How aggrieved traders are uniting against Binance after the crypto crash

Transcript

Angie Lau: When investors lose money due to technical issues in exchanges, whose fault is it? Are investors being fairly served by crypto exchanges? And is there a path to get justice for all with blockchain?

Welcome to Word on the Block, the series that takes a deeper dive into blockchain and the emerging technologies that shape our world at the intersection of business, politics and economy. It’s what we cover right here on Forkast.News. I’m editor-in-chief, Angie Lau.

Well, the world’s largest crypto exchange Binance is facing heat — this time from investors. Remember May 19th? The price of Bitcoin plunged 30%. US$8.6 billion worth of crypto was liquidated across exchanges during the infamous crypto crash that dark Wednesday. Many exchanges were cut short, unable to deal with the avalanche of volume, and more than 775,000 traders saw their positions forcibly closed.

Now, Binance was one of those exchanges that suffered a technical outage, leaving investors locked out of their positions, watching helplessly, unable to get their money out.

Since then, Binance has offered up to 30% in compensations. While some investors took the deal, others are refusing to take the hit.

And now a band of six investors affected by the Binance outage are leading the charge to bring the claims of all Binance customers to arbitration. The group has joined hands with Swiss-based litigation financing private equity fund Liti Capital. And today, I’m joined by its Executive Chairman and Chief Investment Officer, David Kay.

David, welcome to the show.

Now, I understand that you’re on vacation, but in our industry, nobody ever takes a break. So I truly appreciate you coming on the show.

David Kay: Thanks for having me. It’s true. 24 hours a day. Seven days a week.

Lau: All right. First of all, let’s start with litigation financing. What is litigation financing? What is Liti Capital?

Kay: Yeah, it’s a great question. So Liti Capital is the first private equity firm on the blockchain. To date, private equity has really been for the 1%. I worked in private equity for the last decade. And one of the biggest disputes that I had with my partners was that my parents couldn’t invest in the fund that I founded and ran, because in the U.S., if you don’t have $1 million of liquidity, you cannot invest in private equity. Decentralization generally — and blockchain specifically — is about the democratization of finance.

So we are really pleased. We’re really proud to be the first private equity firm that’s for everyone. Anyone can invest — if you have $5 or $5 million dollars. What is litigation financing? Maybe the best thing to do — if you don’t mind — is to give an example. Let’s say Angie, that somebody came up and said, look, I want to buy this podcast for $20 million. HugeCo shows up and says they want to buy your podcast for $20 million. Are you in?

Lau: Where’s the check?

Kay: They own it, right? In the contract, what they say is, ‘Look, there’s a provision of the contract that for the first three months, if you do anything that brings any disrepute or bad reputation to the podcast, we’re going to keep it and we’re not going to pay you anything.’

And you think, ‘Fine, no problem. We’re going to do that.’

And two weeks later, you go out and you jaywalk. God forbid, you jaywalk, and HugeCo comes and HugeCo says, ‘You know what? That brings disrepute onto the channel. And therefore, we are keeping your podcast and we are not paying you $20 million.’

What do you do?

The answer is that most people, they walk away because suing HugeCo costs somewhere between $2-5 million dollars to do, and people don’t know how to do it and they’re uncomfortable with it. They’ve now lost their job. They don’t have that much capital in their account to do it, and they walk away. Some people put a little bit of money towards it, and then HugeCo comes in and says, you know what, I’ll pay you three or four million dollars. Let’s just end this. And most people, $3 million or $4 million is a lot of money. 

Lau: We’ll take it, yeah.

Kay: You take it and they walk away. So that’s where litigation financing comes in and that’s where Liti Capital comes in.

Lau: So you come in and you say, ‘You know what? That’s not fair. You should get your $20 million and I’m going to front you the dollars.’

Kay: Not am I going to front you the dollars, but you have no risk. So we will come in and we will say, ‘Look, Angie, this is going to cost $3 million and we will take 100% of the risk, 100% of the cost, nothing comes out of your pocket. If you lose, nothing happens. We take all of it.’ We will take then let’s call it 30% of the upside.

Now, we turn around to HugeCo. Huge co now knows that what they did to you is going to be decided by an arbitrator or a judge and that somebody is going to decide whether jaywalking is something that is worth taking $20 million from somebody. So then HugeCo comes and they say, ‘All right, all right, all right. Listen, I get it. Maybe it was a little aggressive. Why don’t we give you $15 million?’ And you say to yourself? $15 million is a lot of money.

