Across the landscape from Washington to Wall Street, a significant shift has taken place: digital assets and blockchain technologies are no longer regarded as mere experimental endeavors. Financial institutions are testing tokenized deposits and settlement systems, while asset managers are beginning to offer digital asset products. Meanwhile, lawmakers are crafting regulations that reflect the permanence of this technology. This development is promising, but it ushers in the challenge of ensuring that the underlying technology is fully prepared for widespread adoption.
The next stage of cryptocurrency evolution will not hinge on flashy marketing or speculative frenzies. Instead, it will be shaped by fundamental, albeit less exciting, metrics such as throughput, finality, and cost. In essence, blockchain networks must become so efficient and dependable that they become indispensable for businesses seeking to integrate them into their operations.
Rapid Transformation in the Financial Sector
This narrative transcends mere technical details for me. Having grown up in southern China and moved to the United States as a teenager to pursue studies in mathematics and finance at Carnegie Mellon, I have always perceived numbers as a foundation of certainty and objectivity. Despite my passion for research, I hesitated to commit to a lengthy Ph.D. program; instead, I aimed to create a substantial impact in a shorter timeframe and opted for a career in trading.
In the world of Wall Street, performance is measured in unmistakable terms: your profit and loss (PnL) statements speak volumes. This clarity suited my preferences perfectly. I thrived in the disciplined environment of markets, where even the most sophisticated theories must contend with real-world conditions. However, I also observed the shortcomings of traditional financial systems. Settlement processes were sluggish, data remained fragmented, and each enhancement seemed more like a makeshift solution than a genuine leap forward. Discovering cryptocurrency during the early days of decentralized finance (DeFi) felt reminiscent of witnessing the dawn of the internet—a raw yet potent framework capable of fundamentally transforming finance.
As I transitioned from conventional finance to DeFi, I joined AirSwap, one of the pioneering decentralized exchanges. Our team attempted to adapt traditional financial mechanisms, like order matching between market makers and takers, to the blockchain environment. However, when another decentralized exchange, Uniswap, emerged by eliminating market makers altogether and allowing users to trade directly against liquidity pools, I experienced an enlightening moment. This platform enabled users to exchange cryptocurrencies independently, without relying on intermediaries such as banks or brokers. For the first time, trading could occur without a counterparty in a decentralized setting, with market rules encoded in open-source software that anyone could review. While the experience was somewhat cumbersome, it represented an entirely novel innovation made possible through blockchain technology.
Innovative Possibilities with Blockchain
This revelation spurred my curiosity about the potential applications of blockchain infrastructure. The DeFi landscape was still developing, and I decided to establish Amber Group, a crypto wealth management firm focused on enhancing liquidity. We successfully grew Amber’s assets under management to $5 billion at its peak. During my time at Amber, we experimented with various approaches to Web3, achieving some successes and encountering failures, yet consistently striving to push the boundaries of what was possible. Each new development in blockchain technology presented an opportunity to rethink finance in innovative ways.
My tenure at Amber Group made it evident that crypto infrastructure still requires significant advancements to meet the efficiency demands of institutional players. While there has been notable progress, for banks, asset managers, and fintech companies to fully embrace on-chain operations, the underlying systems must operate with the reliability of essential financial infrastructure. Speed and transaction finality must improve, with latency needing to approach sub-second interactions. Additionally, costs must be not only low but also predictable, as enterprises rely on certainty in their financial planning. Ideally, established systems should appear straightforward on the surface while possessing sophisticated capabilities beneath.
Transforming Financial Systems
We must recognize the tremendous advantages that could arise from integrating blockchain technology into our financial frameworks. This transition should be viewed as a hardware upgrade. Just as the shift from phone booths to smartphones enhanced communication and unlocked new lifestyles, the move from paper tickets to electronic trading transformed Wall Street. If blockchains can deliver on their promises, they could similarly revolutionize finance—not merely replacing existing systems but enabling entirely new possibilities.
The Ripple Effects of Change
Throughout this journey, my focus remains on tangible impacts rather than abstract performance statistics. How can this technology enhance our daily lives? Can it make transactions more affordable and efficient? Is it capable of creating entirely new markets? Can it empower individuals with greater control over their assets? Can it broaden financial opportunities for everyday people, both domestically and internationally? If we succeed in developing robust infrastructure for the financial system, the ripple effects could resonate for decades across the globe. The demand from institutions is genuine, and public engagement is palpable. This pivotal moment in reputation will not be secured through mere rhetoric but through demonstrable performance. The infrastructure must be fast, affordable, dependable, and secure enough to seamlessly integrate into the background of our financial ecosystem.
When the world is ready to engage, there is no need for grand displays; all that is required is for the numbers to align.
