Original Article Title: Tokened EP.5: Conversation with Arthur Hayes
Original Source: Tokened Podcast

Guest: Arthur Hayes, Co-Founder of BitMEX

Compilation, Editing: LenaXin, ChainCatcher

ChainCatcher Editor's Summary

This article is compiled from the Tokened Podcast's in-depth conversation with cryptocurrency billionaire and BitMEX Co-Founder Arthur Hayes. Hayes shares his unique perspectives on wealth, risk, and the freedom brought by travel. From navigating market volatility to exploring the world, Hayes shares the key insights from his journey. These experiences are applicable not only to the cryptocurrency field but also resonate with life philosophy.

ChainCatcher conducted the compilation and editing.

(1) Hayes' Entry Point: Transition from Traditional Finance to the Crypto World

Tokened: What initially led you to enter the Bitcoin space, and how did you get involved?

Arthur Hayes: I was previously involved in ETF market making at Deutsche Bank and Citigroup in Hong Kong. After being laid off by Citigroup in 2013, I decided to depart from the traditional financial industry.

During my period of unemployment, I came across articles about Bitcoin on Zero Hedge and started researching Bitcoin, which coincided with my interest in gold investing, as Satoshi Nakamoto's whitepaper deeply resonated with me.

By the summer of 2013, I fully embraced the concept of Bitcoin. As a trader, I delved into understanding how the cryptocurrency market operates, how to long and short, and engage in derivative contract trading. Through arbitrage trading between Icybit and Mt.Gox, I gained practical experience.

This experience led me to decide to create a derivative exchange. From late 2013 to 2014, I co-founded the exchange with partners Ben Delo and Sam Reid. Twelve years on, I am still deeply involved in this field.

(2) Hayes' View on Current Trends in the Cryptocurrency Field

Tokened: How do you view the current trends in the cryptocurrency field? Is there an issue of overhype? Is cryptocurrency seen as a means of payment, underlying chain development, or asset tokenization? In which areas do you see bubble risks?

Arthur Hayes: I believe the core trend is the continuous depreciation of fiat currencies. Taking Japan as an example, its debt-to-GDP ratio has reached a historic high, making it a typical representative of large-scale money printing. Inflation concerns are becoming increasingly prominent, with the public struggling to afford housing and food, and wage growth lagging far behind the speed of monetary expansion. This constitutes the most fundamental economic trend.

Against this backdrop, Bitcoin has always had intrinsic value. Unless it can be proven that countries will stop monetary expansion, holding Bitcoin remains a rational choice. Despite price fluctuations, over the 15 years since the genesis block in 2009, Bitcoin has consistently maintained the best asset performance record in human history. Its fundamental driving force lies in the continuous depreciation of currencies globally.

Tokened: But I think if you look at any mainstream media now, you'll find it overly focused on trading rather than the real world.

Arthur Hayes: There has always been a demand for trading. People are well aware that the dollars, yen, and euros they hold are continuously depreciating but still need to sustain their livelihoods and family responsibilities. This is precisely why Bitcoin has always had intrinsic value.

(III) Hayes's Travel Philosophy: Explore the World, Enhance Communication

Tokened: You mentioned many billionaires now reside in Singapore, but can it truly be called home?

Arthur Hayes: I am passionate about skiing and spend much of the year in Hokkaido and Japanese ski resorts. I also love surfing, kite surfing, and other outdoor activities, always pursuing a lifestyle of coexistence with nature.

Tokened: Does traveling change your perspective on freedom, power, and money?

Arthur Hayes: 24-hour global connectivity has become a significant privilege of modern life. Travel restrictions during the pandemic have shown us that some are content to stay put while others crave mobility, depending on geographical circumstances and personal preferences.

The global trend is clear: travel demand continues to rise, and both airline miles and fuel consumption increase year by year. Humans have always yearned to explore the world and enhance communication, which is the eternal value of travel.

Tokened: What is your current daily life like? Could you describe a typical daily routine?

Arthur Hayes: During the ski season, I usually go to bed around 7-8 PM and wake up at 4 AM. I start with some stretching exercises, prepare food for the whole day in advance since I walk eight hours on the slopes every day.

（IV）Industry Transformation: From Talent Shortage to Attention War

Tokened: Do you think it was easier to start a business back then or is it more challenging now?

Arthur Hayes: Challenges have always existed but in different forms. The core challenge BitMEX faced was talent recruitment. At that time, many qualified talents were unwilling to enter the field, forcing us to hire some individuals at high salaries who they may not consider today.

Now the situation has completely changed, and cryptocurrency has become a standard career path. For instance, with Maelstrom, we can attract excellent university graduates who are not only well-trained but also enter the crypto ecosystem with the right mindset and career plan. The evolution of this talent environment is a manifestation of the industry's maturity.

Tokened: Have you noticed changes in the funding needs of startups?

Arthur Hayes: I believe the core challenge of Web 3 startups has always been gaining user attention. Although development costs have indeed decreased, the cost of breaking through the attention barrier continues to rise. Whether through advertising or paying KOL alliance fees, acquiring traffic requires a significant amount of capital investment.

