In this episode, Austin chats with Alex Rawitz, co-founder of DIMO, a DePIN project built on Polygon which allows users to collect and monetize their car's data. Instead of pitting one blockchain against another, Austin and Alex have an optimistic, open-minded discussion about the DePIN space in general. The conversation also highlights a non-maxi, cross-chain attitude toward building DePIN projects; though built on Polygon, DIMO leverages the Helium network (which migrated to Solana last year) for its IoT piece. 

In this episode, Austin chats with Lev Gelfer and Serge Levin from DeVol Network, a low-cost, fully onchain option trading platform. Serge and Lev dive deep into complex trades and the advantages of bringing options to blockchain, but at a higher level, this episode is an exploration of exactly the kinds of projects that are only possible on Solana. It's a testament to how every step-function change in performance or cost unlocks entirely new use cases that were impossible to build before and how projects like DeVol are making use of these changes. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

In this episode, Austin chats with Nabil Manji of Worldpay, one of the largest payment processing companies in the world. In a recent collaboration with Worldpay, Visa expanded its USDC settlement to the Solana blockchain. Austin and Nabil chat about the current landscape of card payments and what the integration of blockchain unlocks for large financial institutions. Why complicate the legacy fiat payment system if it seems to work so well? Drawing on the firsthand experience at Worldpay, Nabil discusses the due diligence behind adopting USDC, the way USDC rails work for merchants, the internal process of adopting blockchain at a large company, and more. 

In this episode, Austin chats with Matt Luongo (Thesis) about the role of decentralized custodial solutions for Bitcoin such as Threshold's tBTC. Beyond the technical details of how tBTC works and what its holders can do, the conversation often digresses into Bitcoiner views of the world in the context of a crypto industry now dominated by smart contracts. What should the role of BTC be in DeFi? What are the cultural implications of the flippening if it happens too early? How will the BTC network remain "relevant" for decades to come? Austin and Matt exchange views on these questions and more. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

In this episode, Tommy Johnson discusses Armada, a collaborative project between PsyFi and HXRO that provides an open-source toolkit for launching tokens from inception to full decentralization. He and Austin reflect on the historical pain points of token launches, the evolution of tokenomics over the last several years, "governance-light" vs. "governance-heavy" DAO models, and more.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

In the early days of Solana, Justin Bons (Cyber Capital) was one of the network's biggest public critics. However, in the last several months, Justin has had a change of heart. In this episode, Justin opens up about both his disillusionment with the Ethereum L2 roadmap and why no longer sees Solana in a negative light. He also discusses the importance of approaching crypto through an interdisciplinary lens and how his philosophy background has encouraged him to stay open-minded, even if it means rethinking old beliefs. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

In this episode live from BP 2023, Austin sits down with Rune Christensen to discuss MakerDAO's Endgame plan. Rune outlines how the concept of subDAOs will fix the current problems faced by DAOs, why SVM architecture is best suited to carry out his Endgame vision, the toxicity of tribalism, and more. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

In this episode, Austin is joined by Amira Valliani (Solana Foundation) to chat with Dante Disparte (Circle) about stablecoin adoption, regulation, and more. Dante envisions a promising future for stablecoins as he explores fundamental questions about their ultimate objectives and distinct applications in the world of payments.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

In this episode, Austin has a freeform conversation with Anatoly Yakovenko about the state of Solana. Beyond the cliches of the past, present, and future of the network, Austin and Toly explore higher level ideas such as design philosophy, hardware limitations, balancing new features with network performance, AI and blockchain, and much more. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

 Private credit in emerging markets like Latin America generally lacks modern infrastructure. According to Thomas Bohner (Credix), blockchain is the perfect technology to bring these markets into the future. With a company like Credix, investors and borrowers are able to leverage smart contracts for things like instant settlement and frictionless cross-border transactions, all while operating within legally compliant frameworks. In this episode, Austin and Thomas discuss Credix's model and the broader implications of DeFi 2.0 projects, many of which heavily rely on off-chain components.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

Oracles are an essential part of how real-world data gets integrated into DeFi smart contracts, but historically, that process has been fraught with challenges. In this episode, Jayant Krishnamurthy (Duoro Labs) explains how Pyth is addressing these challenges and redefining how a blockchain oracle can work. Originally built on Solana’s L1, Pyth is a low-latency, high-frequency oracle that has expanded beyond the Solana ecosystem and now provides data feeds for over 30 blockchains. The way it does this is through Pythnet – the first network to deploy the Solana codebase for an application specific blockchain.  DISCLAIMER The content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor. Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.

Multisigs, short for "multiple signatures," are wallets that require multiple private keys to authorize transactions. In the wake of 2022's many collapses, multisigs have increasingly become the default security paradigm in both the Solana ecosystem and the crypto space more broadly. In this episode, Stepan Smikin (Squads) discusses the many use cases for multisigs and the importance of having a security-first mindset, while also sharing insights on what it's like building a multisig specifically on Solana. Other topics include Squads' formal verification, approaches to monetization, and more. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

Technology has defined the form and function of storytelling since the beginning of time. In this episode, storyteller, artist, and professor Lance Weiler offers an optimistic perspective on how blockchain, AI, and other frontier technologies will affect storytellers across mediums. Rather than discussing the tech behind NFTs on Solana, Lance shows us what it's like for an artist to apply that technology to human expression. He considers on how models of IP may evolve to be more "open source," the role of technology in art education, and more.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

In today's episode, Austin moderates a panel discussion about compression with Jon Wong (Solana Foundation), Noah Prince (Helium Foundation), and Ilmoi (Tensor). Compression is a way of storing data on Solana that reduces costs by orders of magnitude. For now, its most common use case is compressed NFTs. With compression, you can mint one hundred million NFTs for two thousand dollars. Jon, Noah, and Ilmoi dive into the tech of how compression works, the ways in which developers are utilizing it, and how it may be a driving force in Solana's mass adoption. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

Transparency is one of the key features of blockchain, and block explorers play an important role in that transparency. However, navigating explorers on Solana can have a high learning curve, even for crypto natives. This is due to Solana’s abstract data structures, a feature that makes indexing and interpreting data on the blockchain difficult. In this episode, Fathur Rahman (SolanaFM) discusses ways of building block explorers on Solana that will improve user experience. Through clever engineering, Fathur thinks it's possible for Solana block explorers to one day feel as intuitive as traditional search engines. We also discuss explorer revenue models, the role of explorers in smart contract security, and more.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

As of 2023, the gaming industry is worth hundreds of billions of dollars. Why disrupt something that's working so well by introducing blockchain into the equation? In this episode, Michael Wagner (ATMTA/Star Atlas) makes the case for blockchain games. Star Atlas, the flagship game that Michael and his team are working on, is a AAA game that uses Solana as its main infrastructure. He describes why this design is compelling for Star Atlas, the technology behind how it all works, its impact on the user experience, and more.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

With Anchor, Backpack, and Mad Lads under his belt, Armani Ferrante is one of Solana's most senior and prolific developers. In this episode, Armani reflects on the values and design philosophies that first attracted him to the Solana ecosystem and where he thinks the ecosystem is headed. He also discusses some of the tech behind xNFTS and Backpack, their use cases, and the importance of building applications users actually want. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

