Sept 2nd, 2020
DigiFinex AMA Recap – Cryptocurrency, the Future of Finance
In the last decade, Blockchain technology has played an essential role in putting forward a decentralized payment system. Ever thought about how it can influence the traditional finance industry? For better or for worse? Perhaps Michael will be able to answer that with exclusive insights for you.
The 6th DigiFinex AMA took place on August 31st, with the CEO of the Sydney Stock Exchange, Michael Go, to open up on how SSX operates, and shares an exclusive point of view on the traditional financial industry and the future of cryptocurrency. The influences blockchain technology has on the traditional financial field will also be a main topic to be talked on.
Guest of the night, Michael Go, CEO of Sydney Stock Exchange
Michael Go is currently the CEO of the Sydney Stock Exchange and has broad experience working in the international financial markets. He is familiar with the challenges and opportunities presented by Australia’s financial services, and the changing technology and business models. He has also been involved in start-ups and high growth businesses challenging traditional models.
Prior to SSX, Michael was Head of Trading, in the Asia Pacific market for Thomson Reuters. Previously he was the Global Managing Director and appointed in C-Suite roles overseeing the Operating and Growth strategies of major Global and Domestic Banks with responsibility for developed and emerging markets internationally.
Michael is also involved in several start-ups in the Digital, Financial, Clean Energy, Payments, Agricultural Technology and Fund segments, with an emphasis on supporting the development of the next generation of financial services.
Host of the night, Kiana Shek, DigiFinex CXO
Previously working for Baidu as Assistant General Manager, Kiana has had advanced education in the financial field, also obtaining a rich background in Big data, AI, international businesses. In 2017, she founded DigiFinex as a Co-Founder, and dedicated to provide a safer, convenient, transparent digital asset exchange platform for the people. She is also responsible for promoting brand values globally on behalf of DigiFinex, and actively takes part in various Blockchain summits around the world.
Below is a highlight of our Live Session:
# Michael Personal Interview
Kiana: Hello Michael, thank you so much for your participation to DigiFinex’s 6th AMA. Our users are crypto lovers and investors from different parts of the world, which will bring forward some variance from investors of traditional markets. Perhaps our audience doesn’t know Michael well enough to understand why I’m bringing up the difference between both markets. I will allow Michael to first greet our audience with a brief introduction of himself!
Michael: Thank you for the introduction Kiana. It’s great to be here talking to you and the audience about this subject.
You’re quite correct that I come from a long background in the financial markets in Asia and in Europe, mostly in the investment banking sector but also the electronic trading platform, broking and payments sectors.
This is all important to us as I believe that while we see new and innovative technologies, business models and investment platforms being created, the fundamentals of the financial markets and investment remain and the protection of the investor is more important than ever. We’re seeing successful integration of established stock exchanges converging with innovative digital exchanges and their products so it is an exciting time to be in the markets.
Kiana: So as you all have heard, Michael is very experienced in the financial field and definitely a well known professional among exchange centres and investors in the Asia Pacific region. In today’s live, we will be opening up with everyone on how SSX operates, and Michael will be sharing a rare point of view from the executive board on traditional financial industry. And of course, we will discuss together the future of cryptocurrency, and the influences blockchain technology has on the traditional financial field.
# About Australia’s financial market, and everything about SSX
Kiana: First question, in your opinion, what is Australia’s financial market’s outstanding advantage in a global picture?
Michael: Australia has a distinct advantage over other locations because it has a strong regulatory governance environment in a well established legal jurisdiction that protects companies and investors. The advantage is that we have the ability to have a balanced, impartial view on the market participants with a framework that ensures there is impartiality in the process. Australia has a number of social frameworks that support ongoing investment growth such as compulsory Superannuation (Pension Fund) of 9.5% that means a growing annual investment base across the working population. It also is a strong source of educated and capable resources, generally able to add value to the market.
