In June, BMAN announced he has teamed up with Jun Du, the cofounder of Huobi, to launch a $400 million fund that will focus on Web3 builders. The name of the new fund is ABCDE, which stands for “A Blockchain-Centric Development Ecosystem.”
As one of the OGs in China’s crypto world, BMAN has experienced multiple market cycles and has accumulated a deep understanding of the industry. Meanwhile, his previous entrepreneurship experiences in Web2 enabled him to jump out of the inertial thinking of the crypto field. He holds a deep belief in the concept of world citizens and freedom, as most Web3 believers do, while he also believes Web3 might need a super app to provide an integrated-service solution to invite more people to the game, which might be the opposite of many Web3 people’s intuitions.
In this interview, BMAN recalls his past 10 years in the crypto world and introduces what ABCDE is trying to do to reach his expectation that the crypto industry will reach 1 billion users in the next cycle. It is an ambitous goal, since the industry is estimated to have only approximately 300 million users. However, the development of the crypto world is astonishing. No one can deny that few fields in the world are quaking like crypto these days. As BMAN said, “I am a lucky one to enter the crypto world when I was still in school and observed its development. It is a wonderful journey, not only for the industry, but also for myself.”
Pandaily: You are part of one of the earliest waves to join the crypto world. How did you come to know and enter the industry?
BMAN: I joined the industry back in 2013, when I was working for an American investor Simon Black. He graduated from West Point and once served in Iraq. He witnessed a lot of the cruel and dark sides of the Iraq War. After returning to the US, he decided to sell all of his properties in Texas and become a world citizen. He left the US when he was 26 and became a successful investor. I met him when he was 36 at an event host by him in Europe. I joined his team then as the first Chinese and he told me I should watch Bitcoin because it is a free currency. That is when I bought my first piece of Bitcoin.
In 2015, I co-founded a digital marketing firm. The firm was acquired by Baidu in 2017. We developed an AI tool with the support of big data available by Baidu to write the words of ads, so that to target audiences more accurately and eventually increase their conversions. I only stayed at Baidu for less than a year because I wanted to create more value. I noticed that some Web2 firms were struggling with bottlenecks, even if they have received series A or B funding. Many of them had the willingness to transition to crypto. I have entrepreneurship experiences, I also have a strong background in crypto, data and consulting, and thus, I transited my role as an advisor and investor to empower those companies to move further. Many of those companies brought a 10X, or even 100X return, which was a big surprise and brought me a lot of confidence that my experiences in crypto, marketing, strategy, and data were useful and could benefit those teams a lot. I also met Jun Du around that time. Since then, I started to invest, incubate, and advise in crypto full-time.
It is fair to say I have experienced multiple cycles in the crypto market and accumulated my personal investment strategy and philosophy; therefore, I decided to found a new fund called ABCDE in this cycle.
Pandaily: A few follow-up questions from your response. You mentioned that Simon Black was a world citizen and I noticed that you also called yourself a world citizen in your Twitter bio. How do you understand the term?
BMAN: I indeed value freedom a lot and am personally an avid traveler. S has impacted me a lot as my early-stage mentor. He has been to over 120 countries, and when I was working with him, I also traveled to more than 20 countries. In my eyes, to invest and incubate local firms based on different cultures and policies is fundamentally to create diverse values with a globalized vision. I want to be a world citizen, a free person, to create a broad and different value system across borders.
I believe now in the future, more people will treat themselves as a Metacitizen in cyberspace to interact and collaborate based on their mutual belief in crypto and Web3. Hopefully, I want to host a camp somewhere next year, to invite young people globally to come together and discuss investment, entrepreneurship, and our visions together.
Pandaily: What is the role of crypto playing in the concept of world citizen?
BMAN: I believe world citizen is a very crypto native concept. For example, when crypto holders get together, you might not ask each other what nationality you are. Instead, you will see each other as family if you are holding the same NFT. People always say the internet created a global village. However, I dont think that is the end. If we really want to connect as a “village,” we need to have mid-level consensus to become a “family.”
Pandaily: However, cryptos have a strong property of investment. The floor price of many popular NFTs sets a high barrier for normal people to join the game. Under these conditions, the game might be exclusively open to those who have huge wealth?
BMAN: NFT is still at a very early stage. Current NFT holders are early adopters. It still needs to take time to go to majority. BAYC only has 10k items in its collection and it might be pretty exclusive to the wealthy group. However, the goal of Yuga Labs is to create an ecosystem to include more communities within it. I believe it is similar to physical art works. There will be expensive ones in the auction house but there will also be some creations for the major popularity.
I believe NFT represents a new lifestyle. You can see some holders have produced merchandise of their NFTs and converted the digital items into something in their real life. I believe in the future, different NFTs will stand for different concepts, beliefs, and consensuses, and thereby form communities in diverse forms.
