Exclusive interview with the editor-in-chief of the Financial Times Chinese website: What do you think of Crypto?

Interview: Eric, Techub News

Compiled by: J1N, Techub News

The bubble in the financial market is not accidental, but a product of the intersection of technological innovation, capital promotion, human greed and regulatory lag. The development paths of cryptocurrencies, AI, and the Internet are surprisingly similar: new technologies bring imagination, capital fuels the fire, information asymmetry creates arbitrage opportunities, and regulatory lags allow market fanaticism to continue.

Technology itself is not a bubble, but the market's advanced pricing of technology often creates irrational prosperity. The bubble may last for five years, ten years or even longer, and the geopolitics and capital game makes the market more difficult to predict. But history tells us that in the end everything will return to rationality.

In such a cycle, individual soberness and choice are particularly important. "Everyone is drunk and I am alone" does not always bring the best results. The market irrationality can often continue to exceed the patience of most people. Understanding market laws and understanding bubble cycles is the key to staying rational and avoiding being trapped in a fanatical era.

In December last year, Alphaville, a column based on the ill-telling style of the Financial Times, published an ironic article, which "apologized" for its long-standing fraud and manipulation remarks to the Crypto market against the backdrop of Bitcoin's breakthrough of $100,000. This also aroused the author's curiosity. How do traditional financial markets and leading financial media view Crypto? Have their impression of Crypto changed over the years?

In this regard, we interviewed Mr. Wang Feng, editor-in-chief of the Financial Times Chinese website, to see what the "shape" of Crypto in his eyes is:

Techub News: What kind of channel is Financial Times ' Alphaville ? I looked at it before and found that the content is written directly and highly critical. Why is this channel set up? Why is the writing style so bold?

Wang Feng : This is one of the many columns of FT. In my impression, its author was not a full-time reporter or editor of FT. There are two types of FT’s columns: one is written by FT’s full-time employees and the other is contributed by outside professionals. Alphaville belongs to the latter, whose authors are usually professionals in the financial field and have regular feed relationships with FT. This is a column for team operations, not handled by a single author.

Alphaville’s writing style is different from other FT columns. Other FT columns are more formal, following the format of news analysis or comments, both in the first person and third person, maintain a certain objectivity. Alphaville is more like a blog, citing a lot of analysis reports from the financial industry, company annual reports, and commenting directly. The language style is relatively casual and free, close to colloquialism, and sometimes the views expressed are direct and abrupt, and even have a certain sense of humor or irony.

When we translate this type of article, we also find that the style is relatively special and sometimes we do not choose its content. Nevertheless, its topics are kept up with market dynamics and written by industry professionals, which can quickly provide industry insider analysis and are therefore more popular among the investor community. The focus of the column is on market and investment. "Alpha" represents absolute return (Absolute Return). It can also be seen from the name of the column that its core purpose is to provide guidance for investment.

Techub News: You mentioned just now that Alphaville ' s views do not represent the official position of the Financial Times. Take the article that Bitcoin broke through $100,000 as an example. They published an ironic "apology" article. Since the article can be published on the FT website, does it mean that it has been reviewed? Or is Alphaville 's content freely released?

Wang Feng : The editor of FT was the final decision on whether to publish the article. Although the author may not be an FT employee, there is some communication between the writer and the editor. The topic selection may be discussed with the editor first, or the writer will submit it directly after completing it, and the editor will finally decide whether to publish it.

As for whether it represents the overall position of FT, this is a complex question. In Western media, columns, comments, and analytical articles are usually not considered to represent the views of the entire newspaper. Newspapers, websites, blogs, and other multimedia content, as a whole, provide readers with diverse information rather than conveying a single position.

Only in rare cases, such as American newspapers during the presidential election, will publicly support a candidate. Only then will the newspaper speak out in its official capacity. But in most cases, especially in British newspapers, the editor will not consider too much whether a column article represents the position of the entire newspaper.

FT does not express its position in a single voice, but provides a large amount of information, comments, speech analysis and data to serve readers as a whole. In the media, editorials can represent the official position of the newspaper. Different newspapers may have different naming methods, such as "Leader" or other specialized names.

