FinTech Chat (FTC) is a series of educational & informative interviews with world professionals in the FinTech / Crypto / Blockchain communities. We aim to provide content that is digestible in multiple mediums such as video, audio (podcast), and written (blog) form! FTC Episode 5
In this episode, we will listen to the story of Joshua Ho - Co-Founder at QCP, a lawyer, an entrepreneur and an early investor in the blockchain and crypto market. During his talk, we can learn more about what QCP has achieved and helped accelerate this blockchain revolution. Moreover, he also shares his thoughts on what the next movements of the blockchain industry would be, including DeFi, NFT & institutional participators. — — — — — Note: This transcript was automatically generated by artificial intelligence (AI) and therefore typos and grammatical errors may be present.
00:12 Wayne: Hey everyone, welcome and thanks for watching. Today we are joined by Joshua Ho. Joshua is one of the Co-Founders of QCP Capital. First and foremost, Joshua thanks for joining us today. 00:24 Joshua Ho: My pleasure. Thanks for having me here. 00:26 Wayne: Awesome man, great. Great to have you always. Great to talk about things that are going on in the crypto space and the fintech space. But man, I always like to start out interviews talking about history. So, how did you get involved in the fintech space, involved with cryptocurrency and what's your history with it? 00:46 Joshua Ho: Sure, I want to give a quick background. You know, another life I used to be a lawyer a long time ago and that turned out to be a pretty boring path. So, I looked into entrepreneurship and other growth paths out in Southeast Asia and I started an e-commerce company with the Rocket Internet group and later was helping launch Uber and other Silicon Valley startups around Southeast Asia that kind of led to you know the most obvious. You know, realization that the biggest movement in Asia was about the cheapest customer acquisition possible and a lot of that was in the fintech space payments and cross-border etc. I worked for a company called Gojek for a bit you probably haven't heard of it but it's a 10 billion dollar deca corn based out of Indonesia essentially does what WeChat, Uber does in one app in the fourth most popular country in the world. So, they already have their own e-money on that. Basically, they've got a digitized version of the Rupiah which is Indonesian currency and in a big way that's elevated or or accelerated the movement of capital onto this digital space in a very very quick short amount of time. Then if it comes to crypto that specifically I was just dropping on a conversation at a dinner party started looking into it back in like 2013 2014 and didn't pay much attention to it. So, you know everyone else late 16-17 and that's when we started QCP Capital to take a more serious look at space. 02:15 Wayne: Nice. Nice, yeah I think many of us have similar stories where we can all think back of a point where we heard about it and dismissed it back and yeah it was around the same time for myself as well that 2016 2017 just couldn't really ignore it anymore. So, tell us a little bit more about QCP Capital. What is it that, what it does. 02:39 Joshua Ho: So, it started off while all four of the partners including myself were working full-time jobs. You know, kind of a garage band thing we saw the space, we saw an interest in it, we were all arbing with our own personal capitals. Well, the genesis of this really was the Korean bitcoin, arbitrage and that's kind of how we built a balance sheet from scratch. It was myself and Darris and two other partners and we were really taking a close look at this when the market just suddenly you know gave us a big opportunity. So, I distinctly remember you know I was still moonlighting starting a pcp while I was at my last job, Darris was still at the bank and one day he's like screwing it. I'm making way more money doing this. He walks literally right next door to the bank in this random sweatshop of an office. He walks around the corner, quits and comes back and just gets on with it. So, that's kind of how we started. I think the more interesting thing about what we do and how we've evolved in the last three years is really into the forefront of Southeast Asia market making now. There's a lot of market makers in this space. You've probably talked to a lot of different liquidity providers in crypto and it's hard to sort through what's real and what's not. But I think the most verifiable way of looking at who's in space is really just who's lasted long enough right and and we've been through multiple cycles now and we've managed to maintain our lead here in Southeast Asia. So being able to deal spot OTC and same Dollar, Ringgit, IDR, Taiba all the local currencies has been our core business. We've grown from there into one of the leading market makers for options as well so back when no one was looking at it. We were the first option market makers for Bitcoin and Ethereum over the counter and that eventually led us to being one of the largest investors in Deribit as well. So, our core business now has grown into 50 people and that's mostly based out of Singapore but serving the Southeast Asian market and and functionally providing spot and option OTC services 04:56 Wayne: Nice. Nice, so what do you see is kind of the future on the road map for QCP. Are you looking, is the company looking to expand into other aspects of the space? 05:11 Joshua Ho: Yeah, absolutely. I think unlike a lot of other sectors you know worked in this, this one just moves the fastest. It's so hard to keep track. I probably spend the most time just probably wasting the most time on crypto twitter and also trying to keep track of what's happening out there. But that being said, you get a lot of perspective when you know you made a lot of money and lost a lot of money too in crypto and for us. We try to take a step back and see where we can invest some of our balance sheet these days you know into equity projects places where we weren't so comfortable before but now we're happy to take a longer view on. Infrastructure for the space that's supporting what we see in Southeast Asia and at the core the business for us is really about monetary mobility right you know we look at the space as an evolution of cross-border capital fluidity. We've been doing this for a long time across the region and it's pretty fascinating to see you know big corporations now looking at the space most seriously...And I don't mean you know fortune 500 companies that are just buying crypto although we're seeing some of that now. I'm talking about mid-sized corporations and smes in Southeast Asia that are using stable-coins. For example, to hedge their credit and their fx and that's happening quite quietly but it's happening wholesale. 06:37 Wayne: Yeah, we're starting to see that a whole lot more. I just did a report the other day. Like you mentioned some of the big companies you know like some of the top companies are looking in. But I've also talked to people that provide kind of like crypto accounting and invoicing services for crypto and they're starting to see a lot of mid-level companies just really get into it. And you mentioned stable coins there, I mean that kind of seems to be the bridge. It's going to help bring more people to this space and to being more open to crypto. I find at least on the business side right because most businesses don't have big margins to work with so they want to avoid day-to-day volatility.
