Dialogue with Bill from Wanwudao: The biggest problem for Web3 is the lack of breakthroughs in demand scenarios—don't let cyclical theories blind you
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Dialogue with Bill from Wanwudao: The biggest problem for Web3 is the lack of breakthroughs in demand scenarios—don't let cyclical theories blind you
You ask me if a new bull market will come, I'd advise everyone to forget about cycles, focus on fundamentals, and pay attention to technology and user base rather than asset prices.
Navigating Web3 tides with focused insightsInterviewer: flowie, ChainCatcher
Guest: Bill Qian, Chairman of Cypher Capital
Bill Qian, co-founder of Wànwù Island, currently holds multiple roles. After leaving his position as Head of Investment and Financing at Binance last year, he joined Phoenix—the largest Web3 holding company in the Middle East—serving concurrently as Chief Investment Officer of both Phoenix’s ecosystem investment platform Cypher Capital and its exchange M2.com. He also serves as a board member of the TON Foundation.
When discussing how his investment approach has evolved with these shifting roles, Bill Qian first emphasizes one “constant”: whether at JD.com, Binance, or now Phoenix/Cypher, his philosophy has always remained the same: “I am an entrepreneur happened to be an investor.” Put simply, creating value is always “more valuable” than merely seeking it.
The evolution under this philosophy lies in experience: traditional Web1/Web2 investing made him highly sensitive to use cases and traffic; his time at Binance sharpened his focus on early-stage ecosystem investments and large-scale M&A. Since joining Phoenix/Cypher, Bill Qian has adopted a “build and invest” strategy—dedicating significant effort to building multiple defensible businesses, ranging from Bitcoin mining and incubating compliant exchanges to mid-early stage venture investments.
Starting with Bitcoin mining, Phoenix now operates Phoenix Mining, the world's largest Bitcoin mining facility. Its 1.5-year-old multi-strategy Web3 fund, Cypher Capital, covers a broad range of activities including mining, node operations, fund-of-funds, direct investments across primary and secondary markets, and regulated exchanges. Cypher has invested in notable projects such as Sui / Mysten Labs, Sei Network, and zkPass. Bill Qian notes that if they identify a promising direction without an existing founder, Cypher will assemble a team and launch the venture themselves—such as their upcoming compliant exchange M2.com.
In the Middle East—a relatively balanced regulatory and innovative Crypto “fertile ground”—how exactly does Cypher “build broad alliances” while operating diverse businesses? What are the defining characteristics of Web3 investing and entrepreneurship in the region? And as an investor who has experienced full cycles in Web1/Web2, how does Bill Qian view the current development phase of the Crypto industry, especially recent trends like spot Bitcoin ETF applications and PayPal launching a stablecoin—moves by Web2 giants entering “against the tide”? On these topics, Bill Qian recently shared deep insights in an interview with ChainCatcher.
"An Entrepreneur Who Happens to Be an Investor"
1. Could you briefly share how you first got involved with Web3?
Bill: I started at a U.S.-dollar-denominated PE fund, Zhenxin Capital, focusing on tech and healthcare investments. Later, riding the rise of Chinese corporate venture capital (CVC), I spent six years at JD.com overseeing global technology and fintech investments. By 2020, Web2 growth had slowed, and through serendipity, I joined Binance as Head of Investment & Financing, leading fundraising, M&A, and Binance Labs.
2. Why did you join a Middle Eastern investment fund, Cypher Capital, last year? How is your team developing?
Bill: Our parent group, Phoenix, is the largest Web3 holding company in the Middle East. Its core business is Phoenix Mining—the world’s largest Bitcoin mining operation—with 7% of global Bitcoin network hash power. We also operate a joint mining subsidiary with Abu Dhabi’s sovereign fund ADQ, valued at $650 million. I serve as Chief Investment Officer for M2.com, Phoenix’s exchange, and Chairman of its ecosystem investment arm, Cypher Capital.
I also serve as a director on the TON Foundation, supporting Telegram’s public blockchain, which boasts over 800 million active users. Perhaps because my background was in Web1/Web2, I’m particularly focused on traffic and real-world use cases. The Telegram ecosystem gives me more opportunities to explore how Web3 can achieve mass-scale adoption.
3. What are your main areas of focus since joining Cypher Capital? How has your management and investment style changed from being Binance’s global head of investment to Chairman of Cypher Capital?