RWAs (Real World Assets) are assets that exist in the real world that are tokenized on chain. The RWA market comprises things like equity, fine art, loans, and more, all of which globally account for trillions of dollars in value. In this episode, Trevor Bacon discusses Parcl's unique approach to real estate as an RWA. He's bullish on opportunities such as higher liquidity and lower barriers to entry for retail investors. Although RWAs are a promising new frontier in crypto, we also discuss some of the concerns they raise, such as centralization and information asymmetries between on chain and off chain data. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

If web3 had an intuitive Venmo-like app for sending and receiving crypto, could that expedite mass adoption? Aleksei Zakharov (Ottr) seems to think so. Aleksei describes how blockchain-based products such as Ottr can give users the experience of a modern bank, all without the bank. Banking 3.0, as he calls it, eliminates the possibility of bank failures, all while making USD more accessible to emerging markets and reducing friction in international transactions. According to Aleksei, solutions like these will incentivize both consumers and merchants alike to adopt banking 3.0 platforms in the near future. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

If blockchain is going to scale to billions of users with use cases like payroll and and savings, privacy is a prerequisite for adoption. But if privacy preserving technology is vulnerable to the law - think OFAC's sanction of Tornado Cash - how will adoption at that scale ever be possible? In this episode, Yannik Schrade (Elusiv) describes the possibility of a gray area between public and private transactions on blockchain. Through community consensus, Elusiv is making it possible to flag illicit actors and grant temporary decryption authority to third parties, all without compromising the privacy of its honest actors. Yannik describes the mechanics of how such a system works and wrestles with the role of human judgement in trustless systems.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

When Congress passed Section 230 in 1996, it created the legal preconditions for the growth of the modern internet. Today, web3 faces legislative uncertainty in the US, harkening back to the state of the internet before Section 230. In this episode, Chris Grieco (Rain, ex-DOJ) and Lauren Culbertson Grieco (ex-Twitter)  offer a historical primer on Section 230 and consider the law in the context of web3. Could Section 230 apply to blockchain? If not, what would the web3 version of Section 230 look like? Without a comprehensive law akin to Section 230 for web3, what will the future of blockchain be in the US?DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

Traditionally, maps have been built by centralized entities like governments and tech companies. But in this episode, Ariel Seidman discusses the potential of Hivemapper, a decentralized mapping protocol, to completely disrupt the space. When it comes to building a global map, Hivemapper claims that decentralized, community-owned infrastructure can produce a higher quality of service with more granular data than a centralized network. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

In this episode, Austin talks with Kevin Bowers, Chief Science Officer at Jump Trading. Kevin and his team are the brains behind Firedancer, Solana's second independent validator client. As Kevin describes the process of building Firedancer, it's clear that this episode is not only about building a validator client; it's about Kevins unique perspective on the 1% of computer science focused on making things as fast and efficient as possible. Throughout his interdisciplinary career, Kevin has again and again proven to be an iconoclastic thinker, unabashedly dissatisfied with the status quo. He expresses his unconventional views on programming languages, scaling solutions, data flow optimization, and more.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

In this episode, David Hoffman (Bankless) and Austin have an honest and multi-faceted conversation about the differences between Solana and Ethereum’s decisions, community, and future. David makes the case for an Ethereum-dominant future, and in doing so,  illuminates much about Ethereum's philosophy of design and the culture of its most fervent believers. Naturally, Austin makes a similar case on behalf of Solana. This is a conversation between two people who have mutual respect for each other, but fundamentally different opinions about how a blockchain should be built.   DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

DeFi is defined as, “smart contracts that can execute trustless financial transactions," but beyond that, understanding what’s actually going on under the hood of DeFi protocols and how to use them is still a very narrow area of expertise. Wrapped assets, bridges, automated market makers––these are new tools foreign to the world of traditional finance. In this episode, Cindy Leow offers a primer on how both the technical and practical features of DeFi work. She also shares thoughts on the direction of DeFi in the next twelve months and what we have to look forward to. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

One of the things holding back crypto from mass adoption is bad UX. According to Ori Kwan (Orca), crypto's history of bad UX  isn’t just because of blockchain’s software constraints. It’s also because of the underrepresentation of designers’ voices. In this episode, Ori helps us understand how she thinks about building web3 products that are desirable, feasible, and viable, all from a designer's point of view. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

In this live taping of Validated from NFT.NYC, Austin has an informal chat with his Solana Foundation colleagues Amira Valliani and Pedro Miranda. They discuss how web3 x web2 partnerships are evolving, the pros and cons of Central Bank Digital Currencies, and the disconnect between crypto Twitter and conversations among crypto regulators. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

In this episode, Austin, Amira (Head of Policy at the Solana Foundation), and two ex-OFAC lawyers discuss regulation in web3 as it pertains to national security. Naturally, they discuss OFAC's sanction of Tornado Cash and consider other ways in which the government could have handled the situation. While the Tornado Cash sanction may be old news at this point, thoughtful conversations about the intersection of blockchain, national security, and technology ethics are always relevant. The recent Warren-Marshall Bill threatens to hold blockchain validators responsible for illicit activity on chain, which, like the Tornado Cash sanctions before it, will have overreaching consequences for the blockchain industry if it passes.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities. 

Will mobile-first applications be a driving force of mass adoption during the next crypto bull run? With over 5 billion smart phone users around the globe, Chris Osborn, founder and CEO of Dialect, thinks that's a solid bet. In this episode, Chris discusses some of the innovative features that will set web3 messaging platforms like Dialect apart from their Web 2 counterparts. He also shares thoughts on why crypto has taken so long to embrace a mobile-first mindset, the difficulties of dealing with traditional app distributors, and the role of crypto phones like Saga will play in the ecosystem.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

Self-sovereignty is one of the foundational promises of crypto, but without self-custody, that promise simply falls flat. In this episode, Charles Guillimet (CTO of Ledger) discusses topics like the importance of self-custody and the role of security, in addition to the the evolution of Ledger's product offerings as the crypto industry has changed over the last decade.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

When Meta Angels launched in 2021, it branded itself as an NFT community using web3 to "harness real world opportunities." In late 2022, Meta Angels was acquired by Hug, an NFT curation platform, and their respective communities merged. In this episode, Meta Angels co-founder Alex Cavoulacos discusses how a values-driven NFT project can be sustainable and what it's like for an NFT community to undergo a merger. As the current Head of Product at Hug, Alex also shares insights on scaling a web3 organization that is part platform, part product, and part community. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

During the last bull run, legacy fashion brands raced to incorporate web3 into their strategy. Now, with consumer demand for web3 in hibernation, where does that leave marketers in the traditional fashion space who are still bullish on web3?  In this episode, Lisa Pillette (CMO of Fossil Group) discusses Fossil's venture into NFTs and how the company's attitude toward web3 has changed in the last year. Lisa remains bullish on the implementation of web3 strategies for both Fossil and other legacy brands in the long term, but only if those strategies are implemented for the right reasons. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities. 

To skeptics, blockchain-based AI may sound like a solution in search of a problem. But to Humayun Sheikh, founder and CEO of Fetch, decentralized AI has the power to revolutionize how we transact on the Internet by creating truly peer-to-peer information systems. That sounds straightforward enough, but consumer-facing AI is still in its infancy, and the industry faces many hard questions in the years to come. Humayun navigates these questions with nuance and diligence as he shares his compelling thesis on the future of decentralized AI. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

Crypto venture investing has plummeted from all time highs, but maybe perceiving this as a "crypto" problem is the wrong way of looking at it. Through the lens of seasoned investors, Ben Gilbert and David Rosenthal (Acquired) help us make sense of the present moment of crypto venture and the future conditions under which investing in crypto will become attractive again. DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities.  

