Benjamin Bai from Ant Group Turns to Crypto: Now or Never

Benjamin Bai, former vice president and head of intellectual property (IP) and international litigation adviser at Ant Group, recently moved to digital asset trading firm Amber Group as chief legal advisor.

Bai, who will soon be moving to Singapore from Shanghai, was previously partner and head of regional IP practice at Allen & Overy and Jones Day.

His last professional defection was a sign of the times.

In recent years, several senior lawyers have also made the transition to internal roles. In particular, the most prominent moves have all moved into start-ups. The most recent and by far the highest profile is Julie Gao, a former partner at Skadden, Arps, Slate, Meagher & Flom, who has built a whole brand for herself advising Chinese companies on high-risk US stock listings. Gao has moved to Chinese media technology company ByteDance. A few months earlier, his partner Chris Betts, another former partner of Skadden, left to join super-app company and online transportation giant Grab Holdings in Singapore.

In 2020, Paul, Weiss, Rifkind, Wharton & Garrison also lost China leader Jeanette Chan to a general advisory position at digital payments firm Airwallex.

To be sure, Bai’s move at home happened early. In 2016, he left Allen & Overy after nearly six years to join Ant Group, which owns and operates China’s largest digital payments platform, Alipay.

Ant’s parent company and e-commerce giant Alibaba Group, which is yet to go public, began courting him shortly after he joined Allen & Overy from Jones Day, where he led the company’s patent litigation practice in China. But he turned down the opportunity.

“I was skeptical, to be honest,” Bai said. “The idea of ​​working for an e-commerce platform at the time didn’t appeal to me.”

The opportunity came through Alibaba’s general counsel, Tim Steinert, a former Freshfields partner Bruckhaus Deringer. Alibaba and Ant continue to raid international law firms for talent. The company now counts former Simpson partner Thacher & Bartlett Leiming Chen and veteran Fangda Partners attorney Jonathan Zhou among its ranks.

A few years after Bai was first approached about a position at Ant Group, parent company Alibaba made a US$25 billion initial public offering in the US. Bai was approached again, by Chen. This time he relented and never looked back.

“We talked about what else we could do together, and my potential contribution, at that, was a new fintech company coming from China,” Bai said of his conversation with Chen.

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Prior to moving to Ant, Chen was one of the leading international lawyers advising Chinese companies on their American and Hong Kong IPOs. “It was different for me. I am a lawyer representing international companies like IBM or Apple, going after Chinese companies for IP infringement,” Bai said.

But he told himself that before he died or retired, he wanted to be able to do something for a decent Chinese company.

“Ant is my choice, and now has the largest blockchain patent filing in the world,” he said.

Over the past few years, Bai has developed a great interest in Web 3, the umbrella term for a new and improved vision of the internet, based on blockchain and digital assets such as cryptocurrencies and non-fungible tokens (NFT). He has been an investor in cryptocurrencies himself and has followed closely the growth and evolution of digital currencies and assets.

While Ant takes blockchain very seriously, having launched various blockchain-based solutions and platforms. Bai’s interest in Web3—and cryptocurrencies in particular—is stalled, as China prohibits any form of cryptocurrency trading.

“At the beginning of last year, I started thinking, ‘What if we lose something?’ So I started looking at crypto from a work perspective. I was so interested that I started buying crypto myself,” he said.

So when the opportunity arose, Bai found friendly conversations with Michael Wu, co-founder and CEO of global digital asset company Amber, and Wayne Huo, the company’s chief operating officer, interesting. “We hit it off and that’s it—here I am,” Bai said with a laugh.

His newfound penchant for taking risks when it comes to his crypto investments did not come naturally. Most are earned only after leaving private practice. But after more than five years at Ant, risk-taking now has a very different tone, Bai said.

“I think in law firms, you analyze risk but you tend not to take risks. Risk taking is a mindset as well as an ability. It was about my team,” Bai said.

