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Jun Ming Yong: DeFi Winners & Losers, Asset-Backed Stablecoins & Regulator Dynamics

· Podcast Episodes,Fintech,DeFi,Crypto

For enterprises, let's say you're a new startup and you raise like five million or something, the idea isthat you will not necessarily deploy your entire fundraise at the beginning on day one. You'll alwayshave your treasury. What you'll typically do with your treasury perhaps is to put it in a bank to generate some yield or you buy bonds or something to have a higher return on the treasury that is not deployed. This can be typically between what 1% to 5%, because you want to get something that is safe. So if you're a startup, the alternative strategy is that you can convert the fiat that you have into, for mexample, USDC, and you put this into a learning protocol on Binance or Polygon, and you earn 10% yield.That way you sort of stretch your runway further. That is one of the major innovations or things that astartup could do and why crypto could be very helpful for them. -Jun Yong

Jun Yong is the Protocol Lead at HaloDAO- Enabling the next phase of crypto expansion via asset backed stablecoins issued by regulated emoney issuers by providing decentralised infrastructure that other innovators can build on to optimise crypto trading, fx and payments.

This episode is produced by Kyle Ong.

Jeremy Au (00:00): 

Hey, Jun. Good to have you on the show. 

Jun Yong (00:02):Hi. Very nice to have me here. I'm really thankful. 

Jeremy Au (00:05): 

Yeah. I'm really excited because you're going to be sharing about not just your personal journey as a founder, but also someone who's spearheading DeFi, decentralized finance in Southeast Asia, so really excited to share a little bit about that journey. 

Jun Yong (00:22):Yeah. I think today, what I hope to do is to share with people what is DeFi, how you can learn about it and why is it relevant to the modern ecosystem in startups. 

Jeremy Au (00:32): 

Yeah. So Jun, obviously, you start out in university and what I can tell is that for a long time, even undergrad at King's College, London, you already started being passionate about blockchain. So how did you get started? 

Jun Yong (00:46): 

Yeah, I think like everyone who try to get into an industry, the first part was before I got into the industry, actually, I didn't know what I wanted to do in my life. I was a very typical university student. And how I discovered the industry was actually going through as many different industry conferences as I could. 

Jun Yong (01:04): 

When I got into crypto or blockchain was I actually attended this conference, and there was a very peculiar sight, whereby I saw people who are like what we would call hippies. They were dressed in a weird way, and you see them hanging out with people in suits. So you have this very eclectic mix of people discussing about innovation. And I wanted to be part of that. 

Jun Yong (01:26): 

To get involved, what I did was to bring a community around in London through my school called King's College London Blockchain Society. And through that, by interacting the community, I landed my first job at ConsenSys, which is an Ethereum venture studio. Our founder, Joseph Lubin, he was the co- founder of Ethereum. And what ConsenSys did was to really build out a lot of the common tools that we see in the blockchain Ethereum space, such as Truffle and MetaMask, Infura, very key infrastructure projects that developers love and use. 

Jun Yong (01:59): 

Where I continued in ConsenSys was doing enterprise sales and supporting my principal, to really talk to corporates and what their needs are and how they interpret blockchain and crypto. But I left in last year in April to start my own business because I felt that the ethos of crypto was really about public decentralization, and enterprise interactions at the beginning were not the most helpful. You really need to think about how you bring the community together to innovate. 

Jun Yong (02:33): 

So I left and I started a company called Big Mochi. To me, this company was more like a user testing phase, where I was trying to understand the needs of how people move money, in particular migrant workers because actually they are a huge market that have very low access to financial services. They typically pay very much higher rates for remittance compared to me and you who can use digital payments gateways. So I was trying to understand their pain points. 

Jun Yong (03:03): 

I developed this entire e-commerce site just to understand how to interact with wallets, actually, how to interact e-wallets, where are their pain points, where's the onboarding, how do we scale their interaction and adoption and what they need. From there, my team actually pivoted and we launched our protocol called HaloDAO. HaloDAO is a decentralized infrastructure where we are building something called an automated market maker and lending market optimized for stablecoins. 

