Opening words

Startup Web3, chat every Wednesday!

"Startup Web3.0" is an interview program for Chinese Web3.0 entrepreneurs initiated by Mankiw LLP. Every Wednesday night, we will invite industry leaders, first-line institutions, well-known entrepreneurs, etc. to share their views. We hope to promote the compliance development of China's Web3.0 industry through positive voices, rational discussions, and experience sharing.

This issue is themed "China's Web3 Entrepreneurship Opportunities", focusing on the current status and future development direction of the Web3 industry. Lawyers Liu Honglin and Niu Xiaojing combined their rich professional experience and discussed the concept of Web3, industry opportunities and challenges from the perspective of entrepreneurs and the law.

As the founder of Mankiw Law Firm, China's first law firm specializing in Web3, Lawyer Liu Honglin shared his entrepreneurial journey and insights into the industry, analyzed the commercial potential of asset issuance, trading and supporting services, and emphasized transformation barriers such as information asymmetry. This interview is a discussion of the technical essence and practical application scenarios of Web3. This dialogue aims to provide inspiration for fellow lawyers, industry practitioners and entrepreneurs, and reveal the positive construction value and realistic opportunities of Web3 in the Chinese market. From the practice of Mankiw Law Firm to the vision of the future of the industry, it provides a comprehensive perspective for understanding the embryonic stage and potential of Web3, and is a systematic review and outlook on the Web3 entrepreneurial ecosystem.

(The audio transcription has been processed by AI and may contain omissions and errors.)

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"Startup Web3.0!" The old program is restarted

Lawyer Liu Honglin: Tonight feels like a long-awaited reunion. This column was launched two years ago, called Entrepreneurship Web3. At that time, we planned to talk to you about entrepreneurship in the industry every Wednesday night. It was suspended for some reasons. Today is the first episode of the old program. Starting from next week, we will invite founders or partners of Web3 startups in the Chinese community every Wednesday night to talk to you about their entrepreneurial stories and their views on the industry from different tracks and projects. Tonight is a special session for two lawyers, and the topics and perspectives will be closer to lawyer colleagues.

Lawyer Niu Xiaojing: Let's get straight to the point. Today I want to talk about the opportunities for Web3 startups in China, and one of the prerequisites is China. Now, I'd like to invite Lawyer Liu to give a brief introduction.

Lawyer Liu Honglin: We hope to make this column a regular activity, and discuss the entrepreneurial direction in the industry with you every Wednesday night, and let the core founders share. As an entrepreneur of a Web3 industry law firm, today I would like to talk to you about my feelings as an entrepreneur in this industry and what I have seen.

Mankiw Law Firm’s Entrepreneurial Journey: Three Years of Deep Exploration into Web3

Lawyer Liu Honglin: I believe that many partners are supporting us online tonight, and they are more familiar with what we are doing and what is going on. In short, Mankiw started to delve into the Web3 industry three years ago and is the only law firm in China that focuses on this field. It can be seen that there has been no substantial development and progress in the industry in the past three years, otherwise fellow lawyers would have come in long ago. The development of an industry means that Party A has sufficient legal service fees. Now everyone is reluctant to come in, perhaps because they think that Mankiw has worked hard for three years and can wait and let the bullets fly. From the perspective of entrepreneurial direction positioning, we have chosen such a track and have been deeply involved in it for a long time. After three years of entrepreneurship, thanks to the support of all partners, we have teams in Shanghai, Shenzhen and Hong Kong.

