CoinEx founder Haipo Yang on crypto winter, the market’s future and expansion into Russia — interview

In 2021, the Chinese cryptocurrency exchange CoinEx added support for the Russian language and integrated popular payment systems widely used in the CIS. The platform’s representatives emphasised the importance of the Russian-speaking segment for CoinEx.

In June we spoke with the founder of CoinEx Haipo Yang. He told ForkLog about the exchange’s development during the bear market, the principles of listing new assets, and the behaviour of Russian traders.

ForkLog: You launched CoinEx in December 2017 when the crypto market was at its peak. Did the crypto winter of 2018–2019 affect your plans?

Haipo Yang: I once heard a maxim: “In a bull market follow the trend, in a bear market be bold.” In entrepreneurship, timing is crucial. The year 2017 gave startups a golden opportunity — to start a business in the cryptocurrency market.

Before launch, we carefully assessed user demand and the timing; product simplicity and asset-differentiation strategy distinguished us from competitors.

And yet, three years of bear market complicated managing teams, developing new products, and accumulating assets. Fortunately, we chose the right development plan. While other exchanges sought immediate profit, we focused on long-term growth.

One could say that crypto winter gave us time, reduced the cost of trial and error, and helped choose the best path forward.

CoinEx’s long-term strategy includes selecting cryptocurrencies for listing, expanding internationally, PR, R&D. Now we are working to turn CoinEx into a broker. We want to provide users with comprehensive investment services, for example information about cryptocurrencies, market conditions and industry news to help in making informed decisions.

ForkLog: Do you think the current market conditions resemble 2017?

Haipo Yang: Since its launch in 2009, Bitcoin has undergone four bull and bear cycles. They unfolded in similar patterns: people bought Bitcoin expecting growth and lost money.

The explosive growth of Bitcoin in the first quarter of 2021 awakened investors’ fear of missing out (FOMO). In May, a combination of positive and negative factors cooled the market. But the bull runs of 2021 and 2017 differ: this cycle was started by users in Europe and the US, whereas previously Bitcoin was bought by Chinese residents.

The bull market is ongoing. It is gradually approaching a stable trend. We have not noticed a significant drop in the platform’s popularity. Users continue to register on the exchange and provide liquidity. We anticipate Bitcoin will rise to new highs.

ForkLog: Which CoinEx product is most popular with users?

Haipo Yang: Perhaps, автоматизированный маркетмейкер (AMM), which allows investors to invest in liquidity pools. AMM users receive passive income: up to 100% of trading fees on native CoinEx token markets (CET) and up to 50% on other markets.

Currently CoinEx supports more than 300 AMM markets. The platform recalculates yields daily and distributes profits to users. Participation in liquidity pools allows earning on assets that would otherwise sit in wallets.

ForkLog: What do you think about the emergence of a large number of derivatives on crypto exchanges?

Haipo Yang: This question touches several aspects. First, derivatives are used by a limited group of traders: most users trade on the spot market. Second, traders often leave the crypto derivatives market after losing money. Third, many derivatives target speculation rather than innovation and quickly lose relevance.

Crypto exchanges are increasingly launching derivatives, but during bull markets users prefer spot trading. Crypto derivative platforms like FTX are moving toward spot trading. This aligns with user demand.

Derivatives in the crypto industry have become a full-fledged market. Futures and options on cryptocurrencies keep pace with traditional markets, and now it’s hard to find more innovative products.

ForkLog: The CoinEx ecosystem includes blockchain CoinEx Smart Chain (CSC) and native token CET. Binance and FTX are developing their own decentralized exchanges (DEX). How do you assess the role of DEX in crypto markets? Are such exchanges needed by users?

Haipo Yang: DEX is the most innovative product of the DeFi sector. Enthusiasts have worked on the concept of decentralized exchanges since 2013. It became a reality with the launch of Uniswap in 2018. It popularised automated market making and free token listing, and solved the problem of circulation “long-tail” assets.

The crypto industry is concerned about centralised exchange security. And DEX users hold their assets in their own hands and do not fear hacks.

Investors quickly understood the advantages of decentralized exchanges. DEX appeared on all major PoS blockchains. And as long as users are interested in decentralised products, DEX will continue to grow.

However, DEX is not perfect. Fake coins have spoiled the lives of many investors. Centralised exchanges addressed this with standardised token checks before listing. I think decentralised and centralised exchanges can complement each other.