Jun Yong (03:33): 

It is quite a mouthful, so we are elaborate a little bit on that. An automated market maker is basically, you have two assets, for example, Singapore dollar gains ETH or something like that. And people want to trade between both sides. So going from Singapore dollar to Ether or Ether to Singapore dollar. What this technology does is that it matches their order so they can convert between different assets in a nutshell. A lending market is similar to how a bank works in concept. So it takes in liquidity like deposit, so to say, and lends it out to people. 

Jun Yong (04:08): 

All this is done in an algorithmic way. There's very little or almost none, I would say we have none or no human intervention in assembling these value chains or interactions. That is what makes the technology super exciting as an infrastructure piece for others to build on. That's what we are doing now. And on 24th of June, we'll be launching our version zero where we support the XSGD by Xfers. We also support the THKD from Hong Kong and the finance IDR from Indonesia. That's where we are now. 

Jeremy Au (04:43): 

Wow. That's a great progress that you've made so far since we started hanging out. I think obviously the part that you shared was you also want to help explain at a zoomed out level what DeFi is. That's something that people are still getting their heads around because they start out saying, I understand bit Bitcoin because it's supposedly something that we're mining and we're assigning a store value. So it's a currency just like trading currencies or stock. 

Jeremy Au (05:12): 

I think that's how most people are, I'll say even the mass consumer, kind of understands that at a very high level. Bitcoin has a price and Bitcoin goes and goes down. They see the news and they want to get in and they want to get out. So I think that there's a basic now understanding of what Bitcoin is, which is unimaginable five years ago. Obviously there's blockchain, which people have been much more passionate about and then there's DeFi. So could you help me explain how we get from Bitcoin to blockchain and then to DeFi? 

Jun Yong (05:48): 

Sure. I think the common challenge in understanding the blockchain space is that people understand it from a very technical point of view, whereby the common explanations tend to focus on what is a consensus mechanism? Oh, you secure the network with a block and block. That is where people get lost. 

Jun Yong (06:06): 

How I typically explain blockchain is that blockchain is the internet of value. Right now, for example, we are on this podcast or when we interact with Google, we are on the internet of information. So it's collecting information and information is being transacted. What's happening on the blockchain side is that we are transacting value. So what that means is we are programming value to move between people and recording that interaction. That is a very high level what is blockchain. 

Jun Yong (06:38): 

What that means is many use cases that were explored before, for example, for IoT or supply chains, these have not been as successful because you're not really transacting something of value, so to say. And how you transact this value is you need somewhere to store it, so the token is sort of this vehicle to store value. So when you talk about supply chain and IoT, these tend to not be as helpful in the blockchain space because it is secured by a public network. This will probably be more helpful in the internet of information, which for example, Amazon is doing very fantastic when you track your packages and things like that. 

Jun Yong (07:13): 

That's why when we look at blockchain, the important thing is about looking at use cases that transact value. So we go onto the next phase is if you want to build something on blockchain, how do you do it? This is how we interpret Ethereum and Polygon or Binance Smart Chain. When you look at these, these things are more think of it as a operating system to build things on. Apple and Windows are operating systems. 

Jun Yong (07:37): 

So Ethereum, MATIC Polygon is also an operating system, and protocol teams like myself built on these operating systems so that we can move money or create financial services replications on the blockchain. We program money to do certain actions so that we can remove ourselves and let it be truly decentralized. This DeFi refers to decentralized finance is the movement we would say to replicate existing financial services on the blockchain to program money to do things. That is what it is. 

Jeremy Au (08:11):What's the problem that decentralized finance is solving, because isn't finance the way it's done today good enough? 

Jun Yong (08:19): 

Yeah, I think that's a very good question. I think that one of the big things about finance right now, or rather when we look at how technology is being structured, whether is it money or is it information, is that when you build a bank or you build a traditional financial FinTech startup, there is always this black box. You are like a silo. And what this means is the number of people you can reach, the number of people you can participate with is a lot slower. 

Jun Yong (08:46): 

For example, you think about I'm in the UK now, I'm currently traveling. In the UK, we have a bank called Monzo or Starling Bank are challenger banks or neobanks. For them to get deposits, they can only be constricted to the local market. And they can only use that liquidity in the local market to make markets or make products out of it. 

