Frax Finance’s Andy Cho: From Bar Owner to a Journey Down the Crypto Rabbit Hole

At the age of 20, Andy Cho bought Bitcoin for the first time, motivated by its potential price increase, even though he didn’t fully understand it. Four years later, he entered the crypto space as the director of communications at IQ.wiki, still without a deep understanding of the technology.

“Ironically, IQ.wiki is an educational website aimed at spreading crypto knowledge to everyone, but when I joined, I didn't really have much knowledge about crypto myself,” Andy said. “At that time, I mainly served as a communication bridge between the founding team and the Korean team because I spoke both English and Korean.”

Since then, Andy Cho’s six-year journey down the crypto rabbit hole has led him to serve as the director of business development at IQ.wiki and director of Asia at Frax Finance. Both projects were co-founded by Sam Kazemian.

Before devoting himself to crypto, Andy Cho, who received a bachelor’s degree in law in Canada, worked in a law office and owned a small bar business.

The Spotlight is a series of interviews hosted by Coin98 Insights, featuring industry builders discussing hot topics in the market.

- Recently, IQ.wiki and Frax Finance co-hosted an event to enhance the capabilities of IQGPT.com, an AI assistant for crypto knowledge. What do you think about the potential benefits of integrating AI into web3?

Andy Cho: About two years ago, before AI became a hot topic in web3, we started looking at the intersection of blockchain and AI. At that time, IQ.wiki existed as the largest encyclopedia in blockchain, with thousands of search entries on founders, tokens, and exchanges.

With such a vast amount of data, we thought, why not use AI to generate these search entries? The birth of ChatGPT has changed many lives, and we believe that in the field of information, AI will be the next trend.

That’s why we launched IQGPT to help users query both on-chain and off-chain data. The difference between IQGPT and ChatGPT is that with our AI, you can verify the source of the information provided.

I believe AI will be here to stay, helping to bring diverse and reliable information to users.

- From the perspective of someone with a legal background, can you tell us about the prominent legal challenges in web3 today, especially in the Asian region?

Andy Cho: When I entered the industry six years ago, things were relatively easy, with numerous projects launching ICOs (initial coin offerings).

Now, almost all of those projects have disappeared. This has created the perception that many projects, especially in Asia, are scams and will eventually fade out. At least in Korea, when a project launches, regardless of its legitimacy, it is often seen as a scam.

Regulations have since evolved, and it’s now much harder to launch a project, which is a positive development. Governments are more involved in supervising and ensuring that projects comply with regulations and have measures in place to protect investors.

I am a stablecoin maximalist, meaning I believe every project will eventually launch its own stablecoin

- In your opinion, how are Asian web3 projects different from Western projects? Also, what are the biggest challenges that Asian projects are facing?

Andy Cho: I think Asian projects have a lot of potential because, in the end, we are smart people, right?

One positive aspect is that we learn from Western projects, but do not copy them completely. For instance, when I went to Japan, I saw many gamefi and NFT projects—a very different development focus compared to the West. We keep trying and failing until we succeed, and eventually, everything falls into place.

However, Asian projects face language and cultural barriers, although this is an easier problem to solve. Frax Finance and IQ.wiki hired me and other Asian colleagues because we know the language and understand the culture, so we can easily bridge the gap between Asia and the West.

Another challenge for Asian projects is educating users on the essence of web3, not just speculation. How do we teach newcomers about stablecoins, exchanges, and crypto wallets? This is part of my KPI in Asia.

- You are currently working in Korea. Can you tell us how the fall of the UST stablecoin has affected investors here?

Andy Cho: The collapse of a major algorithmic stablecoin like UST affected all other stablecoin issuers in the industry. In Korea, there was a period when merely mentioning stablecoins triggered immediate suspicion within the community.

However, algorithmic stablecoins are just a small part of the stablecoin market. We have many other types of stablecoins with different pegging mechanisms. Unfortunately, few people are aware of this distinction, so they assume all stablecoins are bad. That’s why education is so important.

The UST incident also tainted the perception of the entire industry. People began to think that not only stablecoins but all tokens were bad, and that crypto was dangerous and should be avoided. The media amplified this perception.

On the bright side, it served as a stern warning for both projects and investors. I hope such incidents never happen again, but when there’s bad news like UST or FTX, the media tends to focus on it. I just wish they would also highlight the positive developments in the crypto space.

- Frax Finance also had an algorithmic stablecoin. Can you tell us how the company responded after the UST incident? Also, what role does the recent launch of Fraxtal layer 2 play in the company's stablecoin ecosystem?

Andy Cho: When the founder of Frax Finance introduced algorithmic stablecoins, it was an innovation that worked at the time. But after the UST incident, we learned from others’ mistakes and transitioned to a stablecoin model backed by US dollar reserves, believing this is the safest way to support our stablecoins.

We also offer stablecoins pegged to Ethereum and the FPI (frax price index), which is pegged to the CPI, similar to a basket of goods.

Frax Finance doesn’t see other stablecoin projects as competition. We believe in a positive-sum approach for the entire market, where collaboration benefits everyone. The market won’t thrive if we all try to beat each other, right?

As for Fraxtal, it represents our vision of the "endgame"—a large umbrella for the entire ecosystem. In addition to our stablecoins, we have lending markets and LSTs (liquid staking tokens), which will gradually migrate to the Fraxtal chain, helping Frax Finance become one of the dominant stablecoin issuers in the market.

- What do you think about the stablecoin landscape in the future? Are CBDCs a threat to decentralized stablecoins?

Andy Cho: I am a stablecoin maximalist, meaning I believe every project will eventually launch its own stablecoin.

In the long term, I see stablecoins being integrated into web2 industries, such as gaming companies using stablecoins as a means of payment.

As for CBDCs, the main difference between them and stablecoins is that they are issued by governments and banks, which proves the value and effectiveness of stablecoins. However, I believe stablecoin issuers in web3 have more experience in this space, and it would be ideal if both sides could collaborate.

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