【Blockchain in Korea】Hillstone Rayol Hwang:China, Japan and Korea project differences
【Blockchain in Korea】
25days ago

The full text is a total of 2303 words, expected to read 5 minutes.

Editors note:Coinin is the Korean blockchain media headquartered in Seoul, South Korea, it relies on industry head resources and community advantages to form a huge influence on the media. It is known as an upgraded version of the blockchain field 36Kr.


Coinin recently launched the "Blockchain in Korea" series in South Korea, visiting the top blockchain practitioners in South Korea and promoting exchanges and cooperation between China and South Korea. In the new phase of "Blockchain in Korea", the rotation host Taewon Kim who is CEO&CTO of GLOSFER invited Rayol Hwang, CEO of Hillstone Partners to talk about "Differences among Korean, Chinese and Japanese blockchain projects".


Guest introduction


The 43rd phase of the "Blockchain in Korea", the rotation host Taewon Kim who is CEO&CTO of GLOSFER invited Rayol Hwang, CEO of Hillstone Partners to talk about "Differences among Korean, Chinese and Japanese blockchain projects".


Rayol Hwang:

Hillstone Blockchain Center CEO

Hillstone Partners CEO

Yozma Campus Managing Director

Krazylab Inc. CEO

Lanello Studio CEO

Medici Inc. CEO

TJ Soft CTO  

HScom Creative Director

ZikoPrime Inc. Investment Manager

Xpace Inc. CEO

UMind Inc. CEO




Taewon Kim: Hi, everyone, this time I will interview Mr. Huang, one of the most famous and most respected people in the blockchain industry with crypto investment and many start-up experiences. Today, I will interview Mr. Hwang's view on the blockchain and Hillston Partners.You are currently the CEO of Hillstone Partners. How did you connect with the blockchain industry? You have established more than 15 startups. Which is the most successful project in your opinion?

Rayol Hwang: Hillston Partners was originally launched as a traditional M&A fund, and in 2018 it entered the blockchain area through overseas alliance with crypto funds. Especially, Chinese funds that have worked with us for a long time have a greater impact on us.

Unlike other funds, we are investing in the blockchain sector while maintaining the identity of traditional funds.

In 2019, through traditional Fiat funds, it is experimenting with various hybrid methods to invest in blockchain companies.

The most successful project I personally exited was the game engine development, which was conducted through M&A with 30 billion KRW. Among the 15 ventures, 5 projects successful exited and 10 failed. However, the winning rate of 30% is not bad objectively. I am called "the king of failure" in Korea. The above list is a record of my failures and successes.


Taewon Kim: You have a lot of experience in the traditional field, and more importantly, those experience of failure are likely to be helpful in fostering many start-ups in the blockchain industry. Please introduce the Hillstone Partners. As a traditional private equity fund before considered as a crypto fund, is there any difference when Hillstone Partners screening projects? What are the characteristics of a high quality project?

Rayol Hwang: Blockchain VC and the startup VC are very different in some areas, and same in other areas.

Firstly, from the perspective of traditional VC, it is a general model to invest in potential enterprises and then to recover investment funds through investors or IPOs. Since the general investors does not involve in this process, so the risk is reduced through professional methodologies. For this reason, the investment method will naturally be more cautious and slow.

For tokenfund, the interval from investment execution to listing is very short, investment recovery is very fast, and some even invest with ordinary investors.

The two patterns seem similar, in fact, the traditional way is the acquisition of equity, while the latter is the way to obtain tokens.

In terms of equity, it is very important for the company to become bigger and stronger, and the market price of the token is very important. In fact, it can recover the investment money at a point faster than the growth of the enterprise.

For this reason, it is difficult to make long-term investments. Factors that are not related to the company's growth, such as simple favorable news, rising token prices, will become a standard for investment and this may cause many problems.

We implement investment based on three perspectives.

Firstly, does the service actually need blockchain technology (compatibility)?

Secondly, how does the price of the token rise? (design)

Finally, whether you can implement the service (development) as mentioned above?

Of course, there are many other factors that can be used as a basis for valuation, but it is impossible to perform investment by examining these elements one by one. In short, projects that clearly answer the three questions can be our investment targets.


Taewon Kim: Thank you for your clarification. In the end, we should not look at the crypto field as a new world, but to look at how the funding and results of the existing financial market differ and their advantages and disadvantages. Of course, we should compensate for the shortcomings. Hillstone Partners invests in domestic and foreign technology-based companies and seeks investment projects in Korea, China, and Japan. What are the differences among the blockchain projects of Korea, China and Japan?

Rayol Hwang: The difference is that it may be because the scale of the Chinese market is stable, compared with the consideration of services, China seems to pay more attention to technology and the environment is very good. Japan is slowly evolving in a very stable way. There is a problem with South Korea. Compared with the large market size, the growth of the project is not good enough. Although the development is very rapid, I think the order of project excellence is China > Japan > Korea.

In general, China project's technology is strong, and Japan's project services are solid. In my opinion, South Korea's strength is  that it can quickly catch up with these advantages.


Taewon Kim: Your answer is really insightful. I personally hope that the three countries can unite and carry out more projects to achieve complementary advantages. You said that blockchain technology is not a panacea, but there are some areas that can only be realized by blockchain technology. Which areas can only be implemented by blockchain technology?

Rayol Hwang: The financial sector. In the financial sector, the blockchain has many environmental factors that can definitely stand out. Of course, the existing financial monopoly is so powerful that it has strong regulations, but I think the blockchain is anti-authoritative, that is, it was born to break the existing compliance. I believe that blockchain technology is still very useful in the financial industry and it will create the most significant results in the future.