Jun Yong (09:05): 

But with DeFi, the expansion there is that it can bring liquidity into a space from a global investor pool. That means likewise, it can also support people in a global manner. This is one thing that's different. What this means is you can see teams like SushiSwap or Uniswap getting billions of asset under management, so to say, very quickly compared to a traditional FinTech startup. What might take a traditional FinTech startup maybe four years or maybe five years to reach, a DeFi protocol can reach that in maybe a couple of months, if it has a proven use case. That is one of the fascinating things. 

Jun Yong (09:42): 

I think the second thing is that because you are open, so many people can participate. You are lowering the barriers to entry for financial inclusion, so to say. That's not to say that DeFi as a movement is ready now to really push for that narrative, but it's moving in that direction. And we have other challenges to solve, but as a movement, I think there's a direction it's moving towards. I think that is one of the key things that DeFi is an advantage over traditional finance, so to say. 

Jun Yong (10:09): 

But I think the last thing is on cost. To maintain a FinTech team, let's say a bank, you usually have a lot of staff because you have to check and recheck or reconcile transactions in a manual way. But when you are able to program money, then this being managed by the code, so to say. You see teams that are building complex financial tools, like an automated market maker. I would refer to Uniswap because they're probably one of the most successful projects. You only have like 20 to 40 developers compared to a bank, which might have 10,000 staff, for example. 

Jun Yong (10:45): 

What this means is actually it's a tremendous cost saving that can be passed onto the consumer. I think that is how we can change the way we look at finance. I think that maybe I would clarify one of the myths is that the DeFi space will replace banks. I think that's not going to be the case. It will replace the traditional startups of FinTech unicorns that we have come to love and use. So I would say it's not meant to be a replacement, but I think there'll be a new interaction and we reach this new equilibrium that connects traditional finance and decentralized finance. 

Jeremy Au (11:21):

Wow. I really love that quick summary about how you're able to use DeFi to basically have global inflows and outflows, lower the barrier success and to decrease the cost of transactions, as well as building out the fundamental operations as well. There's a lot to it obviously. What would you say are some of the interesting applications that you've seen that DeFi is innovating on? 

Jun Yong (11:49): 

Sure. I think we had this sort of DeFi summer last year in 2020 like the emergence of compound protocol. What did compound do was it was one of the interesting lending protocols. Why it did this, it shows you, you can take in liquidity from a global investor base for crypto and you lend it out. That was a very singular use case, but from there, people realize that, oh, you can actually do something with the crypto. You can actually create applications that work that have usage. There is actually liquidity moving in and out in transactions. 

Jun Yong (12:25): 

From there, it looks like there is a sustainable model, so to say, because when the protocol earns fees and you can distribute back to people who support the protocol very much how a bank gives its depositors yield, for example, interest, then you start realizing that, okay, we can actually do more complex things. I think that sort of led to the boom in DeFi, whereby many teams are building different products to build on top of these, I would say, financial primitives. 

Jun Yong (12:55): 

This is another loaded word, so perhaps it's a bit helpful to explain. In DeFi, in the view of conceptualizing technology is that there's something called money Lego. Money Lego is about building and leveraging the work of other protocols to create new applications. The exciting part of this is when we think about Lego, I think using Lego is a good example. You and I might both have like five pieces of Lego, but how we build it might be different. So you could make a stick figure and I could make a Lego car. This ability to mix and match different pieces of financial applications to create new ones is how value and innovation moves. This is a very exciting point. 

Jun Yong (13:38): 

I think the second point is that the DeFi space is different from the traditional startup space in that it doesn't sleep. It is operational seven days a week because you cannot shut down the blockchain, so to say. It's not like the stock market whereby, oh, there's a public holiday. There's no such thing in the crypto space. Innovation moves very, very fast, and we see tremendous amounts of investor interest. This is really by that time. I would say that that is one of the things that is happening now. 

Jeremy Au (14:08):For money to flow in and out, why is that an innovation that everybody stood up? Because that feels like the fundamental premise of all finance. So why was it exciting from the eyes of an insider? 

