Bitsonline was able to sit down with LakeBTC CEO Thomas Xie, to shed some light on the well-regarded but little-known bitcoin exchange. Xie also talked about LakeBTC’s recent project, LakeBanker — an attempt to create a decentralized bank.
Xie is a cryptocurrency veteran, since 2011. He co-founded LakeBTC, one of the world’s leading cryptocurrency trading platforms. After graduating from Beijing Institute of Technology and working for IBM, Xie became a serial entrepreneur with 18 years of experience in the technology and financial services industries.
Bitsonline: Your company has been around for years and seems popular with users, but there’s been almost no marketing or publicity. Why is that?
TX: Our style is to get work done before talking. In the current climate of hysteria around blockchain, many projects are excessively focused on marketing grand ideas with little substance behind them.
We’re not like that. We’re real blockchain enthusiasts: we want to bring cryptocurrencies to billions in the real world, not just the world of ideas and marketing.
LakeBTC has many customers with little money and limited access to banking who want to invest in cryptocurrencies but have no feasible way to do so. A big part of our model is to help people like this. Even though we’ve had little recent publicity, we still sustain interactions with the traditional financial world, including banks, payment processors, credit card companies, insurance, asset management and regulators in small circles relating to Blockchain and cryptocurrencies.
The demand for LakeBTC’s services has been exceptionally strong. As has the demand within the LakeBanker beta. We have been dealing with that. The feedback from the beta has allowed us to streamline our processes and improve the system. Now it’s ready for the world.
Bitsonline: A form of LakeBanker has already been operating for a year or so. How does introducing a native token improve that experience for network members?
TX: We’re introducing the token ‘banc’ (BAC) to drive transactions within the LakeBanker system. All fees and interest will be denominated by BAC. The LakeBanker system currently deals with hundreds of countries and dozens of currencies with more to come as we expand.
A universal internal token will be more consistent and easier to use. Here’s an example of how the token integrates into our business model: Once we gather enough data for a region, value-added services such as credit lines and peer-to-peer loans will be offered.
Imagine the system extends a credit line of $5,000 to a user, and they borrow from that credit line. At the month’s end, they may owe 200 BAC in interest. The user can buy 200 BAC from the market to pay that interest. If they don’t want to buy BAC, they can become a LakeBanker and serve others to earn it instead. The earned BAC can be used as payment for services or sold to the market. In this way, BAC facilitates true “crowd-banking”.
Bitsonline: Does being based in mainland China present any problems when looking for investors and participants?
Xie: Not at all. For two reasons: Firstly, despite being headquartered in China, LakeBTC and LakeBanker are in fact international organizations with plans to open offices in Hong Kong, London and elsewhere.
Our team and advisory board comprise an international group of experts in finance and blockchain technology. Our potential corporate partners are spread throughout the world. As are our customers.
Secondly, any fears about China as a location for financial innovation tend to be based on unsubstantiated rumor and gossip. If you look at the actual evidence, it’s clear that China is a friendly environment for crypto-assets, blockchain-related startups and other financial innovations, including ICOs.
The Chinese national government is keen on risk management for sure. But that will be an attraction, rather than a deterrent, to serious investors. Our CSO wrote a detailed post on this question. You can check it out on our site.
Bitsonline: What has been the response to your token sale so far? Any lessons learned?
Xie: Many investors are now participating: Some are long term investors who recognize the strength of our business model and the potential for our token to circulate amongst many millions of users in the long run.
Some want to join us in revolutionizing banking to improve the lives of millions of people. Some are current participants in our beta, wanting to be part of the coming expansion. Some are professional traders who predict a 1300 percent flip can be made within two months.
As you know, the current price is 1 ETH = 1300 BAC, while in Phase 2 our auction starts with 1 ETH = 100 BAC. These traders think our Phase 2 (in Oct) is likely to close at that price. This is a 13x profit. So people have lots of different reasons for investing.
As to lessons learned: We actually started by looking into previous ICOs/token sales and saw a number of potential problems. For example, server overload, network congestion, blockchain confirmation delay and skyrocketing miner fees for users.
To mitigate these problems our system accepts contributions now, well ahead of the official Phase 1 start time: All contributions received before 15th September 3PM UTC will enjoy the first-hour price of 1 ETH = 1300 BAC, which is the best price anyone will ever get. We have set it up so people can get this price without needing to compete with one another to get their transactions confirmed at the last minute.
Further, during this period, participation is guaranteed: if we oversell, tokens will be allocated on a pro rata basis, so everyone can enjoy this price. Nevertheless, Phase 1 has a very small cap, and after 9/15 3pm, it’s first come first served. So early participation is recommended.
What do you think of Thomas Xie’s comments regarding LakeBTC and LakeBanker? Let us know in the comments below.
Images Via LakeBTC, Pixabay
Bitsonline senior editors Scott Fargo and Jon Southurst are LakeBanker advisors.