07:19 Joshua Ho: Yeah, I mean it's the bread of butter out. Here for us, it's the majority of our spot flow business and you know just to give you some anecdotes for how widespread it is. You know, if you were to go to Hong Kong right where there's some streets and some tourist areas with tons of money changers. It's pretty interesting because you can see Tether being quoted physically over the counter at money changers in Hong Kong. It's super common and we're starting to see that pop-up across Southeast Asia as well. So, these days a pretty common category of client for me. Might be you know, an auto parts manufacturer or a liquor distributor that has problems functionally moving its working capital on balance sheet around Southeast Asia because of so many capital controls between Indonesia, Malaysia. Thailand, Vietnam etc. But instead of having to deal with banks where the online systems actually sometimes have operating hours and close they can 24*7. You know, move stablecoin between them and on-ramp and off-ramp and local currencies as well. 08:29 Wayne: Yeah, I never really thought about that. I mean that kind of really can drive a lot of adoption. How do you feel since things have changed with travel and all and COVID I mean there's not there's not as many conferences and and places where people can go to talk about crypto. Do you find that since that's happened and we've gone more virtually you think that's slow down adoption or speed it up? 08:52 Joshua Ho: I don't think anyone would argue it's slowed down. This has been the busiest period for us both in terms of growth hiring in terms of just stepping back and building but it's also given us a chance to you know really reevaluate where we want to focus in the space because it's you know when the market's frothy this is a lot of fluff out there and people are looking at projects like it was 2017. They want to get and get out fast so you know we've tried to avoid being mixed up and all that and taking more infrastructure view for our geography. You know we want to be at the top of our game in the geography where we operate so we've only seen in the last eight months non-stop acceleration sleepless nights. It's just been non-stop you know we've been launching a few new products. A few new sort of yield focused products that exist outside of you know the DeFi space but we find complementary. I'm still very much focused on our core as Bitcoin, Ethereum and stable coins and I think that you know the market will revert to that as we're seeing now pretty violent pullback from a lot of the DeFi fluff from before which is not to say there weren't good projects coming out of that it's more like you know two steps forward one step back, yeah. 10:21 Wayne: Yeah, I can't do an interview in 2020 lately without talking about DeFi and I was always wondering when it's going to come up and my view on DeFi. It's yeah there's a lot of like you said fluff I call it crap. There's a lot of stuff out there that it's just garbage but i think what we're going to see emerge from that is going to be some good technology. Some good products so you mentioned yield. So, you guys aren't really looking at anything in the DeFi space or just kind of not really heavy into it is what you're saying. 10:53 Joshua Ho: Don't get me wrong. We've definitely put a significant test budget and balance sheet towards the opportunities there. But it's without forgetting that our core business is very much driven by you know stored value, value transfer and yield around assets that are more readily recognized so what I mentioned earlier we spent a bit more money on equity investments. I think that's where it's been going so looking at taking sizable investment positions in DeFi projects without having to take pure token exposure has been more the flavor for us, yeah. 11:37 Wayne: Yeah, it definitely makes sense. You know, I compared a lot and a lot of people compare what's happening and what's happened in DeFi over the last few months too not identical but similar to just the hype and the craze around icos back in 2017 where it was just anything and everything that was launching you know was pumping. You know we see what what's happened from that a few have emerged and i think it's the same thing with DeFi what I guess what in the crypto space not necessarily tied to QCP capital but what out there in the cryptocurrency space has your attention or get you excited to look at or talk about. 12:20 Joshua Ho: Yeah, I think right now the most interesting movement right now has been that sort of institutional interest that's taken place over the last six months or so it's happened in a way that a lot of people didn't expect. For example, you know Paul Tudor Jones publishing that piece and then taking a view on bitcoin for his fund that we were talking about creme of hedge funds in the world and from there more and more listed companies beginning to build up a treasury position. I am sure you've seen that on this page to me. That's you know when we were shouting about the growth in 2017. We were screaming this is what's gonna happen but that's you know three years later now. It eventually is coming to fruition so I'm more excited about seeing something that we were hoping for three years ago come to life now. And I guess I'm thinking about what we're shouting about now that might take I don't know another few years to to actually come into reality. So, the institutional interest is one and for that reason. We've also been getting a lot of inbound from family offices in Southeast Asia which while they're already clients of ours are starting to take this space a bit more seriously and they're starting to trade more actively obviously can't name names but a lot of these guys represent some of the largest family offices of the largest employers in the in the region. And it's a very trickle down you know I think of this technology kind of like F1 right. It trickles down from the top and when they start to understand and they start to see the