Jun Yong (14:25): 

Sure. There's this example that one of my core investors use. His name is called Darius Sit from QCP Capital. Moving money is something that we all would like do to conduct commerce efficiently, but sometimes it's not as easy to do so. So an example would be, imagine this Indonesian furniture seller is trying to settle a transaction with someone in China. Indonesia and China both have capital controls, so it's not easy to go to a bank and say, I want to remit my rupiah to someone in China. It can take many days. 

Jun Yong (14:56): 

But what happens is that right now using crypto, I'm not saying using DeFi, let's just say using crypto, the Indonesian furniture seller can just deposit local rupiah to purchase USD Tether, which is an asset-backed stablecoin and send it straight to the person in China. And the person in China can redeem it for.

Jun Yong (15:16): 

In this unique situation, it sort of overcame the capital control issue because in a sense, in this example, fiat did not leave the country. It was still on shore. But yet the transaction was being able to settle because of the crypto network or blockchain network using USDT. This is one of the very exciting reasons why open money flows is very helpful in facilitating global commerce. And we're going to see more and more of that. 

Jeremy Au (15:45):Who benefits from more DeFi? 

Jun Yong (15:48): 

I think consumers and enterprises will definitely benefit the most. One of the things that a lending market does, for example, let me explain how you'll benefit both enterprises in one use case and how it will benefit consumers in another use case. This is not necessarily DeFi, but we can say how the blockchain sort of supports that. 

Jun Yong (16:07): 

For enterprises, let's say you're a new startup and you raise like five million or something, the idea is that you will not necessarily deploy your entire fundraise at the beginning on day one. You'll always have your treasury. What you'll typically do with your treasury perhaps is to put it in a bank to generate some yield or you buy bonds or something to have a higher return on the treasury that is not deployed. This can be typically between what 1% to 5%, because you want to get something that is safe. 

Jun Yong (16:36): 

So if you're a startup, the alternative strategy is that you can convert the fiat that you have into, for example, USDC, and you put this into a learning protocol on Binance or Polygon, and you earn 10% yield. That way you sort of stretch your runway further. That is one of the major innovations or things that a startup could do and why crypto could be very helpful for them. 

Jun Yong (17:00): 

The second point is for consumers. You will see why global inflow and outflow is helpful because there's this new phenomena in the space in gaming, blockchain gaming, an example that's very good would be Axie Infinity. Axie Infinity is a game where people use these Axies or little creatures to fight monsters and they earn tokens. When they redeem these tokens, they can convert it into their local fiat through complicated ways, but they can redeem it for fiat. 

Jun Yong (17:27): 

The outcome is actually you can play games to earn a living in a sustainable way. These people who have actually earned approximately $400 US per month. Put into context, this is the amount of money that this person, if they're from Philippines or Indonesia, this might be the amount of money they would make if they went to Singapore to work, for example, as a migrant worker. So to them, it's game changing because they can play at home and earn money. This is two different ways the blockchain space has evolved to really create sustainable use cases that people can use and derive value from. 

Jeremy Au (18:04): 

I think at the crux of this, is basically saying that if you're able to run a transaction at lower cost and you're able to also spread capital around where is needed the most, then you're able to get higher returns. That's really quite innovative. Who loses from DeFi? 

Jun Yong (18:23): 

I think who loses from DeFi as a movement is I would say the banks in a way because where they lose is that because DeFi is a replication of existing financial services, they'll necessarily be a space where their products might not be as competitive as a DeFi protocol. Take for example, the yield bearing product. If startups will start depositing their cash into a DeFi protocol, then you might see outflows from banks because they might withdraw this money, convert it in the crypto and put it in banks. I mean, in the protocol. So they might not be as competitive because keeping money in there in the bank to a yield is not as high as putting it in crypto. 

Jun Yong (19:06): 

This is where actually my team comes in, HaloDAO, because we believe the banks have a very important role to play. I think where they lose out on the products, they can innovate, and how they have to innovate is by partnering protocols, such as myself. To give an example, I think moving forward, there's this issue of regulatory uncertainty in DeFi. I would say the real fear is that crypto and DeFi sort of challenge the monetary serenity of a country, which means they sort of detach the country's ability to mint its currency and make it less of a usable medium of exchange. 

