MetaEra Hong Kong Zone is now live, and MetaEra has launched a series of "High-End Dialogue" interviews. We will continue to engage with industry elites and leaders to explore the development and future of Web3 together. This issue's interviewee is Du Jun, co-founder of ABCDE.

Introduction

Du Jun is the co-founder of ABCDE Capital and Huobi Group (which has now been acquired by Sun Yuchen), as well as the Executive Director and CEO of New Fire Technology. He previously served as the product leader for the well-known community platform Discuz!X launched by Comsenz, and has excelled in investment, marketing, operations, and creativity. Du Jun is also one of the earliest professional investors in the blockchain industry, with rich entrepreneurial experience and industry resources.

Key Insights

● Make more friends and do things that align with the times together with them.

● Blockchain actually needs a killer application, and I have now found a relatively good answer, which is stablecoins.

● Currently, many blockchain projects aim to get listed on exchanges, and this listing is the endpoint for many projects, which is completely inconsistent with traditional business logic.

● It is not Bitcoin that needs Trump, but Trump that needs Bitcoin.

● For the past decade, I have been doing one thing: telling others what Bitcoin is and encouraging them to allocate and purchase Bitcoin.

● The vision of New Fire is to enable every enterprise to use digital assets relatively safely, without worrying about the risk of theft every day.

Full Interview

MetaEra: Looking back at your entrepreneurial journey, some articles label it as "from grassroots to crypto tycoon." It shows that you have undergone multiple transformations in identity. How did you accurately seize opportunities suitable for you in the topic of "entrepreneurship"?

Du Jun: There are many versions of my early experiences online, but I think the core points are doing things that align with the times and making more friends. Many times, I have been pushed along rather than racking my brain to think of something. I observe what changes are happening in the industry and what my friends are doing.

My first job was at a software company called Comsenz, which was sold to Tencent in 2009, and I worked at Tencent for three years. Around 2010, I met Li Lin and some friends. Later, in 2013, we founded Huobi, which felt like a very natural thing to do at the time. Including the founding of ABCDE Capital in 2022, these all felt like things I could do easily. So basically, it’s about aligning with the times, observing changes, and getting help from many friends.

In summary, it’s about making more friends and doing things that align with the times together.

MetaEra: In the crypto space, you are also regarded as an early legendary figure in blockchain entrepreneurship. When you first encountered digital currency, how did you view this emerging phenomenon? After about 10 years, has your understanding changed?

Du Jun: Around 2012, I first heard the story of Bitcoin in a QQ group focused on alternative investments, which had about 100 people, but only 5 to 10 people eventually bought Bitcoin. I entrusted a Japanese friend to buy Bitcoin for me on Mt.Gox. In March 2013, Bitcoin surged to around $200-300. During the rise of Bitcoin, I was thinking about why it was increasing in price. If Bitcoin were unremarkable, I wouldn’t have studied it. But as the price changed, I developed respect for Bitcoin and began to research it. I looked for articles about Bitcoin and later read the Bitcoin white paper, which made me feel very happy.

At that time, the QQ group was focused on alternative investments, including domain names, wine bottles, paintings, etc., with a core emphasis on scarcity. The first version we heard about Bitcoin was that it would never exceed 21 million, which was enough to demonstrate its scarcity. I thought domain names were more than 21 million, and at that time, they were only a few hundred RMB each, so my first impression was that this thing was great.

After studying Bitcoin's scarcity, I gradually understood its technical aspects, such as whether Bitcoin could achieve double spending, Byzantine attacks, etc. I found these things quite interesting. In April 2013, one day, Li Lin invited me to dinner at a restaurant in Shangdi. He asked if I knew about Bitcoin, and I said I did, advising him not to buy it because Bitcoin's price was highly volatile. At that time, I viewed Li Lin as an entrepreneur, so I didn’t recommend he buy Bitcoin.

However, Li Lin mentioned whether we should create a trading platform, not to profit from Bitcoin but to earn trading fees. I found that interesting and researched Mt.Gox and Bitcoin China, where Bitcoin China’s daily trading fees could reach millions of RMB. We thought that starting a trading platform was a great entrepreneurial direction, so we quickly launched Huobi, which involved buying a domain name, hiring employees, determining a name, designing a logo, etc.

During this process, the biggest challenge we faced was how to communicate Bitcoin to the market. At that time, Bitcoin didn’t have a strong wealth effect and wasn’t as crazy as it is today. As CMO, I needed to acquire users and teach them to register on Huobi and trade Bitcoin. Our main promotional method was to hold offline seminars, sharing Bitcoin's core value of scarcity and anti-tampering, which worked quite well. So, within two to three months of Huobi's establishment, we achieved positive profitability.