Running a blockchain network requires sophisticated hardware and software working together. The term "blockchain infrastructure" refers to any component of this system that actually facilitates the existence of a blockchain. In this episode, we talk with Aaron Henshaw, co-founder of Bison Trails, a pioneering blockchain infrastructure platform that was later acquired by Coinbase. Aaron shares his perspective on building infrastructure for different blockchains, running blockchain infrastructure at enterprise scale,  how infrastructure companies will have to adapt if legacy tech giants become competitive within the space, and more.  DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. All opinions expressed herein are the speakers’ own personal opinions and do not reflect the opinions of any entities. 

In 2019, Li Jin was a tech VC and evangelist for specialized Web 2 platforms and marketplaces. Now, she's all in on web3. From Li's point of view, many of the "passion economy" businesses that were hard to scale in Web 2 are actually more viable in web3. Her current thesis is that ownership - not just revenue - is the next big opportunity in tech, and the best way to facilitate that is on web3.DISCLAIMER The information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

Zero-knowledge proofs are one of the most compelling and counterintuitive technologies in crypto today. How can you prove something with zero knowledge of the thing you're proving? This episode examines the current and future use cases of zero-knowledge systems while having an honest dialogue about both their challenges and promise. DISCLAIMER The information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

Black Dave is a multi-disciplinary artist best known for his music NFTs. Unlike many artists who migrate to web3 from Web 2, web3 is where Black Dave got his start. Dave's web3 origin story is not only unique, but also a crucial part of his success. Dave shares his thoughts on digital culture, community building, the intersection of web3 with the mainstream music industry, and more.DISCLAIMER The information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.  

A century ago, infrastructure was synonymous with big things, like bridges, roads, and electrification projects financed by nation states or the world’s largest corporations. But today, the nature of infrastructure is changing. Thanks in large part to the introduction of tokens, infrastructure can now be decentralized, deployed by individuals to solve real-world problems. This is exactly what Decentralized Physical Infrastructure Networks (DePIN) are doing In this episode, Messari researcher Sami Kassab provides a general overview of the DePIN space and gives an in-depth breakdown of the Decentralized Wireless (DeWi) sector.DISCLAIMER The information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

Permanent information storage is not just a means of preserving data, but a way to resist the grip of authoritarian regimes. According to Sam Williams, co-founder of Arweave, immutable storage systems are a revolutionary movement that will make a more objective truth accessible forever. DISCLAIMER The information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

Being a crypto journalist - a good crypto journalist - is hard work. When it comes to reporting, no other sector requires the same level of technical proficiency, an understanding of financial markets, and a primer in digital anthropology. In this conversation, Austin and Danny navigate a lot of complicated topics including conflicts of interest within crypto native media, reporting in an industry where everyone has a hidden objective, citizen journalism on Twitter, and more.DISCLAIMER The information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

Ryan Selkis, founder of Messari, has been a crypto investor, writer, and advocate since 2013. As someone who has witnessed multiple market cycles firsthand, Ryan is as optimistic as ever about the future of blockchain. Throughout this episode, Austin and Ryan find paradoxical silver linings in the tumult of 2022. Looking forward, they discuss how DC's views of crypto are changing, exciting new sectors within crypto like DeSoc and DePIN, and more.DISCLAIMER The information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.  

Introducing Validated, a new podcast where host Austin Federa talks to people who are rethinking the internet — and our world. No hype cycles. No financial advice. Just conversations on the biggest ideas shaping the future of the internet.

0:00 - Intro1:19 - Web3 School in Sierra Leone10:53 - An Artist and Monke Go to Washington25:25 - How Compression Will Decimate Network Costs on Solana DISCLAIMER The information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

0:00 - Intro1:17 - Introduction to panelists1:54 - How Solana’s infrastructure allows for scalability4:45 - What creators are looking for in NFT platforms 5:53 - Glass.xyz and the future of video NFTs7:25 - Overview of participants in the NFT space8:30 - What does future growth of the NFT market look like?10:12 - The impact of tech behemoths on the NFT space15:31 - Solana’s low network costs16:40 - Panelists’ favorite NFT projects DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

0:00 Intro0:50 Intro to panelists and overview of the browser wars 2:25 How do lessons from the browser wars apply to the wallet market? 3:12 Differences between browsers and wallets 6:00 The roles of wallets in the crypto ecosystem 10:50 Will there be one wallet to rule them all? 16:04 How the dominant mobile platforms will impact wallets18:55 Lessons from Web 2 applicable to Web3 projects25:25 What the future of wallets looks likeDISCLAIMER The information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

0:00 Overview of ReFi3:13 Intro to Emma, Ethan, and Shine Capital4:37 Why Shine sees ReFi as a sound business investment 7:10 Overview of how traditional carbon markets work8:03 Breakdown of pricing in current carbon markets 12:09 Shine’s thesis on how increased demand will impact carbon credit prices12:51 Where increased demand will come from13:53 More on how increased demand will impact carbon credit prices15:13 More on Shine’s confidence in ReFi’s economic viability17:57 Recap of discussion thus far19:28 Speculations on the growth trajectory for carbon markets22:35 ReFi market map23:48 Current systems of MRV and why they’re inefficient 25:28 How crypto can innovate traditional MRV28:02 Opportunities for entrepreneurs in the ReFi space31:25 Closing remarks DISCLAIMER The information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

0:00 Overview of Carbon Markets and Crypto2:45 Intro to Brendan and Patch4:02 Intro to Matthew and Cerulean6:05 What is a carbon credit?7:25 Who are carbon credits for?9:00 Voluntary/compliance market recap10:40 Innovation in the voluntary carbon market12:00 Why are carbon credits so hard to acquire?13:34 Inefficiencies in the current OTC markets14:17 Examples of carbon credit projects15:15 Why do carbon credit prices vary so widely?17:00 More on inefficiencies in the current voluntary markets19:50 How blockchain will impact the supply side of the carbon market21:35 Are corporate buyers interested in crypto carbon credits?23:18 Carbon market scams26:06 Profit margins in the carbon market32:50 More on how blockchain will impact carbon credit supply34:36 Closing remarksDISCLAIMER The information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

0:09 - Episode overview2:17 - Rolf Skar introduction and Greenpeace’s mission4:39 - Daniel Hwang introduction6:54 - Greenpeace’s history with energy-intensive crypto8:24 - The Change the Code Coalition12:32 - Why changing Bitcoin’s code might be feasible 15:49 - What changing the code would entail19:27 - What self-interested incentives are needed in order to change the code  24:49 - How institutions with climate commitments address Bitcoin investments 26:19 - The Blockchain Infrastructure Working Group28:57 - Rolf’s impression of the Web3 community31:37 - Closing remarks DISCLAIMER The content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor. Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. 