Jun Yong (19:43): 

How we bridge that gap is through true asset-backed stablecoins. What it means is a asset-backed stablecoin is fiat that is custody that generates digital fiat on the blockchain. What we would say is that banks will become these e-money issuers or minters who use their fiat, custody it, and mint digital money or digital fiat so that people can use it to derive yield or to help users to deploy this capital into DeFi. And they take a cut from the yield that DeFi protocol would've given to someone if they did it themselves. 

Jun Yong (20:21): 

For example, if someone were to do it themselves, they could earn 10%, but the bank does it for you, so the bank would take a cut from that. So maybe 10% of the 10%, so they take 1% and return you 9% of the yield. I think there will be that innovation. And when you have this intersection of traditional finance and DeFi, what you'll see is that actually banks will likely be more competitive, and it'll be a lot more helpful for our users because they'll be able to access better products. And yet you don't have this issue of capital flight and a bank run. So you find a balance. 

Jun Yong (20:54): 

In this case, in the world right now, actually there is no successful stablecoin project apart from the USD. Actually the crypto market is a very US dollar denominated market. So most of the flows of stablecoin are actually in USDC issued by Circle or USDT. So what is needed is the emergence of local asset-backed stablecoin, such as XSGD from Xfers. These will need to necessarily emerge. 

Jun Yong (21:20): 

My protocol is building this liquidity networks for people to put their local stablecoins to earn yield so that you could deposit. A Singaporean startup founder could get XSGD deposit on my protocol and a 10% yield, for example. I'm not promising a yield, but I'm just saying based on the algorithms, you could perhaps get these yields and follow the use case, so to say. 

Jeremy Au (21:45): 

Let's talk about monetary sovereignty. And then we'll turn to data aspects of it. I think that's a big fear for so many countries because fundamentally, if you are a country that has been able to denominate the financial system, at least for the US, globally, and for many countries domestically, Singapore for Singapore, China for China, the ability to print money has been really in the preserve and authority of the state. 

Jeremy Au (22:14): 

So when you think about that, obviously there's always been a lot of regulator slash apprehension or honestly, pushback, right. We saw that of the Chinese news recently where they're very much exercising authority over what is in bounds for crypto out of bounds. What do you think is the trend of the relationship between governments and DeFi? 

Jun Yong (22:36): 

Yeah. To really reemphasize the point I made just now, I think the point is that governments will want to regulate how the currency is minted. To give an example, the USDC project is extremely successful. There are so much inflows for it. And when we think about China, some people might think that China is averse to crypto, but actually China is one of the first few countries to launch that digital currency on the blockchain. They recognize that there's a need to move value. The blockchain is a more efficient way to sort of create value networks, so to say. As long as the custody, the fiat on shore, they mint the digital version, people can move that then the threat to them being replaced is not there. 

Jun Yong (23:19): 

Countries, when you think about money flows, actually it's like an equation. You have a three step process. The first step of where money originates is the bank, because the bank custody is the money. And then next you have the on and off ramps. These on and off ramps could be for example, exchanges, OTC desk, where you can convert fiat to crypto. This is where fiat moves from the bank through these regulated ramps and then people get crypto and then they deploy it on protocols, for example. 

Jun Yong (23:48):Where regulation is likely to or should happen is on the ramp side, how to convert fiat to crypto and regulating this conversion. That is very important, I would say. There's a need for global coordination for this issue because for example, one of my crypto wallets got hacked, and we could detect where it goes because it's a blockchain. 

Jun Yong (24:10): 

But the issue is that when the person goes outbound and catches up using an exchange not in Singapore, then the Singapore police has no jurisdiction. Given that there are not many of these regulated ramps, I would say, or actually countries should control the ramps, it is necessary in the future of AML and the regulation of this space that countries coordinate and have common standards in corporation to regulate these ramps. And they can sort of find the baddies, so to say, because you can track everything of the blockchain. 

Jun Yong (24:43): 

I guess that is where we sort of see the movement that to really bring the next phase of crypto expansion to let it be for everyone, you need to have asset-backed stablecoins pushed up for the community and the country. Every country will start supporting this. You'll see Xfers, these kind of models appearing in a lot of places. 

