JL van der Velde is the CEO of Bitfinex, one of the most important and discussed exchanges of the crypto world.
Cryptonomist has the exclusive chance to interview him via Skype, so we talked about crypto regulation, KYC, Tether and the Nectar token.
A few weeks ago we heard rumours that Bitfinex was moving its office to Switzerland. Is this true?
Whilst we cannot disclose specifics, we are indeed in discussions concerning the relocation of Bitfinex to Switzerland and a few other places.
Bitfinex has established itself and evolved as an entirely distributed company, with global hubs spread around all the world, and we are now in a position where we look to merge the operations of Bitfinex previously distributed across multiple locations.
Swiss regulators have been very receptive to us since the beginning and our continued wish to be a transparent and cooperative platform is very much in line with the approach taken by Switzerland. More to come on this front in the near future.
Regulators are demanding increasing levels of KYC from exchanges and token projects; how are you navigating these demands?
At Bitfinex we strive to walk the line between full regulatory compliance and providing our users with the level of freedom and flexibility that they expect. In a movement built around autonomy, our users will continue to expect a certain degree of anonymity, and we will continue to provide this to the best of our abilities. We have stringent safeguards in place on our platform to spot malicious activity and we will continue to respect our users’ privacy given that they do not violate these.
At Bitfinex we care deeply about the decentralisation of the digital asset space and providing our users with the solutions they need in a manner which does not compromise the security of themselves, their privacy or their funds. We are making great strides on this front, for example with Ethfinex and EOSfinex, and our goal is to continue the exploration of these distributed technologies.
Exchanges are getting richer thanks to higher fees, but there are a lot of competitors out there. How do you plan to compete in this scenario?
At Bitfinex we remain dedicated to leveraging the latest technologies to provide our users with the world’s leading trading experience. A constant goal of Bitfinex is to sandbox and pioneer the development of protocol-level technologies that meet the demands of a high volume trading platform. As a platform, we strive to provide our users with high-performance trading opportunities which promote freedom, safety and flexibility, and this is what we envision as the future of the exchange.
The blockchain space is based around decentralisation and exchanges are not exempt from this – on the contrary, we are in a first-hand position to directly shape the development of these technologies, and that is where the majority of our energy is going. The standard cryptocurrency exchange will look significantly different in 2020 and we are working hard to ensure we remain at the forefront of the space until then.
What is Ethfinex and the Nectar (NEC) Token?
With Ethfinex we are building a hybrid trading platform based around Ethereum tokens. Ethfinex provides users with the option of trading on standard and trustless versions of the platform, combining order book liquidity to ensure a seamless trading experience for those involved. Traders on Ethfinex are incentivized to add liquidity to the platform through means of the Nectar token, which rewards traders with a stake in the success platform through a profit-sharing model.
The overarching goal of Ethfinex is to deliver a sophisticated trading experience whilst democratizing the governance decisions surrounding a cryptocurrency exchange. Although still in beta mode Ethfinex is playing a key role in the development of on-chain technologies, specifically on Ethereum, through our Nectar governance mechanisms and non-custodial, trustless trading portal.
Regulators are entering the space, scrutinising exchanges and demanding increasing levels of KYC. How does Bitfinex plan to manoeuvre this?
I wouldn’t say that manoeuvre is the right word. Bitfinex works in close affiliation with regulators around the world to shape the future of this space, and to ensure that the road is paved for a sustainable and long-lasting development impact. As a rapidly growing space, largely unlike anything experienced before, it is of vital importance that the central actors of the space do their part to ensure longevity.
However, this is not to say that we aren’t experimenting with various approaches. A constant goal at Bitfinex is to test and innovate within distributed technology protocols to allow for shared and open-sourced value transfer and decentralised governance models which mitigate our dependency on certain parties. The decentralisation of the exchange experience is fundamental to how we envision our industry evolving and it is something we are heavily committed to furthering.
A few weeks ago we published an article about Tether, and we mentioned that you are part of the Europol Task Force to combat cybercrime. A few readers told us they could not find any information about this reality. Can you better explain your position?
Bitfinex has, through virtue of operating in this space for so long, established a number of collaborative relationships with law enforcement and regulators – the majority of which exists outside the scope of the general public.
I cannot comment on the specifics of a relationship with Europol, I can confirm that both myself and Peter Warrack represented Bitfinex for the 4th time at Europol’s annual ‘Virtual Currencies Conference’, between 19-21 July 2018.
This year’s conference was focused around paving the way for a sound digital asset regulatory system, where innovation can thrive without hindering the legitimate interests of global regulators, and we are incredibly proud to have had our team represented there for the 4th consecutive time.
All the participants (around 250 law enforcement/regulatory individuals from around the globe) presented, discussed and reviewed a number of case studies and shared general insights into how the industry can better assist law enforcement with regards to dealing with cybercrime and cryptocurrency related scams in particular.
All speakers received Europol certificates stored on the Bitcoin blockchain, so perhaps there is proof for your readers there!