A Letter from Brian Cai（Founder and CEO of FORTUNA) #005

Hello everyone! My name is Liangbin (Brian) Cai, I’m founder and CEO of FORTUNA. I’ve started a series called ‘Founder Blogs’ to share some of the ideas me and my team have, that do not fit anywhere else. Welcome!
After graduating from Yale University, I won first prize at the International Mathematical Contest in Modeling. I worked in various segments of the financial industry all around the world (New York, London, Hong Kong, Shanghai and Hangzhou), in the fields of investment banking, supply chain finance, Anglo-American law trusts, civil law trusts, and private banking. At the age of 26, I was able to work my way up in a state-owned bank. Prior to leaving, I was the general manager of the private bank and was responsible for over 30 billion in assets. After these great experiences, I decided it was time for something new, something bigger. That is when I founded Fortuna.

Update

Many friends have asked me what I am doing recently. It seems that they haven’t heard my voice for a while, I have been working tirelessly and have not been able to tell them about Fortuna yet. That is also why I originally chose to write “A Letter from Brian Cai（Founder and CEO of FORTUNA)”. To keep everyone up to date on what is going on.

I would like to start out and say that we have been very busy recently. Busy with building products and recruiting people. But especially with achieving the goals we had set for ourselves to be completed per the first quarter: the design and development of FORTUNA’s derivatives trading system of single-node version.
Why will we start with a single-node version of the derivatives trading system (and not with a multi-node mainnet)? I am happy to share this with you and get a little technical:

Excellent methodology with both mobile internet and blockchain

The most powerful methodology of the mobile internet is the A/B version test. This simple and crude method was born in the mobile era and enables a company to try different versions simultaneously and compare results. It is a type of experimentation that is short, frequent, and fast. This methodology has become notorious for pushing out traditional companies that were focused on one-year-version updates.


One of the most important features of blockchain as an autonomous and self-managed distributed network is that it cannot be tampered with. Data can’t be tampered with, rules can’t be tampered with, and this means that many mobile internet era’s methods are not fully suitable for the blockchain domain. How to better inherit and use the excellent methodologies and tools of the mobile Internet? Personally, I think that using a single-node version as a trial and leveraging the rapid verification and continuous trial-and-error methodology can be very beneficial before publishing a fully distributed main net version.

Data formatting and risk control modeling

Some of the core components involved in managing derivatives are the risk control and pricing models. These models are so important that they are said to determine the survival of the investment companies that make derivatives their main business. Because of the quantitative complexity, the core of the derivatives-related companies is usually run by experts from the quantitative fields. After the subprime mortgage crisis of 2008, the quantitative risk management department and the model validation department started to play an increasingly more important role in many large organizations and hedge funds.
To attune the quantitative models, it is important to have real historical data. So, how can we quickly accumulate historical data? Using a crawler is one method. Self-done accretion is another method. A single-node version of a derivatives market will become a great business data accumulation method. Just like our Chief Product Inspector Z. T. said, “Sooner or later, the digital currency space will also become a data processing and service company akin to Bloomberg. Given it’s bound to happen, why can’t it be us?”

Environmental Construction and Investors’ Education

In the past China’s derivatives exchanges had derivatives that linked to stocks, such as options and warrants. In 2005, the Chinese market had launched seven additional stock-linked warrants (similar to derivatives such as stock and options). It is said that at that time, relying solely on the trading volume of these seven warrants, China ranked first in the world in terms of trading volume of stocks and warrants.
However, due to the failure of investors’ education at that time, many investors did not know that warrants should be exercised on the exercise date. Many investors did not exercise their rights before the expiry of the exercise date, resulting in zero value of these warrants once they expired. This led to many unfortunate incidents.
Fortuna’s (single-node) derivatives trading platform will prioritize beneficial and simple derivatives: ‘Option Iron Butterfly’ and ‘Binary Synthetic Option’ based on mainstream digital currencies, and all options will have an “automatic exercise” mechanism that will be set up to avoid unnecessary trouble for investors.


In summary, designing and developing Fortuna’s single-node derivatives trading platform is not only an explanation of Fortuna’s vision, but more importantly the overall strategic deployment of Fortuna’s product. As I often say, the “technology roadmap” is very important. Promises and commitment are very important, but the most important thing must be the team and making the business tangible. Otherwise, all this is just a game of “weaving bubbles and dreams together”, leaving codes but leaving no productivity, creating memories but not making sense.
In fact, the success or failure of a business often depends on the first ten people who joined the company. The advantage of starting with a small team is not in being small, but because you can choose members.