Bill: Currently, I split my time roughly 50/50—half on managing and operating Cypher Capital, and half on incubating new ventures within the Phoenix Group and overseeing capital operations for its subsidiaries. Whether at JD.com, Binance, or Phoenix/Cypher, one thing remains unchanged: “I am an entrepreneur happened to be an investor.” Creating value is always more valuable than chasing it. This is a principle I learned from my mentor, Mr. Zhang Lei.
That said, we must recognize that circumstances change—markets shift, businesses evolve, people grow. At JD.com, I focused on minority stakes and acquisitions in China and Southeast Asia’s mobile internet/Web2 ecosystems. At Binance, I worked on two fronts: early-stage ecosystem investments and major M&A deals—aiming to solve strategic problems precisely through buy-and-grow strategies. Now at Phoenix/Cypher, we do everything from Bitcoin mining and incubating compliant exchanges to mid-early stage investing—a true “build and invest” model.
Cypher’s Multi-Strategy Approach: Building Multiple Defensible Businesses
4. Cypher Capital has a wide range of operations—mining, nodes, fund-of-funds, direct project investments across primary and secondary markets. How are these different divisions performing and how do they interconnect?
Bill: Mining captures broad market beta; nodes earn returns from top-tier assets; fund-of-funds helps us build relationships—making friends with key investors across global ecosystems. Combined with direct investments, this enables us to maintain a full-spectrum, all-weather strategy.
We call ourselves an Evergreen Multi-Strategy Firm. As I mentioned earlier, being entrepreneurs who happen to be investors means we spend considerable time building defensible businesses: from the world’s largest mining operation, Phoenix Mining, to the compliant exchange M2.com, and now the 1.5-year-old Cypher Capital—we continue to incubate new ventures.
5. Looking at past investments, Cypher Capital seems to have heavily backed infrastructure and gaming. With overall crypto fundraising slowing this year, has your investment strategy shifted? Which directions are you prioritizing?
Bill: First, I don’t think the biggest issue this year is a bear market. BTC has risen over 75%—from $16,630 to over $29,000—making it the best-performing asset class globally.
So what’s the real problem? Use case breakthroughs. To date, the entire Crypto industry remains Fintech 2.0: BTC as Gold 2.0, Ethereum as decentralized financial cloud 2.0, layered with USD stablecoins, exchanges, lending platforms, etc. At its core, Web3 today is still a decentralized vertical of Web2 fintech. Other sectors like NFTs, gaming, and socialfi have yet to fully prove themselves.
Our strategy differs from most institutions. We believe investors are fundamentally followers of innovation—founders are the leaders. We prioritize bottom-up judgment over top-down allocation.
Of course, we believe Web3 can far surpass Fintech 2.0. Whenever we find the right direction and founder, we invest and incubate. If we see potential but no founder exists, we build the team ourselves. For example, our upcoming compliant exchange M2.com was assembled and incubated over the past year.
6. This year, AI involvement by crypto funds like Paradigm seems to be a trend. What are Cypher Capital’s thoughts on AI and Web3 convergence? Any clear strategic plans?
Bill: I discussed this with Vitalik in March—he also believes “Crypto × AI” will be a major theme.
Our understanding is that over the past 300 years, the world has been driven by two forces: one is productivity gains via “AL”—what I call “Artificial Labor,” i.e., the Industrial Revolution, which created vast mechanical labor. The second is innovation in factor allocation—capitalism, socialism, state capitalism, and various combinations thereof.
Today, the two driving forces are AI and factor allocation—the value of Web3, where the internet is restructuring commercial value distribution networks. Recently, we co-invested with Coinbase and others in Cymbal, a Web3 portal browser founded by a Web2 veteran (former CTO of Hutu, ex-GP at top Silicon Valley VC KPCB). It’s among the first products applying large models to AI in Web3 contexts.
7. Your largest investment so far was $150 million in Web3 gaming publisher Fenix Games, while most others are under $10 million. Why such a large bet on Fenix Games? What was the rationale?
Bill: Our investments fall into two categories. One is incubation of major verticals—like our mining business launched in 2015, where our Abu Dhabi mine involved a single $650 million investment, the first of its kind in the Middle East. Or our compliant exchange initiative starting in 2022, with an initial $250 million investment.
For VC-style investments, our amounts are generally small, and we never compete to lead rounds. This is for two reasons: financial returns and ecosystem building. The logic is straightforward: for large domains within our circle of competence, we prefer to take the lead and build ourselves; for founders in other fields, we play a supporting role and build broad alliances.
Thus, the size of investment depends on our assessment of probability and payoff—and whether the opportunity lies within our own or others’ circle of competence.