Editorial writing is usually conducted by the Editorial Board. Such articles must be approved by the editor-in-chief, especially when it comes to important issues, and are often discussed and reviewed by the team. Therefore, editorials can be considered as content that formally represents the media’s position.

However, FT, as well as many other media outlets, have various columns and comments that may be written by internal journalists or contributed by outsiders. We cannot expect that the analysis and opinions of each column represent the overall position of the newspaper. In most cases, the media also does not want to keep a single voice on all issues. The main responsibility of the media is to provide objective reports, facts and data, and expression of opinions is only a secondary function.

Especially in the Western media environment, unless major political issues are encountered, such as the US presidential election, newspapers may publicly support a candidate, otherwise they will not usually express their views from a unified standpoint. Most of the time, it doesn’t make much sense to discuss whether an article represents the position of the newspaper, because the task of the media is to provide information, not to dominate public opinion.

In addition, most journalists and editors are not industry experts, and their responsibility is to find real insider experts and organize and share information with readers.

Techub News: The ironic article published by Alphaville ends with the fact that their criticism is not only directed at Bitcoin, but also applies to traditional finance. This shows that they are not simply against cryptocurrencies, but are generally critical of the financial industry . As a financial media, why does this statement have?

Wang Feng : Alphaville's style has always been like this. If they see unfairness, poor information or other injustice in the market, they will directly criticize it. Whether it is cryptocurrency or traditional finance, if they find monopoly, information opaqueness or use information gaps to seek improper benefits, they will be exposed.

Many senior FT journalists and editors are more skeptical and critical of the market phenomenon. After long-term observation of traditional financial markets, they believe that there are many cases of profits through information opacity, which is the core profit model of the financial industry. Therefore, they are vigilant about industry chaos and tend to reveal potential irrational phenomena.

From the perspective of the value system, they will evaluate whether the profits of financial institutions match their efforts and judge their rationality. Therefore, the traditional financial industry has made them "unfavorable" many things, and cryptocurrencies seem to them to have more problems, such as opaque information, injustice, and even suspected fraud. Therefore, Alphaville's criticism of the crypto market becomes even more intense.

However, readers familiar with the column usually understand its style. They criticize any unfair market behavior, not simply targeting a specific industry or product, but hoping to improve information transparency in the market to some extent.

Techub News: From the perspective of you and FT Chinese, how do you view cryptocurrencies?

Wang Feng : In recent years, we have done a lot of related content and also paid attention to the reports of FT's English version in the cryptocurrency field. FT currently has a dedicated virtual asset and cryptocurrency channel on its website, which updates multiple content every day, mainly translated from the English version, and also has some original reports and third-party columns.

The attitude of the FT English version is: cryptocurrency is a market that must be paid attention to because it exists objectively and there are a large number of transactions happening. As long as there are markets and investors, there is a reason to report. Although columns such as Alphaville are deeply suspicious and critical of the opacity, information asymmetry, and even suspected fraud in the crypto market, FT, as a media, still has to cover this market to meet readers' needs and provide impartial information.

The reporting direction of FT Chinese website is basically consistent with the FT English version. The Chinese-speaking circle occupies an important position in the fields of cryptocurrencies and Web3, and once occupied half of the industry, so we have more reason to follow up on related reports. In recent years, we have adopted a "cautious but must follow up" attitude towards this field, hoping to provide a diverse perspective, but not express the editorial personal opinion too much.

Our reporting methods are mainly objective news, not driven by personal opinions. For example, when we interview industry analysts, entrepreneurs, and industry leaders, we will try to show different angles as much as possible instead of guiding readers to form a specific viewpoint. Because this market is extremely risky and full of interests and temptations, we are very cautious and avoid expressing subjective views at will, so as not to be proven inaccurate or one-sided in the future.

Although most of our content is still mainly translated in English, because the Web3 entrepreneurship ecosystem in the Chinese-speaking circle is quite active, we also have independent information sources, and sometimes even grasp industry trends faster than English FT. For example, our interview reports can show the crypto trends in Asian markets such as Hong Kong and Singapore, and also focus on emerging markets such as Southeast Asia and the Middle East.