potential you know when problems come along in their day-to-day businesses. they start thinking about how they can use this to solve problems right now. It's purely limited to store value and the cross-border issue but we see you know more innovative questions coming in from real estate developers and other people who previously thought oh let's just let's how can we use blockchain technology to solve xyz now. They're thinking more like oh this solution. This turnkey solution exists. I can apply this to this particular area of my business be it accounting tax or provenance and now it's more of a product selection as opposed to problem solving that they're looking for. So, that's been great. advancement for sure. 14:40 Wayne: Yeah. Yeah yeah those institutional investments that you talked about, it just gives some legitimacy and validity to what we've known like you mentioned what we've been talking about for years. As far as where this thing is headed you mentioned real estate a few minutes ago and also talked about equity positions. I'm not sure are you familiar with non-fungible tokens? 15:04 Joshua Ho: Yeah, I wouldn't call it the bread and butter of my business. But more on a personal interest level you know I have been keeping tabs. I do remember meeting up with a lot of the NFT projects and the guys who were really building that space back in 17-18 who are now you know kind of seeing a really really strong resurgence as well. 15:24 Wayne: Yeah, that's always piqued my personal interest as well. I was a collector as a kid. I was collecting sports cards and collecting the balls and to see the digital space and that was only one aspect and then once you dive in you see so many different options from you know. These businesses tokenize assets. It could be tokenized equity. It could be you know a whole host of different things that could be utilized to both non-fungible and fungible tokens but is just is something that I feel could is really i think it's going to open up a lot more people to what blockchain is, what cryptocurrency is - you know for many different avenues. It's not just collectibles like we first saw with crypto kitties all right although I do have a few of those I don't know if you ever traveled in those but I just had to test it out one day.
16:16 Joshua Ho: Yeah, absolutely completely agree and I think the problem right now is naming convention right a lot of you saying NFT just doesn't sound that sexy. But we've all been addicted to you know the collectability and leveling up and these ideas for a long time. You know a lot of us being gamers, a lot of us coming from collecting certain things and being addicted to the idea of uniqueness. I think we just use the wrong words in this industry going around calling things NFTS. It just didn't sound that good. I'm very much interested in the way that this will play out in the gaming space and it's pretty interesting to know and see how much investment is going that way too. 17:03 Wayne: Yeah yeah great point. You know the funny thing is I never really thought about it like that. But got you're right now. You know, saying non-fungible tokens even NFT that's that doesn't really appeal to most people. So... 17:15 Joshua Ho: Yeah, I mean I think it has to survive sort of elevator pitch litmus test. You know, you meet someone who's never heard of this. You say NFT, you're just just gonna stare at you really blackley right. 17:24 Wayne: Absolutely absolutely, all right man. Joshua. you know getting close to wrapping it up. Any final thoughts, anything you want people to know or maybe any final thoughts about where you see happening in the cryptocurrency and blockchain space over the next six to twelve months. 17:44 Joshua Ho: Yeah, you know I've given a fair number of interviews and spoken on panels in the past and I often get asked if they're the most common questions, tips and tricks or what to look out for. But it's a very common misconception that this technology exists in splendid isolation that it's some you know turnkey solution to all the world's problems but that's simply not true. You know there's a lot of different AI,tech out. There that could be interesting there's a lot of different reg tech and solutions that are coming out which you know exists in tandem with what we want to do with blockchain and cryptocurrencies. So, what we've been looking at more recently is- how to combine those two at least geographically within the borders in which we operate and we've got a few exciting projects. We're investing in what we're planning to announce soon. So, please keep your eyes peeled. 18:40 Wayne: Nice, nice looking forward to it. All right, awesome. So, thanks again for joining us today, Joshua, thanks everyone for watching and we will catch you on the next episode of FTC. Take care.
18:51 Joshua Ho: Thanks for having me. Bye.
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About Blockchain Wayne (Host)
Wayne has been managing, teaching, and coaching high performing teams for over 20 years. He has a passion for helping and teaching people and a passion for cryptocurrency and blockchain projects. He has created various coaching programs and partnerships with select education platforms and cryptocurrency program tools.
You can learn more on his website: https://www.blockchainwayne.com/
Stably is a fast growing FinTech company from Seattle founded in 2018 by a team of former bankers and Amazon software engineers. The team has raised close to $3M in funding to date from angel investors as well as leading venture capital firms like 500 Startups, BEENEXT and Pay It Forward. Stably is also the blockchain developer for a wide range of cryptographic tokens and stablecoins backed by real assets, such as USD, EUR, CAD, precious metals and real estate. Our mission is to make financial transactions faster, cheaper and more transparent through a borderless digital money platform powered by open-banking and blockchain technologies.
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