Sheldon, the founder of BitMart Exchange, first came into contact with Bitcoin in early 2013 when he was a sophomore. He saw a report about Brooklyn, New York, saying that two young people improved the ASIC mining algorithm, which increased the Bitcoin mining speed by hundreds of times. In the summer of 2013, he attended a Hangzhou Bitcoin Conference and met CZ, Star, Prince Gong, Mo Yiyi, Brother Chong, etc. He founded BitMart after graduating from graduate school in 2017. In early 2020, Distributed Capital invested in equity. Although the amount was not large, it was of great significance. In 2024, a new self-developed derivatives system was officially launched. A CCO (Chief Compliance Officer) was established from the first day of its establishment, so the historical baggage is relatively small. The core value point of retaining users lies in value-added of data assets and interactive services. Changes in market share may mean that more emerging entrepreneurs will invest in DEX or other DeFi There are greater opportunities in the field; at present, the downside space for Bitcoin is not large, but the market situation of other crypto assets is relatively not optimistic. From the perspective of value creation and liquidity, the entire market is still in a downturn; if the political parties change again in four years, there is still a great possibility that regulatory policies will become stricter.
I came across Bitcoin in my sophomore year and thought it was very cool
Colin: Sheldon, this year BitMart celebrates its 7th anniversary. Congratulations on your success and continued growth. It has been a difficult journey despite all the difficulties. Could you please briefly introduce your resume, including your schooling experience and the story before you entered the cryptocurrency industry?
Sheldon: Recently, our platform celebrated its 7th anniversary. The company has actually been established for more than 7 years, and the preliminary preparations took about 9 months, so the BitMart exchange was officially launched on March 15, 2018, which happened to be the time point of March 15.
Let me briefly introduce my past experience. I studied computer science at Hangzhou Dianzi University. This background allowed me to get in touch with blockchain at an early age, because the computer science major and blockchain are closely related. I first came into contact with Bitcoin in early 2013, when I was a sophomore. I was full of interest in new technologies and willing to try cutting-edge things.
At that time, I was still playing Renren.com, which had a self-media platform called Renren Station. I wrote code while running my own station, collecting interesting information in the field of science and technology and sharing it with everyone. Once, when I was reading the news, I saw a report about Brooklyn, New York, saying that two young people improved the ASIC mining algorithm, which increased the mining speed of Bitcoin by hundreds of times. This news aroused my interest, so I began to study Bitcoin in depth.
I was very excited at the beginning, but to be honest, I only knew computers and programming at the time, and I didnt know anything about finance. I just thought Bitcoin was a revolutionary technology that could change the world. From the perspective of financial freedom, it made global transfers free and convenient. For me at the time, this concept was full of appeal. Young people always pursue freedom and think Bitcoin is a very cool thing.
Meet CZ, Star and others at the Hangzhou Bitcoin Conference in 2013
Colin: So you were mining at the time?
Sheldon: Yes! I was still studying at the time, and I tried to mine with my own computer. The industry circle was still small at that time, and I often met these people at offline events. For example, in the summer of 2013, I attended a Hangzhou Bitcoin Conference and met CZ, OKs Star, Baozou Gongqinwang, Mo Yiyi, and Chongge. Everyone participated with enthusiasm for blockchain, and there were some interactions between each other. During that time, I also met many industry partners later.
Colin: Will you continue to explore this industry in the future?
Sheldon: During college, I did some blockchain development, and some innovative coins were made, one of which was quite famous in 2013. After that, I chose to focus on my studies and went to Stevens Institute of Technology in New Jersey, USA, to study computer science. While returning to the traditional computer field from an academic perspective, I have also been paying attention to the development of blockchain.
In general, Bitcoin has inspired me, especially the financial innovation it has brought. What really gave me a deeper understanding of this industry was in 2016. At that time, one of my Hangzhou Dianzi University alumni, who went to the United States earlier than me, worked at SAP in Seattle. He was the group leader of our Hangzhou Dianzi University Overseas Alumni Association, and we often chatted and exchanged views on blockchain and Bitcoin. I also tried some algorithmic trading in those years and discussed related issues with him.
Sheldon: Later, I read the Ethereum white paper, and after reading it, I was excited again. At that time, Ethereums vision was to build a world computer and put all computing and storage on the chain. Compared with Bitcoin, this model is more intuitive, has a more ambitious vision, greater imagination space, and richer actual application scenarios.
Colin: Was this in 2015?
Sheldon: It was in the second half of 2016, just before the surge in Ethereum. After reading its white paper, I felt that this was a completely new world. Different from the concept of Bitcoin, Ethereum can carry smart contracts and has more scalability, which raised my understanding of blockchain to a new level.
Later, I and some classmates started to try to code something and made some small applications on Ethereum. At the same time, I also participated in the trend of cryptocurrency speculation and accumulated some original capital in the market. It is equivalent to experiencing two rounds of bull market cycles, and there are certain returns, but compared with those early players who devoted themselves to the industry, my capital accumulation is not that large.
The opportunity and preparation process for the establishment of BitMart in 2017
I graduated from graduate school in 2017. That year, the market (for cryptocurrencies) was very good. I began to think about the next direction and finally decided to start a business with some friends I met in 2013. Our idea at the time was to set up an exchange, so we started preparations in September 2017 and officially launched it on March 15 of the following year. During these 8 or 9 months, we experienced many challenges, including team building and fundraising. The whole process was very tortuous, but we finally launched the exchange at the end of the bull market.
Since then, BitMart Exchange has officially entered the fast lane of development. The seven-year journey has been long and challenging. Joining the cryptocurrency industry was actually a coincidence, but in the final analysis, it was because I was interested in technology and found blockchain very interesting. On the other hand, I didn’t have a deep understanding of traditional finance, and blockchain provided a new financial paradigm. From a technical point of view, it is entirely possible to subvert the traditional financial system. Therefore, I finally decided to devote myself to this industry and persisted to this day.
Colin: What was your strategy when you first started the exchange? Did you have a clear direction at the time?
Sheldon: The idea at that time was actually quite simple. On the one hand, the crypto market was in a rapid development stage at that time, and on the other hand, the competition in the exchange industry was not as fierce as it is now, and the demand for listing coins was very strong. From the perspective of market demand, we believe that the growth space of the exchange business is very large.
In addition, we believed that the industry had three core tracks: exchanges, mining and chips. In the end, we chose exchanges as the direction of entrepreneurship because the other two areas were not our expertise.
Our competitive strategy has not changed much since then. The core value of an exchange lies in providing a trading venue, liquidity, and high-quality trading assets, so we decided to adopt a rich listing strategy from the beginning. But in 2017, the industrys infrastructure was not yet perfect, and it was much more difficult to enrich products, optimize liquidity, and improve technical infrastructure than it is now.
At that time, the entire industry was extremely short of talent, and there were almost no real blockchain practitioners. Most of them needed us to train or explore solutions ourselves, and the technical difficulty was relatively high. However, we have always adhered to our own competitive strategy, which continues to this day.
At that time, our team had a strong global presence, so BitMart was very popular around the world. When the exchange was launched, the overall attention was very high, and the global structure of subsequent users remained consistent.
2017-2021: BitMart’s rapid development from start-up
Colin: If you divide the 7 to 8 years of development of BitMart into different stages, how would you define these stages? What are their characteristics?
Sheldon: I think the development stage of BitMart is closely related to the changes in the companys internal organizational structure, talent structure, and business scale. If we want to divide the stages, I think the company is currently in the fourth stage.
The first phase covers 2017 to 2019, which is the start-up period of BitMart as a company. At that time, our team was very small, and our business level and market share were in the initial development stage.
The big bear market in 2019 and the market downturn in early 2020 were a major test for the team. At that time, the entire industry was extremely cold, which led to a wave of personnel adjustments. Many early core members chose to leave due to changes in the market environment. I believe that at that stage, every exchange faced great pressure to survive. That was the most difficult period.
Then, from 2020 to 2021, we entered the second stage, which is a period of rapid development. At the beginning of 2020, Distributed Capital invested in our equity. Although the investment amount was not large, it was of great significance to us.
In 2020, we fully upgraded our team and our organizational structure also underwent a major adjustment. Many important core members joined at that time and have remained in the company, becoming the backbone of today and taking on key management roles. This organizational adjustment laid the foundation for BitMarts subsequent rapid growth.
Sheldon: In 2020 and 2021, with the optimization of the talent structure, we also ushered in a bull market. In those two years, asset issuance was extremely crazy. DeFi Summer led to the expansion of the asset scale of the entire crypto industry, and also spawned a large number of value-added opportunities for emerging assets. This industry trend directly promoted the business growth of BitMart Exchange.
Especially in mid-2021, our performance data reached an extremely exaggerated growth level, with monthly trading volume even increasing 100 times compared to 2020. In terms of user growth, the number of retail traders and APP downloads soared, and we once broke into the top 20 of the Apple Store, even surpassing PayPal. At that time, BitMarts daily downloads reached more than 100,000 times, and the number of registered users per day reached hundreds of thousands, with a rapid increase in market share. It can be said that at that time, our exchange business ranked at least in the top five in the global market.
Our success mainly depends on a rich asset issuance strategy and the ease of use of platform products.
2022-2023: Strengthen risk control and security investment
Sheldon: In 2022 and 2023, we define this stage as the development consolidation stage. The main investment is concentrated in products, RD, security and risk control. We have once again upgraded and optimized the internal management process, production and research system, operation SOP, and team structure.
From 2017 to 2019, BitMart was led by the first generation of management team. From 2020 to 2021, we introduced the second generation of core leadership. From 2022 to 2023, we ushered in the third generation of core leadership. The company began to gradually become a professional manager. We introduced a large number of core talents from the traditional financial industry and other leading exchanges. At the same time, we also carried out large-scale upgrades and iterations in the technical system to optimize the exchanges infrastructure.
In addition, the construction of risk control and security systems has been further strengthened, and we have invested heavily in security facilities. To some extent, we see the bear market as an opportunity, allowing us to focus on internal optimization and improve overall stability and risk resistance.
The self-developed derivatives system will be launched in 2024
Sheldon: I think the period from 2024 to 2025 will be the fourth development stage of BitMart, which is also a new round of growth. The core growth points of this stage are mainly concentrated in the contract and derivatives business.
We officially launched a new self-developed derivatives system in 2024. This is a fully in-memory matching transaction clearing and settlement system, which greatly improves transaction efficiency and performance. At the derivatives product level, this system almost eliminates the gap between us and first-tier exchanges. It is precisely because of the launch of this complete clearing and settlement system that our expansion of derivatives business has become smoother. In the past year, the growth rate of derivatives trading has been very fast and has become a new growth engine for the company.
At the same time, in order to adapt to this growth, we have also adjusted and optimized the fourth-generation leadership team and introduced new core management. This iteration of organizational structure is actually an inevitable trend, because if the organizational structure does not evolve with the changes in business forms, it will be difficult to push the company into the next stage.
BitMart chooses the core strategy of compliance development
Colin: I have the impression that you have always emphasized compliance. Compared with other trading platforms, your strategy seems to be different. How did you formulate the compliance strategy at that time?
Sheldon: Yes, BitMart has set up a CCO (Chief Compliance Officer) since the first day of its establishment. Among our core executive team, there are also people who are responsible for legal affairs. In the early days, we conducted an in-depth analysis of the compliance environment for business development and developed a complete set of compliance management plans, working closely with law firms to ensure that the business is legal and compliant. Therefore, our historical baggage is very small.
Sheldon: I think every founder of an exchange has a different personality and decision-making style. As an entrepreneur, the most important thing is to figure out what you really want, what you have, and what you are willing to give up.
Some exchanges have chosen an extremely aggressive growth model, willing to take compliance risks in pursuit of excess returns. However, we have clearly chosen a more robust development path from the beginning, unwilling to take unnecessary legal risks. This is a different trade-off between risk and return for different entrepreneurs, and each exchange will have its own unique considerations.
Future market expansion direction: Focus on Asia and Europe
Colin: Has your user base changed? Because you just mentioned the contract business, and in some markets, you obviously cant do contract trading. Has the geographical distribution of users changed in terms of expansion?
Sheldon: Our contract business will be relatively small before 2024. Compared with contract trading, the regulatory requirements for spot trading are relatively loose, so we have been in a relatively controllable state in terms of regulatory pressure.
From 2021 to 2024, our user distribution has changed significantly. From the original focus on North American users, it has gradually shifted to the Asian and European markets. At present, our contract trading business is still mainly concentrated in the Asian market, and the activity and trading demand of Asian users are still the highest.
Retaining users lies in value-added data assets and interactive services
Colin: So what is your overall revenue and profitability situation now? How has the company performed in terms of revenue so far?
Sheldon: Overall, the situation is still good. Our ability to list coins has always been strong. If you do market research, you will find that we are always one of the exchanges with the most and fastest listings in the industry. The accelerated coin listing strategy has kept our overall revenue at a relatively stable high level, especially in terms of spot transaction fee income, where we have always been in a leading position.
