How Chintai is Making the Trading Life Cycle More Efficient

This week's Slogging AMA guest is Ryan Bethem, a former clinical psychologist who made a big leap into the finance and tech industry. He is the Co-Founder of Chintai, a "comprehensive issuance and secondary trading digital asset solution for SMEs and financial institutions." The HackerNoon community asked him all about Chintai's position in the market and what sets them apart from their competitors.

This Slogging thread by Limarc Ambalina, Justin Roberti, Jose Hernandez, John, Mónica Freitas, Ryan Bethem, Amy Shah, Nicolas Ng and Gimbiya Galadima occurred in slogging's official #amas channel, and has been edited for readability.

Hi everyone! Please welcome our next AMA guest, the CHINTAI Team!

Read their bio below and feel free to ask them anything on:

"Chintai is a Singapore based SaaS company that uses blockchain technology to modernize capital markets for asset managers, banks and enterprise.

Virtually any traditional financial asset can be tokenized with the platform, which enables a reduction of administrative overhead by 50-75% in middle and back offices.

Chinai is backed by leading investment firms B1, Cryptology Asset Group, Collective Capital and Peer Ventures. The CEO, David Packham, is a 20 year financial industry veteran who worked for Goldman, Credit Suisse, HSBC, and Barclays.

Additionally, the business model is geared toward establishing network effects. Any client can become their own market operator. Clients can easily customize, test and white label the technology for their own needs without upfront cost. In contrast, competing platforms burden clients with exorbitant upfront fees and friction, while insisting that clients join their marketplace."

Hi and Ryan Bethem thanks so much for joining us. To start, can you tell us a bit more about Chintai and who your main target market is?

Secondly I'm interested to hear why you decided to start Chintai in such a competitive industry. Can you tell us a bit more about your origin story?

Hi Limarc Ambalina, thank you for having us!

Chintai is a comprehensive blockchain solution that modernizes capital markets for asset managers, banks and enterprise.

Our products enable, dynamic regulated digital asset issuance, automated compliance, reporting, data reconciliation, cap table management, corporate actions, liquidity, instant settlement & more.

Chintai began as a token utility leasing platform. We built a fully on-chain high performance order management system that transacted $250M in total volume for leasing token utility (network bandwidth).

Our founding team consist of a financial industry veteran, physicist, and psychologist. But we are all brought together by a passion for changing the financial system - specifically, we want to democratize access to financial opportunity. The existing system is bloated with inefficiencies that lead to anti competitive markets, a monopolistic grip on capital markets and in general are exclusionary. Blockchain technology can solve these problems, but there hasn’t been a regulatory compliant solution that is fit for purpose.

You’ve probably noticed that the blockchain industry is moving in a regulated direction. More than 2 years ago we saw this coming and made a bet on compliant blockchain solutions. We want to be at epicenter of creating a compliant bridge for traditional finance to be enhanced by the benefits that blockchain technology can offer. While many financial institutions and companies want to get involved in the blockchain space, they are trying to figure out how to do so without breaking the. law. So here we are, with what I believe is the best and most comprehensive solution on the market.

Ryan Bethem Hi guys -- David was on a panel i ran recently on digital assets.

I know your big focus is bridging to traditional finance and enabling tokenization and NFT minting. Two years ago, tokenization would have def been the bigger item -- but given the insane zeal around NFTs right now, what are traditional finance looking at and are NFTs as big to them as tokenizing traditional assets?

Any use cases you can share since you are in your beta would be great too.

Tokenization two years ago is different from tokenization now. Two years ago there was very little being done commercially to provide a built for purpose platform that institutional finance could use. Their reputation and licenses are at risk so their main concern is a robust compliant solution. Whether or not it’s an NFT or fungible token is not as important. Regulatory maturity, tech performance and companies like Chintai make complaint tokenization possible. I think regulated issuance is not only the next wave of usage and adoption in the industry, but it will be the catalyst for capital to enter the space in space in the order of several magnitudes larger than what we’ve seen.

One of the most popular commercial interests we receive however, is tokenized real estate. Many times it’s the ability to fractionalize the real estate and create efficiencies throughout the trade cycle that is most appealing. Settlement, especially in the private commercial real estate markets, is incredibly cumbersome and can often take months. We can reduce settlement time to near instantaneous. We have also received interest in creating NFTs for real estate that don’t involve fractionalization.

In general, NFTs can be used for money laundering. So we believe there will be KYC/AML standards for these markets as the industry matures.

Some use cases I can mention right now in our private beta include real estate products, fund management and carbon credits.

Hi Ryan Bethem Like Limarc said, it's a competitive industry. Can you tell us what sets Chintai apart from the rest?

Chintai is comprehensive and built for compliance.

Financial institutions and SMEs want to get involved in the blockchain industry, but they don’t have a compliant solution. Our compliance framework executes regulatory controls on-chain throughout the full trade life cycle. Not only does this lead to massive efficiencies in terms of administrative costs, it also produces an immutable audit trail for data integrity. Instead of having to sit on the sidelines, our clients can start to get experiment and deploy assets on blockchain.

Which leads me to the next primary differentiator - Chintai is comprehensive. When we observed the competitive landscape in early 2019, we found that the process of issuing, trading and generally managing regulated digital assets was extremely cumbersome. There’s segregated services providers for primary, secondary, cap table management, custody, compliance and other core functions. To begin testing you would need to bring together multiple companies, integrate them and ultimately absorb a lot of up front costs. We decided to solve this problem with the aim of creating a “shopify” type model. Our portal is built to allow full and free access to testing regulated issuance, secondary trading, custody, cap table management and of course compliance.

Hi Ryan Bethem how did you decide to offer your company's services for enterprises rather than the retail market? Or do you also work with retail investor clients?

Someone had to build proper infrastructure for regulated digital asset issuance and trading to exist in the first place. Without that foundation retail participation could not happen.

The cumbersome nature of middle/back office reconciliation and administrative overhead has led to so much inefficiency that larger institutions haven’t been incentivized to offer their services to smaller retail investors. It’s just too expensive. Hence the exclusionary nature of the current system. Chintai technology removes that systemic inefficiency, and will essentially remove millions of white collar jobs. Downstream, this means the trade lifecycle can become efficient enough that it makes sense to tap the large pool of retail investors that don’t currently have access.

Furthermore, it’s on our roadmap to operate our own regulated digital asset exchange. We are currently in the later stages of pursuing MAS licensing for regulated issuance and secondary trading. There’s a huge opportunity for retail investor pools and defi to interact with regulated markets in ways that haven’t occurred before. Our goal is to bring them all together.

Hi Ryan Bethem Happy you're here! I'm curious about your multidisciplinary team. How did you bring a team of people from such different backgrounds academically to collaborate on Chintai? How do finance and technology cross with physics and clinical psychology? And how has that been an advantage as opposed to a "traditional financial" team?

Happy to be here! Thanks for having us.  

We all share a similar drive and passion to democratize access to financial opportunity. But I give a lot of credit to David, our CEO. He has 20 years experience in finance and could have selected people with similar backgrounds. But instead he emphasized company culture, philosophy and diversity of experience.

We share a common understanding that we will succeed or fail based on maintaining a strong company culture. We are aggressive about protecting our culture and have a long hiring process to filter out candidates that aren’t a good cultural fit. One toxic person can bring the entire team down.

And then when it comes to diversity of perspective, I love how our complimentary academic and career backgrounds have interacted to lead us to where we are today. We cross finance, business, physics, software engineering and psychology. Our business is in many ways based on expertise in finance and technology. This allows us to identify the problems we are addressing and develop solutions.

But ultimately businesses are run by people, the visions they have and the relationships they build to create a network that allows them to thrive. The heart of a company is organic and I think that’s where psychology and operations comes into play. The company is only going to operate well with personalities and skill sets that can interact harmoniously to produce success.

When it comes to advantages, I think we tend to be less restricted in our thinking. David is already a very creative person in general and values resisting dogmatic thinking, but Phil and myself came into this with fresh eyes and as outsiders. As cliche as it might sound, I think there’s a lot of truth to the idea that when you are embedded in a culture or way of thinking, it's harder to see things from different angles and you can become blinded. Phil and I aren’t restricted in that sense. You can see some of that influence in our business model and approach. We are pretty unique in the competitive landscape.

Very interesting Ryan Bethem thanks for your well-thought-out responses!!!

Ryan Bethem What aspect of your business has been the most challenging for you on a personal level?

Entrepreneurial endurance and finding my footing in an industry I was not academically trained in.

I’d be lying if I said it wasn’t intimidating to make a leap from clinical psychology to tech and finance. It still is intimidating after three years. But the more I learned about business, the more I’ve come to understand that relationships drive business, whether it's internal, cultural or the network you build. Beyond that, I’ve made a point to embrace the learning process. I’m very grateful to be doing what I’m doing and have an incredible team to grow and learn with. Sometimes I have to pinch myself.