Amir Haleem (CEO, Nova Labs & Founder, Helium) talks with Austin about the Helium story and the current proposal to move Helium to the Solana blockchain.0:00 - Introduction1:05 - Origins of the Helium network5:24 - Early challenges for Helium7:19 - Helium’s unique growth and economic models compared to other blockchains11:35 - The geo-specificity of Helium’s rewards14:18 - Why Helium started on its own L1 16:55 - Current disadvantages of Helium running on its own L1 20:46 - Why the time is right for a Helium migration24:28 - Why Solana is the best scaling solution for Helium28:56 - Composability as parts of the Helium network move off chain30:57 - Solana’s role in supporting amazing applications32:12 - How a migration will help Helium reclaim its internal engineering power34:36 - How the upcoming vote will impact Helium validators and hotspot operators36:27 - How Helium’s migration will open up the Solana ecosystem to its community37:36 - Recent developments in cellular networks41:59 - How long will Helium’s migration onto Solana take, and what will it entail?DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, and does not constitute an offer to sell or a solicitation of an offer to buy any securities, options, futures, or other derivatives related to securities in any jurisdiction, nor should not be relied upon as advice to buy, sell or hold any of the foregoing. This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor.  Solana Foundation Foundation and its agents, advisors, council members, officers and employees (the “Foundation Parties”) make no representation or warranties, expressed or implied, as to the accuracy of the information herein and expressly disclaims any and all liability that may be based on such information or any errors or omissions therein. The Foundation Parties shall have no liability whatsoever, under contract, tort, trust or otherwise, to any person arising from or related to the content or any use of the information contained herein by you or any of your representatives. Austin: I'm Austin. This is the Solana podcast. Today, we're talking with Amir Haleem, the founder of the Helium network and CEO of Nova Labs. Helium since its beginning has operated its own layer 1 blockchain, but in a process set forward several months ago, and which has sort of come to a community governance vote in HIP 70, the network is actually proposing switching from operating its own layer 1 to operating on another layer 1. Uh, in the details of HIP 70, the core developers and core contributors are recommending a move to the Solana blockchain as the new home for the Helium network. So we're gonna talk a bit about that today, some of the history of Helium, and how the network, uh, sets itself apart from other blockchains, uh, which is pretty interesting because it's based much more heavily on real world usage and physical hardware, as opposed to simply a software abstraction layer. So, Amir, welcome to the Solana Podcast.  Amir: Hi, thanks for having me. Austin: Great to have you here. Um, so let's kind of start at the level set here. Um, where did the original idea for Helium come from? Amir: So Helium has been around as a company, uh, for a little while and we, uh, we always intended to try and build, really, a sensor network, that was the original intention, right? It's like, if you wanted to build a big, broad wireless network designed for sensors, you know, how, how would you do it? . Like, it, it felt clear to us that cellular wasn't going to be the right, uh, solution for things like tracking devices and environmental monitors and things like that. And so we set about trying to build kind of like people have called it an overlay network. I like to think of it as, as more like an alternative network to cellular for small things. Right? Like that's kind of the easiest way to think about it. Um, Bluetooth wouldn't really work for this wifi wouldn't work for it, you know? So we always. Had the intention of like, how do we build something very specifically for these kinds of devices? Um, we had a bunch of friends at the time building startups that needed that kind of connectivity. That was really the thrust of, of why we did any of this. And we, you know, we took a bunch of different turns and iterations of trying to do it in, I don't know what you would describe it as, the web two way, perhaps, right? Where we would spend a bunch of money and we would build the network ourselves. Um, and somewhere along the line, like we just kind of realized that we're we're just like a poor version of AT&T or something. Like we were trying to do, we're trying to do things the same way that AT&T would do it or an existing carrier would do it, except we, we don't have any money, relatively. And so it, it wasn't really until 2017, I, I think, that we started to pay attention to crypto in a more serious way.Like embarrassingly, like I had just kind of ignored Bitcoin and Ethereum completely up until that time. Like, blockchain just kind of seemed like a buzzword, uh, that didn't make a lot of sense to me. I read the, the like Mastering Bitcoin book and my mind was kind of blown. Uh, and then I, you know, read the File Coin white paper, I think was the first time that we had seen. Kind of a proof of, of work model that like applied to a real thing, you know, it wasn't just, it wasn't just hashing and it wasn't, you know, just some kind of arbitrary use of compute power. It was actually like in file coin's case, if I can prove that I'm making file storage space available, then I'll, I'll get rewarded for that.And so that was a big thrust for us to like, think about doing things in a different way, was like, okay, here's a model for how you might build a wireless network based on a crypto economic model. Um, and do it in a completely different kind of throw the traditional model on its head or turn it on its head. And that was really the start. Uh, we started building in 20 17, 2018, uh, and launched in 2019. Went from being very small, with 150, you know, deployed devices to close to a million now after, after only three years. So a lot happened in that three years, but that's kind of roughly the, the story of, of how we got to where we wanna be.Austin: Yeah. So one of the things I really love about that story is it really tracks with, um, on a, on a much larger level, my own journey into blockchain, which is that, um, the utility reason was the reason that I actually first got into the space, which was I was working for a company and they thought the only way they could solve the problem was to build something on blockchain. And it, you know, seems very similar to sort of the way you guys examined a lot of different solutions and decided that that community ownership model is best expressed through, through blockchain. Um, so I think that's a really kind of interesting story. And one of the pieces I really like, I just find funny is I actually joined the Helium community far before I joined the Solana community. Um, I got, I got targeted with one of your ads back in the early days and actually bought, um, a few hotspots in, I think I actually, uh, I got in the discord and argued with Mark for a while about how this thing didn't make any sense and how it shouldn't exist or whatever. And there was no, there was no liquid token. And then, uh, you know, really got kind of, you know, as much used as you can get red pilled by a telco, uh, project, um, you know, really brought into the, the idea that this is really something that has a real interesting application in the real world out of it. Amir: Yeah. I, I remember you in the community in the early days. I mean, it was difficult at the start, right? Like, especially as a US based company, like, you've gotta be so careful from a regulatory point of view. And, and so I think some of the things that you kind of wanted to say, you couldn't say, and so, you're trying to explain what this was, I think was a little bit of a challenge, right? It's like, "buy this box and stick it in your window and earn this token." And that was kind of where we stopped. Right? Like we didn't, we didn't say anything more about, you know, what, what happens with the token after that, or, or what you could do with it and whether there would ever be a market for it. And, you know, we've been very careful to kind of stay away from all of that. But yeah, it grew like, like wildfire at some point. Like I, I remember at the start, it was very, very difficult to sell hotspots for like 500 bucks. And, you know, we were running a lot of ads are the ones that targeted you. Um, you know, we were giving away like pies and like doing promos for Valentine's day, you know, just said like, whatever scheme you could come up with to like try and get these things out the door, we were, we were doing it. And then at some point he just got its own momentum. And I remember taking, it took off from like 20 or 30,000 hotspots to hundreds of thousands. In what felt like no time. Austin: It's funny. I, I remember the pie. I, I couldn't remember, but I remember I was like, oh yeah, like you guys mailed me a pecan pie. I think for, cause I bought one around Thanksgiving.Amir: Yeah. We had pies, we had cookies, literally anything we could think of that would like motivate people to buy the box was what we were doing at the start. And then, you know, you had COVID supply shortage stuff happened and it, it went from like, we're trying to give these things away to like the demand for them was insane and they were selling on eBay for like 10 grand in the used market. So yeah, it definitely been, been crazy to, to watch and a hell of a journey. Austin: Yeah. So one of the things that, uh, I've always found fascinating about helium is that both the growth model and the economic model