Pandaily: Another follow-up from your previous response. You said you have experienced multiple market cycles. What is the difference between the current bear market and the previous ones?
BMAN: This should be my third bear market. The first one was in 2014-2015, when the Bitcoin price dropped to $300. Many miners left the industry at that time. However, the impact of that bear market was very limited because there were only millions of crypto holders around that time. The second bear market was happening in 2018-2019. The crypto population has been widened and the whole population has been expanded to tens of millions. A lot of institutes started their crypto journey in that cycle. However, still many of the population were opportunists with little understanding of crypto. The whole market was full of speculation and FOMO. There were a lot of communities and conferences that cost a high fee without solid contents. The current cycle is quite different. The population of crypto holders has reached hundreds of millions and many of them have gone through the last bear market. They have learned from their past experiences and pushed the whole industry to a higher level. Meanwhile, the larger user group naturally eliminated those unqualified teams and projects.
You can tell the difference. Crypto has transited from a toy of geeks and punks, to an instrument of speculators, and now a tool of value creators who have seen the power of the technology.
Pandaily: As you said, the crypto population has been expanding sharply in the past years. I heard some people comment the community is not as crypto native as it used to be. We also observed many Web2 people move into Web3 in the cycle. What is your opinion on that?
BMAN: I won’t set a clear line between Web2 and Web3. I believe they will both exist in the future just as Web2 does not replace Web1. My parents are still reading news on Web1 websites, for example. I also believe Web3 can learn a lot from Web2. For instance, the data-driven growth strategy, operation strategy, user-centric product design, etc. When I advise Web3 teams, I always share my experiences in Web2 with them as well.
I personally have a high expectation of those who are moving from Web2 to Web3 because I believe they have seen the core value of the related technology. They usually have observed the industry for years and are capable of merging their experience in Web2 and their understanding of Web3.
Pandaily: Since we have discussed something related to people in Web3, I want to follow up on this topic – what features are important to achieve success in the Web3 era?
BMAN: The first one is crypto native. They need to hold cryptos, understand why cryptos are important, and know what they can be used for. They know crypto means a new relation of production. The second one is global native. As I introduced above, crypto visualizes the concept of global citizen and dim borders across countries. I believe many Chinese founders are qualified for those two properties. The previous generation of Chinese founders has accumulated a lot of experience doing business globally. The new generation is going further based on their steps.
Pandaily: You raised the term “crypto native.” What is your definition of the term?
BMAN: They have built a solid personal philosophy of a niche field of crypto. They might consider something that I never thought before. I believe the construction of mindset requires people to hands-on a lot, think a lot, and summarize a lot. The mindset is not necessarily a common thought held by most people, but a special and strongly personal approach. I know some people might change their profile photos to BAYC or other NFTs to demonstrate their inclination to Web3, but that is superficial. I want to scout those who are truly digging into the hole.
Pandaily: Do you have any other requirements when you review a project?
BMAN: The founder should be someone of integrity. Otherwise, founders will easily surrender to temptations. Especially in the bear market, I do care about whether the team has a long-term vision and keeps steady when noises are around.
I also want to see a founding-market fit. Do founders have previous experiences and enough foundations in the realm of their new project?
Pandaily: You mentioned the bear market might have a lot of noise and the crypto world is changing fast. I believe when the bull market pulls back, the whole industry might look totally different. In the long run, are there any new trends or concepts worth paying attention to?
BMAN: The new cycle has a lot of changes. The last bull market was driven by two things – DeFi (e.g. AMM and Uniswap) and NFT (e.g. gaming) from the application perspective, which has been driving the whole crypto population to over 300 million. With a user group of 300 million people, I believe it is possible to have a super app or killer app with tens of millions DAU. Thus, in the next cycle, with the foundation of new Layer1 and the spread of crypto concepts, I am looking forward to the birth of several killer apps that did not exist in the past cycles.
Another battlefield is public blockchain. The main bottleneck of the industry in the past cycles is always around traffic and gas fee issues of Ethereum. Many unicorns were born to provide solutions to them. However, the bottleneck is still here. Public blockchains are different from traditional operating systems. Operating systems can be updated regularly, as Windows has evolved from Windows 98 to Windows 11. However, as long as chains go public, it is hard for them to get upgraded. The merge of Ethereum has been ongoing for six years but still not finished yet. However, technology keeps evolving and new chains will pop up to replace old ones. I still believe Ethereum will keep its leading position since most properties and developers are here.
Pandaily: A few follow-up questions coming into my mind. Firstly, what does a killer app look like in your eyes?
BMAN: I think a combination of Web2 and Web3, so-called Web2.5, has potential. Users can sign up with their emails or phone numbers. When they need to trade tokens, then the app asks them to get a wallet. The approach can take users step by step and lower the entry barrier.
