Below is a transcript of the above YouTube Q&A livestream with questions taken from this Reddit thread.
Welcome to our bi weekly Q&A.
I’m so excited to have you on, its October 24th and I’ve seen all of your questions on Reddit.
I want to wait until more people are in, until then please just tell me when you are from.
I know some of you are going to be disappointed that I am not wearing black, I’m in my “normal colours”, bright colours.
For those of you who are joining us for the first time, this whole thing is recorded so you can watch this on YouTube afterwards. It is also being transcribed, so you can read the entire transcript, and we will link all of these.
We are going to go through some of the questions on Reddit, here is the link for those who want to post or upvote some questions. I’m going to refresh that page and just scroll through. That should make sure that most if not all questions are answered.
There are a couple of things that I must point out from our side. I think this session is not just about answering your questions, but also giving you some information, some insights.
Let’s get started and go through a couple of things.
Firstly, internal situations. Many people have asked these questions, and we are finally giving a response because we have hit a milestone, and we did not expect this to be happening so quickly. One of the reasons I want to explain this to you is because we have been working on this in the past weeks, and of course in the coming weeks because we are expecting this number to go up dramatically.
We have close to 100,000 users. This is insane, and honestly, I want to thank you all for this, because this number is unbelievable. We did not expect this to be achieved within such a short timeframe. I want to be very honest with you. When we did our ICO, we planned on having 15–20 thousand users by the end of the year. Now, it is the end of October, and we are really really fast, and scaling, and hustling.
On one hand, we are very excited about this and obviously we want to get that number up, we want to keep pushing for that and keep going, but it is also one of the reasons why we have been a bit slow on releasing some of the features that we really wanted to release. One of the reasons I never wanted to admit what was the reason was because I have been struggling with our lawyers, our legal and compliance team on whether we are allowed to release these things, which is important.
I really want to thank you for all that, the funny thing is is that it is very very balanced, we have roughly the same number of Android and iOS users. We also have some individuals who exclusively used the webapp. This is something we didn’t expect, as we thought that the webapp was just going to be an intermediate, temporary solution, but it’s impressive how many people use that.
That obviously brings a couple of challenges. We expect a big leap in November. As some of you know, we have had some massive filming last week, which was one of the reasons I was in Europe. We expect maybe even double the amount that we currently have, one of the reasons being that we are going to be on a Television show. Once the date is announced, once everything is fixed and certain, we will release and announce that to you. We are going to have roughly 2 million viewers on that television show, whose target audience are individuals who are very future savvy, who have foresight and very interested in cryptocurrencies.
They are very open to such things, and live in a market that is very strong in this kind of area. So, this is something we have to work on. There is nothing worse than let’s say, having another hundred thousand people come in, and your entire service shuts down. One of the things that we have been working on with our entire backend team, is making sure that the entire backend system can keep up with the increase in users.
Obviously we hope that the number of users keep growing, and this has already exceeded the expectations that we had in June, and this is also one of the reasons why I understand that there has been criticism from people who do not get their Ethereum or their Dash or their cards on time. I hope that you understand that certain problems cannot be solved with money. We need other systems to work as well. Certain scaling solutions, just the money alone being transferred through our app, has exceeded our expectations. We had two people sitting there making sure that everything was working properly, that nobody was stealing our money, that the input is the same as the output.
All these things are things that when you are a small company, with just 6–8 people, which was half a year ago, and now half a year later, you’re there and you know that if you make a mistake now, your company is bankrupt within a month. This is why there has been a shift in priorities. Rolling out a new feature, risking the entire company, versus making sure the system is completely stable. I hope that this explains why we have been doing certain things the way we do, why we have been hesitant in rolling out certain features, even though we did promise to do it.
I know that we are behind this and I am confident that this is the right decision right now. On the other hand, I am really thankful, and we are still committed on shipping out the entire waitlist for European card holders until Christmas. That promise stands. Every time I talk to the entire team on this, they are confident that this is achievable. This, of course, is subject to the condition that the transaction volume per person does not increase exponentially.
Currently, it stands at a couple of hundred dollars per person per month. If that increases exponentially, we might not be able to ship cards to everyone, because we would have so much transaction volume that our trading engines do not work. Some of you have noticed that, that when we have a lot of users and they are doing a lot of transactions at the same time, that the exchange rate dips slightly, and you get a worse exchange rate. Our trading engine is not strong enough yet to handle these peak volumes.
We hired Taylor, a payment processing specialist, who is going to work on adding more and more exchanges, getting better routing for these payments, allowing us to convert these currencies in a more efficient rate and give our users the best exchange rate.
We are in the process of moving in a new office. We are just finalising the specifics, who sits where and how the teams are going to be arranged. The next Q&A will be from the new office, thats for sure. Since our Q&As are going to be fortnightly, the weeks without a Q&A we are thinking of doing team introductions. This will allow you guys to better know the team members, and understand who works on what. In the new office, we expect the developers to be in the office more, as compared to now. This is because we currently cut them a bit of slack because it is a very noisy environment at the moment, which is not a conducive work environment. We are probably going to do bi-weekly team intros, everyone is sharing what they are working on, what’s on their mind right now, and introducing new team members.
Another thing that I get asked a lot is “Why am I doing videos on general topics that are not really relevant to TenX” This is similar to a question that I got asked in January/February last year, when I did videos on ICOs and fundraising and stuff. People asked me “why do you do this, why don’t you focus on building the product or business development?” This is because in June, we needed a zero dollars marketing budget.
I’m doing the exact same thing now. For those of you that think very short term, thinking “Why is this relevant right now, why doesn’t he do a video explaining something that is happening at TenX? Why does he do a video on Bitcoin, or Bitcoin Gold, or how to help with a fork?” You will understand, when you look back in 6 to 9 months, and you are going to thank me for that, because it will be the reason, we are going to hit or shoot over a million users. There are a couple of things that we do, that have a bit more foresight, as compared to people who just think about the next day.
Next, I get personal messages and comments about this, and while I do not reply to all of them, because some of them are really hurtful, I do read them. I don’t understand why you do this, because it comes from some very short sighted people who just want to create some hate. These are people who do not appreciate the hard work that our team puts in, instead nitpicking on certain things. I do want to throw out some things, like why do we go to events. Why do we fly to meet regulators, why do I talk to MAS, why do I meet BaFin in Germany, why was I in Liechtenstein. Why am I in Amsterdam, why did I speak at the European parliament, why are we in the US speaking to regulators. This is really short sighted sometimes because people assume that just because I am overseas, the company does not work. This is absolutely not true.
We have Toby and Paul who are such great leaders. Bettina who takes care of the entire HR and support. We have Mike and Brendon and Joel, we have everything ready for Germany, we take care of English, we have such great UX people. All these stuff (things), it (they) doesn’t (don’t) always need everyone to be everywhere. We need to take care of things that are necessary right now, and we do need a lot of foresight. A lot of the things that we do, are long term decisions, and I hope you understand that. I need to build relationships, to build connections for example to the European Parliament member who is in charge of blockchain for all of Europe. Think about it.
How important, and how relevant is it going to be for TenX, to know the person who is in charge of all the European regulations in Europe? I think it’s very important to be in charge, and having their personal contact of that person, and being able to be in touch and understand when regulation updates are going to happen, and when certain things are happening. It might not be so relevant right now because what you care about is why does the token not jump up a little bit, what I care about is “What can we focus on, over the next 5–10 years, that allows us to be at the right place at the right time, to understand what is happening?”
While I know that some of you will keep bugging and keep commenting on why do we do this, and I didn’t have to explain myself, I wanted to because trust me, I do read these comments and I feel this is very unappreciative because in 6 months, or in 12 months, you are going to thank me for it, and you are going to thank the entire company for everything that we do. We get some stupid comments every once in awhile, which are uncalled for.
Last but not least, I want to mention something that has not been mentioned on Reddit. You should join our Riot Chat. Just go to chat.tenx.tech, we are shifting everything over from Slack because of security reasons.
For those of you who are not very happy with our new chat platform, Riot, please understand that it is still a work in progress. It is more important that we have full control, to ensure that our users do not get scammed and we do not have bots that are sending messages. I know it may be a step back in terms of usability, but in terms of security it is a great improvement.
When I was in Cologne, I met people from Slack and I asked them “You know, we have this large community, one of the largest in the crypto ecosystem, wouldn’t it make sense to have some features?” and their answer was as straightforward as it could be. They said “Look, we don’t want you guys on slack, you are straining our servers, causing problems. Slack is not designed for your needs” which made it very clear to me that we needed to shift away as soon as possible. We know the founders of Riot, and that’s more important than having a finished product at the moment.
I saw the question on Kraken, which is something I can announce.
I was on the phone with Kraken last week on Thursday. They are not adding tokens at the moment because they also have some scaling challenges. We have finalising the contract, the legal status and so on. I can’t promise right now that we are going to be in the first batch, which is in mid to late November, but I have been in touch with them, and I think there is a high probability. I still think that it’s realistic that we are going to be added by the end of the year.
We have some very nice timelines, and once these things have been more concrete, we will announce it. Regarding Kraken, I also want to be upfront. Until now, we have always declined paying a fee to be listed on exchanges, but with Kraken, if there is a small fee, I think it is in the interest of the entire community that we pay a small fee to be listed on Kraken. We will definitely be very transparent and public on that, because that is a very community oriented effort and it will bring value to the community. Regarding Bitfinex and Gatecoin, Hong Kong has been cutting down on some of the tokens, leading to us being delisted. I am in touch with them, and I think it is an absolute misunderstanding.
They are just not taking chances. One of the reasons I did not fight for staying on Gatecoin was because we had very small volume, and I decided to prioritise hiring a COO and two other positions for our company. For Bitfinex, we are in discussions with the Hong Kong regulators. Regarding Binance, we were in touch, but they suddenly stopped responding. If you know anyone from Binance, please ask them to reach out to us, we are very interested.
1) “How can you benefit from the banking license if you are a token holder?”
View the banking license as a passport. TenX is planning to get banking licenses in three different jurisdictions all around the world. If TenX gets the banking license in Europe, it will allow us to issue cards to Europeans on our own, removing the need for a card issuer. It will also facilitate getting partnerships in other countries. As a token holder, you are not going to benefit directly from a banking license, but you are going to benefit indirectly, through TenX being able to issue way more cards, accessing way more users, and not having to share margins with someone else. It also builds our credibility as a company, being good on the AML and KYC side of things.
2) Relationship with Visa and Mastercard
Both Visa and Mastercard know about us, but we have not had a direct relationship with them so far. We met Mastercard personnel from New York in Singapore, but our direct relationship is always with a card issuer. Mastercard and Visa do not issue cards, they are technology providers. Our current provider is Wavecrest, and we are going to be announcing a new card issuer in the weeks to come. We’re going to announce an issuer that will allow us to scale beyond Wavecrest. The big thing for us, of course, is for us to be able to take matters into our own hands, and issue cards ourselves.
3) When do you expect to get the banking license?
Yana is working on this, she has experience having worked with Amazon and Paypal. Earliest would be April or May 2018, latest would be the end of next year. I was just in Europe to discuss the banking license, flying back there in November to meet with regulators.
4) Based on your experiences from past conferences, current partnerships and development of TenX projects, what are the biggest long term obstacles being created by financial institutions? How is it possible that you are able to be in the leading position, how are you persuading these big banks to go forward with your ideas?
This is why we meet with regulators, why I talk at Bank conferences. Its very difficult to hate up close. It’s such an important statement. If you are close to people and talk to people, and they know you, they know your intentions and it’s not to take banks out of business, but instead to give people options. If banks want to work with us, we are open to that. If banks do not want to work with us, then that is also okay, but we know that there will be banks, and institutions. We have received great offers and partnerships, but some of these are beyond our capabilities. If a company came to us and said “We want 10 million cards and we want it next year,” this is not something we can achieve. Some of these institutions, their kind of numbers is out of our reach at the moment.
Right now, we are struggling with basic things like adding a new coin. Right now, everything is in Bitcoin, and Bitcoin is blowing. If we add a new coin for everyone, this means that close to 100,000 people have this coin and the entire highway gets double the speed. We are already struggling with this one highway, and these are things that we have been working on a solution where we could have 50,000 users for Ethereum, and by the time this was ready, we had over 50,000 users. We can’t roll out this solution, it’s not going to work. So we started exploring other scaling solutions.
While I do understand that it is frustrating that we are late on these things, it’s not because we’re not capable or lazy. The team works really really long hours and I hope that you recognise that.
There is no guarantee. We are a startup, a startup with 40 people. There is a reason that most startups fail. We are not over that hump where we can say “Hey, we are going to be successful” but we are doing our best to get there. One of the ways we do that is by being in touch with these regulators, being close to banks and understanding what they are looking for.
Compare us to other companies who are trying to achieve certain things, and be objective. What have these companies achieved, compared to what we are doing. I do understand, that you paid $15 for something, and you want that card, and you want that card now, because that is what you are used to from Amazon. You order something and the next day it is in your email. But don’t forget that Amazon is 20 years old now. I hope that in the future we will be able to be in a similar position, and that is one of our goals, but I also hope that you understand that at the level we are at right now, it is not comparable to Amazon. Throwing money at something is not going to solve that problem. It still takes time.
5) I have 500,000 USD. If I happen to buy 500,000 worth of PAY, and luckily buy the day before TenX gets its distribution, do I get the benefit of all transaction fees, even though I just bought the PAY the day before.
If you have half a million dollars in total, never put your eggs in one basket. This is the first answer that I give you, even though I am the founder of TenX, and I am committed to TenX. I believe a million percent in TenX, but on a rational level, do not put all your eggs in one basket.
I just really want to be honest and transparent about this. Should you put something in TenX, obviously yeah, I mean obviously I believe in what we do, but be smart.
The second answer is about the 0.5%. The short answer is that yes, you will get everything. Right now, we are just checking with our legal team on the exact structure, how we can pay and distribute this reward. We were hoping for the Casper protocol, but since that is not going to be included at least for the next 18 months, we will have a different solution to distribute the rewards. There are a couple of challenges in that. We want to exclude exchanges, and exclude our own tokens. This also has to be 100% legal, and I think we have the right kind of structure to distribute the rewards. As soon as we have that, we will roll it out. One of the promises is that we are going to do it in 2017, and I am very confident that it is going to happen. I would have loved for it to happen after the Ethereum fork if Casper had been activated, but since it is not going to be implemented, we will find a workaround.
Obviously the reward is not directly linked to a card. The reward is linked to people making payments through the app. If people just transfer money in and out, this is excluded. Only actual payments are excluded. It may not always be 0.5%, because we might add new payment models and payment systems with different commissions, such as the development of COMIT. We will have to use different models for different payment systems, but since COMIT is a payment system, it will definitely be included.
5) Which law firm are you using in Singapore to solve these issues?
Dentons. We actually hired one of their lawyers. We did not poach their lawyer. That person, Desmond, was very open to joining us.
6) Are you considering anything like and Oracle or other off chain tech to improve ID and scalability?
You are hitting the nail on the head with this, we have considered such solutions for scalability. We need to have a 100% legal, secure system. We want to have a system where only the individual token holders can get the rewards. It would give more to the users.
7) Julian, your opinion on the Mastercard Blockchain project?
I’m excited about it. I love it when companies look into blockchain technology. I think its going to benefit us, it’s going to benefit everyone.
8) OmiseGo New partnership?
We haven’t talked to them for quite a while, instead focussing on improving our own product. I think they are also focussing on their own product. I think they have a great team, I think we have a great team and we would be open to cooperating with them.
TenX does not comment on competitors. To be honest, I want my competitors to do well. If other companies are failing, it hurts the entire ecosystem. I think in the crypto ecosystem we need to remember that we are all connected.
10) Why should I not buy Monaco coins instead of TenX?
If you believe in their project more than you believe in us, think about it, look at the product, look at whats live, look at whats ready. Look at the team, look at all that you have then decide for yourself.
Why I am 100% in TenX is because of that. We have a product, we have users, we have proof- I mean, there are so many people who have our cards now, we are shipping over a hundred cards per day. This is not because we cannot ship more, but because we need to get our trading volume in steps.
11) Are you considering expansion to other mainchain blockchains, is this even possible?
At the moment we have no plans to get our token unto other blockchains. For us to add on more coins, definitely. We just met with Charlie Lee here from litecoin yesterday. Litecoin is definitely on our roadmap.
I align with the company opinion here, we believe in the regular Segwit, we are not going to support the fork. We will stay on the regular Segwit chain. For us, that is absolutely fine, lets see how that plays out. I want to see if they are even able to fork it.
13) Low hundred per day since early August that makes 9000 cards.
There was a time that we sent out a lot more cards, then we paused a bit, and we started again. We are way over 9000 cards, I can tell you that much.
14) Can we expect other cards design in the future?
Definitely, that is something we will be interested in.
15) Is your focus Asia or Europe as your target market?
At the moment it is Europe, but soon it will be international, including both America and Asia
16) Can you make a video on how to transfer PAY to my EtherWallet account?
Okay I will, that’s a great idea.
17) 100,000 users mean that 100,000 cards have been shipped ?