Kiana: According to articles, since your joining to SSX as CEO from Dec 2019, you have introduced a new wave of reforming practices, also implementing new strategies to support proactive and emerging firms in Australia and Asia Pacific in areas of technology, resources, properties and sustainable development.
Could you briefly tell us the objectives and targets behind these new takes? And what could investors take away from these new strategic reforms on investment?
Michael: Yes, I’ve made it a priority to ensure the SSX is seen as a strong Asia Pacific exchange that is able to allow storing companies with good governance practices in growth mode from across Asia Pacific to IPO. The SSX is a Tier 1 licensed Stock Exchange in Australia and can list any sized company but is focused on supporting growth companies who are ready to begin their strategy of maximising their potential.
We focus on Property (Real Estate Trusts), Tech companies, Mining & Resources (and have just listed a Gold mining company) as well as ESG (Environmental, Social, Governance).
The upshot is that more companies can get listed and capitalised in a shorter time (4 – 6 weeks) which leaves them in a stronger position.
Kiana: Is SSX, or other traditional exchange centres in Australia, considering to develop businesses and opportunities in cryptocurrency, or maybe in the form of partnerships with cryptocurrency exchange centres?
Michael: It does indeed. The SSX as a Tier 1 licensed stock exchange must be very careful to ensure it understands the intent and operating model of any company it deals with and as we know there are many in the new digital sector that have fallen by the wayside because of serious flaws in their business model which does not protect the investor. We are at the forefront of this in terms of our research in the sector and aim to engage with those who have an ambition to run a platform that could easily work within a regulated environment. I must say there are quite a number in this regard also.
# “Cryptocurrency, the Future of Finance”
Kiana: I have come across some of your sharings from Linkedin on Blockchain related news, perhaps you personally are quite attracted to the development of the blockchain industry too.
I would like to ask for your view on blockchain development, especially in cryptocurrency, as someone who is dedicated in the traditional financial field. Are you for or against it? Are there any current factors that will affect the traditional financial industry to invest in this foregin field?
Michael: I support blockchain development as part of the evolution of the financial markets. I have been part of a strong crypto exchange with a view to imparting my knowledge about the financial markets and regulatory governance and compliance, while learning about the crypto/digital side.
I’m a Board Member of Blockchain Australia and hope to learn as much as I put into this organisation.
Kiana: What sort of issues that exist in financial servicing do you think could blockchain technology apply to solve?
Do you think blockchain technology could bring forward certain positive reforming to the financial system?
Michael: The core of this is digital security. The transfer and settlement of funds across the markets is key and one that blockchain can certainly assist with. I can also see the advantages of the ability to utilise smart contracts that create a great digital trail of events and the security of these contracts and events across all aspects of industry, not just financial markets.
Kiana: From this year April to July, DeFi’s market worth has skyrocketed from $1billion to $12billion, its swift growth rate and massive room for business development have garnered great attention from the market.
What is your view on DeFi, and do you think this is the future direction for financial services?
Michael: To be frank, DeFi is a name used to apply to the Blockchain solution of digitising financial services. I think it is extremely important as a vehicle for change and it will continue to grow.
The technologists developing these solutions and entrepreneurs creating new business models over the top of this technology will be the big winners as traditional banks and financial institutions grapple with the concepts and their own internal priorities and procedures, keeping them behind the new pack.
Everyone wants to see speedier and frictionless transactions which are cheaper and more accurate. Peer to peer business models not just between individuals but more importantly, businesses and market places that are peer to peer will be the future, once current institutional biases are left behind. Look out for more “Buy Side” markets that leave out the Sell Side banks, for example. We see this in Foreign Exchange where Peer to Peer is common place now and is more efficient and a friendlier experience. The caveat is, of course, that they must have the right level of governance and controls in place. This is where the market has been let down and where individuals have created distrust with governments and regulators. Blame those guys for the cynicism felt in most government quarters.
Kiana: In view of the future expansion of the crypto industry, what are your predictions and suggestions, is there a tendency to regulate the business or other possibilities?