My personal opinion does not represent any person or institution. Judging from the contacts and reports over the years, I think cryptocurrencies do have potential from a technical perspective, especially when combined with Web3 and AI, which could be the bursting point of the next Internet revolution. This technology itself has its value, especially in the fields of blockchain decentralization, smart contracts, data security, etc.

But at the same time, the information in the cryptocurrency market is not transparent, the supervision is imperfect, and there is a lot of speculation, manipulation and even fraud, which is also the reason why the media, regulators and traditional financial industries are cautious about it. The traditional financial industry has long relied on information asymmetry to obtain profits, while the problems in the crypto market are more serious, with less transparency and prone to bubble formation. Therefore, many senior journalists and market observers are skeptical about cryptocurrencies and are willing to expose the chaos.

In the past few years, the Hong Kong government has vigorously supported the Web3 and cryptocurrency industries, while emphasizing regulatory and orderly development. Hong Kong and Singapore have become the two core markets of virtual assets in Asia, and their respective policies and market trends are also competing. Our reports will focus on the development of these regions and expand to emerging markets such as Southeast Asia and the Middle East.

Techub News: How do you view the current situation of the cryptocurrency market?

Wang Feng: From a technical perspective, blockchain and its related technologies have great potential, especially when these technologies are combined, they can promote new technological development. There are indeed many professionals who are working hard on R&D, and this part is worth paying attention to.

But on the other hand, the market has too many temptations and the profit methods are too rough and wild, even surpassing the traditional financial industry. From leaders in the free world to bold and innovative entrepreneurs, many people are able to create huge wealth in a very short time. This phenomenon has led to extremely impetuous markets, especially ordinary investors. Most people do not pay attention to underlying technological innovation, but think about how to "make quick money" or cut leeks.

The Trump issue of coins has further strengthened the market atmosphere of "issuing coins is reasonable and cutting leeks is not guilty." His behavior provides an unprecedented endorsement for this market logic, causing the market to further lose its normativeness. As a traditional media reporter, I am vigilant about this phenomenon.

But from a news perspective, unexpected things happen in this industry every day, and are always full of hot topics and topics, making reporters "unable to idle". For the entire industry, this situation not only brings risks, but also means that a certain proportion of funds will be deposited into underlying technology research and development, team building and talent training. This is a complex situation, with both advantages and disadvantages.

There is still uncertainty in the long-term sustainable development of the industry, and the experience of any traditional industry cannot be used to accurately predict the future of the crypto market. But what is certain is that this industry has long-term potential and underlying technologies still have huge room for development. However, most of the mainstream participants in the market are still focusing on short-term speculation rather than truly promoting the development of the industry.

Techub News: What do you think about Trump’s release of Memecoin?

Wang Feng : Trump’s issuance of coins is not so much an impact on the order in the currency circle, but rather a challenge to the traditional political order.

In the currency circle, similar things have long been common. Many people will issue coins after having influence, using fan economy and market speculation to earn huge wealth. The currency circle is essentially a "grassy world", which adheres to the law of survival of the fittest, and can make legal profits as long as someone is willing to pay. From this perspective, Trump's behavior is not out of line.

But as a former president with huge political energy and a possible future leader, he issued coins on the eve of the campaign, which was a major impact on the traditional political system. Because this involves conflicts of interest and transparency in national governance, it poses a challenge to the government management system.

In theory, if he sets transparent and standardized standards during the token issuance process, such as providing detailed disclosure information, it may play a positive role in the industry. But in fact, his way of issuing coins is very casual, and he simply announced on Twitter and social media, and he built a rough website and completed the release. This arbitrary nature will only strengthen the disorder of the market, rather than guiding the industry to standardize.

Techub News : Is the "national Bitcoin reserve" feasible?

Wang Feng : Trump can propose any policy, but whether other countries are willing to follow up is another question. As a national reserve asset, Bitcoin can theoretically exist in asset diversified allocation, but it is difficult to become a core reserve asset. I think there are three reasons:

• The market is easy to be manipulated: the liquidity and volatility of the Bitcoin market are too large, far exceeding traditional assets, and do not meet the stability requirements of national reserve assets.

• Lack of regulation: Bitcoin’s decentralized nature makes it difficult for the government to effectively control or regulate the market.

• The traditional financial system does not recognize it: Although some institutions are trying to invest in Bitcoin, as a national reserve, they still need higher credit endorsement.

