Are You A Retail Investor Interested In Crypto High Frequency Trading? You Can Do That On This Exchange

ValueWalk’s interview with Kwun-Phite Lock, the CEO of BXB Exchange. In this interview, Kwun discusses his and his company’s background, making money from transaction fees, creating the best trading environments for retail traders, their live simultaneous markets and product line, the currencies BXB supports, the tap trading tool, if Facebook’s Libra is a PR stunt, advice on tradying cryptos and his dream crypto legislation.

Tap Trading

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Interview with BXB Exchange CEO Kwun-Phite Lock

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Can you tell us about your background?

I come from a traditional finance (equity trading) and project development background. I was first introduced to crypto around 2015 and I was doing some small trades at the time but my main focus was still on traditional equity trading.

As I began trading more and more I began to see just how powerful the blockchain industry was and also some areas that could be improved upon. That’s really how the BXB project started. It was identifying the current problems in the industry and knowing that we could build something that could really help a lot of people, and provide access to the industry and to the trading world in general.

When did you start your firm and what does it do?

We started forming the team around late 2017, and development for the platform began in 2018. BXB Exchange is a financial and blockchain technology company. Our mission is to make trading accessible to the average person and the retail trader.

We provide a platform where people can trade their crypto currencies. We aim to make the experience as simple and smooth as possible, and provide users with powerful trading products that are fun and easy to use. At BXB we are providing users with tools that give them an edge in the market and we have increased accessibility to these tools. We are currently licensed and regulated out of Estonia

How do you make money?

We make our money solely from transaction fees. When users place a trade on the platform, the transaction fees they pay to execute the trade is the revenue that the exchange makes. Whether the users gains or has a loss, BXB does not make money from this.

Do you deal with retail or institutional investors?

We deal strictly with retail investors and do not accept any institutional investors. Actually that's one of the things we really pride ourselves in at BXB. We want to create one of the best trading environments for retail traders. In a lot of exchanges they accept both retail and institutional traders. For us the way we see it is that this really does not create a fair trading environment.

It is like if we were to put professional NBA players and have them compete with the general public.

At BXB we don’t allow professional and institutional traders. We want to level the playing field so that everyone has the same advantage. One of the ways we have done this is by locking our API so nobody has a technical advantage.

A lot of firms are now offering crypto trading. How do you differ?

Our key differentiations are apparent in how we are built and how we operate. As stated above, we don’t serve institutional traders. While institutions bring in a lot of volume and thus trading fees, its comes at the expense of retail traders. We are willing to give up short term profits to build a truly unique trading ecosystem focused on fairness, which currently does not exist.

We also differ ourselves through great technology. Our CTO was the former chief architect of the Shanghai Futures Exchange. Our entire trading system is modeled after a system that has existed for over 20 years, which has been stress tested and handled large volumes of orders with speed, fair order matching, no hacks, and overall extreme reliability.

This means also that our systems were built entirely in-house and do not rely on any third party vendors. This is a large issue that’s becoming more and more apparent in other exchanges, especially top ones, which too much focus on speed at the expense of fairness and security. We also see too many exchanges shutting down because of order “overload”, AWS issues, which indicate a heavy reliance on third party vendors, and white label solutions, and other silly issues that would not be ok in the traditional finance world.

In addition, we are the only exchange to offer six live active products. Most exchanges offer a couple products (spot and futures trading). BXB on the other hand has three live simultaneous markets – spot trading, options trading, and futures trading – and the following product line: Stack Trading (Program Trading made simple), Auto-trading (Simplified transaction fee mining), and our latest Tap Trading.

What currencies do you support?

  • RVN
  • RDD
  • ONT
  • NEO
  • IMC
  • GARD
  • ETH
  • BTC
  • EOS
  • BXB
  • ATOM
  • ALGO
  • TOSC
  • TRX
  • ZEC

We are constantly adding new coins weekly.

You say that  tap trading is very simple and easy. Don’t you think that is dangerous for many investors?

We’ve really made it easy for anyone to get into trading. The steps a user takes to execute a trade are the same steps a user would take to execute a trade in the stock market or any other crypto exchange.

What we have done, however, is to simplify the entire process and make it intuitive and easy for users to understand. Users easily select their volume and the corresponding prices, then buy and sell simply by tapping. In all other exchanges users would need to input additional information, which can be especially foreign for a new person who has never traded. They need to select limit versus market order, manually type in the volume and manually type in the price. A new person to trading might not know what to do. So we can see it's all the same steps, but in a very simplified intuitive manner. We’ve essentially taken the complexity out of trading so any user can easily and quickly enter in and out of trades.

You highlight a 20 year old woman from the Philippines who is making around $10,000 per month after never having traded. Isn’t that the type of thing we see right before a massive bubble bursts? I mean we can't expect any novice to consistently make big profits on a regular basis trading frequently

It’s really about practice and understanding what you are doing. This woman, Loise, was not making $10,000 per month when she first started, but really worked her way to the level she is at now. She was actually not very interested to trade before trading at BXB as she found it quite complicated before she tried our platform. When she picked up tap trading she was able to see just how easy it was to get into trading and how powerful the tap trading tool was.

Traditionally, tap trading derives from high frequency seconds trading, and it’s really quite a complicated product when we take a look under the hood. We have, however, made it simple and easy to understand for all users. In essence what we have done is present individuals and traders with more apparent trading opportunities to take advantage of. We have amplified the volatility so that trading opportunities are more apparent and evident, and we are also providing leverage to traders so they can start for as little as $1, which increases access to trading, and also allows them to see sizable gains. By doing so, we have found that our traders are more fully equipped to tackle the markets. When we combine this with their understanding of which opportunities to look out for, our traders are consistently profitable.

Big talk about Libra, many saying it’s just a PR stunt. What do you think?

I don't have too much of a comment on this, as we are an exchange with a mission to make trading accessible. What I can say though is that the announcement has brought more light to the industry, which I believe is always a good thing. It’s made people more aware about blockchain and the space we are in, which is great for increasing adoption.

What should investors know before trading cryptos?

Research, study, and gain a good basic understanding of the industry first. This will allow investors to know what they are getting into, and also know what they should be paying attention to in the markets. I believe this really helps with identifying what opportunities to look out for.

If you could pass one crypto related piece of legislation what would it be?

My dream crypto legislation would be anything that would allow users to have easier access to buying and selling crypto.



About the Author

Jacob Wolinsky
Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Prior to ValueWalk, Jacob was VP of Business Development at SumZero. Prior to SumZero, Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver