On September 4, 2017, a ban on fiat currency trading and ICO financing of cryptocurrencies was introduced. At that time, the two trading platforms with the largest domestic trading volume were interviewed by regulators. Subsequently, the two trading platforms issued announcements saying, User assets can be retained, but all related trading businesses will be stopped.

Soon after, domestic exchanges chose to go overseas, that is, to place their company registration places and operating entities abroad, in order to participate in the global market, and continue the business of "selling water" on the gold rush.

Next, a natural question is, can the "overseas exchanges" in the currency circle find gold? Is it easy to make money?

Give me your money

As early as June 2017, Binance, founded by former OKCoin CTO Changpeng Zhao, had focused on overseas markets and deployed a large number of servers abroad. After the 94 ban, the domestic exchange track experienced a short "window period". Will it call it a day or move overseas? While everyone was hesitant, Binance was reaping the benefits. Liquidity that had nowhere to go gradually entered Binance, which caused Binance's cryptocurrency trading volume to continue to rise.

Capital always pursues profit. After smelling business opportunities in foreign markets, domestic exchanges began to plan to go overseas. After the two giants at the time, Huobi and OK (OKCoin separated from OKEx), made decisions, other Chinese exchanges also followed suit.

Singapore is the first stop for many Chinese Bitcoin exchanges to go overseas. This has a deep-rooted relationship with Singapore’s multicultural genes and open economic environment. According to the 2018 Global Financial Centers Index (GFCI) ranking report, Singapore is the fourth largest international financial center in the world.

Singapore is not lagging behind in the research and development of cryptocurrency. The local financial regulatory bureau classifies digital currencies into three categories: utility tokens, payment currencies, and security tokens. Such a classification regulatory system is very rare in Asia. According to Lieyun.com, a piece of data shows that as early as 2017, Singapore was the third largest ICO market in the world in terms of the amount of funds raised, second only to the United States and Switzerland. 94 In the months following the ban, Chinese citizens quickly established over 1,000 foundations in Singapore.

However, the road for domestic exchanges to go overseas for gold mining does not seem to be smooth. "Sometimes, I feel like I can't integrate into the environment of foreigners, and they are not used to using it." A staff member from "Overseas Exchange" told BlockBeats. In addition, at that time, the overseas market share was still not developing and growing. The Chinese were one of the main forces in global currency speculation. It was impossible for any exchange to completely abandon the domestic market.

On the other hand, it is not particularly smooth for overseas exchanges to come to China for gold mining. Subject to domestic regulatory policies and user KYC rules, there are very few Chinese people who actually trade on the main sites of Coinbase, Bitstamp, and Bithumb. Among them Most of them are based overseas all year round. Similarly, for these exchanges that focus on overseas, making money in a compliant environment is a top priority. Compared with this, entering the Chinese market has small returns and uncontrollable risks.

It is not an easy path for domestic exchanges to go overseas. However, the people of the past planted trees for the shade of the people of the future. Although it was not completed in the end, it left valuable assets to those who will go overseas in the future: supporting technical solutions, system service providers, market makers and user communities, as well as how to comply with regulations and how to go overseas in the process. Respond to different cultural environments.

I have the money

If the registered address is overseas, does it really mean that it is serving overseas users?

BlockBeats counted the top 100 exchanges in BitUniverse and found that nearly 60 of the "overseas exchanges" have business service targets concentrated in China.

There are a large number of second- and third-tier exchanges, such as DigiFinex, Coinbene, and BitForex registered in Singapore, Bibox and Hotbit registered in Estonia, Bgogo registered in the Cayman Islands, etc. In fact, the main users are still Chinese.

"Converting exports to domestic sales" is also a helpless move for these exchanges. “Foreigners’ stickiness to local exchanges is still very high, and it is difficult to compete with established Bitcoin exchanges.” When BlockBeats interviewed an exchange operator, the other party responded, “These are pretty good, and there are some In the end, the exchange couldn’t continue, so it used the excuse of going overseas to leave.”

At the beginning of 2019, the bull market came, and a new batch of exchanges began to emerge. They had money, resources, and strength. Among them, BiKi is a typical representative. Unlike the exchanges that emerged in the wild era, it is difficult to stand out from the leading platform without differentiated strategies during this period. BiKi’s initial currency selection strategy is somewhat similar, such as preferring those with strong community awareness, or those with strong community awareness. The currency used in the economic model gameplay was later called "popular currency", "community currency" and "model currency" by the market.

They understand the domestic market better, and more accurately, they have tapped into the sinking incremental market and gained a group of new users. So, for the emerging exchanges that have made major breakthroughs this year, do they have overseas What about the gold mining plan?

to da moon

Taking exchanges such as BiKi and TradeOgre as examples, BlockBeats conducted interviews and in-depth analysis on this issue.

"Massive projects rely on quantity to win, and they use crazy tactics to build groups and attack the sea of ??people." BlockBeats summarized BiKi's market strategy 4 months ago. To this day, their style of play remains unchanged. According to Coingecko statistics, BiKi has launched 298 trading pairs, covering 173 currencies, including mainstream currencies such as BTC, ETH, and XRP, model currencies such as VDS, and many less well-known popular currencies with active communities. coins and community coins.