There are more than 30 lawyers, plus other colleagues, a total of 40 to 50 people in the team. The overall development idea is to deepen the industry and link or set up local offices according to the needs of entrepreneurs in the Chinese-speaking area. This year, the focus is on the Greater Bay Area, and Shenzhen and Hong Kong will be grouped together. The goal is to have a team of about 30 people in Shenzhen in two years. In 2025, that is, at the end of this year, we will look at opportunities in Singapore. Today, there are Singaporean lawyer colleagues or friends in the live broadcast room who are interested. Maybe we can jointly set up a law firm in Singapore that specializes in serving this industry. In addition to Singapore, Dubai, which everyone pays attention to, now has a more friendly entire crypto industry, Web3 entrepreneurial environment, and regulatory policies. Our idea is that we will go wherever the people need us to appear, close to the market, close to customers, mobilize local resources and compliance capabilities, and support the development of entrepreneurs in the Chinese-speaking area. This is the perspective of entrepreneurs, and I will share it with you first.

Lawyer Niu Xiaojing: Okay, thank you, Lawyer Liu. Lawyer Liu mentioned that Mankiw has been working in this field for nearly three years. There may be many lawyers, industry practitioners or entrepreneurs who want to transform into Web3 in the live broadcast room. Can Lawyer Liu first give a brief introduction to Web3 to peers or other entrepreneurs who don’t know much about Web3 in the live broadcast room? In addition to the currency speculation, blockchain, and NFT heard in the news, what is it like? What are the differences between concrete things and the Internet we are exposed to?

Web3 Disassembly: From Bitcoin to the Next Generation of the Internet

Lawyer Liu Honglin: There are three concepts here. Let me talk about them first to help you sort out the relationship. Three terms: the first is cryptocurrency, the second is blockchain, and the third is Web3 or Web3.0. Let me share with you briefly. First of all, when it comes to blockchain, the most popular project is Bitcoin, BTC. The current price is around 85,000 US dollars, and it reached more than 100,000 US dollars some time ago. Bitcoin was born during the subprime mortgage crisis in 2008. A netizen named Satoshi Nakamoto published a white paper, saying that he wanted to create a project that did not require a middleman and could pay cash point-to-point through the Internet. This was his original intention for Bitcoin. He wanted to create a currency system that was not issued by a national central bank and could be used as money on the Internet. Bitcoin came first, then blockchain, and then Web3. This is the origin of everything. Let's simply understand that all blockchains come from a set of electronic currencies called Bitcoin, and come from this origin.

As Bitcoin slowly developed, many people who were engaged in technology found that the underlying technology of Bitcoin, such as distributed storage, incentive mechanism brought by blockchain network node maintenance, and encryption algorithm, seemed to be able to do other things besides the Bitcoin network. People extracted a series of underlying technologies of Bitcoin and collectively called them blockchain. Bitcoin is the most successful application of blockchain technology and also the first application. This is the first concept I want to talk about. The relationship between crypto assets or cryptocurrencies represented by Bitcoin and blockchain technology is that one is an application and the other is a general term for underlying technology.

In addition to the term blockchain, why does Web3 exist? Web3 is a concept that was artificially refined. My understanding of Web3 is the third generation of the Internet. The first generation of the Internet, like the people born in the 1980s and early 1990s, surfed through BBS, Tianya or Yahoo at that time, which was the 1.0 version of the Internet. In the 1.0 era, as netizens, they browsed Internet information more. Websites, pages, and forums came from professional editors or webmasters, such as Ma Huateng and NetEase, who were webmasters who maintained Internet pages. This was Internet 1.0, and users were passive browsers of information. The second generation of the Internet is called Web2.0, which is basically the same era as the current mobile Internet.

The biggest difference between Web2.0 or the mobile Internet era and Web1.0 is that as an Internet user, in addition to passively browsing information, you can also actively interact with other netizens and actively share content. Like the earliest Weibo, Moments, Zhihu, Douyin, and the video account we talked about tonight, we are all content creators. The biggest feature of the Internet 2.0 version is that everyone can produce content on the Internet, deliver it to other netizens, and even watch movies, order takeout, and take a taxi. This is the Internet in the Web2 era that we understand, mobile Internet, roughly this logic. According to the version iteration or 1.0, 2.0, the next generation of the Internet is called 3.0 from the perspective of sequential numbering, which is what we understand as Web3. I shared at CEIBS (Business School) some time ago, and a student asked me, Lawyer Liu, do you think Web3 will come? I said it will definitely come. There are Web1 and Web2, and there will definitely be Web3 in order. Although it is a bit of a joke, it means that the Internet must evolve and iterate, and there must be a general direction.

We must answer the question, what is the core difference between the next generation Internet and the Internet such as video accounts and butterfly accounts used at this moment? This is the core point of Web3 and Web2, and it is also an important reason why we entrepreneurs choose to dig deep into the industry. There are two revolutionary events in the next generation Internet. The word combination is a bit exaggerated, but it is two very big breakthrough points. The first point is to solve the problems existing in the current Internet. What is the problem? Traffic privacy information protection. For example, the core used tonight, whether it is X social platform or butterfly account platform, are we WeChat users or commodities? It is a bit of a speculative question. WeChat founder Zhang Xiaolong has always said that WeChat is built for users, but from a business perspective, we belong to WeChat commodities. The number of WeChat users exceeds 1 billion every day, and 1 billion people use services on Douyin every day, and a lot of attention is paid to this. Correspondingly, you can see that someone inserts an advertisement in the fourth post of Moments, a large number of advertisements are embedded in public account articles, and various advertisements are also available in videos. The biggest way to realize the traditional Internet is through advertising. We are Internet users. All browsing records and personal information are mastered during the use of the Internet. With these, we can deliver precise advertisements to advertisers.

It sounds fine. No commercial Internet company can provide services for free forever, but problems will occur in the process. This year's 315 Gala talked about AI robots making harassing calls. Someone bribed China Telecom and China Unicom operators to accurately obtain the information of people who called medical beauty institutions and then sold it to other commercial organizations. This is a lot of problems in the Web2 era. As an Internet user, information and privacy cannot be well protected. To solve this problem, China attaches great importance to it and has established a national data bureau. There are data bureau departments in every place. Our office is in the Xuhui Data Bureau's administrative park. The country has found that data is very valuable and needs to protect its value and commercial value. There is no good way to solve it in traditional Web2, and something else is needed to solve it. We see that the solution is blockchain. This is my understanding of the first blockchain in version iteration, and the focus of repairing the current Internet. The second point returns to the original intention of Bitcoin's birth, hoping to make an online or Internet currency system.

The Web2 era is the information Internet. Web1 browses information, Web2 creates information, and sends information to other friends at the same time. But the problem that cannot be solved is value transfer. I often give an example. We are users of China Merchants Bank. In theory, if a manager of China Merchants Bank has the authority, he can remove a zero from all user bank accounts at 2 a.m. We don't care because we don't know how much the account has two decimal places. Of course, China Merchants Bank will not do this based on goodwill and some reasons, but there is a chance from a technical perspective. Blockchain can solve the problem very well. A crypto asset in the wallet is transferred from my account to Lawyer Niu's account. My account has one less and Lawyer Niu has one more. The entire transfer process cannot be tampered with or changed. Because of its tamper-proof nature, value transfer is achieved to some extent. This is what I think is the biggest charm or opportunity of Web3, the next generation Internet, compared with the traditional Web2 Internet. The foreshadowing is a bit long.

Lawyer Niu Xiaojing: Lawyer Liu is indeed a loyal fan of Web3. He explained Web3, blockchain, and cryptocurrency Bitcoin in a very simple way from the underlying technology. I would like to ask, as a lawyer and founder of Mankiw, you have come into contact with many Web3 industries and practitioners. Which directions do you think are worth trying and entering at the moment?

China's Web3 opportunities: three major tracks and lawyers' perspectives

Lawyer Liu Honglin: I think that by 2025, the time node, blockchain technology will have developed for 14 years, and some things will be implemented seriously. From a logical point of view, the industry has several major business points to do. The first is asset issuance, Web3 projects, projects with tokens, overseas architecture, drawing tokens, and implementing a similar traditional IPO method. Traditional listing is called listing on an exchange now. This is asset issuance. But the biggest problem is that Chinese entrepreneurs are very passive in doing this in China. China is very sensitive to the issuance of encrypted asset tokens and ICO fundraising, which is not easy to do. If you want to issue assets, you can only go overseas. This is the first point.

Second, if there is asset issuance, there must be asset trading. The most popular or star project in the entire industry is the crypto asset exchange. I looked at the data last week. From January 2020 to February 2025, the financing data of the entire crypto asset or Web3 industry, the first is the underlying protocol public chain, and the second is Cefi, centralized exchanges and other institutions. The underlying public chain has raised about 28 billion US dollars in 14 years, and the crypto asset exchange has raised 23 billion US dollars. At present, CEX is the leading industry practice node. I understand that 60% of the top ten crypto asset exchanges in the world are Chinese, or they were once mainland Chinese citizens, and then went overseas for some reasons. Trading is a long-term track with clear commercial profits, whether it is traditional centralized or decentralized trading.

The third point is supporting business services. At the 2025 time node, in addition to making money from asset issuance and asset trading, the only thing you can see is supporting business services. When I looked at the industry as an entrepreneur in 2021, I found that I had no plan to leave mainland China, and I hoped to stay in China. I can't issue assets, I can't trade assets, I can only provide peripheral business services. This is my consideration or thinking path for choosing the track and direction. From a micro perspective, what business services can a lawyer do? Legal compliance is the old business. The entire legal industry was like this three years ago, and it will still be like this in 2025, three years later. A large number of legal professionals or colleagues around me have three dissatisfactions with the industry.

The first is looking down on them. When it comes to crypto assets, blockchain, and Web3, they say you are engaging in fraud and money laundering. They have filters and tinted glasses. The second is not understanding. Many partners in the live broadcast room today are at this stage. What does not understand mean? The industry seems to be run by outsiders, but people around me say that there are good and bad people, and I don’t know how to get involved. I don’t know what kind of business lawyers can do in the industry. I participated in lawyer peer exchange activities. Everyone knew that we were in this industry, so they directly asked what kind of business lawyers can do in this industry. The simple understanding of the industry is that we can only unfreeze bank cards, or rescue people when their bank cards are arrested for suspected fraud or fraud when they leave the country.

Everyone is stuck in single-point business. It is true that a large number of lawyers are doing this kind of business on video accounts and Douyin because the base is large. However, there are many overseas companies that cannot provide wording, and a large number of gray and black industries use cryptocurrencies, which often freezes bank cards. In our opinion, this cannot represent the needs of the industry. What we do is more positive and supports entrepreneurs. We help project parties or entrepreneurs from domestic Internet giants, such as Tencent, NetEase, and Alibaba, who want to use blockchain technology to support their entrepreneurial direction. We help them with compliance. If they want to develop overseas, we help them with overseas services, company registration structure construction, and license application. Internet company startup teams or traditional Internet giants have done a lot of Web3 transformation. Web3 business is too novel. The novelty is that it is an emerging industry and it is very early. As a lawyer entering the industry, all social phenomena can return to the perspective of legal relations and the perspective of traditional legal business.

A large number of criminal cases in the industry are one of our core businesses, and we have more than ten lawyers specializing in this industry. Cryptocurrency or blockchain projects, understand crypto assets as one of the tools of crime, and borrow the concept of blockchain, which is both good and evil, to commit fraud or something. When it comes to virtual currency, criminal lawyers have a very large business space. The funny thing is that many lawyers told me that there is a lot of money laundering and fraud in this industry, so they can't come. But the problem is that if you are a criminal lawyer, shouldn't this be an industry and client that you particularly like? Because there are a lot of similar scammers or behaviors in the industry, there is a need for you to help with risk prevention and criminal defense. In addition to actual justice, there must be procedural justice. It depends on how you look at the industry.

In addition to commercial and criminal services, we also help the industry explore compliance for cutting-edge projects. For example, we use USDT to solve cross-border payment and collection issues, how to do anti-money laundering in the process, apply for licenses in specific countries and regions, and solve business flow and cash flow issues. This is what lawyers can do in the early stages of the industry. In turn, lawyers can do things in these scenarios, and entrepreneurs in the industry can also do a lot of things.

Lawyer Niu Xiaojing: Lawyer Liu just introduced the Web3 industry observation. I can hear that Lawyer Liu founded Mankiw with the original intention of building and exploring the Web3 industry, not just stopping at criminal defense for bank card unfreezing. If an industry really wants to develop in the future, it will not always be on the edge or incomprehensible. I would like to ask Lawyer Liu, from more than three years of exploration, what barriers and challenges will traditional industries or traditional Internet industries face if they want to transform to Web3?

Barriers to Traditional Industry Transformation to Web3: Information Asymmetry

Lawyer Liu Honglin: The biggest problem is the elimination of information asymmetry. In the early days of the industry, there were a lot of real situations that only insiders or practitioners knew about. Let me give you a personal example. I started to enter the industry in 2022 and first focused on NFT.

There is a personal example in 2022, when NFT was very popular. As a lawyer, I wonder what legal needs and legal issues entrepreneurs and users in the NFT industry have? I searched this morning and found that most of my fellow lawyers discussed the nature of NFT intellectual property rights at a theoretical level, what legal relationship is the circulation transaction from a legal perspective, and whether it is protected by similar copyright laws. Most lawyers focus on this perspective or point. But I joined dozens of NFT exchange groups and communicated with several entrepreneurs in the industry who were doing NFT, and found that no one paid attention to intellectual property rights. The question everyone is concerned about is what business qualifications are required if the secondary market is opened? If 10,000 collections are sold, 4-5% of which are kept in your own pocket and sold in the secondary market through operations, will it constitute a rat warehouse? Is there any criminal risk? This is what entrepreneurs in the industry are most concerned about. I want to express that when most of my fellow lawyers want to enter the industry and find business directions and opportunities, the most important thing is to get close to users and see their real legal problems and needs. This is better.

Are there any compliance issues in centralized quantitative hedging business? The core issue is whether the investment trader has custody or has touched the client's funds, which is the biggest problem. Now a large number of quantitative funds are isolated through API. If the user's assets are taken publicly, there will be great risks.

Back to the point just now, if you want to do business in the industry, the most important thing is to get close to the industry first. We brag that if you want to do Web3 business in the Chinese community or in China as a lawyer, joining Mankiw is the best strategy. The Mankiw team is the team with the highest content of Web3 lawyers, legal affairs, and practitioners. We chat, pay attention to, and study real customer problems in the industry every day.

For everyone, we must first break the information asymmetry, which cannot be solved by reading books on blockchain and Web3 on the market. I started reading in 2017 and read until 2025, but there are no books written from the perspective of lawyers. We still have something. As a lawyer or industry practitioner, if you really want to understand the real legal issues and compliance requirements in the industry, reading this thing is the most valuable. The booklet "Avoiding Pitfalls for Cryptocurrency Players" describes different scenarios in the industry. This was researched and coded in the past three years, and it is also an important part of offline courses. All courses are built around this system. If you want to understand the industry situation, I recommend getting this book first. You can participate in the lucky bag or follow my account and join the group to receive it. If you want to learn more systematically, the class is highly cost-effective, more systematic and practical.

The first step is to break the information asymmetry in the industry, and the second step is to find a segmented track or business field from an entrepreneurial perspective. If you are a criminal lawyer, switching to Web3 business now is the best practical node. There are a large number of cases involving virtual currency and blockchain in China. Last night, a lawyer friend in a county in Henan, my hometown, called me and said that he had recently received many cases involving virtual currency in Zhengzhou. Many people in the county are doing online orders to collect U or duplicate U. They make one or two hundred yuan for each U collected. It is very comfortable to make 10,000 or 20,000 yuan a month in fourth- and fifth-tier cities. But the process may involve money laundering, helping letters or fraud. This is the business point of criminal lawyers. My friend has been a criminal lawyer for nearly ten years. When the client's family told him about this, he was confused. He didn't know what USDT was and how to trade U. Curious about how there could be victims of this thing, he called me for advice, and I restored the real business scene of the industry to him. As a lawyer, if you don't understand the business scene of the industry or how everyone plays, it is difficult to serve customers well. Understanding the industry and business is the differentiated competitive point of lawyers.

After resolving the information asymmetry in the industry, you need to find business opportunities in the industry to truly enter the industry. Lawyers and entrepreneurs cannot just do it based on faith and passion. It can be a hobby, but it cannot be a startup project. Business positive feedback is needed, and the best way to achieve this is to help clients solve problems and create value, and they will pay you. This is an important point for long-term entrepreneurship and finding direction in the industry.

Lawyer Niu Xiaojing: Thank you Lawyer Liu for sharing sincerely and answering my next question, how to understand user needs. Lawyer Liu said that we need to solve information asymmetry to understand needs. Sometimes lawyers or other industry professionals solve problems based on their industry expertise, but what clients really care about is not how to solve the problem, but how to solve the problem. The process includes legal or other means, which clients do not care about. I would like to ask Lawyer Liu to briefly talk about what stage Web3 is currently in?

The current state of Web3: a reflection of the 1990s Internet

Lawyer Liu Honglin: If we use historical comparison, I think the current situation is a bit like the Internet in the 1990s. Why is it similar? The Internet in the 20th century was useful, but not that useful. When I was in elementary school, 10 years old before 2000, the Internet was just surfing the Internet. The computer at home needed to dial up to the Internet, which was slow and difficult to browse text content. It was difficult to have consumption, entertainment or enjoy browsing. It cost 5 or 10 yuan per hour to surf the Internet, which was very expensive, and it was very similar to the current transfer of assets on the Web3 chain. If the Ethereum network is used, a transaction of about 10 US dollars or more is possible, which is very similar. The second point is that the application scenario is very weak. In the 1990s, the hottest Internet websites were portal websites, novel websites, and news and information websites. What is the hottest Web3 industry now? Is the exchange a blockchain? In my opinion, it is not, it is Web2 logic. The hottest Internet industry now may be stablecoins, cross-border payments, or using blockchain technology for evidence storage and electronic signatures. From the application perspective, it is very similar to the Internet in the late 1990s. It is useful, but only in niche areas or scenarios.

The third point is that it is also very similar from the perspective of concepts and user intuitive feelings. In the 20s, everyone said that the Internet was a liar, not knowing that the other side was a dog, and only bad boys went to Internet cafes to surf the Internet. Similarly, at this time point, ordinary people feel that Web3 is a liar and CX, and no serious person would go to Web3. From the perspective of technology, application, and the acceptance of the people, it is very similar to the Internet at that time. Conversely, from the perspective of entrepreneurship, we must have a perspective of the times. If Zhang Chaoyang and Li Yanhong, like Zhang Chaoyang and Li Yanhong, left their overseas Silicon Valley companies and institutions at the end of the 20th century, gave up their annual salaries of millions and returned to China, set up a grass-roots team to make small applications, and started an Internet business. From the perspective of entrepreneurship, this is our opportunity.