Jun Yong (25:02): 

The next thing is governments will prevent synthetic stablecoins or algorithmic stable coins from listing in their country. That's how they control that. To give you an example, there is the terror debate in Thailand, whereby the founder of Terra protocol said that to the central bank in Thailand, that he wanted to list a Thai Baht. But this digital type Baht was not an asset-backed stablecoin whereby you're depositing fiat Baht into a digital Baht. 

Jun Yong (25:31): 

This Thai Baht that he wanted to introduce is backed by an algorithmic asset. So it's not based on fiat. What you're doing is creating money out of thin air, which is challenging the monetary sovereignty of the central bank. This was naturally prevented from circulation. 

Jun Yong (25:50): 

The government still has a lot of power in preventing this kind of challenges to replace them, so to say. And it's necessary. I would say algorithms stablecoins are probably not good for the ecosystem because they are backed by a volatile asset in their creation. Sometimes you have a situation whereby the underlying asset is worth less than all the stablecoins out there in the market. 

Jun Yong (26:17): 

This means that if someone want to redeem all their stablecoins, you have a collapse of that monetary ecosystem. I would say that is not as sustainable in the long term. Asset-backed stablecoins are really the key to allow this kind of innovation to grow in a healthy way. And the regulation of ramps is the most important factor moving forward. 

Jeremy Au (26:40): 

Wow. That's really interesting and a great crash course for people trying to understand that. I think there's a lot of truth there, which is at the end of the day, the asset-backed stablecoins are really the best of both worlds, where they respect the monetary sovereignty of the country while at the same time, allowing us to have that global inflows and outflows at audience wise, the lower barriers excess as well as the lower cost to build and to maintain on a rolling basis. And now that lowers the cost, which means that it's a high yielding product on average for people. People get to retain more of the value as they go through. 

Jun Yong (27:18): 

I think it's more like being able to trade better and paying money. I think being able to trade better or trade easier means that more people can participate in the ecosystem. I would say the biggest beneficiaries are consumers, especially those who are financially excluded. The challenge of financial inclusion has always been, how are we going to reach the people? Is it going to be via a digital banking app given that so many people have smartphones? 

Jun Yong (27:48): 

I mean, that has been tried very much and there's very little headway in certain places. The reason is because even if you gave someone a nice app with a neobank, if the underlying infrastructure has high cost, this still creates barriers. The whole point of the blockchain movement is how are we going to reduce these barriers by making the cost lower and lower and lower? And then how are we going to improve the UI so it's simpler and simpler and simpler for people to get involved? 

Jun Yong (28:14):Right now, it's still too complicated, so there's still a long way to go. The industry is still at its infancy. There's many much things to do. That's what makes it exciting to participate in this space. 

Jeremy Au (28:26): 

Yeah, that's really interesting because it also benefits not just the borrowers in order to be able to access credit but also helps lenders in order to preserve some more of that value. I'd love to ask you more, which is that as you see yourself building on HaloDAO and what you need to do, what are you most excited to build in the next coming one year? 

Jun Yong (28:49): 

Yeah. I think the next coming one year is where we'll deploy our version one product sometime in August. What we are going to allow is local stablecoins to earn yield. We would say startups in Singapore, Hong Kong, the UK, Canada, to all be able to use their local stablecoins to earn yield and enterprises, consumers, et cetera. 

Jun Yong (29:09): 

So I think that what I hope is that we'll see a greater inflow of fiat into the digital space or DeFi space via asset-backed stablecoins. And this is a tremendously huge market because when we think about the amount of fiat in the world, there's currently estimated 95.7 trillion of fiat. The current amount of money in DeFi right now in terms of if you think about it like a bank, 200 billion locked into DeFi right now. There's trillions of dollars in the fiat space. 

Jun Yong (29:41):So if I'm correct, then we will sort of create this new equilibrium of access whereby it is not just the US dollar in the crypto markets, but there is other local currencies emerging with liquidity and people can trade and interact with that. That will, I would say, support the next phase of the crypto expansion. That's what we hope to do and what I'm excited for. 

Jeremy Au (30:01): 

As you transitioned to become a founder, what did you feel like you had to learn? Because there you are, you've got about a few years of work experience, and now you're becoming a founder. Was there any things that surprised you about becoming a founder? 