In 2023, we clearly put forward the strategy of diversifying the revenue pillar, that is, expanding from a single spot income to derivatives income. In 2024, the growth of derivatives trading has greatly boosted our overall revenue. This has also expanded our team, but we still maintain a lean operation. The company currently has nearly 500 people, more than double the size of the team in 2021.
Colin: So what new changes will there be in the companys strategy this year?
Sheldon: Yes, BitMart’s core strategy has been evolving, but there is a core vision and mission that has never changed. Over the past five years, at every annual and quarterly conference, we have repeatedly emphasized our vision - we hope to become the infrastructure of the future Web3 world.
Colin: You just mentioned the companys long-term vision. If you were to summarize BitMarts core values over the years, or the corporate culture that you think is most important, how would you define it?
Sheldon: From a user-oriented perspective, we always hope to provide a free trading venue, give users the opportunity to freely choose assets, and build an open, free and trustworthy Web3 platform. Therefore, our products and trading tools always start from user needs, whether in terms of trading experience or asset support, to meet user needs as much as possible. It is this concept that enables BitMart to maintain a high user retention rate and continue to expand the market.
Colin: So in terms of the companys internal culture, what kind of values do you mainly advocate?
Sheldon: The core values of our internal culture can be summarized in five keywords: credibility, reliability, simplicity, efficiency, and persistence.
These values run through the companys daily communication, strategy formulation and business execution process. Whether it is collaboration within the team or decision-making in the face of market changes, we always adhere to these five core principles.
From the perspective of revenue strategy, we are promoting the expansion from spot revenue to derivatives revenue to achieve diversified growth. From a long-term strategic perspective, this year we have also formulated a decentralized wallet strategy. In the third quarter of 2025, we plan to launch our own decentralized wallet and integrate it with the existing centralized exchange wallets.
For exchanges, the core value of retaining users lies in value-added of data assets and interactive services. The wallet strategy is extremely important to us because it is not only a storage tool, but also an entrance for users to enter the Web3 world. Based on this entrance, we can establish a complete asset value-added system and provide services such as asset management and information interaction. This is the core direction of our long-term vision and mission.
Colin: Is it necessary to develop a wallet yourself? For example, acquiring some existing on-chain products or wallets may also be a good choice. Just like Binance’s acquisition of Trust Wallet?
Sheldon: Indeed, acquisition is also a viable option, but we have already accumulated a lot of technology in this area. Our asset management framework also cooperates with some third-party custodians, such as Copper, Fireblocks, Cobo, etc., but our internal team has accumulated a lot of experience in wallet technology for a long time. 2025 is just the right time point, so we decided to develop it ourselves instead of directly acquiring it.
The trend of CEX and DEX integration
Colin: Your strategy is actually a problem that all CEXs have to face. Just like in 2017, Binance seized the dividends of the altcoin market. Now centralized exchanges may face challenges from DEX and on-chain economy. Do you think this challenge will have a fundamental impact on centralized exchanges?
Sheldon: I think CEX and DEX have different advantages, and the user groups they serve are also very different. At present, it is unlikely that the product forms of the two will be completely integrated in the short term, but in the medium and long term, CEX and DEX will gradually get closer, learn from each other and integrate at certain technical levels.
For example, many DEXs now rely on decentralized backends for clearing and settlement, but the front-end display and interaction still use centralized methods. Similarly, centralized exchanges have also begun to embed decentralized self-custodial wallets in their internal centralized wallets to enhance users ability to control their assets.
I believe that the market size of both CEX and DEX will continue to grow in the future and eventually form a certain fusion state. DEX has obvious advantages in transparency, self-custody and anti-censorship, while CEX still dominates in high-concurrency transactions, high liquidity and support for complex trading strategies. Therefore, the two will not completely replace each other, but will continue to move closer in their respective areas of expertise and complement each other.
Colin: Do you think the market space for CEX will become smaller and smaller? On the one hand, it faces competition from DEX, and on the other hand, the development of local compliant exchanges is also accelerating.
Sheldon: This question needs to be looked at separately. If we look at it from the absolute market value, the market size of centralized exchanges will continue to grow in the next 5 to 10 years. But if we look at it from the market share, the situation may not be optimistic.
At present, the regulation of DEX is relatively loose. For example, the withdrawal of lawsuits against DEX-driven protocols such as Uniswap has given DEX many opportunities for development. Therefore, the market share of DEX may continue to rise.