From a lawyer's perspective, Chinese lawyers need to make great efforts and contributions. Can they come up with a solution similar to the VIE system solution that helped Sina solve its overseas listing? China does not allow ICO issuance, but there are a large number of Internet talents and projects. Can they solve the problem of mainland Chinese entrepreneurs going global or going to Qianhai backstage through compliance solutions? Can lawyers help solve compliance solutions? This is also what we are exploring. Lawyers Wang and Mao in the team are studying the RWA track, which is to some extent the VIE structure of the Web3 era. Either the research is not successful, or the research is successful and benefits entrepreneurs in the Internet or Web3 era. In my opinion, as a pioneer in the industry and a practicing lawyer, in addition to doing business to earn lawyer fees, we may also be able to do things to promote the development of the industry. This is an important reason that motivates us entrepreneurs to delve into the industry.

Lawyer Niu Xiaojing: I was quite moved when Lawyer Liu talked about his original intention. Now seems to be a time when it is not very profitable, but as Lawyer Liu said, if we look at the present from the future, the industry that is not understood by most people may be in its infancy. It is a good opportunity and condition for young people and entrepreneurs without resources to start a business.

Lawyer Liu Honglin: Tonight I will talk to you about the industry from the perspective of an entrepreneur. I often share Mankiw's entrepreneurial story on occasions, and I want to tell you about my own case. It is still possible in mainland China. Correspondingly, I want to tell you today that if you want to work in the industry for a long time, it is important to control risks when solving industry know-how. Recently, my friends around me have encountered compliance problems, which are very passive. There are many pitfalls to avoid. If you want to avoid pitfalls, you can read "Avoiding Pitfalls Guide for Cryptocurrency Players". If you want to learn systematically, you can buy our offline courses.

Web3 friends asked what they should pay attention to if they want to run a wool-pulling studio? I shot a short video to talk about this a few days ago. The essence of wool-pulling is to pull wool, which is essentially no different from receiving red envelopes on Pinduoduo and letting others cut a cut to make 100 yuan. If you use your own account, time, and spend your own money to do this, it is completely legal and compliant, no problem. On the other hand, if you pull wool from Pinduoduo, buy other people's mobile phone numbers and QYC information on the Internet, break into other people's websites and protocols in order to become bigger and stronger, or hire more people to invest in equipment, and raise funds from non-acquaintances. There are three crimes in the traditional Internet: illegal sale of personal information, illegal intrusion into computer information systems, and illegal fundraising. If you do this in Pinduoduo, it is illegal and criminal, and you face the same risks in the wool-pulling studio. If you don't do the three things just now, it is legal.

Lawyer Liu Honglin: Starting from next week, Lawyer Niu will be in charge of the Web3 Entrepreneurship column, and it will be better and better. The industry is not short of boasters, and there is no shortage of teaching activities to rush to the local dog, but this is not what we want to do. We want to discover outstanding entrepreneurial players and projects in the industry, so that everyone can see that this is a serious industry. This is why I talked with Lawyer Niu yesterday and wanted to continue the Web3 Entrepreneurship column. OK, Lawyer Niu, I have a question for you. I want to know how Lawyer Niu switched to Web3. I remember you went to stock up on cookies in 2017?

Lawyer Niu Xiaojing: How to switch to Web3. In fact, Lawyer Liu also mentioned this problem, which is the problem of information asymmetry. I think that in the current Internet era or the upcoming Web3 era, information problems can be solved by searching and thinking on your own. The key is whether you have the curiosity and courage to explore the outside world. This is the most important issue at the moment. As long as you are full of curiosity, you will find the entrance to the future.

Finally, Lawyer Liu was invited to talk about the prospects of Web3.

The future of Web3: a 5-10-year trend

Lawyer Liu Honglin: Lawyer Niu talked about his vision for the industry. I have always told everyone that if blockchain really enters the homes of ordinary people, like the current mobile Internet, it will take at least 5-10 years for users to use it happily, and everyone should have psychological expectations. But in 5-10 years, it will not be starving to death in the next 1-5 years. The combination of blockchain applications and business is a gradual process. By the time node of 2025, blockchain and the payment industry have been effectively combined. Many domestic businesses, especially those in the coastal areas of Jiangsu, Zhejiang and Fujian, will use USDT encrypted assets as a payment method. The problem is that he collects U in payment, and domestic expenses and payments are in RMB. How to solve the legality and compliance of the process? It is a very realistic business demand. Supporting domestic cross-border acquiring and third-party payment companies, now all go to Singapore and Hong Kong to do Web3 payment, and even individual C-end users like USDT encrypted bank cards.