are very different than any other blockchain out there. The primary function of a network like Bitcoin or Ethereum or Solana is to be a software platform and to run well. Bitcoin's not a smart software platform in the same way, but Bitcoin is a scarce amount of supply. Ethereum and Solana are smart contract platforms that are designed for other people to build applications and services on top of. You know, apart from the fact that the helium blockchain will we'll get into a lot of the limitations of the existing L 1 right now, but the modeling is, is very different than what you'd see in any other network, because you are both rewarded for providing availability and then also of specific geographic coverage range and proving that you own, you can provide service within that range, and then also passing data through it. And this is one of the things that it took me a while to wrap my head around is like the real value here is on how do you reward the network infrastructure for simply existing and then creating an economic system to meter expenditures on pretty much anything that can be modeled economically as a flow system?Amir: That was the learning really from looking at something like File Coin, right? Like that they had figured the same thing out, which was that if we can bootstrap the network by rewarding people for making file storage space available, then you can start the flywheel that way, right? I mean, arguably Bitcoin works this way, right? Like, they are delivering block rewards to miners for mining blocks, regardless of whether there are any transactions or like meaningful fees inside those blocks and it's the same, you know, the same kind of flywheel there in the sense, right? You have to sort of create the network first, um, before it can be taken advantage of, and in the case of a wireless network, that's particularly challenging, right? Because there's a threshold that you have to cross before someone really takes the network seriously. And, and by someone, I mean like a user of the network, right? Like a, a UPS or something that's looking to build like a logistics solution can't really consider doing it on a network like Helium until Helium is large enough and the coverage is ubiquitous enough that it works in most places. You've really got a very, very like difficult ramp at the start. And that's where I think this economic model has been the most powerful, right? The biggest innovation I think we came up with was proof of coverage, where we devised this scheme where hotspots, which are the equivalent of miniature cell towers basically, um, would transmit encrypted packets over the air and other hotspots would receive them, um, and that was kind of the proof, right? Like, are you where you say you are, are you signing things with the right private key? Uh, and that was the reward that's sort of like the Bitcoin mining reward equivalent, right? If you can prove that you are available to move traffic, then you're gonna get some reward for that. And then you're also gonna get more reward if you actually move traffic. And again, if I were to like, continue the Bitcoin analogy, the miners also get transaction fees for whatever transactions are in their blocks. And it's, it's, you know, similar kind of bootstrapping. I think, you know, that's one of the most powerful effects of, of crypto and, and one of the most interesting parts of, of using these crypto economic models is that you really get to bootstrap these networks in this completely different way.I think when people have tried to build these community wireless networks in the past, it's been this kind of tit for tat model, right? Where you share your wifi network and you can use mine. Um, but that's just not that interesting, right? Like I want, I want to make money somewhere. I, I want to be a telco operator or I want to be an Airbnb host or I want to be a cab driver in the Uber model, you know, those were the sort of breakthroughs economically. And so I think crypto is a way of just sort of decentralizing and democratizing that same, that same effect. Austin: Yeah. It's interesting. Cuz with the File Coin analogy, you have a similar idea of a resource flow system where you reward both for availability and then for actual storage or in this case passing data. But you guys added, I mean, I'd say two quite difficult components to that. The first is, uh, you know, File Coin operates primarily in consolidated data centers, right? There's not many people running File Coin nodes at home because the economics are such that you really need large amounts of storage availability for that network. But there are penalizations on the Helium network. The rewards you get in New York city, uh, because it's so crowded are, are lower than the rewards you might get in like a, you know, a less dense urban environment. Um, so I think that's a really interesting component too, where you also have to account for overlapping coverage is incredibly desirable up to a certain point. At which point, then it becomes detrimental and you can't simply reward that system. So it's a, it's a much harder system to model than simply data availability where like, you know, an infinite number of replicas is infinitely desirable. There's obviously a diminishing utility there, but for here it's really, um, it's really different. So it's interesting. Amir: Yeah. It's, it's both difficult to, to model economically, but also challenging to educate, right? Like, because people kinda live wherever they live, and you have to sort of explain to people that, Hey, like being the 5001st, you know, hotspot in the greater New York area, not that useful, right? Like there are 5,000 others that are already there, you know, providing network coverage. And the redundancy is just not useful enough yet until there's, you know, significant amount of traffic. So it's such a new idea to build a telecom network this way that I think we've learned a ton about what users expect and what they do and how they behave. There's so much that can still be done. People are like, oh, congrats on, you know, all the success. And I'm like, it doesn't feel like we've accomplished anything yet. Like we're in, you know, 0.1% of the journey is complete at this point. Um, but yeah, I, I think, you know, our marketing team, especially I think did a phenomenal job of trying to like explain this in simple terms. And I think that was one of the other things that was important that we did well. We made crypto mining available to like random everyday people, right? Like it didn't, you didn't need to be in a data center. You didn't need some crazy like warehouse full of Asics. You know, like you, you literally could just stick this thing on a, on a window ledge and, and get going. And I think that was also a, a, a meaningful innovation. Austin: So I wanna get into, um, you know, the reason we're doing this call and podcast today and not, you. Four weeks from now, which is the HIP 70 proposal. Um, so let's start maybe with some of the history of Helium actually going forwards and deciding that the right model, at least to bootstrap the network was to build its own L1 and some of the learnings that you've had along that process that make you think now that the recommendation for the community is to migrate to a different L1.Amir: Yeah. So when we started, I mean, it's important for everyone to sort of think about the timeframe here. Like when, when we started building it was 2017 and um, Ethereum was really the only smart contract platform that you could even contemplate using at the time. Um, I mean, this is so long ago in crypto terms that Anatoly was interviewing for a job at Helium.Austin: What was he interviewing for?Amir: I don't remember what the role was, but Solana didn't exist. And he had a, a white paper in the form of a Google doc that was for something called loom. And he had this proof of history idea. Yeah. So that's where we were, right. Just to like, kind of set the landscape. Thankfully he didn't take the job and he went and built Solana, which is, um, which I think was a net positive for, for everyone. Um, But that's kind of where we were, Ethereum was kind of the thing that, that you could use. Uh, and if it wasn't for Ethereum, you're, you're kind of on your own, right?Like there were some other platforms where you could create a token. I think like stellar, perhaps, and even back then, we were worried that Ethereum would become too expensive. Like we weren't sure how to model the network in a way where the number of transactions was reasonable enough to, to not cost thousands of dollars a week. Um, and so given that circumstance, we had a bunch of distributed systems guys on the team. We decided to like, build our own blockchain that we didn't fork anything. We just, you know, started from scratch. We, we borrowed where we could. Um, but effectively it is a novel sort of ground-up build. Um, and I think for the most part, it, it sort of did the job that it needed to do. Like, we designed a system that was like maximally decentralized, I would say. Right? There weren't even validators, like the whole network was running on these hotspots, which were raspberry pie powered devices. Like, so literally you had like the whole network was being validated by hundreds of thousands of like raspberry pies, which is in hindsight, really cool, but also in incredibly insane, uh, to, to pull off. And so, you know, the network has grown so much, we've learned so much about the, the decisions that we made we've realized I think a lot of the, the challenges of like being on your own island, right? Like you, you don't have any of the interoperability with, with some of the amazing projects that you see, like Solana, for example, uh, things like wallet support is harder, you