Tokened: Do you also provide strategic advice to the companies you invest in?

Arthur Hayes: Yes, we serve as their corporate consultants.

Tokened: If you could give advice to your early-stage self, what do you think would be the most significant adjustment needed?

Arthur Hayes: Hire Better Talent.

(5) The Digital Nomad's Dilemma: Off the Grid, Einstein, and the Antarctic Dream

Tokened: A full year completely off the internet, or a full year without travel. Which would you choose?

Arthur Hayes: A full year completely off the internet.

Tokened: If you could choose a historical figure as a travel companion, who would you choose?

Arthur Hayes: Einstein.

Tokened: Not Satoshi Nakamoto?

Arthur Hayes: Satoshi Nakamoto should remain a mystery. Not meeting, not revealing identity, is the best way to protect this legend.

Tokened: You travel frequently, is there a destination you have not yet visited but have always wanted to?

Arthur Hayes: Antarctica.

Tokened: Do you bring books or watch movies when you travel? Is there a particular work that has inspired you?

Arthur Hayes: My favorite sci-fi series is "The Three-Body Problem."

(6) Advice from Hayes to Entrepreneurs

Tokened: If you were to offer a piece of advice to any entrepreneur, what would be your main advice?

Arthur Hayes: Building a product truly worth paying for is key. Many entrepreneurs today focus on creating products that attract venture capital rather than addressing market needs. While they may secure funding and eventually be acquired or go public, the founding team might end up losing ownership, essentially just stacking unnecessary features on a free service that nobody truly needs.

In the Web 2 world, an enterprise often needs a long-term accumulation to reach a $50 million valuation, while in the Web 3 world, a company may achieve the same valuation within just a few hours after token issuance, reflecting a fundamental difference in valuation logic between the two business models.

Tokened: Do you primarily invest in Web 3 or in a combination of Web 2 and Web 3?

Arthur Hayes: Maelstrom focuses on token investments rather than equity. We are familiar with the high liquidity nature of the crypto market, often able to achieve a return on investment within two years.

In contrast, equity investments have a much longer cycle of 7-10 years, which does not align with our liquidity needs. This is not to deny the value of equity but rather a strategic choice based on capital efficiency.

I like this flexibility. Cryptocurrency is a field I am familiar with, and we are familiar with successful tokenomics models, so we insist on focusing on our own track. We only do what is within our capabilities and do not blindly diversify.

(7) Decentralized Media: A Key Breakthrough?

Tokened: In the BlackFree project, what type of key project do you think is currently most lacking?

Arthur Hayes: I look forward to achieving decentralized social media. Current mainstream platforms like X, Instagram, and TikTok monopolize the value of community interaction, and breaking this centralized barrier is a key breakthrough.

Tokened: Are you referring to data and content?

Arthur Hayes: Your data and content could be blocked by authorities at any time. Whether it's Elon Musk or at a national level. This centralized control goes against the core idea of the cryptocurrency movement. We pursue data ownership and economic autonomy, aiming to eliminate the intermediation monopoly of governments and large financial institutions through disruptive technology. The current architecture clearly conflicts with this vision.

Tokened: Why would you put your data on the blockchain?

Arthur Hayes: Founders should focus on underserved niche markets. Instead of chasing after mainstream users, they should aim to build a bespoke social credit system for a specific community. By starting from the grassroots level, gradually establishing a low-cost network effect, and ultimately achieving ecosystem expansion. This is the effective path to break the monopoly of social media.

Tokened: Are you still active in the NFT space?

Arthur Hayes: I don't like cyber punks.

Tokened: Are we missing a key project? Perhaps one that is directly driven and developed by yourself, specifically catering to your follower base?

Arthur Hayes: While I may not possess the business or technical capabilities to lead the social media revolution, I am convinced that a group of dedicated entrepreneurs needs to tackle this challenge, which has yet to be truly overcome. The key is to drive social media decentralization and gain the support of the entire crypto community.

As for Musk? He is clearly not interested in this. His goal is to strengthen the centralization of Platform X, utilize data to train AI, and integrate it into the robotics system. This has its own logic but is completely contrary to the concept of decentralization.

(8) Where is the Future of Crypto Heading, and What is the Outlook?

Tokened: How do you view the development prospects of cryptocurrency in the next 5-10 years? What are your expectations for its evolution?

Arthur Hayes: I expect the price to rise significantly, but more importantly, the user base. I hope to achieve a true application ecosystem with 2 billion active wallets. This means the current user base needs to grow a hundredfold.

Tokened: How can you clearly explain the value of joining Web 3 to potential users?

Arthur Hayes: I suggest that beginners start with a small allocation of Bitcoin, read the Satoshi Nakamoto whitepaper, and share it with friends. This process will naturally form a binary perception, either recognizing its revolutionary value or considering it a scam. Based on this foundation, further explore the crypto space according to personal needs.

Original Article Link

Welcome to join the official BlockBeats community:

Telegram Subscription Group: https://t.me/theblockbeats

Telegram Discussion Group: https://t.me/BlockBeats_App

Official Twitter Account: https://twitter.com/BlockBeatsAsia