By 2025, Web3 payment has become a highly commercially valuable, stable cash flow income, and completely legal and compliant entrepreneurial project. This year is cross-border acquiring payment, and next year stablecoins may do better. The Hong Kong dollar stablecoin regulatory sandbox has come out, but the real project has not been run. In the next 1-5 years, the financial industry or payment track will slowly develop, and there will be others. Well, this is my vision of the industry. It will take 5-10 years for everyone to find small business points and small entrepreneurial directions now, and wait for the wind to come.

Lawyer Niu Xiaojing: The theme of tonight is "Waiting for the Wind to Come". Some friends left a message asking how is Mankiw Law Firm in Hong Kong? As far as I know, we have an office in Hong Kong. Please introduce it to us.

Lawyer Liu Honglin: We do not handle litigation cases in Hong Kong, but mainly provide financial compliance services. Including the E49 license plate that is often mentioned in the news, and a large number of crypto asset-related licenses under the EU framework at the end of last year. This is what the Hong Kong team mainly does. From the perspective of customer composition, about 30% come from overseas business. We have established business partnerships with many projects in Hong Kong, Singapore, and the EU, helping to make compliance plans, making compliance frameworks on the global method side, and finding cost-effective places to apply for licenses. This year, the obvious feeling point is crypto funds. After the United States passed the Bitcoin ETF in 2024, Hong Kong followed closely to pass the BTC and Ethereum ETFs. Today, I saw Lao Xue posting on WeChat Moments saying that the price of Bitcoin is not very alive, about 84,000 US dollars, 20-30% lower than the high point, but 50% higher than this point last year. This is the case in terms of time.

Why have crypto funds become popular this year? Now a large number of family offices are paying attention to crypto assets. Next Thursday in Guangzhou, more than 100 people will share courses offline, and more than 100 domestic family office friends are all paying attention to this. It's very simple. Their clients give their money to the family office, help with asset allocation and management, and tell him that they have made a profit of 6% through unremitting efforts at the end of the year. People say that Bitcoin can reach 100,000 US dollars, so why don't they allocate Bitcoin or crypto assets? This is a question that more and more high-net-worth people are asking the second party. Traditional high-net-worth people, family offices, and fund managers face the stock market and traditional investment products. Do they need to find an industry with growth potential to do it? This is an important point, and it is also the reason why they pay attention to this track.

From the perspective of business services, this is our differentiated competitive point or entrepreneurial point. Now we are doing family offices, traditional identity planning, tax planning, and wealth inheritance. Hong Kong is very good at what we can say or do. It is a good choice to focus on the Web3 track. Hong Kong will start to slowly develop the business that was originally said to be shady or underwater in 2023, such as crypto asset exchanges. Hong Kong already has at least 8 or 10 companies, such as HashKey and OSL from Shanghai, which are crypto asset exchanges. Starting from 21 years, mainland China cannot do asset transactions, but Hong Kong can conduct business legally and compliantly. The supporting facilities are crypto funds, which means the logic of traditional US dollar funds or private equity funds, but the fundraising methods and investment targets are all crypto assets, which is also completely legal and compliant. If you have a Hong Kong brokerage account, you can buy Hong Kong stocks, or you can use your account to buy cryptocurrencies directly. It is a great existence. Knowing that ZhongAn Bank is directly cooperating with HashKey, you can buy BTC directly at ZhongAn Bank. This is what is already happening in the industry. It is not an underwater gray state, but a sunny victory.

/ END.

Author: Mankiw Brand Department