know, like trying to get Ledger to adopt you and, you know, like all of those things which are kind of like table stakes for crypto at this point. Exchange listings, defi stuff, NFT, marketplaces, you know, like we don't have any of that stuff because we're like on an island and we're also trying to build wireless networks. And so we don't have time to do it. And so I've come to think of like blockchains as almost like the database or like cloud infrastructure layer of like web two, where you would be insane to like try and build your own sequel database or to try and bootstrap your own data center when you could just use AWS for nearly all applications. There are some cases where that's not true, but for the vast, vast majority, that is true. So now that we're in this sort of new era of, uh, infrastructure and you've got things like Solana, it no longer really makes any sense to like, try and maintain your own L1, given that our mission objective is to build wireless networks. . And that's, I think, just like the simplest way without getting into like a ton of technical detail, that's the simplest way of thinking about it is. There's a bunch of stuff that's very novel and unique about Helium, and none of it is to do with moving tokens around and like validating blocks. And, and so if you can outsource that work, you should. And I don't think we could in, in 2017, uh, but we certainly can now. And, and I, I definitely think Solana is the best place to be doing that work. Austin: Yeah. And I mean, Helium network to its credit, like, there are very few networks that could do something like run proof of coverage on chain. There's sort of this like strained analogy that you could say to like, you know, to go way back in the day, like Spark, and Sun Microsystems versus like an X 86 architecture, right? Like the, the thing that Helium is good at doing, it's incredibly good at doing and faster than really any other network could deliver that one specific thing. But as you're saying, the Helium network, it lacks any sort of smart contract support at this point, which is the foundation of really all the growth that we've seen in every other network. There's two networks that have that anyone cares about that exist, that don't have smart contracts, they're Bitcoin and their Helium right now. Um, so I think that's a pretty interesting kind of place to, to look at being in at this point. Amir: And it was a very calculated decision at the time. Like we, we knew the danger of having a smart contract environment. The sort of surface area of potential vulnerabilities was so large. And, and again, like we're trying to build a wireless network, like we're building hardware, we're building apps, we're building block explorers, we're building firmware. It's already a massive endeavor that could reasonably be three or four different companies worth of work. And so to add, like, you know, A smart contract platform and then try and like get integrations across like all of the different things, it it's just too much. People don't scale that way. Right? You need focus and I, I think a big part of the drive for HIP 70 is just for our team, but really the whole community, to get focused on what really matters, which are things like proof of coverage and data transfer and usage of the network and stuff like that. And really, again, not on like block validation or transaction validation and stuff like that, which is again, you kind of need it, but it's not differentiated on, on Helium anymore.Austin: Looking specifically at, um, why the move is required so some of the things you, you talked about before, that sort of the network is at a place where it's hard for it to keep up with itself in, in some of those operations, but then, um, as you look at expanding into a network that does have smart contracts on it, that that can do more of these kind of features. What are sort of the, the, the benefits, the trade offs, like how, how is that process internally to come to a place where the consensus from a lot of the core developers, both of Helium foundation at Nova was like, it's time to do this thing now?Amir: So a big part of like, what HIP 70 tries to do is, is also like rearchitect the way the network works. So as you kind of mentioned, everything is on chain today, and that has a lot of challenges in terms of, of how you scale it. Um, you've got a million hotspots beaconing and transactions that have to be validated all the time and, and the validation or the verification of those is reasonably complicated work from a computational point of view, so regardless of, of any move to a different network or a different L1, we had arrived at the conclusion that moving as much of this off chain as we could was probably the right thing to do for now. Um, so we could get the performance up, we could spend less time kind of firefighting the problems and, and really spend more time on like improving things, cuz there's a whole bunch of improvements and, and changes that we always wanted to make, but just had never really had the time to, to get through because of all the firefighting that we were doing. So, that's kind of one component of it, is thinking about like proof of coverage and data transfers being these off chain Oracles as, as we're describing them. Um, and so once you've kind of arrived at that design decision, you you're left with like, okay, what is it that the L1 does? And it, it really is just about, um, moving tokens around, right? It's like the Oracles will tell the, the L1, like, Hey, you, you know, these seven hotspots beaconed and these 25 hotspots witnessed, you need to pay out HNT to these owners. Um, and you, at that point, it's like, why would you maintain your own L1 just to do that? Right? Because you, you don't gain any of the upside of being part of a bigger community, like Solana. Those upsides are things like, you know, decentralized exchanges and this defi ecosystem and NFT marketplaces and, uh, exchange support and wallet support, and, you know, like all those things, uh, that you don't have. And you're still spending like a massive amount of engineering cycles, like maintaining your own L1 when really all the L1 does is move tokens from one place to another. So, really the fundamental design decision is like moving stuff off chain. And once you've done that, it's like, okay, why would you, why would you keep running an L1 if all it does is move tokens around. You should be on a platform where you get the benefit of like being part of this bigger ecosystem. And one of the other things I'm most excited about that we haven't talked about that much, or doesn't get talked about that much in the community is the ability for like other developers to contribute in a more meaningful way. Right? Like we wrote our L1 in Erlang, which is, you know, a powerful, but somewhat unique and quirky programming language. Um, WhatsApp is probably the, the biggest user of, of it that other people would would've heard of. But in general, it's kind of, you know, it's harder to find engineers that are Erlang people, uh, and it's harder for the community to contribute meaningfully as a result versus using something like Rust or, or being familiar with Anchor and other things on the Solana universe. Like, that will open the playing field significantly and allow more and more people to contribute and, and not be quite as dependent on the core team, you know, to do everything. So super excited about that part of things. Austin: Yeah. So let's, uh, let's cut to the chase a little bit on this. Why Solana? Why was the recommendation out of all of the different scaling solutions out there, um, and all the different blockchains that this, this could have been the recommendation of, what about Solana felt like the right thing to recommend to the community here?Amir: There were a few things. And I, I know we're still, you know, putting out this sort of matrix of, of like all the options we looked at and, and how they, how they stacked up. But I think there were a few, like really, really important things. I mean, one was speed, you know, there's something really to be said about the fact that using Solana feels like using a web two app, um, especially in our environment where the kinds of users are not necessarily like typical of a crypto community. Like we have a lot of people for whom Helium is their first and only like interaction point, um, in crypto. And so having things feel like it isn't on a blockchain is, is really, really powerful. Right? So like when you add a hotspot to the network, it's just there, versus, you know, we have to manage these pending states and stuff like that because our transactions take over a minute. So speed is definitely one factor, especially if, when you start to think about the fact that you're kinda sharing this with a lot of other applications. Um, the choice of, of programming language was also quite important to, to us. So the fact that like Rust is kind of the, the environment of choice, um, in Solana at the smart contract level, I think was really, really important, both because we have a lot of understanding of Rust internally, uh, but it's an extremely popular language with like a big developer community on the Solana side as well. So I think attracting developers and, and sort of further decentralizing core development, um, is important and a popular program language is a big part of that. There's other more nuanced things like key compatibility, which don't get talked about much. So both Helium and Solana use the ED 25 519 curve, and that doesn't sound like a big deal, but it's hugely important because it means we can, we can map a Helium address to a Solana address without knowing the private key, which means that we can migrate the whole ledger without the user