What I mean by entrepreneurial endurance is the motivation, drive and belief it takes to make it through the difficulties that are inherent with starting a company. We built this company through a bear cycle. People have come and go. There have been some dark times. We’ve gone through periods where we didn’t know if we would make it. But this team did everything we could, whether working insane hours or taking severe pay cuts, or no pay at all, to make it to where we are now. I have a lot of respect for the people who start and run businesses around the world. And I’m thankful for the resilience in the co-founders of this team. We’ve all picked one another up along the way and kept going despite the hurdles.

You said “You’ve probably noticed that the blockchain industry is moving in a regulated direction.”

With more countries officially accepting crypto as legal tender, it sure seems that way. However, do you feel that regulation is inherently contrary to decentralization? If so, what problems do you foresee to arise as more governments attempt to regulate blockchain and crypto?

With more countries officially accepting crypto as legal tender, it sure seems that way. However, do you feel that regulation is inherently contrary to decentralization? If so, what problems do you foresee to arise as more governments attempt to regulate blockchain and crypto?

Decentralization is on a spectrum. I think a trap in the industry in general is a tendency to champion one version of decentralization over others, as if there’s a “right or wrong”. The conversation can become very religious and myopic. The industry began with a sentiment that goes something like “we’re going to build a parallel system that will become the dominant system and supersede the old one”. I see the source of anger, resentment and skepticism that led to this and completely understand. However, I think the greater opportunity and more likely path forward is changing the system from within. My personal view is that you need various levels of decentralization depending on the use case. And if we want to have the benefits of decentralized infrastructure to be adopted on a global scale, there needs to be adherence to regulatory controls and being a part of developing frameworks that benefit everyone. So I don’t think regulation is contrary to decentralization, but it is another form when compared to a pure anarcho- capitalist type of approach for example.

The benefits of applying regulation are that addressable market now becomes the entire global financial system rather than a very small subset of mostly retail investors in defi. That will create financial opportunity that wasn’t accessible to the majority of people on the planet. You can also afford protections to users, like account recovery and recourse with hacks. There’s also the ability to prevent money laundering and financial crimes.

But some of the potential pitfalls I worry about have to do with data privacy and control. There is a dystopian outcome in which governments could align to control every movement of money globally and use that information or power in abusive ways. That already exists but it could be worse. Furthermore, the tension between the people and controlling entities has been a part of the history of human beings for thousands of years. I don’t think this would be something new, but rather, just another iteration of the same story.

Hello! Sorry for joining this a little late. I am curious about your experience with basing your company in Singapore. While there's plenty of financial institutions there, I imagine that there was also plenty of skepticism and regulation involved with setting up there. Did you encounter any significant pushback from regulators or companies?

We haven’t received a lot of push back. Singapore is very much focused on growing and investing in the local economy. We’ve made a point to invest there and have made local senior level hires. Our CEO will also be there on a regular basis. The MAS is very progressive as a regulator, while being considered amongst the most respected globally. Hence, it’s a great fit for us as we pursue licensing to issue and create markets for tokenized securities and other digital assets.

Sorry for joining this late. The responses I have read so far have been inspiring: I would like to know more about your organizations work culture. What is the best part about working at Chintai?

Our holistic approach to company culture.

Even if it’s not said explicitly, usually the basis of company culture is framed as “we do “x” to achieve our company goals so we can generate revenue and succeed”. This sentiment is a part of company culture, but I think it’s limiting and potentially alienating to employees.

Our approach emphasizes not only company growth, but personal growth as well. We believe by focusing on the individual and their needs, talents hopes and dreams, we can maximize mutual benefit. In practice this looks like creating path for everyone to focus on expanding their skill set, but also growing as a human being. If you think about it, most of us spend a lot of time working. In some cases even more time than with our families. So we see every opportunity when we work together as a growing opportunity. Whether that means learning how to receive criticism, or leading a team, or approaching conflict instead of avoiding it.

I speak with each new employee about their goals, strengths, weaknesses and our culture in general. We identify personal goals and meet every few months to discuss whether or not goals are being met and what could be improved. If the company isn’t the right environment to improve and grow both in terms of skillset and personally, I advocate that people leave and find a more suitable opportunity. Life is too short to be doing something that doesn’t mutually benefit the company and personal growth.

Thanks very much to Ryan Bethem from Chintai for joining us! We wish your company the best in all your endeavors.