To give a simple example, the most convenient way to send money from China to Korea or to send money from Korea to Japan is to send Bitcoin. People call it the gray area, but I say it is a blue ocean that has never been created.


Taewon Kim: Yes, this part can be seen as an instinctive reason for their fierce opposition to the proliferation of cryptocurrency. What impact will institutional investors’ entries have on the current blockchain industry? Is it difficult for industry SMEs to gain competitive advantages?

Rayol Hwang: I don't think there are any conditions for institutional investors to enter the market. In fact, in a sense, we are “institutions” from traditional fields. From this perspective, there are not enough factors to attract institutional investors, so we are trying to play the role to attract institutional investors.

Because we are more aware of the two parties, it is easier to get in touch and proceed this, but unfortunately we have been criticized by both sides. But I believe that the traditional field and the blockchain field will be combined. In order to achieve this combination, we are actively trying to help traditional institutions aware of the substantial benefits.

Obviously, big companies will play an important role, but as you know, big companies are always slow. I think SMEs have many opportunities to use this time difference to make a good positioning.This is a war with time.


Taewon Kim: Yes, the creativity and rapid execution of SMEs ultimately determine the survivability in the new market formation process. You commented that initial coin offering is a very innovative way. What do you think about the  new fund raising methods IEO and STO?

Rayol Hwang: There are many problems with initial coin offering. In some ways, initial coin offering can be considered a failure, but this is a very surprising attempt in my opinion. Of course, if the project sticks to initial coin offering, I will criticize it. It is a bit exaggerated to say that the current initial coin offering model is dead. The market has proved this result.

The fundraising methods that were carried out later were IEO or STO. I personally think that STO is the most blockchain approach. Of course this model has not yet been completed, but I believe that when it is fully prepared, STO will create a new paradigm.

I personally hope to encourage people to do more research and improvement on the STO model to extend the use of blockchain technology. I hope that it will not rush like initial coin offering, and let the good model disappear.


Taewon Kim: Agree with your point of view. Although there are many shortcomings in the start of new industries, if the STO model is more cautious and more constructive, it may be a new beginning for the cryptocurrency world. In Korea, your name is related with scam-hunter or minister prosecutor of blockchain. You are called "grim reaper" by companies that are not prepared and only want to raise funds. Could you explain why you are called "grim reaper"?

Rayol Hwang: Maybe a lot of people have something to say in their lives, but they can't tell. It is the same when you encounter a fraud project. I am just saying it bluntly, not bearing it, and at first I've been hated. Even in an open place or he is a close friend, I will tell the truth. I blame the wrong project, not the people. In order to ensure the healthy of this ecosystem pointing out the mistakes is necessary, not just encouragement.

Especially for the scam projects that destroy the ecosystem, I will blame them bravely for the sake of justice. Otherwise, all of us will die.


Fortunately, there are a lot of people who support me, so it's not as hard as it used to be.


Taewon Kim: What is the latest activities and future plan of Hillstone Partners? In what ways does Hillstone Partners hope to cooperate with projects or institutions in China and South Korea?


Rayol Hwang: Our originally base is in China and had cooperated with more than 20 Chinese institutions. A few days ago, I decided to hold meetup with Bepal which produces hardware wallets, and GXchain which has already landed in China, as their Korean partner we help them with entering the Korean market. If any organizations or teams need help in Korea, please feel free to contact us.

Unfortunately, the industry size of the blockchain is still small. I think the more you cross the border and work together, the more power you can exert.


Taewon Kim: "The more you unite, the more powerful you will be," is the most resonating for me. The last one is the tradition question of interview.

As a well-known person of the Korean blockchain, you may know a lot of outstanding practitioners in the blockchain industry. "Blockchain in Korea" interview program is launched by [Coinin], is dedicated to exploring high-quality blockchian projects and practitioners. Could you recommend three honored guests to our program?

Rayol Hwang: I recommend my favorite blockchain project's Jang Sunghoon, the CEO of 'Beat Berry' wallet service, Jeong Giyeong who is consistent with my concept, like a friend and respectful, and Jeon Hajin who is the Korea Blockchain Startup Association’s Self-Regulatory Committee Chairman, he is my spiritual pillar.


Q&A Session


Q1: Do you have any experiences that you would like to share with entrepreneurs as an serial entrepreneur?

Rayol Hwang: Entrepreneurship itself is a process. If you hold the idea of must success may let you become unfortunate. Although it is a bit ironic, even when I failed, I felt happy because I did something I like, even when I earned a lot of money, I wouldn’t feel happy if I did something I dislike.

It is not for the sake of accomplishing certain things, but to start a business with a happy attitude, this may be the most desirable thing for entrepreneurs.


Q2: Recently, the price of Bitcoin has skyrocketed. Does this mark the beginning of next round of bull market?

Rayol Hwang: I think the recent rise in bitcoin has been affected by South Korea. (This is my very personal opinion.)The number of Korean won to buy bitcoin has been rising. However, many investors are Chinese.Perhaps the Chinese who own the Korean won in South Korea threw the Korean won. In South Korea, there has been a problem with currency reform. As a joke, I would imagine that since the Chinese have Korean won changed them into the dollar and the bitcoin, so the Korean won is depreciating and the price of the bitcoin has risen.

In any case, it began to rise and then followed the large-scale transaction in Brazil (the uncertainty of the fiat), and then saw the news of Bakkt's ETF license to boost this round.

I have been paying close attention and the rise is still going on, but it seems difficult to make a prediction. I personally think it will rise steadily, but it should go through a stabilization phase.

From: Coinin

This article is reproduced only, does not constitute an investment opinion


Get more information


© BeeCast-Blockchain media of the Southeast Asian