8. Sui, the Layer 1 from Mysten Labs (backed by Cypher) launched its mainnet earlier this year, but sparked controversy due to skipping airdrops in favor of direct exchange public sales/IEOs. Its token price later underperformed. As an investor, how do you view the listing controversy and its secondary market performance?
Bill: As the only institution in the Middle East to invest in Mysten, we’ve consistently supported Sui’s ecosystem development. In today’s tightening U.S. regulatory environment, decisions made by projects based in America cannot be viewed purely through a commercial lens. We believe that under long-term leadership, Sui will follow a path of compounding growth—long slope, wet snow.
Why Has the Middle East Become a Crypto 'Fertile Ground'?
9. What are the characteristics of the Middle Eastern Web3/Crypto institutional investor market? Where does your firm stand within it?
Bill: The Middle East is a destination for many Web3 teams and a market for LPs investing in global funds. Sovereign funds from Abu Dhabi, Riyadh, Qatar, etc., have deployed capital into numerous global funds as LPs. However, in tech investing, the largest pool of GPs is in the U.S., followed by China, then India and Europe. Thus, the GP community in the Middle East remains relatively small—whether in traditional PE, Web2 VC, or Web3 funds.
This market is primarily user-driven, with founders backed by global funds expanding here. For example, the region’s top search engine is Google from Silicon Valley, its leading short-video app is TikTok from China, and its largest Crypto exchange is Binance, originating in Asia.
Thanks to our ecosystem—including the world’s largest Bitcoin mine, the largest compliant exchange in the Middle East, and Cypher Capital—we are already the largest Web3 presence in the region. Combined with our strategic positioning and endorsement from sovereign funds, we are leading—and will continue to lead—the development of the regional Web3 ecosystem. We aim to attract more developers and investors to this market.
10. Amid SEC crackdowns on Crypto in the U.S., firms like Coinbase have announced expansions into the UAE. What specific advantages does the UAE offer in terms of Crypto policy and business environment?
Bill: The UAE has always welcomed Web3 with open arms. I see it as a healthy balance—neither unconditional openness nor blanket strictness, but a continuous effort to strike equilibrium between openness and regulation.
Controversial figures like Su Zhu and Kyle can still reside in Dubai pending final rulings from regulators and law enforcement—that’s tolerance. Yet at the same time, regulators in Abu Dhabi and Dubai keep pace with the latest global regulatory standards, holding local founders accountable. That, to me, represents the ideal balance.
Therefore, it’s not just Coinbase—many centralized institutions and decentralized protocols are choosing the Middle East as their future regional or even global headquarters.
11. Recently, there’s been a surge in Bitcoin mining interest in the UAE. Can you share which Crypto sub-sectors or narratives have gained traction over the past year? Are there any preferred areas for Web3 startups in the UAE?
Bill: Yes, in 2022, UAE sovereign fund ADQ partnered with us to establish a $650 million Bitcoin mining operation—the first sovereign-backed mine in the Middle East.
I believe in the previous cycle, more and more sovereign nations began recognizing Bitcoin as a proven “digital gold” asset class for strategic reserves—even using this digital gold to reform their national monetary systems.
As for sub-sectors or narratives, Crypto has been global from day one. So what we see are global themes reflected in different regional founder communities—there are no distinct, localized, non-global narratives. The UAE, especially Dubai, is the Hong Kong and Silicon Valley of the Arab world. It attracts founders worldwide—from Layer1s like Polygon and Ton, to apps like Biconomy, and our own Phoenix as the world’s largest BTC miner. Founders from China, India, Slavic regions, and Persia alike come here to pursue their visions across various niches.
12. How do ordinary citizens in the UAE view Web3/Crypto? Compared to frequently cited high-adoption regions like South Korea and Vietnam, how would you characterize the Web3/Crypto investment climate in the UAE? Any interesting observations?
Bill: Korea and Vietnam are known for having large, aggressive Crypto user bases, partly due to prevalent “casino culture,” making such behavior understandable. In contrast, Middle Eastern and UAE residents tend to be less aggressive in token investing, but show strong potential in NFTs. This likely relates to local customs of using physical or virtual consumer goods to signal social status. I frequently attend Punk and Ape gatherings here, and this sentiment is palpable.
13. You’ve established a large offline Web3 community in Dubai called CypherHub. What were the most discussed topics at CypherHub this year, or anything particularly memorable?
