The same is true in the cryptocurrency industry. To make big money, you must have ethics.

Interviewee: Li Guoquan, Professor at Singapore University of Social Sciences

Interview and article: Anderson Sima, Foresight News

After finishing his 20-minute speech, Li Guoquan rushed to the interview room. Compared with the young audience, he was one of the few participants who was over 70 years old. But in the field of blockchain, he is a rare expert and scholar.

Li Guoquan is a professor at the Singapore University of Social Sciences and the chairman of the Global Fintech Academy. After graduating with a doctorate from the London School of Economics and Political Science, he taught at top universities such as the National University of Singapore. In addition to his academic years in the ivory tower, Li Guoquan also has rich business experience. From hedge funds to real estate development, Professor Li Guoquan has always been with entrepreneurs.

His connection with blockchain originated from his own children. When his youngest son was 14 years old, he told Li Guoquan that he could earn Bitcoin by playing video games. Since then, Li Guoquan has discovered a brand new field. In 2014, Li Guoquan opened a blockchain course at Singapore Management University (SMU), becoming the first scholar to study and open blockchain courses in the local area. The book (Digital Currency Handbook) he compiled in 2015 also won the American Library Association's Outstanding Reference Book Award.

Interestingly, this Singaporean scholar is also very concerned about China's issues. In his keynote speech at the Shanghai Blockchain Week on October 17, he mentioned his understanding of "new quality productivity". He believes that for foreigners, the meaning of new quality productivity is the industrial integration of emerging technologies such as AI, blockchain, new energy and other innovative technologies.

Li Guoquan giving a speech Source: Wanxiang Blockchain Lab

After the speech, Foresight News conducted an exclusive interview with him. The following is the edited full text.

Foresight News: What do you think of the current blockchain ecosystem and its future development?

Li Guoquan: In the early days, there were many weeds. After new funds such as ICO entered the blockchain industry, various projects entered a stage of flourishing. In the end, only 5% or 1% of the projects may survive the test of the waves, but the surviving projects are already very mature.

Bitcoin has been around for more than a decade. It is hard to see a thousand-fold increase in price in the future. Currently, its valuation is similar to that of traditional companies. It is no longer a wild field, but is thriving in a well-managed "garden". As for Ethereum, you can see that its transaction fees have been reduced to a very low level, and its user base is growing. Competition from public chains like Solana is also becoming increasingly fierce. It can be said that the development of blockchain in the first 15 years may be completely different from the development in the next 15 years.

Future projects will definitely not just be about issuing coins. New tracks like RWA and DePIN will combine the broader traditional economy with blockchain technology, which all have great prospects. But there is an important criterion: new projects must consider what benefits they will bring to the national economy, whether they will bring compliance, legality, security, common prosperity and sustainable development. If your Web3 project makes a great contribution in this regard, the next 10 years will be yours.

Foresight News: What do you think of mainland China’s strict regulatory attitude towards cryptocurrency-related fields?

Li Guoquan: From my personal experience in Singapore, about 10 years ago, I predicted that the government would definitely accept Bitcoin, and now the results prove that our view at that time was correct. If I were to predict now, I think Web3 will also be used by the Chinese government in the future, and I am full of confidence in this.

Because every new financial product goes through a development phase, the Chinese government has chosen to suppress the "hype" and other chaos when the weeds are growing, so I agree with everything that Chinese regulators have done. When everyone starts to comply with the law, the relevant international regulatory mechanisms have been established, and cryptocurrency has become an important channel of global finance and a legal investment target, I think China will be no exception.

Before regulation, one must have some understanding of the industry, but the blockchain industry was born relatively late, which makes it difficult for regulation. But now you can see that the BIS (Bank for International Settlements) is involved in this field, central banks and commercial banks of various countries have begun to do so, and financial institutions have begun to open their arms. So I predict that China will embrace blockchain technology and cryptocurrency sooner or later.

Another example is Hong Kong. It shows that China is willing to encourage the development of cryptocurrencies, but it must be locally controllable and allowed to develop steadily under systemic supervision, so Hong Kong is a test field. I think everything Hong Kong has done is very good, including the newly established compliant exchanges, which are growing much faster than before.

Foresight News: In comparison, what are the characteristics of Singapore’s approach to cryptocurrencies?

Li Guoquan: In the field of blockchain, Singapore plays a pioneering role. Singapore's market will not be larger than that of the United States. When the United States formulates various regulatory frameworks for cryptocurrencies, they may be faster than Singapore.

Singapore's advantage is that it can act as a bridge between China and the United States. In the game between major powers, both sides are wary of each other and cannot trust each other's technology and network. In this way, Singapore has its own position, and the unified public chain it advocates has the opportunity to link China and the United States. This is different from Hong Kong, which has a large hinterland behind it, so I am very optimistic about Hong Kong.

Foresight News: Do you think the US presidential election in November will have an impact on cryptocurrencies?

Li Guoquan: I think no matter who wins the US election, it will not have a big impact on the overall trend. The cryptocurrency industry will continue to rise, but if Trump comes in, the speed may be much faster. Because from many years of experience, now the right time, right place and right people are all there, and cryptocurrency has become an important tool for the compliant financial system. At the same time, it has also become a political tool that can bring a large number of votes, and it has become a tool for the game between major powers.

Foresight News: What do you think about the development of AI technology? How does it relate to blockchain?

Li Guoquan: First of all, the compliance cost of AI will be very high, much higher than that of cryptocurrency. The characteristic of AI is that the winner takes all. From the perspective of investment scale, only governments and large institutions can afford it, and it is difficult for individuals to participate. One of the characteristics of AI is that it can improve efficiency, but it does not create a large number of jobs and wealth. If AI is used maliciously, the consequences will be very serious. Therefore, we need to develop AI technology responsibly. The series of cryptography and smart contract technologies represented by blockchain can help AI provide a guarantee for humans in data storage, data distribution and data ownership. This kind of technological integration is an inevitable trend in the future.

Foresight News: You have always emphasized that the development of technology should be "people-oriented" and "common prosperity", but the cryptocurrency industry also follows the Matthew effect. What do you think?

Li Guoquan: Because the pioneers bear greater risks, they get high returns. From the perspective of traditional compliant financial products, the annualized returns of these products are mostly 10-20%. Any higher means huge risks. Now cryptocurrency investment has been included in the compliance system in many countries, which means that the current investment returns may be within 30%.

Therefore, every new industry will go through a stage of overgrown weeds. There will be nouveau riche, and many pioneers will make a fortune without knowing much. This is as it should be because they are taking huge risks. Then, as compliant institutions enter and the industry matures and creates a large number of jobs, the high returns will slowly disappear.

If you want to be at the forefront, you have to be brave enough to try something new and risky, but at the same time, what you have to do is bring a gray area into compliance and get these pioneers on the right track.

In addition, I have another point of view. You are not fighting against the traditional industry and cutting a piece of their cake. It is difficult to achieve explosive growth in this way. You must create a new industry. No one knows how to make money. If you have a new technology to make money, it is equivalent to creating a new flavor of cake and letting others share it with you. I think this is what young people should consider.

At the same time, you also need to understand the rules of the game in this market. If you want to develop safely in a gray area, you must have a good sense of morality and ethics. Only when you do gray business within the framework of sustainability, when you see risks, you know how to pull yourself back.

I think if you want to make a lot of money you must have ethics. Without ethics, you will quickly be pulled apart and eliminated in an instant. There are many such examples in the industry. If you don’t have ethics, you will most likely become a fraud group in the future.

So don't chase money, let money chase you. Everything you do should be in demand in the market. Although you may not see returns in the early stages, sooner or later the market demand will find you.