ForkLog: In February 2021 CET surged in price. What do you expect from the token in the long term?

Haipo Yang: CET is undervalued. Along with Bitcoin and Ethereum it forms a large share of my investments. I’m not extolling our token, but in 2021 I bought CET for tens of millions of dollars. It has strong prospects as a long-term investment.

CET was created to fight inflation. In February 2021 CoinEx burned more than 1.08 billion tokens. The exchange spends $100 000 daily on CET buybacks, which exceeds the value of mined tokens.

On the one hand, emission restraint and regular CET burning reduce the supply on the secondary market. On the other hand, the number of large CET holders is growing exponentially. CoinEx attracts a million unique visitors per month. If you compare the token’s price with exchange tokens with similar metrics, you can again confirm CET’s undervaluation.

In the last two years we have increased the value of CET: made it part of the privileges program, and with the launch of CoinEx Smart Chain — as the native token. CET became a core element of the CSC ecosystem and gained growth potential.

ForkLog: Do you plan to launch DeFi products on CSC?

Haipo Yang: We have been watching the development of the DeFi sector and have worked in this direction for almost a year. On 31 May we launched the CSC testnet, and in June the CSC itself. CSC is an efficient and inexpensive operating environment optimized for DeFi. And it is compatible with Ethereum: developers can easily port apps, tools and components from that ecosystem to CSC.

For now we are trying to attract popular projects and developers. To this end we launched a $10 million fund. Promising projects can receive up to $100,000 to develop dapps for CoinEx Smart Chain.

ForkLog: In January 2021 CoinEx added Russian language support. Did you notice an increase in new users after localization?

Haipo Yang: We want CoinEx to be the leading cryptocurrency exchange. For this you need solid localization. User experience is our main priority when entering the local market.

The translation of the interface into Russian is part of preparing CoinEx’s expansion into the CIS countries. We also plan to attract users who speak Spanish, Korean, French, Japanese and Arabic to the exchange.

After localization the number of Russian-speaking users of CoinEx grew by 358% compared to 2020. In other regions the monthly growth rate of new users stays at 105%. These figures prove that our efforts are paying off.

ForkLog: Are there Russian-speaking staff in the CoinEx support team?

Haipo Yang: Yes. They are helped by enthusiasts among ambassadors. Users can submit inquiries through tickets on the CoinEx site, as well as via Telegram and Twitter of the exchange.

ForkLog: How will CoinEx develop in the CIS market? Do you plan to open an official office and expand presence on social networks?

Haipo Yang: CoinEx follows the principle of “the customer comes first,” so we will not indiscriminately launch marketing campaigns. More importantly is to continuously improve products. We plan to translate help pages into Russian, refine localisation and improve user experience. For example, we recently added support for popular Russian payment systems so users can buy cryptocurrencies with rubles and tenge. We plan to add more CIS currencies and enable card withdrawals.

CoinEx takes cultural differences into account. Our team includes talented people from around the world. The regional representative in the CIS lives in Russia. She knows the culture, interests and habits of Russian-speaking crypto enthusiasts well. We also hire Russian-speaking ambassadors to help promote the brand.

ForkLog: How do you assess competition among exchanges on the Russian-speaking market? What advantages do you have?

Haipo Yang: Russia is a market with huge potential for the crypto sector. Russian-speaking users think independently and respond well to innovations. And Russia has many Bitcoin farms. In 2018 the mining pool ViaBTC entered the CIS market and attracted a significant number of Russian-speaking miners.

Perhaps CoinEx doesn’t have the widest range of products. But we design every tool with the question: “How will this increase users’ profits?” For example, this year CoinEx launched AMM that optimizes liquidity on the spot market and lets investors earn passive income.

When selecting assets for listing we do not look for explosive growth, hype and speculative potential. First and foremost we care whether a cryptocurrency is suitable for long-term investment. With this approach our users rarely lose money on shitcoins.

At present the exchange supports 294 cryptocurrencies. In other words, we have 95% of high-quality projects in the crypto market. The main advantage of CoinEx is careful asset screening.

Over the three years of operation CoinEx has never been hacked or attacked. I think 99% of exchanges cannot claim that.

But we understand that cautious listings and security measures are not everything. One of my personal goals is to make CoinEx the best localized exchange in the Russian-speaking market, so users feel a physical and cultural connection with the exchange.

Read ForkLog’s Bitcoin news in our Telegram — crypto news, rates and analysis.