Jun Yong (30:14): 

Yeah. I think being a founder, the fun part is that you are expected to grow very fast. Because you do not know many things, but yet you have to be the best founder, you need to compete against the best people. So you suddenly have to learn very fast. When you're fundraising, one of the comments which one of my advisors investors said was, "Jun, actually what you're doing in fundraising is what a person in investment banking would have had to learn over a period of three years, and you're compressing that into two months. And you have to keep up." That is one of the fun parts of being a founder. 

Jun Yong (30:45): 

I think the second part is I would say being very calm, learning how to calm and manage anxiety. What I mean by that is, as a founder, oftentimes you'll have situations where something would, for example, maybe explode on your face. You realize, oh, there's a big problem. The typical me in the beginning, would've been very stressed over these issues. And the me now having had to grow, it's like, okay, something has happened not necessarily positive. How am I going to deal with that? And I'm able to do so in a much more calm way and manage the anxiety of myself and perhaps my team so that we can educate towards the better result and better outcome. 

Jun Yong (31:23): 

I guess these are two things that I have to do as a founder, grow very quickly. That's very nice because I can track my own personal growth. I do that by writing my journal. And the second thing is also managing the sense of uncertainty and being able to live with it. That has been quite good for my personal development. 

Jeremy Au (31:45):I'm curious. What do you read in order to learn quickly as you just talked about? What do you read, what do you consume in order to keep up and accelerate? 

Jun Yong (31:55): 

Yeah. I think actually I will I don't really read these days because I find that one of the things I learned is school to accelerate is that reading is not necessarily the best way to find out about how to accelerate. The best way to accelerate is two ways. One is actually do the thing you want to do to learn about something. 

Jun Yong (32:15): 

And the second way is to find the people who have successfully done the thing and have a conversation with them and being very interested in what they do and learning from them because they're able to distill their wisdom of their entire market or entire exercise in something like an hour versus you ramming your head against the wall trying to figure out different approaches. So they'll be able to explain that. I would say, I typically go to the person who has done it before to learn from them. Having these conversations is what I do as a founder. 

Jun Yong (32:41): 

The second thing is how I consume information is I would say, there's this obsession with email lists to read newsletters. I stopped that because newsletters tend to be periodic or might not be as high frequency. If it's too high frequency, sometimes you have too many things to consume, and then you have an information overload. 

Jun Yong (33:02): 

As a founder, what happens is that I actually have to reduce the amount of information I consume so that I'm better. Where I get my information now is actually on Telegram groups, which are highly curated so that I just see what I need to see, which is important for me. Yeah. I guess that I have a different way of consuming information to ensure that I am constantly on top of my industry. 

Jeremy Au (33:24):Could you share some of the Telegram groups that you follow? 

Jun Yong (33:26): 

Yeah, sure. I think one of the best ones that I like is a group called CryptoDiffer top seven. I would say ICO Analytics is helpful because they sort of break down the information for you and show you who has fundraised, who has had a partnership, who are the major players coming into crypto and what they're doing. These groups are pretty helpful, so to say. 

Jun Yong (33:48): 

Of course, there's a lot of information on ICOs, et cetera. This is also another point where I like to clarify the myth. I guess, in the DeFi space right now you see meme coins emerging, like Dogecoins and Shiba Inu coins. These are things that distracts from the real innovation. I think when the market crashed maybe a month ago or a few weeks ago, it's actually positive because you clean the market out of this negative speculation. That's important. 

Jun Yong (34:16): 

The second thing is there's a lot of IDOs happening, initial DEX offerings. There's a lot of people trying to rush into launching protocols. The market downturn so far has been positive because you wipe out these people out to make a quick buck. This is also where the different lies compared to 2017 where there's a ICO boom. That time everyone was building random stuff that might not work at all. You have people saying, oh, you have a token that can help you redeem movie tickets or something. All these things don't work. 

Jun Yong (34:44): 

But with DeFi, what you see is this tangible usage of these applications, so they do work. There's a huge difference there in then. I would say that the difference then, is that now with DeFi, actually the ecosystem is much more mature and there's a lot of institutionalization in the crypto space. So I guess that will bring further stabilization as we move forward. Just to clarify those myths. I think if someone try to understand crypto, the best way is not actually to read the news. Actually the best way is on Telegram. 