For the past decade, I have been doing one thing: telling others what Bitcoin is and encouraging them to allocate and purchase Bitcoin. In communicating with others, I have faced some setbacks and pressures. For example, many people ask: What value does your industry bring to society? In what aspects of life can blockchain be used? This has been particularly painful and anxiety-inducing for me in the past two to three years because I also need to think about what else Bitcoin can do besides trading on exchanges. If there isn’t a good answer or solution, this industry will still face such problems in ten years, and mainstream society and media will continue to hold biases and misunderstandings about Bitcoin and blockchain.

Today, it’s easy to explain what the internet is, what mobile internet is, and what AI is. However, before OPEN AI emerged, AI was also misunderstood; people wondered what it could do after burning so much money. The early internet was similar; people thought it was useless except for sending emails. For instance, mobile internet has made it more convenient to hail a taxi or order takeout. From today’s perspective, these things conveniently solve problems encountered in everyday life. However, blockchain has not solved this problem to date. It actually needs a killer application, and I have now found a relatively good answer, which is stablecoins, represented by USDT issued by Tether, which I believe has solved some payment issues. I also believe that the usage data of stablecoins will surpass that of traditional financial payment companies like VISA.

So, in these ten years, stablecoins have emerged, but I don’t think there have been any significant changes.

MetaEra: At the same time, ABCDE Capital is your current focus. Can you disclose the current development status and investment landscape of ABCDE Capital? Given the current weakness in primary market investments, how do you view this issue?

Du Jun: Currently, many blockchain projects aim to get listed on exchanges, and for many projects, listing is the endpoint, which is completely inconsistent with traditional business logic. Your business model should be to go public and sell stocks, not just to provide value to users. Listing on an exchange just to sell tokens is problematic in itself.

One point we have been anxious about in recent years is how to find projects with real commercial value. You will find that although many companies are doing things in the blockchain industry, they actually do not need to issue tokens. What is the necessity of issuing tokens? For example, Bitcoin has an incentive role on-chain, and Ethereum cannot operate without tokens; that is the necessity of issuing tokens. However, many projects today do not have the necessity to issue tokens; their tokens are not linked to their applications and are purely a marketing strategy or a way for the entrepreneurial team to monetize.

This is one of the points ABCDE has observed: how to judge these projects. ABCDE will soon announce the completion of a new round of fundraising and will continue to invest. We aim to invest in 15 projects each year, and we have cumulatively invested in 30-40 projects, with a single investment starting at $1 million, generally in the range of $1 million to $5 million.

Currently, ABCDE is mainly focused on several directions: AI and trading, as well as consumer-oriented application products. We believe that trading products still have significant room for improvement, and overall, we will focus on foundational development.

MetaEra: Besides Web3, AI has also been developing rapidly in the past two years. Many projects have been labeled with both Web3 and AI elements but are in a situation of "loud voices, small actions." How do you think Web3 and AI can better combine?

Du Jun: What is AI, and what is Crypto? I think there are some different views today, and secondly, what is the necessity of their combination? The biggest problem currently is that many companies have added AI functions to Crypto, but there is no real need for the combination, and combining them does not necessarily make them better.

Currently, we are paying attention to new opportunities brought by the combination of AI and Crypto. For example, Meta's Llama 3.2 model can run on any mobile device, so it can also perform local inference on any Crypto node device, which I find quite interesting. Recently, our team has been researching running Ethereum nodes on small mobile devices, and we plan to open-source this product for community use soon.

Another example is World Labs, a spatial intelligence startup founded by Stanford professor Fei-Fei Li, which announced it has completed a massive $230 million financing. The most scarce resource in the AI field is datasets. If we can accelerate the collection and organization of spatial data or 3D data construction through Crypto mechanisms, I think there are great opportunities. We are quite optimistic about the industrial forms generated by AI and Crypto.

MetaEra: As the Executive Director and CEO of New Fire Technology, which is a publicly listed company in Hong Kong, how is New Fire Technology embracing this wave of Web3 in Hong Kong? How do you view the entrepreneurial environment for Web3 projects in Hong Kong?

In August, it was announced online that New Fire Technology acquired the licensed exchange BitTrade in Japan. Can you share the reasons for the acquisition and what further plans you have after the acquisition?