“Internal advisors need to be able to work with businesses because if you tell your business associates that they are going to violate, say, some IP rights, and you don’t give them a choice and they can’t move forward at all, it’ will kill their business,” he explained.

“Risk has to be measured, and businesses can use it to make their own decisions,” Bai. next. “Although as an internal attorney, I might tell them, ‘if you do this you will be exterminated but you will make sufficient commercial profit, and I will sue you as long as it is not a criminal.’ ”

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When it comes to digital assets, the willingness to take risks is even more important, but goes against how lawyers are traditionally trained. In addition, most traditional lawyers find it more difficult to grapple with the highly complex and evolving subject of the metaverse and Web3, and the relative lack of regulatory frameworks and legal protections.

“Crypto is difficult, especially in the area of ​​regulation, so you see a lot of law firms trying to establish crypto regulatory practices,” Bai said. “But if you’re going to do crypto regulation work, you need to understand how bitcoin works, how Ethereum works. This is a completely different world.”

And when the law firm discussed working with him, Bai didn’t mess around about this.

“I told my outside advisors that if they don’t understand crypto, then they can’t possibly understand our product, which means they really have no business to talk to me about.”

Web3 and its relevant elements present many opportunities for investors, stakeholders and law firms, but also cover a myriad of legal and regulatory risks and issues.

First and foremost, Bai said local governments need to figure out how crypto should be regulated.

“In the world of traditional finance, the landscape has been set, but it is set to the point that traditional institutions cannot innovate,” he said.

“Innovation doesn’t happen if you put up so many shackles. If that happens, you are stifling innovation,” he explained. “So how much leeway are you giving the crypto world? How do you protect investors and encourage innovation? That’s something every country is trying to figure out.”

With Alipay and WeChat payments, for example, regulation comes after innovation takes off, Bai said.

However, it is not only the government that is putting the brakes on. Innovation can also be stifled by the failure of innovation itself, Bai notes, pointing out that the chaos that is stablecoin LUNA, which lost nearly all of its value last month, is a prime example. Investors lost millions of dollars for nothing, and the lack of legal protection for investors made headlines.

But Bai argues that failure is an indispensable part of innovation. He strongly believes in the rise of stablecoins and argues that within the next decade, half of the world’s financial products will be based on cryptocurrencies and the other half fiat.

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Bai’s pivot into digital assets is also unnatural, although he has been innovating for most of his time in private practice, focusing primarily on intellectual property.

“I wouldn’t have been able to do this without going through my experience at Ant,” Bai said. “IP is only 20%, maybe 30% of what I do. I do a lot of general law work, litigation, investigative, AML (anti-money laundering), sanctions and financial regulatory work, so this was the perfect transition for me after spending several years at the world’s leading fintech company.”

Still, Bai took the time to think about whether he should move to Amber, as he didn’t want to create succession problems at Ant, he said. However, at the same time, he knows the crypto train won’t be waiting for him.

“In the crypto world, every month is like a year in the traditional world. I said if I waited for two years, you know, I would lose a lot of fun,” Bai said.

Amber currently has about a dozen attorneys worldwide. The team will continue to grow. Bai’s plan is to establish a legal department in terms of culture, risk taking, and corporate governance structure. The idea of ​​building a function almost entirely from scratch appealed to him. A legal panel will be formed soon.

“I don’t have any bias in terms of size,” said Bai, who added that instead of hiring a larger team to work on day-to-day needs, he would rely on external advisors for routine work. He will also rely on the law firm for litigation needs.

“So my team had to do what internal advisors had to do to really add value to the business. I needed to build a team that would focus on enabling our business to thrive,” he said.

On Bai’s LinkedIn profile, he describes himself as a “crypto fan.” But underlying that enthusiasm is a belief system that aligns with Amber’s mission.

“We will use crypto to reach a lot of people around the world who may not even have a bank account. We will bring financial inclusion through crypto,” said Bai. “And this is the vision I share with Amber. I will lead my legal team to make it happen.

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