I remember an analogy from the book “Hackers and Painters.” It roughly says that big companies are like giant ancient Roman warships. One thousand crew members paddle at the same time to make the battleship go forward. However, there are two core factors that make this giant battleship unable to be fast:
Firstly, nobody notices that their efforts to paddle makes the battleship move faster;
Secondly, the speed of battleships depends on a thousand people, which greatly averages individual efforts and achievements.

Ancient Roman Battleship

If you select 10 people from a thousand people to make a relatively sized boat, it will move faster than the battleship itself. It will be faster, because working hard is encouraged, and inactiveness is discouraged. The boat is a cooperative park and athletic field that is naturally suitable for the survival of the fittest.
At this point Fortuna has only existed for three months. As you can imagine this is a very short time spent for a project, let alone running a company. We have grown rapidly during this time and I have spent the most time and energy in attracting like-minded and talented people to join the party. I believe that this is one of the most important things in the development of Fortuna.
Fortuna has now gathered a small group of powerful “fans” in their respective fields (blockchain technology, financial derivatives, trading systems, business operation, etc.) and together we are making progress very quickly. This is one of my happiest and proudest experiences.
Thanks for reading and see you next time!
Brian Cai.


Follow us on social media:
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Twitter: www.twitter.com/FortunaBlockch1
Reddit: https://www.reddit.com/r/FortunaBlockchain/
LinkedIn: www.linkedin.com/company/fortuna-blockchain/
Website: www.fota.top
Facebook: www.facebook.com/fortunablockchain/
Email： hi@mail.fota.top

AMA with Brian Cai

Our CEO Brian Cai was interviewed by Informance.
The questions were submitted by the community prior to the AMA.

Enjoy!

It will be in the future! This early version is for testing functionalities! 

Nicely worded! Your support is greatly appreciated 

We do indeed plan to list on new exchanges, however we can not conclude any information as per exchange requirements

Love to have you on board! 

Very interesting read! You're support is greatly appreciated! 

Bump

Weekly Fortuna News, Issue 012


Dear Fortuna supporters,

Please find the weekly edition of Fortuna News below! As always, thanks for being a great community, and enjoy the read!

Founder Brian Cai’s Foreword

Dear Fortuna Community,

I want to take the opportunity to address some things in this weekly update.
We have recently released the Black Friday platform and received a lot of feedback. I want to be clear that the Black Friday platform is only a testing platform. We use it to collect valuable data and users’ feedback, it is not an official version. In fact, from the domain name blackfriday.fota.top, it can be seen that Black Friday is only a transitional test version. Actually, this was mentioned in my forewords and weekly Fortuna news;

Secondly, I’d like to emphasize that since Black Friday is a test platform, most of our attention is spent on the development of the main network and the quantitative resource database of Fortuna. After the completion of the quantitative resource library, many more tools will be available. If we combine that with the feedback on the Black Friday platform we will have all we need to launch a formal version with high performance, high availability, asset security, sufficient mobility, and rich products, so stay tuned!
 
Thirdly, we have been recording weekly news video’s (see the links at the bottom of the page), but will switch to a slower rythm such as a monthly video, or a video once in a while, instead. We are making this change because we felt the results were not satisfying for the amount of effort we put in. In the future the video’s will capture interesting information on topic such as the R&D progress, product strategy and business plan and will be explained by the people who are in charge of these business segments.

-Visual FORTUNA-

You can check out our Fortuna Behind the Scenes #012 Here.

Technology Research and Development

• Decentralized Fortuna Platform: The minimum runnable version (called FirstBlood) of our multi node platform is undergoing testing and the multi-node connection has been approved. The requirement for Double (the improved version of Firstblood) will be reviewed this week and going into the official development phase next week.
• Single-node Version Black Friday Derivatives Platform: The first week of the Black Friday public beta is over. The first weeks options were settled at 14:00 (UTC time 6:00) on the 4th May, with a grand total of 23,774 options sold. Thank you for your participation!
  We have now launched the second phase of beta testing and users who previously participated in the free gifting activities (on the 8th of march and 14th of march) have received a coupon for free options. If you haven’t received yours: please check your e-mail and text message inbox. The option to redeem the free option’s will be closed at 14:00 on Friday (May 11th). Once beta testing has been completed there will be one week for bug repaid and system optimization. So be sure to send in your feedback! We look forward to it!
• Fortuna community BBS: This week, the final draft of the design was passed, the technical plan was confirmed, and the development phase began.

Quantifying and Modeling


Stepping up to implement the basic Monte Carlo module, Monte Carlo is an important tool for quantifying wind control and calculating many other parametric scenes;

Completion of other relevant modules to achieve quantitative risk control such as Expected Shortfall and Value at Risk;

At the end of last week, the deployment of a backtest code for an artificial intelligence strategy was completed, and its trading model was tested by using several different sets of stock data.

Marketing and PR

• Manage, activate Chinese and English communities, and answer community questions about Fortuna;
• Chinese bounty mission statistics and other ancillary work;
• The official fan group plus the task lobby carry out “Fortuna’s questions”;
• Invited the Fortuna hunter leader to join in the first issue and interview him;
• The adjustment of the English version of the hunter program poster, the writing of the reward rules, the announcement of the new Hunting Lobby, the release of the reward task, and the statistics and evaluation of the hunter task completion and reward;
• Black Friday platform’s BUG problem collection, information summary; black friday pages of Chinese and English version optimization; black Friday novice guidelines revised;
• Send Mail/SMS messages containing a coupon earned during the International Women’s Day / White Valentine’s Day activities. The coupons can be redeemed for Bitcoin Options;
• Published English articles on the Fortuna Official Bitcointalk account;
• Exploring and creating Fortuna’s Wikipedia;
• Community BBS page, discussing the UI, final review and approval, self-built background function collation;

Talent Hunting


A total of 81 resumes were reviewed this week. 15 were interviewed. The details are as follows:

• Technology Department: 58 recommended resumes were reviewed, 8 interviews, pending decision.
• Product Department: 7 recommended resumes were reviewed, pending decision and 1 admitted.
• Quantitative department: 6 recommended resumes were reviewed, 5 interviews and 1 admitted.
• Operating Department: 10 resumes were reviewed, 2 interviews and 1 admitted.

Internal Compliance

Thank you Aurellio, your support is greatly appreciated!

Everyone started somewhere when did you get into the scene Murky?

A Letter from Brian Cai（Founder and CEO of FORTUNA) #004



Hello everyone! My name is Liangbin (Brian) Cai, I’m founder and CEO of FORTUNA. I’ve started a series called ‘Founder Blogs’ to share some of the ideas me and my team have, that do not fit anywhere else. Welcome!

After graduating from Yale University, I won first prize at the International Mathematical Contest in Modeling. I worked in various segments of the financial industry all around the world (New York, London, Hong Kong, Shanghai and Hangzhou), in the fields of investment banking, supply chain finance, Anglo-American law trusts, civil law trusts, and private banking. At the age of 26, I was able to work my way up in a state-owned bank. Prior to leaving, I was the general manager of the private bank and was responsible for over 30 billion in assets. After these great experiences, I decided it was time for something new, something bigger. That is when I founded Fortuna.

Can you tell me something about the direction blockchain is going?

Whenever you ask someone if they know bitcoin, the answer is yes, however many are unaware of blockchain and many of the other coins and tokens. Sometimes, talking to people outside of the blockchain industry feels like talking to “Muggles” from the Harry Potter franchise. They are not fully aware yet of the magic in our world.

 
However, in the past two months, more and more people around me started showing interest in ‘digital currency’. I also realized that the people started to believe more and more in the success of the blockchain technology. Today I’ll talk about how I turned into a blockchain “believer”!
My first experience with blockchain was in 2013, I wanted to do an Utransfer project for Transferwise. The Utransfer project primary goal was to use the Internet to solve the problem of excessive cross-border exchange costs and too slow efficiency.
 However, after communicating with the related departments at that time,
 it came to light that this type of business could easily be characterized as an “evade foreign exchange control” (2013 RMB internationalization was not yet a major development strategy and foreign exchange control was very strict). Thus, the project never started.
At that time, I noticed that a technology company named Ripple was listed at MIT Technology Review. Ripple used blockchain technology to solve the problem of cost and efficiency of cross-border payment. After that, the story must have been fully understood. Ripple is already the third largest blockchain project in the world. From that time on, I started to learn and understand the blockchain. As I was engaged in the financial industry, I became more aware of the blockchain industry. I began to really realize and recognize the blockchain and the value of blockchain’s Killer App “digital currency”.

The phenomenon of “rent-seeking costs” and “low efficiency” in the financial industry is too common. In a big jargon, it is “taking a lot of money, things are done slowly,” and the blockchain is not so much a subversion as it is an improvement. The degree of centralization is gradually weakened, allowing more people to “pay less money and do things faster.” In terms of space, I only share one case today: Commercial Bank (a form of modern credit organization-the most mainstream financial intermediary that is close to people’s lives), and its core business model and disadvantages.
“The economic crisis is an inevitable product of the capitalist system”

In our childhood, the teacher taught us: “Marx said that the economic crisis is an inevitable product of the capitalist system.” However, as I grew up, I discovered that there are also economic crises in socialist countries. In fact, there have been about 60 economic crises in the history of mankind. Originating in the credit market, stock market, foreign exchange market, commodity market, etc. All are closely related to the proliferation of liquidity. The most important two ways of the proliferation of liquidity are M0 and M2.