Lau: That’s pretty good.

Kay: Yeah, take $15 million. You say, ‘Great!’ You take $15 million. Of that Liti Capital gets 30%. So we get $4.5 million. Which leaves you with $10.5 million. So now you went from zero or $3 million up to $10 million, and Liti turned its $3 million into $4.5 million.

Now, here’s the crazy part. Here’s why litigation financing has made 30% to 50% cash-on-cash returns every year. Guess who also benefits from that — HugeCo. Because HugeCo saved $5 million on what they otherwise would have paid you. So HugeCo in the real life does that all the time. Because at the end of the day, if you’re just withholding money that you would already have owed from somebody who can’t fight you. HugeCo’s downside is just to pay what they already owe. And so they are repeat players in that sense, because it makes sense for them to do it. And they do it over and over again. And so that repetitive bad action and the fact that people need help.

Lau: Yeah, that is incredibly, unfortunately, so cynical. I mean, we think of the justice system, we think of contracts, we think of process, due process as something that if I’m going to engage with you in a fair way, that I’m going to do it in full faith. And what you are saying is that there’s actually business in a little bit of bad faith because it saves a ton of money.

But where does this leave the little guy? And let’s take this example to what happened on May 19th. We saw a lot of traders, not just at Binance, so many other exchanges also experienced technical difficulties. And we can dive into that a little bit more later. But what ended up happening was displacing all of these traders outside of their positions, costing a lot of money. That day, Bitcoin fell 30%. That’s only a straight trade. If you had multiple positions on positions, it could have had a cascade effect, which unfortunately did for a lot of people, and no one could do anything about it if you were on some of these exchanges that had those technical difficulties.

And so, where are we right now? Up until this point, all we have been hearing is, the ‘I’m sorry, I have some insurance dollars and I can make you somewhat whole 10%, 20%, 30% whole, and possibly pennies on the dollar but sometimes these things happen.’

Where are we now? Obviously, that does not sit well with the band of six investors who initially came to you. Where are we right now with the Binance case? What are you doing with the Binance case?

Kay: Yeah. So it’s a good point. To what you were saying before, The sad truth is that we do like to think that the good guys win But in the real world — at least in my experience — a lot of times they don’t. And so, with respect to Binance — which is not to say that Binance are bad guys — but we are in an interesting situation.

Maybe it makes sense to first talk about what happened on May 19 and then where we are. 

So the group of traders that we have, which now number in the hundreds — we have gone from six to hundreds in a little bit less than a week with more and more signing up at binanceclaim.com every single day.

But let me give one example. Someone who’s become my friend, who’s a part of the group of six lost $12 million on that day. Let’s talk about how he lost $12 million. He had built up an account and wealth from nothing, and he had $12 million in Binance, invested in Binance futures products. Not Bitcoin, not Ethereum, not community assets, a Binance-created futures asset. And all the people in my group are people who invested in Binance-created futures or leveraged products. These are not people that were investing in Bitcoin or Ethereum or spot markets investing in a Binance futures product on the Binance platform.

Bitcoin and Ethereum, the underlying assets that the futures contracts reference, started going down. He has pictures and video of him trying to close out that account over and over and over again for the better part of an hour. $12 million, Angie, a life’s worth of money sitting in an account. By the time the Binance system started working for the Binance products, Binance had made its decision as the owner of the margin account to completely sweep his account. And he had nothing.

And that is the story that is happening over and over and over again. So forget the law, forget the case for a minute. You tell me. If you are a trader and you’re on a Binance system trading a Binance product, the Binance system doesn’t work, by the time the Binance system works, Binance sweeps your account and you have zero. Who is responsible for that? Who is the person that should lose $12 million in that? Let’s layer the law on in a second, but just as a pure, equitable question, is he responsible for that? He did everything that he could possibly do. He recorded the incident, for goodness sake.

Lau: And then there’s the fine print. So every investor, every trader goes on Binance, there’s all this fine print and it’s whether you click ‘I agree,’ and you didn’t read it, you still clicked ‘I agree.’ 

Kay: I love it.

Lau: You actually acknowledged it. 

Kay: You are exactly right. 

Lau: So the fine print, David.

Kay: Let’s talk about the fine print. I love that you said that. That is absolutely true. There is a user agreement that you click when you join Binance. Let’s talk about what that user agreement says and what it does, and then let’s talk about whether it’s allowed.

