Chan Ahn is the CTO and co-founder of ALEX, a DeFi company that is operating on the Stacks blockchain and is inspired by traditional financial markets. ^[1]

Education

Ahn graduated from Imperial College of London with a BSc in Mathematics and Computer Science and a Ph.D. in Computational Finance. ^[1]

Career

Ahn was a director at Credit Suisse, where he was Head of Structuring for the Americas and Asia offices for four years. He then transitioned to JPMorgan Chase & Co. as executive director and worked as the Head of Product Development, Asset-side Cross Asset Structuring, and Structuring for another four years. ^[1]

He became executive director at Goldman Sachs for almost seven years before co-founding ALEX with Dr. Chiente Hsu and Rachel Yu in 2022. As CTO of ALEX, Ahn is responsible for directing the technology strategy and vision to align with the company's mission and values. ^[1]

Interview

Bitcoin DeFi Landscape

In January 2024, The Block Runner Podcast interviewed Ahn about ALEX and its work in Bitcoin DeFi. At the beginning of the interview, Ahn shared some background on ALEX and its co-founders: ^[2]

“We started almost three years ago, around May 2021. Our team consists of myself, the CTO, Dr. Chiente based in New York, and Rachel in Hong Kong. All three of us have backgrounds in traditional finance, particularly in investment banking, quantitative analysis, and derivatives. Around that time, the Uniswap v3 white paper was released, signaling to us that blockchain technology had matured enough for individuals like us to potentially add value.”

“At that time, we had limited knowledge about many aspects of crypto, to be honest. However, we explored several options. Bitcoin stood out to us, partly due to our backgrounds. As newcomers to the crypto space and institutional investors, there's often a tendency to focus on Bitcoin. We were interested in developing something on Bitcoin, although back then, Bitcoin DeFi was virtually non-existent. Despite its novelty, we believed that building something on Bitcoin, as opposed to Ethereum's EVM, could hold more significance from our standpoint.”

He also shared why they chose Stacks as their foundation for the protocol: ^[2]

“We encountered the Stacks team, who coincidentally happened to be close neighbors of Chiente. He suggested that if we utilize Stacks as our smart contract layer and build on Bitcoin, given our familiarity with the team, we could receive considerable support and collaborate effectively.”

When asked why they chose to focus on Bitcoin instead of other blockchains, Ahn responded: ^[2]

“We initiated this project partly due to the absence of similar initiatives in the space. To ensure we developed the right product, we've undergone several pivots. Building on Bitcoin presents an intriguing opportunity for project builders for several reasons. Firstly, Bitcoin stands as the largest and most recognized decentralized and secure blockchain globally, offering a robust foundation for any development. Secondly, its uniqueness lies in its lack of support for smart contracts, which has resulted in slower adoption among builders compared to other blockchains.”

“The third reason echoes the sentiment expressed in the second one, a sentiment commonly encountered when discussing the development of Bitcoin-based DeFi. Many wonder why we don't simply replicate what has been built on the Ethereum Virtual Machine (EVM) by forking it. However, our decision to focus on Bitcoin stems from its strong institutional interest and appeal to first-time crypto holders. The demographics of Bitcoin holders differ significantly from those of EVM or Web 3.0 users. While Bitcoin boasts a market cap in the range of $700-800 billion, the focus often shifts to comparing it with Ethereum's market cap. Yet, what often goes unnoticed is the composition of the people behind this market cap, who primarily consist of first-time crypto investors.”

He then discussed how the Nakamoto release would affect the user experience on Stacks and ALEX: ^[2]

“The Nakamoto release represents a significant advancement in enhancing user experience. Currently, our infrastructure design must account for potential delays due to missed Stacks blocks, which are mined for each Bitcoin block. Consequently, the speed of Stacks blocks is inherently limited by Bitcoin block production, resulting in intervals ranging from 10 to 30 minutes. This poses a considerable challenge to creating a seamless user experience. However, with the introduction of the Nakamoto release featuring 5-second blocks, this issue is effectively eliminated. Users will enjoy enhanced speed, programmability, and a native smart contract experience on Bitcoin.”

Ahn also talked about blockchain security factors and XLink, a standalone Bitcoin Bridge from ALEX: ^[2]

“Breach attacks and smart contract exploits have occurred frequently throughout history for various reasons. The preference for keeping assets on Bitcoin stems from its reputation as the most decentralized and secure blockchain. Therefore, it's advisable to maintain assets on a secure layer whenever possible. While layer-two solutions offer scalability benefits, they may not provide the same level of security as layer-one. However, the decision to move assets should consider multiple factors beyond just the blockchain itself.”

“One limitation we encountered recently led us to spin off our bridge project into a separate entity called Xlink. This decision stemmed from our use of multisig technology as a vault for Bitcoin. While multisig offers improved security compared to single private key wallets, it still presents challenges related to private key ownership and control. Through the spinoff of Xlink and the decentralization of governance and ownership of the multisig, we aim to address these concerns and enhance user security.”