Jeremy Au (35:12): 

That's something that gets a lot of people worry because when you talk about the negative speculation, at the end of day, I think a lot of people get worried about blockchain and Bitcoin and everything because it feels like there's a lot of good actors and there's also a lot of idealists and there's a lot of bad actors. It's how to tell who's from who from the outside going in. Obviously once you get in, then everybody kind of knows who are a bad actors or what to steer away from. How would you recommend people figure out who to trust and what to read and how to enter the space? 

Jun Yong (35:45): 

Yeah. I think actually this might be a different view, but what I would say is actually these scams and things like that are positive for the space because it sort of warns people you shouldn't just jump into anything you see. I think what people should sort of follow is protocols actually have usage and adoption. On a very introductory level, I think people can look at Uniswap and SushiSwap because they have tangible volumes. 

Jun Yong (36:09): 

Uniswap as a AMM has higher volumes than some of the tier two exchanges out there. They are already replacing or overtaking centralized exchanges in terms of volume and trading and usage really because exchanges tend to be localized and a decentralized exchange or AMM is global in nature, so it's able to scale better. I would say that when someone's learning about DeFi it's good to learn how it works and actually see it work. You can actually interact with these steps. If you can interact with them, then you'll know, okay, this is the use case. And then you can trust in that, so to say. 

Jun Yong (36:48): 

Just following whatever IDO comes and then not seeing how it works, I think that's where the scams can happen. I think it's too difficult to do due diligence sometimes. So it's best for people who are not versed in the space to not participate in these speculative activities, so to say. You should look at use cases and tangible progress. 

Jeremy Au (37:09):Which is really good, strong, solid advice, I think, from a macro level but also from an individual level, which is to be self-aware about your knowledge and also be aware about what you're getting into. 

Jeremy Au (37:23): 

Last question here is very much when you think about all that you've done so far, obviously you've been both rising star as an operator in blockchain but also now a founder. Obviously times have been good, times have been bad. I'm just curious about, have there been a time when you had to overcome some adversity and had to choose to be brave? 

Jun Yong (37:45):Yeah, I think as a founder, I mean, right now I'm not a crypto millionaire because there's a lot of movement in the crypto markets, but I'm not making a lot of money. And I think the point there was taking the leap to quit my job, which paid me well to work with my co-founder and deploying all the resources I had, so to say, to fund my team. I could have invested and speculated in the market and probably make a good return. 

Jun Yong (38:09): 

But as a founder, sometimes I think the main point of being brave is being willing to sacrifice short-term profits or short-term progress for something more long-term. When we do that, what I would say the return is not just compounded, but it's fantastic on both hopefully on a financial level and on a personal level. It's like the cookie problem, if you delay, you get more cookies. I would say putting effort into my current team and supporting their growth is probably more rewarding hopefully. But on a tangible level now, it is very rewarding on a personal development because I know I've grown a lot. 

Jeremy Au (38:47): 

Awesome. Wow. Thank you so much, Jun. I mean, I think I really appreciate to wrap things up here. The three things that you kind of shared here, I think the first of course, the crash course on DeFi, blockchain, and stablecoins for the general listener here that's listening in on here. And hopefully they got a good sense of how those are interlinked obviously. And obviously they have chronological links, but also are very different takes about what we're trying to achieve. 

Jeremy Au (39:18): 

The second part that I really appreciate of course, was I think the focus on articulating how DeFi and your approach to it will help not only improve the global flows of capital from the inflow and outflow basis but also lowering barriers to access and lowering the cost and thus increasing the yield for everything and preserving more value along the way. 

Jeremy Au (39:44): 

I also appreciate you articulating the winners, the losers in this dynamic but also what you think is the way forward for asset-backed fiat, stablecoin that will be the future from your perspective. And lastly, we didn't touch on to it a little bit, but I love the energy you bring as a founder. And that it's definitely been rewarding from a professional development basis already and hopefully, like you said, will pay off over the medium to long term. 

Jeremy Au (40:14): 

Thank you so much, Jun, for coming on the BRAVE podcast. And if you like this podcast, feel free to follow and subscribe and go to jeremyau.com to also join the club to be able to discuss this episode in our internal members forum. Again, thank you Jun. 

 

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