The United States under Trump can do anything crazy, but if other countries want to follow up, they must carefully consider potential risks. The choice of national reserve assets is related to financial stability, and major countries will not easily accept Bitcoin as their main reserve asset. Trump’s proposal is more like campaign propaganda than truly viable policies. (Author’s note: This interview was before the Lunar New Year, when Trump had not signed the executive order for Bitcoin National Reserves.)

Techub News : As the editor-in-chief of the Financial Times Chinese website, how do you understand the word "finance"? The excessive speculation in the Crypto market seems to be far from what we understand as “finance.”

Wang Feng : This is a very big problem. I actually don’t know where to start. As for the market, the essence of the market is information asymmetry, information differences always exist, and those who have the initiative can always make profits from it. The early stages of traditional finance also experienced chaos, disorder and grass-roots development, and were also full of the logic of speculation, manipulation and survival of the fittest.

Many things that happen in the currency circle today, such as cutting leeks, speculation, and market manipulation, are actually not unfamiliar with the traditional financial industry. In the final analysis, this is all human nature. The way the market operates has not changed essentially, it has changed to a technical carrier, from stocks, bonds, and derivatives to cryptocurrencies and DeFi, but the core logic is that pioneers use information gaps to obtain benefits.

The same is true of the Ponzi scheme. As long as the bubble can continue to expand and everyone can make profits in the short term, this game can continue to go on. The history of the financial market continues to break people's perception of the duration and scale of the Ponzi scheme. The seemingly incredible phenomena in the past often reappear in the form of larger scale and longer cycles in new markets.

One of the basic laws of finance is that all wealth ultimately requires someone to pay the price. As long as someone makes money, someone loses money. This is true in the long run, but in the short term, especially in the stage where emerging markets expand rapidly and regulation has not yet kept up, market fanaticism and bubbles can often last longer.

At present, we are in an era where technology development speed far exceeds regulation and public awareness. The market takes longer than before to adjust and correct itself, so we keep seeing new bubbles break through historical records, such as the current cryptocurrency bubble and AI bubble.

The duration of the bubble is unpredictable. The Internet bubble burst in the early 2000s, but the current AI or cryptocurrency bubble could last for five, ten years, or even longer. In addition, geopolitical factors may also affect the existence of the bubble. For example, the Trump administration has deeply bound the US national destiny to the AI ​​industry, which may further promote the expansion of the bubble.

Technology itself is not a bubble, but when factors such as capital, speculation, and human greed are forcibly superimposed on technological development, it may lead to the market maintaining irrational prosperity for a long time. In this environment, people even begin to wonder whether the bubble will last forever. However, from the perspective of human history, all bubbles will eventually burst, and the market will eventually return to rationality, back to a state based on real demand and sustainable growth.

The current wealth accumulation and industrial prosperity in the market have broken through people's traditional perception of market bubbles. However, this is mainly because the time dimension of our observation of the market is too short.

Some of the financial bubbles in history may take decades or even hundreds of years to break down and return to rationality. From this perspective, it may be too early to discuss when the market collapses. Judging from the hundreds of years of time scale, the basic laws of the market will not change, but in the short term, the market fanaticism may continue for many years.

Therefore, any market judgment we make today may appear too short-sighted on a longer time scale. The operation of the financial market is not controlled by the individual's will and follows its own development laws. The most important thing is that individuals keep their minds clear and take responsibility for their own decisions.

During the market fanatic times, it is very common that "everyone is drunk and I am awake alone". However, those who are alone may not be able to get the best ending. In the short-term market, the craziest, irresponsible, and even selfish people may make the most profits, while those who try to remain rational and make correct decisions in the long term may not be able to survive until the bubble bursts.

Just like the 2008 financial crisis described in the movie The Big Short, some people who saw market risks in the early stages made correct market judgments and made long-term hedging bets, but many people failed to make profits because they failed to persevere until the end. Sometimes, people who make correct judgments too early will be eliminated during the operation of the market mechanism.

The key is that everyone needs to be responsible for their choices. Market trends are uncontrollable, and what individuals can do is to stay sober, understand their investment logic and risk tolerance, and not be swept by market fanaticism.