Michael: There is no doubt that there will be more regulation which is not a bad thing if it increases the number of investors in the market and allows them to run in tandem with traditional markets which are by average daily volumes many many times larger than the crypto markets. The potential is huge for the right businesses.
Kiana: Would you say cryptocurrency is the future of financial businesses? Do you personally hold any cryptos at the moment? How is it possible for people to accelerate the learning process and invest into cryptocurrencies?
Michael: The future is very bright and I would say that the financial markets and other industries are waiting to accept the new technology when they can trust the players as being of the right quality rather than the appearance of being a high risk, long shot. I don’t generally discuss my investments but I will say that I know a growing number of people who do hold crypto that would not have been supporters of this new investment class only a few years ago.
# Opinion on China’s financial market
Kiana: With regards to 2020’s pandemic impacts, the global economy has declined as a result of business halt. What is your general view towards China’s current economy and financial market? What are your expectations on China’s financial market?
Michael: I think China is a resilient country and their economy has been strong enough to grow despite others shrinking. During the pandemic, they will have a strategy and buffer in place to protect their economy. The growth we have seen over a number of years may not be as high but I am sure it will be higher than competing countries as a result of long term planning.
Kiana: Are there any sectors in China’s financial market that you reckon is doing particularly well? Any reasons behind that if so?
Michael: It’s an interesting question. I would think the Commodities and Equities markets will be strong as gold and precious metals increase in price. And the Equities market will grow in line with more companies wishing to list domestically (individually or dual listed), showing loyalty to their home markets and with reciprocating loyalty from domestic investors.
Kiana: DigiFinex has recently launched China A Shares Crypto ETF trading pairs! Global users will be free from registering a brokerage account or RMB account, directly investing into China’s A Shares from DigiFinex registered platform. Have you ever invested in A shares from China’s stock market? If yes, could you share with us your stock type, and your view on China’s A shares market’s future trends?
Michael: I think this could be a popular product with the art in acceptance of this product being in educating investors to ensure it is seen as a simple product to invest in, rather than a mystery. As said, I don’t really discuss my own investment strategies but I do think the China A share market is going to grow and become stronger.
Platforms that are supported and are investor friendly will win out and if the authorities support them as being of the right quality then there will be huge wins for those companies for sure.
Kiana: Carry on with the previous question, do you personally think there are areas where A shares perform better than US stocks or Hong Kong stocks?
Michael: A difficult one but we can see the future is strong. A relatively young market compared with the US and HK which gives an advantage in terms of creating a market and avoiding any of the problems of these other markets. We also see the appetite for chinese companies and from chinese investors becoming larger and growing strongly in the tech sectors where we see supply chains growing globally as well as high tech and future tech stocks where we will see China excel over the coming years.
Kiana: Last question for the day! Are there any investment suggestions or products you would recommend to DigiFinex’s users?
Michael: As the CEO of a tier 1 stock exchange I can‘t recommend specific strategies or products but would suggest they do their research on the companies they intend to use for advice to determine whether they are aligned to their risk limits and parameters. If you’re not sure, I suggest it’s better to think twice before jumping straight in without prior knowledge of a product or market. A good company like Digifinex will always answer your questions and help you to understand the product and markets your thinking of investing in.
Kiana: Thank you Michael once again for the insightful discussion with us today. Not only are we seeing the great potential of blockchain in multipurposes, China’s stock markets are definitely worth taking time to study too.
We had a great AMA session with Michael Go, and learnt on how Blockchain technology could be a huge influence on the traditional financial market. Cryptocurrency on the other hand could be a game changer for the future in most aspects.
The Sydney Stock Exchange (SSX) is a tier one licensed stock exchange in Australia. The SSX provides a fresh, flexible alternative for Asia Pacific companies seeking the opportunities for growth that only listings can bring.
To watch the AMA Live, click: AMA | Cryptocurrency, the Future of Finance
Sources: Sydney Stock Exchange