Look, one of the things that I give Binance a huge amount of credit for is they are the first company in history that has gone without regulation, without offices, they have no jurisdiction, they — according to them — are subject to no laws. So in their user agreement, when you sign up, you are not permitted to sue them in any jurisdiction around the world. The only place that you are allowed to sue Binance when you sign up to that agreement is the Hong Kong International Arbitration Center. 

So let’s start there for a second. If you lose $10,000 or $25,000 or $30,000, and you’re based in New York, the United Kingdom, Venezuela, Brazil, how are you going to get to Hong Kong and bring in arbitration in Hong Kong? But let’s not stop there. The other interesting thing is Binance obviously doesn’t want to be subject to local jurisdictions because they don’t want to be regulated, which is a very smart thing to do if you’re in their shoes.

But here’s another difference. When you are regulated and you’re subject to local rules and law — and we got to circle back to that, because that is important — There is a system of government that has been put in place in every developed country in the world over the last 50 years for consumer protection.

For financial regulation, if you and I were to start an exchange tomorrow where we were going to put out Angie and David future products, we are not permitted to just turn around, put it out there and start charging people. You need a license. And in order to get a license, guess what — your system has to meet certain basic requirements to make sure that it works. Binance didn’t have to do that.

Then you have to have certain financial assets in the jurisdiction that you’re going to be in. So if something happens, the citizens of that country know that they’re going to have recourse. And finally, you have to submit yourself to the jurisdiction of local courts, because the governments there want to make sure that if you’re offering complicated financial products to people, that they’re subject to jurisdiction just in case something like this happens.

So here, they’re not subject to jurisdiction anywhere except Hong Kong. And unlike your local court, where theoretically you could go in, you could not pay lawyers, you can represent yourself. And the judge for free will hear and adjudicate your case. In arbitration in Hong Kong, It costs $65,000 per plaintiff to be heard. You have to pay the arbitrators. You have to pay the center. It is justice at a cost. So just the 700 people that were in the original Discord group that organized it would cost them $45.5 million to be heard, just to be heard, according to Binance’s terms of use.

But let’s not stop there. The other thing that is in Binance terms of use is that you are capped at your total damages in 12 months of the fees that you paid Binance. So every trade that you do, a tiny amount goes to Binance for fees. So what does that mean? That means even the person who lost $12 million, according to Binance, could only have a maximum claim no matter Binance did of less than the $65,000 dollars that it would cost for him to bring the claim without a lawyer. I.e., there is no way — irrespective of what Binance does to you — for you to make more money than it cost to bring a claim.

That’s what the user agreement says. I know you’re going to say next Angie, and I’ll just give you one more piece and then I want to talk about it, which is, in every jurisdiction in the world, there is some iteration of what I call the ski lift ticket rule, which is that when you go skiing and you buy a lift ticket, you sign the lift ticket. And when you sign the lift ticket, you say that even if somebody that works for the mountain pushes you off the chairlift and you fall and get hurt, that you cannot sue the mountain. The reality is, even if you just fall off the chairlift and get hurt, you can sue the mountain. Why? Because in click through, one way, non-negotiated contracts, especially with large financial players, there are certain rights that you simply cannot give up.

The question for Binance is, what law are they subject to? And my response is, set up a Wheel of Fortune wheel. We’ll put a bunch of different laws on it, spin the wheel, and we’ll take whichever one lands, because there is no law anywhere where that contract is acceptable, appropriate or going to be enforced.

Lau: Look, this market and crypto industry in particular has accelerated at a pace far faster than regulators have been able to even catch up. Such as the case of Binance when it started, nobody really cared about it. And then all of a sudden, it was this huge behemoth.

And certainly now as more and more interest into crypto has come in. Regulators have started to come in. Binance Singapore is in a regulated environment. Binance USA is in a regulated environment. Binance, the overall group, to your point, is trying to play by the rules that are increasingly getting more strict.

Over the past couple of months, we’ve seen regulatory action against Binance in the U.K., in Japan, et cetera. Hong Kong specifically, David, the SFC has decided to move forward with new policy that restricts capital investment from non-accredited traders for crypto exchanges. So crypto exchanges cannot work with anybody below a US$1 million threshold.

There are rules in Hong Kong. Now, specifically, the arbitration rule is a very, very specific arbitration rule. But in the ecosystem that is Hong Kong, which is a U.K.-based litigation, international law, it still has that structure. Multinationals are based out of Hong Kong for that very reason. There is international rule of law.