No, it means that 100,000 people have registered through our app. I do not know the exact number of card orders right now, but its definitely a lot of people. That’s why I’m highlighting every once in a while, that people do not treat our app as a wallet.
18) Speed of card distribution
This will definitely increase in the future
I do want to do these videos bi-weekly, since we don’t have an update every week, and it also gives us the chance to do other formats, like introducing the team. We are also going to do quarterly kind of updates.
Yes, you can pay using Ethereum on the TenX app if you are one of the people who are unlocked for Ethereum. We have been very slow at rolling this out due to the increase in user growth.
19) Will the PAY token benefit at all from COMIT?
It will benefit from COMIT. It will benefit from Payments. Right now, cards are the main medium for payments.
20) Card Issuing
Yes, we still expect the waiting list for Europe to be cleared by Christmas. For non European countries, once we get an exact roadmap from our new issuer, we will update you guys. Currently, I do not have an exact timeline, but I am expecting an update on this within the next two weeks.
21) Did you find your team in Singapore, or did you have to bring in people from other countries?
Right now, the ratio is about half half. We have people from New Zealand, Canada, all sorts of countries
22) Are you allowing withdrawals?
23) Why is Wavecrest taking too long to ship cards?
The issue is not wavecrest. We could ship all of our cards in one go. The problem is that everyone will want to use their cards at once. That is something we cannot handle at the moment.
24) If 100,000 people have registered on the app, how many percent have gotten their cards?
I can’t give you the answer right now, we have a huge amount of people on the waitlist, with around half of them being in Europe. It would depend on the waitlist and how everything is distributed.
25) Will it possible in the future to deposit Bitcoin with Lightning Channels?
Definitely. We want to do this with COMIT, working together with Lightning.
26) The 0.1% reward should be implemented as soon as possible
I completely agree with you, it is something on our to do list.
27) How can I pay my taxes to tax authorities?
We send you an email which functions as a receipt, so you need to report that yourself.
28) How can TenX prepare for the unwanted case of being regulated by the SEC?
I do not think that we are going to be regulated, but we are preparing for such a scenario.
29) What’s the problem with adding more card users? Is it too many transactions per second?
No, it is the transaction volume. It’s about us having to sell your crypto and get Fiat, then sending that Fiat to the card issuer which sends it to the entire network.
30) Can you compare the security of the TenX wallet to a desktop wallet?
The TenX wallet is not an open source wallet. If you want to own your private keys, which I recommend for large amounts, then you need to keep it in a wallet which allows you access to private keys. Since the TenX wallet does not provide you your private keys yet, we will add that next year, you should not store large amounts in your TenX wallet, instead storing small amounts that you intend to spend.
31) Will the new card issuer ship worldwide?
One of the things that I have been pushing with regulators around the world is to provide us with leeway on free taxation on cryptocurrencies, similar to that of Australia. It is also necessary for regulators to differentiate between cryptocurrency investing as compared to cryptocurrency spending. If that was possible, then maybe cryptocurrency spending would not be taxed.
32) The best wallet for TenX?
I would use MyEtherWallet.com, but do not use their private key, I would use a JSON file or if you have a Ledger, use that. Make sure you are at the right MyEtherWallet URL, because there are many scam sites out there.
33) Will you be adding atomic swaps in your wallet or in the background?
Yes, we do want that, and obviously with COMIT we are going to have a similar system. We do want to have.
34) Will there be an audit option in the app?
Yes, we have plans to allow our users print out their monthly statements for Fiat.
35) What are all the different countries and when they are going to be available?
Completely depends on our new card issuer. I will let you know an exact timeline within the next 7–10 days.
36) Cooperation with N26, especially the app?
I think we can learn a lot from them when it comes to usability, and they can learn from us when it comes to crypto.
37) What do you say about Revolut adding crypto?
I think that’s a valid concern. I am going to meet them in London, Paul met them in Japan, I think they are doing it differently, they are not going to have their token. As far as I understand, they are doing a fantastic job and we can learn from each other.
That was an hour, we went through all the questions on Reddit, and I have given you a couple of insights on things that most people are not ware off. I am looking forward to a similar Q&A in two weeks, these were great questions. Thank you for your support, and I look forward to seeing you in the Riot chat.
I wish you all a very nice Tuesday Evening, Lunch, Morning, wherever you are from.
Thank you so much from the entire team here!
TenX Q&A Livestream and transcript — 24th Oct, 2017 was originally published in TenX on Medium, where people are continuing the conversation by highlighting and responding to this story.