Du Jun: First of all, as a company listed on the Hong Kong main board, compliance is our hallmark. From a business perspective, we have obtained Class 1, 4, and 9 licenses to provide compliant asset management services. Our New Fire Asset Management has launched about a dozen funds, with an asset management scale of around $90 million. We have deep cooperation with Huaxia Fund, Jiashi, and Bosera on Ethereum ETF products. As more Crypto funds emerge, our products will become increasingly leading, which is also a key development direction for the company in the next two to three years.

Secondly, we have our own MPC self-custody platform SINOHOPE, which uses MPC-CMP technology to support users in distributed management of private key shards and collaborative signing, addressing single-point risks of private keys and effectively increasing transparency and usability.

We believe that as regulation deepens and the industry develops, crypto exchanges will gradually be split into more compliant and segmented parts. Today's crypto exchanges will slowly be divided into trading platforms, brokerages, custodians, banks, insurance, and issuers, rather than being a single exchange that combines all roles, which does not meet traditional regulatory requirements or user demands for transparency and security. The vision of New Fire is to enable every enterprise to use digital assets relatively safely, without worrying about the risk of theft every day.

Thirdly, New Fire Technology recently announced its intention to acquire the licensed exchange BitTrade in Japan. BitTrade is a cryptocurrency exchange registered in Japan in 2016, primarily engaged in cryptocurrency trading. Additionally, BitTrade holds two compliance licenses issued by the Financial Services Agency (FSA) of Japan: "Cryptocurrency Trading Business Kanto Finance Bureau No. 00007" and "Type 1 Financial Instruments Business Kanto Finance Bureau No. 3295." Furthermore, BitTrade has joined three self-regulatory associations officially recognized by the Japanese Financial Services Agency, which have the ability to formulate and enforce cryptocurrency trading rules and standards in Japan and can promote the introduction and development of Japan's security token system.

Currently, our listed company has issued an announcement regarding the proposed acquisition, and the acquisition is still in progress. We expect to complete the entire acquisition process in the near future. We plan to expand our compliant trading business in Japan and other regions next year, and New Fire Technology aims to use this acquisition to enhance the company's asset management services.

Now, we have three core products and services: exchanges, custody, and asset management, which can achieve synergy for our business and enhance our core competitiveness in the Asia-Pacific region.

MetaEra: You currently spend most of your time in Singapore. If you compare horizontally, how do you view the regulatory attitudes and policies towards Web3 in different regions around the world? Will you increase your layout in Hong Kong?

Du Jun: Hong Kong has always been a key area for us. Looking globally, there are several locations that are very important. In the United States, whether from a technological accumulation or funding perspective, it is undoubtedly at the top globally. Previously, we only needed to focus on the West Coast and set up a point in Silicon Valley, but today we find that many clients' trading and investments are in New York, so we are currently recruiting partners in New York. Therefore, our business is divided into two places in the U.S.: in Silicon Valley, we focus on new technologies and ideas, while in New York, we will layout trading and investment.

Additionally, Singapore, Hong Kong, and Dubai can radiate the Chinese crypto circle and the Asian crypto circle, and we are focusing on these areas. We also have a team of about 50 people in Tokyo. Our business in these locations has some differences; in Singapore, it leans towards business and operations; in Hong Kong, it focuses on back-office functions, such as legal, finance, and asset management; in the Middle East, we have just started, mainly focusing on business sales; in Tokyo, it operates as an independent system with a well-established team.

MetaEra: Let's discuss an impromptu topic. With Trump's election as U.S. president, the crypto community generally holds confidence and high expectations for the digital currency market and Web3 development. For someone like you, who has experienced two or three bull and bear markets, can "this wind" really influence the trajectory of the Web3 industry?

Du Jun: From an entrepreneur's perspective, I pay attention to policies because, after all, you have to start a business in a physical space, so you need to know what changes and impacts policies will have on you, and your entrepreneurial direction should align with each government's different focuses and concerns.

Therefore, you need to do things in accordance with policies and operate within the boundaries. You need to know where the legal bottom line is, and you can do some challenging things within the boundaries, but never cross the legal bottom line. I think there’s no need to put yourself in a difficult situation.

From the perspective of a holder, I think it should be the other way around. There’s no need to emphasize the value of a decentralized product every day. A decentralized, peer-to-peer blockchain protocol should not have its value tied to a centralized entity; I think that in itself is upside down. So I shared a quote on Twitter: "It is not Bitcoin that needs Trump, but Trump that needs Bitcoin."