So how does this jibe, then, to have this one really narrow band of arbitration in Hong Kong? Because I don’t want to malign Hong Kong. It is not to say that we’re doing that in this case, Hong Kong is a highly experienced legal market. But for the arbitration clause in this case, it really takes advantage of this one arbitration process that is convenient for what predominantly has been a stateless company for thousands upon thousands of investors now around the world who have all signed that fine print.

Kay: So two things. First, Hong Kong is one of the top two or three most prestigious international arbitration centers in the world, period. And all of the international arbitration centers apply international law. So it’s more like the House. It’s like if you have a football match in Wembley versus Giant Stadium, it’s different outside. But the rules and the players inside are the same.

What is frustrating about it is that Hong Kong is far away from a good three-quarters of the world, and the intention of the arbitration clause being in Hong Kong is almost certainly partly to disincentivize people who have been harmed by Binance for standing up and trying to get justice. It is much harder if you are anywhere that is a plane ride away from the island of Hong Kong to conceptualize going to Hong Kong for a loss under X dollars. And that’s at least $65,000. 

And it’s not just Hong Kong. All of the arbitration centers in the world, whether it’s Paris, London, Washington, they all cost money. Arbitration is a private method of dispute resolution. And so, like you said, it is a very prestigious place. We feel very comfortable that we’re going to get a fair hearing, which is why, at the end of the day, from our perspective, the idea of this contract being enforced, we just don’t think it’s going to be. 

But I did want to grab on something that you said, because I think it’s important. This is unique in that it will be the largest consumer arbitration in history. Generally, because these companies are regulated, consumer fights happen locally. They happen in your country pursuant to jurisdiction. They do not happen under international law. Because when you’re regulated as a company, you are required to show up in that country’s court system to have the fight.

So this is very unique. For a lot of reasons, but most interestingly to me is because consumer arbitration as a world, as a group, as a community, this is really one of the first times that the question has not been consumers of this jurisdiction or consumers of that jurisdiction, but the consumers of the world and a community.

So I think that is a really interesting nuance here. And it ties into what you’re saying, because all this is happening at the same time. Regulation is coming. The regulators are standing up there saying, ‘Look, we need to set some rules here and we want to be part of that second chorus of voices, which is what about the consumers? We have a say here, too. How are we going to be treated by this new type of corporation, this stateless, borderless, officeless corporation, that Binance is the first but not the last?’

Lau: And you’re putting $5 million to this effort.

Kay: At least $5 million. We’ve committed at least $5 million. We will do what it takes. And getting back to the point from the beginning with the example we gave with your podcast. This is at no cost and no risk, and this is for everybody. If you have lost $25 or $2 million, it doesn’t matter.

We have a website. It’s binanceclaim.com. It takes less than five minutes to sign up. And once you sign up, White & Case, which is the number one international arbitration firm in the world, four out of the last five years, including this year, they will be your counsel and we will represent you. And if we lose, you’ll never know. Nothing will happen. There’s no liability. If you win. Then we will send you either a check in fiat or if you lost Ethereum or Bitcoin, that is ultimately what you’ll get back.

Lau: They’ve offered 30%. I mean, just thinking of that investor who lost $12 million, 30% is still significant, still in millions. But what are you hoping to recover? 100%, 80%, 90%?

Kay: Yeah, it’s a great question. Look, I think the 30% number, I can tell you from experience, is quite rare. Most of the hundreds of people that we have talked to have been offered significantly less than 30%. Generally in the single digits. And I think Binance includes in that percentage for the smaller people, the value of a one-year or two-year free use of their premium service.

So that is how they’re getting to 30% with lower people. We have seen very few examples in the 30% range. It’s really in the single digits. What we’re hoping for is 100%. And what we expect is 100% of the value lost because of Binance’s systems failing on Binance-related products. These are leveraged and future products where, again, they’re Binance products. Binance system failed.

And this is important, Angie. It’s not like you could go to another exchange and trade these products like Bitcoin or Ethereum. These are Binance products that failed on a Binance exchange where Binance decided to liquidate and take 100% of these people’s money before the system started working.

Lau: Well, another analogy is like you go into a casino. You win. The dealer says, “Yeah, no, I’m not going to pay you out because I can’t get to my cash, so see you later, sorry.”

Kay: Good luck. Yeah, Godspeed.