Another problem is that most crypto-native products are composable. You need a plug-in to log into your wallet, another plug-in to buy required NFTs, and then some other plug-ins to do the following steps. It is totally opposite to what users are used to. I believe an integrated solution is required to get users to adopt the new concept. A good example might be Apple. Apple provides an all-in-one solution from hardware to software. After its success and wide adoption, the whole system is now composed into different components by different developers.
Similarly, I believe there should be someone to provide an integrated solution in Web3, to set up a widely accepted standard that is also adopted by other participants in the industry, and then to compose, to diversify products. It might be a more smooth and natural approach.
Pandaily: But open-source is one of the key spirits of crypto?
BMAN: When Apple dominated the market, people felt they no longer wanted to be controlled by the iOS. Apple was a devil. It was too closed. Then, Android was born. The market needs a monopoly, needs a devil to be “attacked” and targeted. Otherwise, people might have no or little motivation to unite together to challenge and change.
The problem of the current industry is that it lacks standard and integrated experiences to let more people in. The history of the internet is “long divided, must unite; long united, must divide.”
Pandaily: When will this killer app come?
BMAN: I am very optimistic. I believe it will be born around the end of 2023. Currently, there are around 300 million crypto users – approximately 6% of all internet users. When the internet reached its first 300 million users, Google was already founded. I believe it is time.
Pandaily: Another follow-up question. Your response reminded me that you once tweeted that scaling is still the main focus in the following three years.
BMAN: Yes. The scaling issue is still up in the air. For new chains, they need to have a long-term vision. Otherwise, they will soon be replaced. As I said, it is pretty hard for you to make any upgrade after chains go public. It is cruel, but that is how technology makes progress. I am looking forward to when the solution comes out and believe it will be a fantastic investment opportunity.
Pandaily: Can I conclude that super apps and public blockchain are the two focuses of ABCDE?
BMAN: Yes. Both Du and I have a lot of experience in ToC applications, especially community-related. We’ve done many investments in ToB as well. For example, ChainUp, a leading crypto SaaS firm, was incubated by Du. We also once invested in Jinse, a leading crypto media company. We have covered a wide range of racetracks.
As to our investment plan, our highest priority will be infrastructure. Certainly, we will definitely keep our eyes on those potential tens-of-thousand-DAU-level killer apps, too.
Pandaily: The hottest trend in the crypto world might be DAO. Many funds are also investing in DAOs now. What is your opinion about DAO?
BMAN: I am a member of many DAOs and have been observing them for a while. People in DAOs have diverse backgrounds and mindsets, and it is easier for them to come up with some fun ideas. Thus, I agree DAO is a creative mechanism to innovate something new from 0 to 0.5.
However, when you need to scale things up, it has its limitations due to the loose team structure and inefficient decision-making process. Thus, to deliver decisions and execute plans effectively and efficiently, I hold the opinion that a firm structure is still needed because you need someone to be responsible for the decision and plan. Founding a company is a huge responsibility because you need to be responsible for your employees and their families’ lives. I still don’t see a DAO that is able to take on such a heavy burden.
I believe DAOs and traditional firms will co-exist and complement each other.
Pandaily: It has been almost 10 years since you entered the crypto industry. As one of the industry OGs, can you explain briefly, what is the core value of Web3?
BMAN: Two things: give users complete ownership of their data and redistribute value. The ownership of value now belongs to Facebook, Google, and other big tech firms, and they make unbelievably huge wealth from our data. In Web3, user data is recorded on-chain and users can receive rewards for their data. Your on-chain behavior, including your collected NFTs, your transactions, and your interactions, construct your reputation and might bring you new airdrops and other values.
Pandaily: The last question. How do you see these 10 years？Has the whole industry moved as you expected?
BMAN: When Simon Black told me Bitcoin was the most free currency in history, I did not have a strong feeling. I just felt it was fun and bought it out of curiosity. A few years later, when it was 2018 or 2019, Bitcoin was recognized by over tens of millions of people and used in international transfers. Now, we can see that many people living in countries with extremely high inflation choose to protect the value of their properties through crypto and some countries choose Bitcoin as their official currency to get rid of the control of USD. We also witnessed the birth of Ethereum and other new infrastructures that enable the possibility to have a truly open, permissionless, and trustless internet. Did I imagine today’s image 10 years ago? No, but it makes me extremely excited. I can see unlimited creativity and potential happening here. The new generation who was born with this crypto native wave is continuously revolutionizing and BUIDLing a new future. I am super excited about everything. I personally also gained a lot throughout the journey. I am lucky to have entered the crypto world when I was still in school and observed its development. It is a wonderful journey, not only for the industry, but also for myself.