Bill: CypherHub is a 1,000+ sqm co-working space beneath Dubai’s seaside Ferris wheel. The past three pandemic years made our industry feel entirely online, but people ultimately return to offline interaction and community. Physical spaces are powerful catalysts for trust-building.
We envision CypherHub as the future “meetup place” for the Middle East’s Web3 community. This year, the dominant theme has been building the UAE’s Web3 startup ecosystem. As the most diverse Web3 hub globally, we’re uniquely positioned to cultivate a global offline community.
Forget Cycles—Focus on Technology and User Base
14. Traditional financial institutions are lining up to apply for spot Bitcoin ETFs. How likely do you think approval is? Institutional entry into Crypto is an old narrative—what’s your take on the timing of this “counter-trend” move by traditional finance, and its potential impact?
Bill: I’m very optimistic. Consider O2O during the 2000 dot-com bubble—it existed back then, exemplified by WebVan, which wiped out many top funds. But computing devices were PCs, not smartphones, and cold-chain logistics weren’t mature enough, so it failed.
Yet today, in both the U.S. and China, consumers routinely order groceries via mobile apps—now a GMV market exceeding $1 trillion. My point is: if a trend is valuable, failure in the first attempt doesn’t mean it won’t succeed eventually. On the second or third try, when timing, conditions, and people align, it happens—and once it does, it reshapes industries and users. For meaningful innovation, we must never overlook “time” as the most critical variable. Given time and patience, what’s meant to happen will happen.
So it is with the future of BTC ETFs. All major money (sovereign funds, mutual funds) and retail investors will eventually allocate to BTC as “Gold 2.0.” To me, this is inevitable common sense—the only remaining questions are when and where. Once traditional institutions begin entering, even a fraction of the hundreds of trillions in global fiat currency will flow into today’s ~$1 trillion Crypto market, creating massive industry-wide impact.
15. Half of 2023 has passed. Looking back at the first half, which events or trends have truly had a lasting impact on the Crypto industry? What developments or narratives should we watch in H2 2023?
Bill: The tug-of-war with regulators has impacted me most deeply. I see this as inevitable. Going forward, financial regulation and industry innovation will coexist as the new normal. Compromise between hawks and doves is also inevitable. Of course, macro-level shifts are beyond individual control—we must accept their existence and learn to coexist with them.
Recently, I’ve been closely watching X (formerly Twitter) and PayPal’s stablecoin. Both platforms have hundreds of millions of users. Their progress in Crypto could elevate our user base to an entirely new scale.
16. Roughly six months after Binance’s BUSD faced regulatory pressure, PayPal launched its USD stablecoin PYUSD. What does this say about U.S. regulatory intent or evolution? What impact might PYUSD have on the Crypto industry?
Bill: Traffic is the most expensive ticket in any business. Whether it’s offline real estate (Macy’s, Wanda Plaza), Web1 portals, Web2 TikTok, or Web3 wallets/exchanges—those who control traffic dominate. Even in the U.S., every player with traffic has long coveted Crypto. Facebook不幸 died on the beach—if it had succeeded, it might have brought 4 billion non-Chinese Web2 users into Web3 by now. I believe PayPal’s move is well-calculated. As a veteran of Fintech 1.0, announcing now means they’re confident in driving their 400 million users into Crypto via this stablecoin. If successful, Crypto will become a 1-billion-user market. I expect—and believe—this will happen within the next 24 months.
17. With traditional financial giants applying for spot Bitcoin ETFs and PayPal launching a USD stablecoin, Crypto communities are loudly debating whether a “new bull market is imminent.” What are your predictions for the timing or triggers of the next bull run?
Bill: A mayfly knows not the seasons. I’ve always felt that “four-year cycle” believers are both “Crypto Native”—because they know the past eight years well—and unfortunately “Crypto Naive”—blind to the broader global political economy and monetary supercycles.
The past two consecutive cycles occurred during the largest fiat monetary easing in human history. So if you held any risky assets, you couldn’t help but rise. But now it’s different—the paradigm has shifted, the global logic has changed, “money” has gotten more expensive (global interest rates have risen hundreds of basis points from zero or negative), and even the world’s decision-makers may be changing.
So when you ask if a new bull market will come, I’d urge everyone to forget cycles and focus on fundamentals—focus on technology and user base instead of asset price. “The wise fear causes; the masses fear outcomes.” Outcomes are asset prices; causes are fundamentals. I hope everyone in our industry focuses more on fundamentals—technology and use cases. “The future is already here—it’s just not evenly distributed.” Let us stay engaged, and wait and see. Thank you.
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