having to, like, intervene in any way. And so we were very, very, very afraid of any process that required the user to intervene or to like migrate their key or like do something because you might end up in this case where like there's orphaned, you know, tokens and like someone's on vacation or, you know, it's just a nightmare scenario. So that was a really huge part of it. And, and strangely there aren't that many blockchains where that is the native address type. Um, so that was a big part of it. Um, the fact that, you know, the Solana team is very focused on mobile was also a very big part of it. I think Solana is the only network I've seen that has any ambition specifically around mobile and what to do with phones with, with the SMS stack, which I, I think gonna be interesting. The fact that you guys have a phone also kind of interesting, like maybe there's some stuff we could do there where Saga phones are, you know, POC maps on the 5g network, like there's all, there's all kinds of potential crossover there. Um, you know, so stuff, stuff like that, the fact that we, we know the team, well, I think matters, uh, whether that's fair or not, uh, but the fact that we can access senior people, you know, whenever we might need them, I think is a, is a consideration. Um, so in, in general, I think Solana has probably the biggest and most active developer ecosystem and the best support of, you know, the best wallets. Um, and just, you know, there's just a whole range of stuff that sort of fits in that mold that I, I think matters is a great deal, but fundamentally, it's about, you know, speed it's about having a scalable or, or a sane looking scalability roadmap. I, I think those are what matter. And, and I, I think for the Helium folks, it's important to also just be aware that, um, We, we are only sort of relying on the L1 for the token movement part, like all the proof of coverage and all the data transfer is kind of off chain. And, and so, um, the choice of L1, it sort of matters a little bit less in that context, right? Like it's not so much, it's not, you're not trying to do so much on chain anymore. Um, so that, you know, that was also a big part of just thinking through the architecture, but yeah, we've been playing around with Solana now for a long time um, and super happy with it. it still kind of blows my mind how quickly transactions confirm. I, I just love that. I think people are gonna be blown away by, by it as well. Austin: Yeah. So, as parts of the network, move off chain, what does that mean for like, let's just say I'm a, I'm a, I'm a messaging protocol on Solana. And I would like to, uh, like I know a wallet address that is on a phone that has another messaging app set up. If I wanna actually transmit a data packet over the network, what would that look like from a composability standpoint? Amir: I mean, it's, it's a really interesting question. Um, there's gonna be sort of a difference between. The physical network, right? So the, the actual sort of air network and what ends up being composable like on chain, and those are gonna be kind of interesting things to watch. Like we, we intend to, to make as much data available on chain as possible without trying to do all the computation there. So any other application that wanted to take advantage of the fact that it was known where a packet was sent, for example, should be able to do that. Um, but they are kind of two different networks. Like one is a physical like air network and the other is, um, the blockchain network for want of a better way of describing it. But there should be a lot of ways for existing Solana ecosystem applications to take advantage of the fact that you now have like a location aware source of data. I'm not sure if there is one on Solana. And certainly there's a, maybe there's a way for step in users to also be POC, like participants on helium. Like why not? Right. They're already out there doing stuff. Um, so there there's all sorts of potential there. And, and I think part of what excites me about platforms, you don't exactly know what people are gonna do with it.You just sort of give them the tools and they just kind of go off and, and build whatever they need. Um, so I'm excited for that. Just like sort of opening up the creativity and allowing people to like build stuff that, that we don't have to be prescriptive about, I think is a big deal. Austin: Yeah. It's, it's funny. You talk about that way. That's one of like the guiding principles of how the foundation approaches some of this development as well, which is, like, the role the foundation is to, is to create and invest in base level infrastructure that makes it possible for anyone to build anything on top of the network. Um, and so like, this is kind of exactly what you're talking about, where it's like, if, if the base layer isn't actually, what's integral to Helium's success, if it's the network effect, if it's the ability to, you know, have high availability and meet the uptime requirements of like major clients and users and that sort of thing, then like, why would you focus on that base layer? And, you know, from, from the foundation's perspective, uh, you know, if we're focused on the base layer, why would we build the application layer? And so, uh, it it's a nice, um, you know, there there's that old sort of saying about like, If it doesn't make your beer better, you know, have someone else do it. I think this comes from like Anheuser Bush back in the, in the day. Right. Whereas they outsourced everything except making the beer. And that's sort of that process here of like, as much as you can strip away of what's required to focus on making Helium the best networks it can be. Um, why wouldn't you do that? Yeah. Amir: Yeah. I, I think, um, that's exactly the way that I've been thinking about it for, for a while now, which is, is, you know, you've got a whole team there and a whole ecosystem that is just focused on making the best possible L1 basically, right? Like, so the whole mission objective, and there's so much for us as a team, but also as the helium community to do on, on the Helium side, um, now being able to just focus on that is, is just gonna be like a gigantic weight of our shoulders. Like if I had to guess we probably spent 60, 70% of our engineering time on L1 related things. Like it may be even more than that, honestly. Um, So, if you think about it that way, like you sort of reclaim like 70 or 80% or whatever the number is of, of your engineering brain power, to be able to spend on things like proof of coverage and reliable data transfer. Uh, and then, you know, from a customer centric point of view, the network gets more stable that way, right? Like we're able to spend more resources on like making the network useful and usable, uh, and less on, you know, block production, basically. Which is a very, very hard problem to, to do well and to do its scale. So I'm, I'm thrilled by the notion of, of being able to just focus on. On wireless networks cause that's, that's really what we're, we're here for. And there's so much good stuff coming, um, that I wish I could talk about today, but gimme another six days or whatever, and we'll be, we'll be able to talk about it. Austin: Yeah, totally. So when you're looking at things that like users can expect changes for here, I mean, part of it is, is in some ways, not much, right? If you're talking about address compatibility, uh, one day, if this, if this hit passes, um, users will simply have their HNT represented or IOT or mobile represented as an SPL token on Solana, as opposed to being, uh, you know, a token on the relying L1. Um, but apart from that, you know, uh, there's a validator network that's currently maintained on the IOT side of things. Uh, that's not necessarily needed anymore. Um, so there's a whole bunch of like, you know, internal Helium community changes that are also related to this sort of thing. But, uh, you know, one, one thing I guess I haven't heard, talked about much is, you know, the rewards that validators are getting what actually happens to them in HIP 70 once it passes?Amir: Yeah. Today it's 6.8, 5%. I think of all the H and T that gets created is going to validates today. Um, and they get paid that to effectively run the infrastructure and secure the network. In this model, because we are kind of moving to be an L2 ,uh, and you already have Solana validators at the L1, like we no longer need to like dedicate 6.8% of the HNT inflation, uh, to securing the network anymore. Right? So that's 6.85%, which I think is around 2 million HNT a year at the current emissions rate is now back in the pool, right? Like it's back in the pool that goes to, you know, hotspot operators, for example. Right. So that's another 2 million HNT going back into, into that universe, which, which is a huge win, like you're right. There's not that many people talking about that part of it. Uh, but using that HNT to pay for security is necessary in the current system and not necessary in, in the new design. Uh, so that's a big win to be able to, to get, get that HNT back into their hands of the people building the network, arguably. Um, and then from a user point of view, as you pointed out, I mean, most users on Helium today are using our wallet app, cuz it's kind of the only one that, that I think people trust. Um, and one day you're just gonna open it and you'll still see your HNT balance. It will just be on Solana instead of on helium's L1 you probably won't even notice except for the fact that your address looks different. Uh, but you'll still have your same 12 or 24 words. Um, your balance will still be the same, you know, like nothing really will change from, from that point of view, except the fact that you can now send that HNT to your Phantom