Lau: Which, some would equate, all of this as being trading in general, finance in general. A little bit of that risk. Well, listen, I think it also speaks to something bigger here. I talked to CZ, the CEO of Binance, earlier this year before even May 19th, and already these issues were showing up.

There were systematic failures on an irregular basis, but enough to comment on. Enough for Binance to work around the clock, as he said, to really take us seriously, to consistently trying to improve the product and improve the platform to create SAFU, an insurance product that, whether its product or not, but a fund internally that allows them to at least compensate in cases like this. I don’t think he nor anyone else would anticipate one $12-million loss among thousands on May 19th.

So there were already instances of this before. What is it that you’re going to be sharing with the arbitrators? What is the responsibility of crypto exchanges — because, who could anticipate this avalanche of volume? The system couldn’t handle it. Was this an act of God or whatever the case is? They didn’t mean to do it. So what is it that ultimately arbitrators need to figure out here?

Kay: Yeah, it’s the right question. A couple of things. The first thing is that it is one of the difference between operating in a regulated environment and an unregulated environment. If you are meeting all of the standards that are required in the jurisdiction that you are in, if you have created a system, an application, a process by which you are meeting the underlying standards, including, by the way, customer acquisition. In most jurisdictions, you can’t just give a margin account to somebody who shows up with a credit card.

There are questions, especially with futures. In the United States, there’s a whole separate group, the CFTC, that deals with additional requirements to bring people on with futures so that make sure that they understand and know the risks and what is going to happen. In those environments, it is very different if there is a massive influx of volume that causes a breakdown versus you and I turning around tomorrow, starting Angie and David Web service securities, selling them to the public, putting advertisements everywhere that we are able to handle as much or more volume than the New York Stock Exchange and Nasdaq. Then when a fraction of that volume comes, our systems, which are not regulatory compliant, our customers who are not brought in with the same standards that are required in the countries in which they exist. And then the system doesn’t work. The idea that there is no responsibility there, that is the question that the tribunal is going to need to answer, and that is really the gap.

So if we go back to what law, the answer is that the law of any jurisdiction, Binance loses because they neither acquired their customers correctly, nor did they put their systems in for the basic scrutiny that is required when you offer a financial service to the public. And so the fact that they exist in an area without law, their argument is then there is no laws, so we can do whatever we want. And our response is, no, pick a law or we can use international law as the basis and we can say whether the system that you’ve set up is at a sufficient level, where this is, as you said, an act of God or whether it was absolutely preordained because the system wasn’t up to basic standards or even in a worst case scenario, that there was some nefarious behavior there.

Lau: Now, that’s not the base case, but I’m sure you’ve seen some of the same stuff that I have. It’s certainly something that we need to get some documents and understand a little bit better.

There have been criticisms, no doubt, of the efficacy of these platforms when it comes to speed and volume during high volume days, such as May 19th and other days. There have even been internal industry critics saying, you know what, developers, engineers, the platform team, there’s so much more that should be done and can be done.

The industry has a hard time policing itself at the moment, and regulators are doing that job for the industry. At what point is there some self reflection, especially in the face of this large litigation that’s coming up in arbitration in Hong Kong against Binance? What message is this going to send to the industry?

Kay: I think it’s the right message. Let’s talk about the internet, which I think is similar to the blockchain 20 years ago. When the Internet came out, it gave access to data, information assets around the world that the world had never seen before. But at some point, we had to stand up and say, OK, now this is big enough where we need to put some basic rules around it.

The internet today is still largely unregulated. It is still largely free. But there are some rules and regulations. And the blockchain and the decentralization of finance — you’ve traveled the world, I’ve traveled the world, in places like Venezuela, Argentina, large swatches of Africa — the ability to have a currency that sticks value, where you can work every day and know that your government’s inflationary actions are not going to destroy your life’s work and family is a game changer.

But we are large enough now where we need to do the same thing. We need to stand up and we need to say, ‘Okay, we need to make some rules here. What are the guidelines going to be?’

The statement and what we need to take away from this is that there are community assets and there are corporate assets. Bitcoin, Ethereum, those are community assets. I think those should be minimally regulated.

The corporations that utilize community assets to make profit from consumers, those are corporations trying to make a profit. And right now, they’re doing a good job of wrapping themselves in the cloak of community assets, but they are not community assets. The internet is a community asset. Amazon is not. The blockchain is a community asset. Binance is not. And so I think that that is the line of demarcation that we need to have.

