contrary, the digital currency market provides retail investors with financial tools that are difficult to reach in traditional finance due to technological innovation. Taking PaiNet as an example, the products of trading robots and dual-currency wealth management are stable in returns and do not have too high an investment threshold, allowing even small amounts to be invested. This can also be considered as our efforts in financial democratization.

BlockBeats: From what I've heard, you highly approve of Bitcoin as an asset compared to traditional finance.

Guojing: We believe in the long-term value of Bitcoin. The fundamental factors determine that Bitcoin's digital gold properties are very certain, which is the premise of Paiwang's long-term and firm investment in this industry.

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