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FluidAI Live – Korea Blockchain Week Exclusive: Dhaval Parikh, Fund Partner, NewTribe Capital

Korea’s premier crypto and blockchain event, Korea Blockchain Week, saw crypto enthusiasts from around the world converge in Seoul for inspirational keynotes, panel discussions, pitch competitions, investor meet-ups, and world-class networking opportunities. 

In an exclusive FLUID Live interview, FLUID’s Head of Marketing and Communications, Matias Jeldrez, spoke to Dhaval Parikh, Fund Partner, NewTribe Capital, to gather his thoughts on fragmented liquidity and how it impacts the crypto industry.

Q. How’s Korea Blockchain Week been for you?

It was wonderful. I was able to catch up with several partners and members I hadn’t seen in a while. The event has been fantastic thus far, and the attendance has been incredible. We also had a presentation about the entire Korean community in general, and how it was flourishing and how some of the Korean markets’ regulations were changing. It was fascinating to hear different opinions and viewpoints from the leaders of the sector as well.

Q. Can you tell us a bit about who you are, what you do, and who NewTribe Capital is?

I’m a fund partner at NewTribe Capital. NewTribe Capital is a growth-oriented Dubai-based Venture Capital fund that participates in seed and private sale allocation. We invest in early-stage blockchain and crypto projects and provide long-term support by creating a healthy partnership with them. We provide value-adding beneficiary services to the projects and ensure long-term benefits by all means. NewTribe Capital has been around since 2019. In fact, we’ve lost our minds when it comes to investing since we’ve completed more than 150 projects across all industries, just like every other VC out there. Our emphasis this quarter is mainly on the technological foundation, such as FLUID. We are trying to get into the projects as early as possible, mostly in the seed round. 

Q. Fragmented liquidity is a critical issue in the industry, causing prices for a single token to vary widely across exchanges. This leads to oligopolies that are highly powerful entities,  siloed liquidity, and the potential for arbitrage, market manipulation, flash crashes, and other activities. Does this remark strike a chord with you? What does it entail to be your own liquidity aggregator?

I believe that this problem statement is accurate and it pertains not only to the cryptocurrency market as a whole but also to the traditional academic side of the business, which was experiencing the same problem prior to the crypto boom. As such, I wholeheartedly support the holding statement and the need for what FLUID is attempting to address in this specific area. From the standpoint of FLUID, the platform’s whole AI and mechanism—as well as the quantum AI and quantum methodology—that are being combined from the liquidity aggregator space is what we really appreciated. The user may actually be at risk of missing out on the great prices to which they may have access due to the volatility of the liquidity of various tokens if there is a large gap in the market. A liquidity aggregation platform which could provide the users with a view where the perfect volume spread is exactly what we are looking for. 

Q. One of the things we realized in the market was a lack of education on the retail side, and the big thing is that institutional traders know when to sell. Do you think education is needed in the market for retail investors?

Education is such an important topic at this point in time. Most of the institutes with which we are in touch provide educational videos, especially for new users. Having said that, these videos may not immediately teach you things like how to exit in an illiquid market, but rather, what a new user can learn is more in terms of what is available in the different markets. 

A lot of times, users have trouble understanding the volatility associated with the liquidity per token. This is why they also miss out on great opportunities for a particular token. For example, due to a lack of education, a user might trade on a token on an exchange that has less volume compared to, say, the other exchanges that can provide them with a better benefit. 

In a nutshell, I think the educational videos that are being posted by the leading institutions out there are very much needed. I’ve been following FLUID in terms of the blogs, videos, and academics posted on the medium, and I feel they are such a great tool for any new retail users coming into the space, so that is the perfect way to get them started. 

Do you think regulation is needed in the crypto space? What are your thoughts on that?

Regulation has always been a very controversial subject in the past, not just in crypto, but in any sector out there. Regulation is not normally welcomed with open arms, and it’s more or less the same in the crypto industry. From a venture capitalist’s point of view, regulation is quite important as it brings stability to the market and there’s an increase in the volume of transactions. When there’s volume, we witness a subsequent increase in users utilizing services and products.  

As users increase though, there’s bound to be loopholes and such loopholes will be taken advantage of by certain users with malicious intent and one way to stop this to have some sort of regulation and rules the kind of which the US government has put to action. From our From a perspective, what we say is, rather than opposing regulations, let’s find a way to join hands and work together. NewTribe is already working with its partners in the industry to understand how a lot of technologies work that could benefit various industries. So once we understand what regulators require, I believe we can mitigate risk, explore bringing stability to the market, and it’ll be a win-win for both sides. 

What’s your future outlook on the crypto industry?

There are a few different angles I could take with this question. One is more from the VC side, which is how we see the crypto industry and what should be our investment goal or outlook. 

Right now, market conditions are quite critical , which means we have seen a bit of a deep trough. We’ve witnessed how the market went down 50 percent in early 2022. Moving forward, we are quite bullish on four main sectors. The first is CCIP, or Cross-Chain Interoperability Protocol. We are betting on this one because it can provide massive value to projects with interoperable sides and different ecosystems. It’s very useful from a DeFi product perspective as it will solve a lot of challenges in the future.  

The second is the web2 to web3 transition, and the third one is the oracle database projects. These are all very technical elements, but these are the foundational blocks of infrastructure that need to be built so that the crypto industry can progress. We’re also keeping a close eye on liquidity aggregators, and that’s how we got to know about FLUID very early on, and we understood how it could be a game changer. 

So these are some of the infrastructure projects we’re excited about. The second angle is all about market movements and we did some analysis to find out that retail wasn’t involved much in the last bitcoin halving, so we’re extremely bullish for the next quarter. We should see some movement in the market by then. Another aspect we’re looking at is mining. That will hopefully bring in more revenue to the fund and then obviously keep a close watch on projects that have potential once the markets begin to look up.     

To watch the interview, click here.