And by the way, you say that you talked to CZ. My hope and expectation is that they are not back and they’re going, ‘boo hoo, ha, ha, ha, ha, ha.’ My hope and expectation is that we will sit down with them, that this industry has moved quickly for them, too, and that there can actually be a discussion to say, ‘You know what, yes, this was not great. Let’s make our consumers whole here. Let’s have some basic rules going forward that make more sense now, given how large we are.’

We all make mistakes. I have made more mistakes than anybody. It’s about how do you handle those mistakes and move on. So, there’s nothing against Binance here. We have all gotten caught up in the growth of this industry.

Lau: Yeah. Have they reached out to you at all?

Kay: They have not yet.

Lau: In a roundabout way, you are bringing blockchain and the whole decentralized notion that we can all participate back to litigation, actually, by opening up litigation finance that has traditionally been only available to the top 1% of investors to pretty much anybody who wants to participate. So if you want to support and also participate in potentially a profit or a payout and still get justice, this is an interesting idea that that you’re bringing to the community as well.

Kay: I’m really proud of it. Liticapital.com, you should come check us out. In this particular thing, this is the dream we were talking before. I’ve been in finance for 10 years. I was one of the founding partners and I ran a private equity fund for a long time. And I’ve been lucky in my career.

And I left there and I started sitting on boards of large companies. And I got a call from my partner, Jonas Rey, who enticed me to get back into this craziness. And this is why. The idea that as opposed to helping the little guy and just giving the money to the 1%. There’s nothing wrong with the 1%, but just giving the money to the 1% never sat well with me. 

And being able to right now, we are raising money from the community. To invest with people, the little guy in the community and the profits that we’re making, which have been 30% to 50% cash-on-cash for a decade. We’re now giving back to that same community. It’s great. 

Lau: With a caveat that if you lose, they get nothing. Just a caveat there.

Kay: Oh, absolutely. If we lose, they get nothing. We are a risk asset. We are a private equity fund. We are investing in cases. There is a portfolio of cases. And anybody that does not tell you that they lose, you should run really, really far the other way. Everybody loses some times. And my job as the CIO is to set up a large enough portfolio with a diverse enough set of assets. When I build a portfolio, I assume that I’m going to lose 50% of the time. So I try and tell myself, look, if I’m no better than anyone else, if I just flip coins, I believe I’m better than that, but I just say, if I just flip coins, I need to set up a portfolio where it still generates returns for my investors, which, luckily enough, I’ve been able to do so far. But do we lose? Everybody loses sometimes.

Lau: Well, in this case, I hope that what we lose is inefficiency. What we lose is a sense of injustice, and what we gain is a stronger crypto exchange industry that is paying attention, and they certainly are to regulators and to thriving within the lines. It is in their economic benefit to do so, as this case will attest. 

Ultimately what do you hope for the industry? Beyond the value of return back to investors and hopefully making them somewhat whole, what do you think this will also instigate for the broader general practices that we’re seeing in crypto exchange right now?

Kay: Yeah. My hope is some basic guidelines to protect consumers. From the corporations. Look, this is just the beginning. Blockchain is the future of the internet, from my perspective. And corporations, this is the beginning of corporations coming in and providing services. That’s great. I can’t wait for that. It is going to provide so much financial freedom and opportunity to literally the world. It is a fantastic thing.

I hope that this starts the conversation and starts to set some basic rules around it so that consumers can interact with these corporations in a way that at least makes the corporations do enough to ensure that consumers either are not hurt or when they are hurt, that there’s some type of potential recourse. I think that is a benefit to the corporations. I know that it is a benefit to the consumer, and I hope that it’s a benefit to the community that’s going to continue to use and grow with these assets.

Lau: And at the end of the day, I got to go back to my roots as a financial journalist. Caveat emptor, buyer beware. At the end of the day, we hear this, just don’t invest anything more than you can lose. Sounds like sage advice. In reality, there are rules, but at the same time, buyer must be aware at least. But at the same time, the industry also must be aware. I think it’s a two-way street here.

And David Kay, I think you’re trying to demarcate the lines of the road right now. And thank you for sharing just what you’re doing in the space and what you’re trying to do for those hundreds of investors who lost out that day on May 19th.

Kay: Thanks so much for having me. This was really fun.

Lau: David Kay, partner and chief investment officer at Liti Capital, thank you for joining us on Word on the Block and thank you, everyone, for joining us on this latest episode. I’m Angie Lau, editor-in-chief of Forkast.News.