BiKi even wanted to borrow the traffic of the traditional Internet and launched TYD (an ERC20 token exchangeable with Tianya Diamond at a ratio of 1:1). "Users will still follow the assets, and they will go wherever the assets are valuable." Winter, the founder of BiKi, said in an interview. Indeed, the hot topics of 2019 are covered almost exclusively.

This enabled BiKi to hand over excellent data sheets with nearly 1.5 million registered users and over 130,000 daily active users, and also made BiKi the 2019 legendary exchange in the minds of many domestic investors.

On the other hand, BiKi’s partner program has promoted the fission of the community and users, and systems such as locking up 10,000 platform coins and promoting rebates have accelerated the spread of the brand. Winter said that BiKi hopes to bring rich digital assets to users in these third- and fourth-tier cities and design complete incentive rules so that everyone who brings resources, users and projects to BiKi can receive tangible rewards. . According to Winter, in June this year, the exchange had more than 1,000 community partners, and the total number of community members exceeded 100,000. The goal by the end of this year is to increase the number by another 10 times.

However, can this almost crazy growth strategy still work overseas? Can BiKi speed really be replicated?

An exchange called TradeOgre has entered the field of vision of BlockBeats. Coingecko shows that this exchange, founded in 2018, currently has a real daily trading volume of US$85,000, but it still has about 10,700 Twitter followers. What’s even more noteworthy is that this exchange seems to focus on “Ono Coin” and its users are very sticky.

The so-called "Ono coins" are those mining coins that use PoW as the main algorithm and have low market value and popularity. Ravencoin (RVN), which is now famous on Binance’s main website, was first launched on this website. Looking at the list of coins listed on TradeOgre, we found that all coins are very similar in "temperament", such as TRTL, LOKI, DERO, etc.

Obviously, TradeOgre has proven that differentiated currency selection strategies will still gain good attention abroad. Similar overseas exchanges include Trade Satoshi and qTrade, but what they lack is an explosive growth strategy. , and this is exactly what BiKi is good at. Let’s make a bold assumption, what kind of chemical reaction will be produced by TradeOgre’s currency listing plus BiKi’s community partner strategy? If BiKi also uses the strategy of combating deviations and supplements community fission, will foreigners be completely indifferent to this type of exchange?

I’m afraid not necessarily. Potential assets do not respect national boundaries. One of the core factors for users to stay is whether they can make money on a deep platform. Globally, sinking users also exist objectively, but the proportions are different in different countries.

In this regard, BlockBeats interviewed BiKi Southeast Asia CEO Ethan. He told reporters: "BiKi has formed a prototype of an overseas strategy. First of all, BiKi will help overseas projects develop the Chinese market, including social development. Group fission, media promotion and market consultation. Secondly, BiKi will look for sinking opportunities in the international market through Meetup, technical seminars and other landing activities, and establish in-depth relationships and resource exchanges with overseas project parties and investors, which can also help China's The project goes to the international market." Fighting alone is not enough. It is understood that they have hired a team of more than 10 people from the Southeast Asian market of a well-known exchange to further develop markets in Southeast Asia and other places.

Perhaps in some Western developed countries, their sinking incremental strategy will not be as sharp as it is now, but it will still be effective. In the broader Southeast Asian and African markets, the sinking incremental strategy is exactly the same. It is ignored by native overseas exchanges. According to the latest weekly report, BiKi has begun taking action to prepare to enter new overseas markets. Between September and October, it has communicated with 86 high-quality overseas projects, of which 24 are popular and 9 are planned to go online. In mid-September, BiKi held three consecutive conferences and parties in Singapore, and was invited to participate in the DELTA Summit event in Malta in early October.

There are reasons for their actions and behavior. According to PwC's Global Consumer Insights Survey 2019 report, Southeast Asian countries or regions account for 6 of the 10 regions with the highest mobile payment penetration rates. Compared with Europe and the United States, the number of bank cards in Southeast Asia is very low, and the traditional generation of credit card payments lags behind, which has led to the rapid development of mobile payments, especially in Vietnam, Thailand and Indonesia.

In Southeast Asia, the mobile payment market is fragmented and not as unified as China’s WeChat and Alipay. Furthermore, the recent regulatory environment in Southeast Asia has been looser than in 2017. These may bring new opportunities in the digital currency payment and blockchain industry. On the other hand, the gap between urban and rural areas in Southeast Asian countries is huge, which brings fertile ground for sinking incremental markets.

Simple copying is naturally a dead end. After all, the infrastructure and cultural environment in China and Southeast Asia are different, and cryptocurrency may still be in the market education stage. However, exchanges like BiKi, which have achieved rapid development by relying on community fission this year, can use their existing experience in overseas markets to think about the differences in details between domestic and foreign users, such as UI/UX, usage, etc. Customs, etc., adapted to local conditions.

Looking back to the country.

Just on October 10 this year, the official Weibo of Alipay Security Center reiterated its attitude towards OTC virtual currency transactions, announcing that Alipay is prohibited from being used for virtual currency transactions and that relevant services will be stopped immediately upon discovery. In a short period of time, this Weibo post caused an uproar in the industry, and many people speculated that "there are not many opportunities left for the Chinese market."

This problem is not only left to BiKi, but also to all cryptocurrency exchanges that want to truly “export”.