However, the growth of centralized exchanges still relies on the asset expansion dividend of the entire crypto industry. Especially under the development trend of digital financial assets, the advent of the AI era will give rise to a large number of new data assets, and their application and interaction frequency will increase significantly. Overall, the market size of the industry (especially the market size of CEX exchanges) will continue to grow, at least in the next 5 to 10 years.
However, changes in market share may mean that more emerging entrepreneurs will find greater opportunities in DEX or other DeFi fields.
Bitcoin market forecast: long-term target of $1 million, short-term impacted by Fed policy
Colin: You have observed a lot about the US market, and we just talked about the current market situation. What do you think about the future market trend? And the possible impact of the adjustment of US policies on the market? Now the US government as a whole is indeed relaxing regulations and giving greater support to the industry, but at the same time, macro factors such as rising inflation may have a certain impact on the market. How do you view the future market trend? From the companys perspective, you will definitely evaluate these factors because they will directly affect subsequent investment and growth plans. In addition, how do you view the opportunities that changes in the US regulatory environment may bring to the industry?
Sheldon: Judging from the trend of the secondary market, Bitcoin has gradually decoupled from other asset classes, but it is still highly correlated with the macroeconomic policies of the United States. Therefore, in the long run, most people agree that Bitcoin will rise to $1 million sooner or later. But in the short term, the price trend of Bitcoin still depends greatly on the Feds interest rate cut policy, the inflow of funds into Bitcoin spot ETFs, and the national Bitcoin reserve plan that may be implemented in the future.
At present, Bitcoins downside is not large. Although the market liquidity is limited, the fundamentals of Bitcoin are still solid. However, in addition to Bitcoin, the market situation of other crypto assets is relatively not optimistic. At present, the market lacks new funds, and there are no faith-level protocols or applications on the product side that can really generate value. Therefore, from the perspective of value creation and liquidity, the entire market is still in a downturn.
The funds for this round of market rise mainly come from the inflow of funds from traditional financial institutions and US ETFs. The final destination of Bitcoin is to be held in banks and several compliant custodians, rather than flowing into decentralized exchanges or non-regulatory agencies as in the past. Therefore, the overall leverage ratio of the market has dropped a lot compared with before. In the past few rounds of bull markets, the leverage ratio within offshore exchanges or non-regulatory agencies was extremely high, resulting in excessive market amplification, and frequent liquidation waves during the deleveraging process, resulting in huge fluctuations. However, the leverage spillover effect of this round of the market is relatively weak. Although the turnover rate of Bitcoin is very high, the proportion of retail investors holdings has been significantly reduced. Therefore, the entire secondary market, especially the altcoin market, is still in a relatively difficult stage.
Sheldon: From the perspective of the US policy environment, Trumps return to power may bring certain opportunities to the market. In the past, the US governments regulatory model was mainly based on law enforcement first. Because the crypto industry has long lacked a clear legal basis, law enforcement mainly relied on securities laws and anti-money laundering regulations. At the same time, since multiple agencies (SEC, CFTC, DOJ, etc.) are all regulating under the framework of traditional finance, their regulatory attitude towards the crypto industry is very tough. This multi-regulatory model has led to a large number of local companies leaving the market funds in a wait-and-see state for a long time.
Although Trumps election will not lead to the implementation of new legislation immediately, it can have a positive impact on regulatory attitudes. From the perspective of the legislative process, after the House of Representatives proposes a bill, it needs to be reviewed by the Senate and then undergo multiple rounds of revisions. Therefore, it will take a long time to truly form a stable regulatory framework. However, the attitude of the Trump administration may have a short-term positive impact on the market, especially for institutional investors who are on the sidelines. This may become an important incentive factor to release the suppressed market capital energy and product innovation energy.
At present, law enforcement agencies remain strong in their crackdown on illegal activities and financial crimes in the crypto industry, but in terms of securities supervision, especially innovative businesses involving crypto assets, such as securitized tokens and DeFi compliance, it is expected that greater policy relaxation may be achieved. From the overall trend, the US crypto industry will have a more stable policy environment in the future, rather than being in a state of high pressure and uncertainty as in the past few years.
Colin: But are you worried that US policies may change dramatically with the change of political parties? For example, in two or four years, if Congress changes, is there a possibility of a major reversal in policy direction?
Sheldon: This possibility exists, and it can even be said to be very likely. The better description of these four years is the delay of law enforcement rather than the suspension. For example, several crypto-related companies were sued last year, just before the election, and some major fines and settlement agreements were completed during the Biden administration. If the political parties change again in four years, the possibility of stricter regulatory policies is still very high.
