Although centralized crypto exchanges (CEXes) and decentralized crypto exchanges (DEXes) are often said to be in competition with each other, an executive from Huobi Ventures believes the opposite is true.
During the annual Harvard Blockchain Conference held 27 March 2022, Huobi Ventures Investment Director HaiJing Lin, who spoke as a panelist at the event, noted that while CEXes and DEXes seem to be vying for market share, “further differentiation in areas of expertise may allow each to establish niche markets that serve users in a collaborative manner.”
The result being “a symbiotic relationship between the two that nurtures the blockchain ecosystem and expands the decentralized economy.”
Lin said
“At this early stage, there is plenty of differentiation to be done around what crypto is as an asset, and what blockchain is as a technology. Centralized Exchanges aren’t necessarily losing volumes, users or assets to Decentralized Exchanges. They’re mutually incentivizing, and the pie is getting bigger, so we’re not necessarily eating out each other’s volume.”
Lin added that CEXes and DEXes each “offer different benefits and need not necessarily be in antagonistic competition with each other.”
He pointed out that the industry “will be more developed — there is a lot of space for collaboration.”
On the subject of recent increasing regulatory scrutiny of CEX by governments around the world, Lin “suggested that the pressure may instead be used as a path forward for mainstream adoption of cryptocurrency.”
Europe, for instance, is “an interesting region of focus where lobbyists may be supporting exchanges and positive regulations.”
Lin continued:
“I don’t see a world where fiat ever ceases to exist. CEX must work together with government and regulators to become compliant with local requirements and reach mutual understanding and clarity.”
At present, the Huobi Ecosystem “supports a combination of DeFi projects, including Atlas DEX and IDEX, to better serve the demands of users and institutions for DeFi services.”
In Hong Kong, a subsidiary of Huobi Tech with “Type 4” and “Type 9” licenses in Hong Kong “received permission from the Hong Kong Securities and Futures Commission to launch a cryptocurrency-based portfolio.”
In Japan, Huobi has “acquired the Japanese licensed crypto assets exchange BitTrade and is providing Japanese Yen-to-Crypto compliant exchange services.”
As a major blockchain company, Huobi Group was “founded in 2013 with a mission to make breakthroughs in core blockchain technology and further the integration of blockchain technology with other industries.”
Huobi Group has “expanded its products and services to public blockchains, digital asset trading, wallets, mining pools, proprietary investments, project incubation, digital asset research, and more.”
Huobi Group has “established a global digital ecosystem through investing in over 60 upstream and downstream companies across the blockchain industry.”
Huobi Ventures is “a wholly-owned subsidiary of Huobi Group that focuses on global investments.”
Huobi Ventures’ structure is “divided into four business lines: Strategic Investment, Strategic M&A, Asset Management, and Global Cooperation.”
Thus far, Huobi Ventures has “launched three funds to focus on Blockchain, HECO Ecology, and NFTs, respectively.”
Huobi Ventures aims “to drive growth for Huobi Group and create a global ecosystem with our partners.”