The most basic business of commercial banks are deposits and loans (internal banks call it debt and asset businesses). However, how many people carefully considered the core difference between deposits and loans?

What is a loan?
In short, it was the bank that gave me a sum of money. Over time, I returned it with interest to the bank.

What is a deposit?
In a nutshell, it was me that gave the bank a sum of money. After a period, the bank returned it to me with interest.

Repeat the paragraphs mentioned above and you will find that, in addition to the different direction, the two are almost the same. In essence, A gives B a sum of money. Over time, B returns it to A with interest. So your deposit is actually not a “deposit”, but your loan to the bank. Therefore, your deposit appears as a “liability business.” in bank’s view.
This business model may be one of the most intuitive and close-to-life sources of economic crisis from your side: commercial bank credit expansion.

“Interest” and “deposit” are incompatible

A long time ago, some wealthy families had hidden a lot of gold bars in their homes. To keep their gold safe they decided to buy a safe. They bought safes that were too big to house all the gold.

 
As a result, they began to accept the trust of their friends to keep their gold bars and charge some custodial fees accordingly. This resulted in the birth of earliest form of a “bank.”
What are the responsibilities of this rich group with safes? They had to take care of the gold bars and keep them safe from others. What kind of fees did they charge? They charged safekeeping fees for housing the gold bars.
Currently we deposit our monthly salary in the bank. Have you ever thought of giving the bank a custodial fee? On the contrary, the bank will pay you interests, and you will take it for granted. Why? Because everyone knows that the bank will take out deposits to lend out and make profit. This is the bank’s financial intermediary position and core business model.

Have you ever wondered whether the business model and the custodian’s responsibility are inherently contrary? Will you take your family’s sapphire necklaces in custody and allow others to use them casually? So why did you give your salary to the bank, knowing the bank would lend it to other? The answer is because the law allows it, and you are used to it.

The law allows banks to use the “law of large numbers” to make money. Banks feel that it is not necessary to leave all their money in the safe as they are, because it is unlikely that everyone will be able to withdraw everything on the same day. Thus the bank is able to take a portion of the deposit to loan. What is the difference between this and “fund misappropriation?” Actually, there is no difference between the two. Historical governments have legitimized this fund misappropriation through a “fractional reserve”. This “legitimate misappropriation” is the basis for the development of the bank and is also a feature of modern credit organizations. It’s also one of the root causes of the economic cycle.
In our final analysis, if you think about it really thoroughly, you will find that interest and savings are out of tune.

As stated in the Introduction to the Business World:

“Bankers, Greedy Gluttons”


As a profit-seeking company, obtaining the privilege of legally misappropriating funds, the bank’s profitability will inevitably cause it to continuously absorb and lend. This is where the economic cycle starts. (this is the reason why various governments set up banking supervision departments). Because the bank’s lending activities are essentially a kind of currency creation behavior (money misappropriation), especially the lending of current deposits.

It is not the same as an investment. When you invest 10,000 yuan in cash to a company, you think that the company has 10,000 yuan in cash, but instead you have lost 10,000 yuan in cash, and some more equity. But when person deposits 10,000 yuan in cash in a bank, he may think that he still owns the 10,000 yuan, and he can withdraw it at any time. Immediately after the bank has already lent his 10,000 yuan to others. The borrower who got the bank a loan of 10,000 yuan also thinks that he already owns the 10,000 yuan. Therefore, at the time of lending, the world has somehow added 10,000 yuan “virtual currency”.

But this is not where the cycle ends. After the person who borrows 10,000 yuan pays 10,000 yuan to others, it will be re-deposited by another person to the bank for 10,000 yuan, and the bank will use it to lend again. Again the world has an additional 10,000 ”virtual currency”. This is the money creation ability of the so-called bank — the money multiplier.

It is exactly this credit expansion lacking savings that has consisted of the fundamental reason why our economy is in a cycle between prosperity and recession in the light of false prosperity, because credit expansion is bound to end with the credit crunch, just as people have joys and sorrows.
In fact, until Cipolla’s Florentine Monetary Policy in 14th century came out, people gradually realized that there was another kind of “virtual currency” in society, that is, M2 we are now familiar with.
From this point of view, take a look at the core value of Killer App “digital currency” in blockchain, I think it will be particularly interesting.

Thanks for reading and see you next time!

Brian Cai.

Your support is greatly appreciated!

We want to receive feedback from as many people as possible so we know where to improve. Since the BETA launch of Black Friday we have received a decent amount of feedback and already made some changes to the platform!

Thank you for your feedback. This is very valuable to us we will use it to improve our Beta platform!

Thank you Murky! I will reply so it saves people a click;D

ALL OF THEM!

Hello Ninja, you can read more open DPOSA Here. Let me know what you think