The latest Cointelegraph AMA, live on October 25, 2023, covered the journey of XBTO, a comprehensive platform for digital assets and tailored investment solutions catered to sophisticated non-US investors and institutions.. The special guest invited to talk about XBTO’s journey, impactful partnerships and position in the industry was Philippe Bekhazi, CEO and founder of XBTO.
Unlocking the Future of Institutional Crypto Trading & Custody: XBTO AMA https://t.co/qQtVcDsHVK— Cointelegraph (@Cointelegraph) October 25, 2023
“We started in 2015 with the premise that the crypto space would be around for a long time. We wanted to build digital asset products around this premise and make the ecosystem a better place. So our first focus was to improve liquidity on pretty much every relevant exchange at the time,” Bekhazi said of the company’s origins.
“I think one of the things that have kept us in the game is our emphasis on risk management, whether it’s market risk, operational risk, or legal risk. Over the years, XBTO has expanded to offer trading, venture capital, asset management, custody and other services while applying management concepts from traditional finance,” he added.
The discussion also touched on how the needs of institutional traders and investors have changed over the years and the importance of providing certainty around compliance, governance and security of assets. “While many exchanges provide proof of reserves, it’s difficult to verify individual Bitcoin holdings on the blockchain. To address this, we introduced the segregated vault custody solution, which allows individual vaults to be auditable on the blockchain at any time,” Bekhazi said, discussing the recent acquisition of the Stablehouse platform (subject to regulatory approval), which enhanced institutional-grade assurance within XBTO solutions.
“What this all comes down to is giving investors efficient access and the infrastructure to make them comfortable participating in digital assets. Through Stablehouse, we have also just launched our new Pro Trading platform that combines advanced trading capabilities with best-in-class client asset protection. We are excited for this launch, as we continuously strive to build the best digital assets infrastructure in the market.” Bekhazi added.
Bekhazi even helped shape Bermuda’s Digital Asset Business Act (DABA), which came into effect in 2018 and established a comprehensive regulatory framework for digital assets, including cryptocurrencies.
“Bermuda is a great place to innovate,” he said. “Especially when every product you create isn’t necessarily going to be successful, so you don’t want to get bogged down in years of regulation that will cost you a lot of money. Finding that balance between having regulations that are open enough to allow the industry to grow but at the same time rigorous enough to protect investors is the best."
Bermuda’s legal framework also supports bankruptcy remoteness. “It’s a strong legal concept,” Bekhazi said. “If I were a client in an institutional-grade exchange, I would definitely want to feel safe from bankruptcy proceedings, that my assets would be treated differently. With bankruptcy remoteness, the client’s assets are completely segregated and can be distributed immediately."
In addition, Bekhazi discussed XBTO’s multi-year partnership with Inter Miami CF, a professional soccer club co-owned by David Beckham, which Lionel Messi joined in 2023. “You’ve probably seen the XBTO logo on Inter Miami’s pink jerseys,” he said. “In my opinion, it was a great deal because soccer is global. It’s international, borderless. You can play soccer with minimal resources. We liked that because it totally represents the space we’re in. And it’s been a fantastic ride, more than I could have really imagined at this speed: you’ve seen XBTO and Inter Miami on Netflix, Apple TV, everywhere. It’s one of the best-selling jerseys in North America, even ahead of European clubs.
At the end of the AMA, Bekhazi touched on future trends in crypto finance: “I think in the next few years, we’re finally going to see the proliferation of securitized real-world assets on the blockchain, especially on the big ones like Ethereum. Tokenized equity is also starting to make sense. More products and volume will be unleashed, so people will have the ability to create portfolios and get access to a number of things in a much more efficient, faster, and more transparent way.
And CeFi is going to stay and be perfectly fine because of all the problems and hacks we've seen recently on DeFi and the regulatory issues that certain institutions face when they trade in DeFi."
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