wallet, or you can send it to a Serum exchange or you do whatever you want with it really within the Solana ecosystem. But, um, it shouldn't feel, it shouldn't feel like anything's happened other other than everything's faster. Austin: Yeah. Well, it's, it's funny because, you know, Like there's no defi on Helium at this moment, so this entire world of, you know, yield farming and vaults products and being able to take out loans against a helium balance just doesn't really exist nowadays in that ecosystem. And, you know, small things too, like when the validators were launched, like it's a hard 10,000 token delegation and there's no ability to delegate stake to another validator. Like there is in most other networks. A lot of these pieces seem like they make a lot more sense once the, once the transition takes place and you're able to kind of take these things that important structural developments, but sort of set them aside as saying like they've served their purpose, the network's going into its next phase. We can set aside some of this stuff, reclaim some of those rewards for node operators and kind of keep the, the process going. Um, at the same time you, uh, you know, there's an acquisition of freedom fi that took place as well. Was this sort of, part of the calculus about like, oh, if we're, if we're transitioning L1s, we can free up engineering time to work on stuff that maybe isn't quite as well supported in the world, like hardware. Amir: Yeah, a little bit. I mean, you know, Helium had spent a lot of time in the IOT universe, so we're pretty well acquainted with that world. Like we understood all the technology, all the hardware, all the protocols, um, you know, we'd experimented with it all over the years. And so we understood the universe of IOT, I think intimately. Um, on the cellular side, you know, even when we wrote the white paper back in 2017 or 2018, like, you know, we had in there that we wanna explore using this same set of tactics, basically for other wireless networks, right? Whether they be cellular or wifi or, or whatever, they may be. Um, and again, just like the sort of L1 landscape has evolved over time, the cellular landscape has probably evolved the most significantly over time specifically because you've got access to, uh, something called CBRS, which is the citizens band radio service.It's an unlicensed block of spectrum that the FCC made available a few years ago, um, that makes it possible for people like us to run a cellular network in an unlicensed band. And usually that's a huge moat, right? Like you've gotta spend, you know, a hundred billion dollars buying spectrum or whatever, before you can run a cell network. But now there's a pretty decent chunk of Spectrum that you can use, uh, to do that. And, and arguably as importantly, like all the major handset vendors support CBRS, right? So if you have an iPhone newer than an iPhone 11, or you have a galaxy S 20 above or a Pixel 5 or above, um, your handset already works in this citizen's band radio service block of spectrum, you don't have to do anything.So. Those were two like huge developments. And then, you know, as a result of that, there's a bunch of open source protocol stacks that, that you can now use without having to build them yourself like Magma. And so those were developments that just like, kind of the L1 landscape had shifted like dramatically since we started building Helium. And we had been so busy building Helium that we, we just, quite frankly, hadn't had time to learn what we needed to learn about how to do this in a cellular domain. And so we started talking to the freedom fi team a couple years ago, um, kind of they found us, I think, really because they were building private LTE networks, but had bigger ambitions. They wanted to figure out how to build bigger, bigger than private LTE networks. Um, and so the, you know, it felt like it made sense. They had deep expertise in doing this. They had spent the last two or three years understanding CBRS, understanding cellular, understanding what it took to like negotiate deals with carriers, uh, to operate networks in different environments. Like, they've done a lot in their, in their time, um, and we kind of understood how to do the other part of it, which was motivate the economic build out of a network. Um, so it kind of made sense that way. And, um, but yeah, I think part of it is, is being able to focus now on the network side and not so much on the blockchain side, I think is. It's kind of like a superpower for, for us basically, right? Like we, we can shed ourselves of a lot of attention. I mean, even when you add people, like, you know, your attention is still dragged away when you know, there's firefighting and there's problems and there's things that you want to change. Um, so it's not like you just add more people and the problem goes away. Those people also get distracted by, you know, L1 related things. And so I think being able to, to focus on, on what we do is going to be a, a huge win and freedom fi is a huge part of that because they, they bring with them this, this expertise set that we just didn't have, uh, internally and quite frankly, just didn't have time to, to, to learn.  It's fascinating to think about, um, that perspective too, like if you think of like, uh, like Rakuten in Japan, like they're, they're now a fully software defined cell phone network that's using ORAN and not relying on, uh, you know, single vendor lock in, and you kind of extrapolate that full and, you know, part of the, the success of, I think the helium I OT network was you could take a Helium brain and plug it into an existing LoRaWAN gateway system and suddenly, you know, all these devices would light up and be able to talk to the network and kind of stay online, and you can see kind of a future where, uh, you know, the, the 5g and cell phone carrier network has that same kind of multiplication effect behind it. Um, but you know, I would say that's a, that's a topic we can dive into on another day. Austin: As we look at like HIP 70, um, you know, if this thing, uh, passes, which, you know, the vote at this point is I think about 81% in favor, um, so pretty strong support at this point in the process, which is, you know, midday, Wednesday, um, what does that actual implementation migration process looks like? Is this, uh, just like an Ethereum merge processwhere we'll see it take three or four years to really come to fruition, or are we talking about a, a much more quick process here? Amir: I mean, I would love to try and get it done by the end of the year.Austin: Um, it's a lot quicker than three or four years. Amir: Yeah. I know everyone listening is probably, yeah. There's no, no chance of that. But, um, I, I think there is a chance of it. I mean, we we've been, uh, already spending quite a lot of time on the Oracle side of the problem, which, which I think is the most complicated part of the equation, which is, you know, moving proof of coverage and data transfer accounting off chain. So sort of like untangling it from the L1. Um, to me, that's by far the hardest part of the problem. And, and as I kind of mentioned, we were heading down that path anyway. So a decent amount of work has already gone in there. So that, that makes me optimistic that there's a chance to hit that.Um, the Solana side of it, there's still a bunch of work to do there, you know? So, so there's now three tokens in the Helium ecosystem. There's HNT, IOT, and MOBILE. So there's some work around, you know, like how those are emitted and, you know, you need to be able to redeem IOT and MOBILE for HNT whenever you want. So there's certainly work to do on the Solana side as well. Um, but it doesn't, it doesn't feel out of the question to, to me that there's a working version of this by the end of the year. Um, and then there's some migration details to, you know, figure out, but we've already got a pretty good head start on that. Like, I think on a test net somewhere, we have the entire ledger exported and imported as an SPL. Um, so you know, that, like I said, that was a hugely important part of the problem for us, was like, how do we make this like seamless to, to the user? And, and I think we've, we've successfully been able to prove that to ourselves.Um, there's also gonna be an airdrop of SOL tokens to all the HNT holders, um, so that they can cover, you know, roughly a hundred transactions worth of, of transactions. Cause that was another concern coming outta the community is that, Hey, we need this like, even though it's a fractional amount of, SOL you know, people now have to like ,buy SOL or acquire it and a lot of, again, a lot of our users are not crypto literate in any way. Um, so making that easy for, for people I, I think is super important. So now they don't really have to think about it. Um, and I expect once we sort of introduce them to the Solana world, they're gonna have a field day and start playing around with all kinds of other stuff. Um, but yeah, that, that's kind of where we're focused is like, how do we, how do we make this as seamless as possible? Um, and make it such that, you know, an existing Helium user is just thrilled by the time it's done basically, right? Like POC works better. Data transfer works better. Transactions are faster and they have more stuff to, to do with their, with their HNT.Austin: Yeah. I mean, I think for, for helium users who are, are listening to this, uh, one transaction on salon is $0.00025 to, to send on the network. So, uh, you know, if you're getting a hundred transactions worth, uh, unfortunately it's not exactly a down payment, but it's definitely enough to, to do a lot of transfers on the network and experience some of the, uh, you know, the fun things you can do in both Solana defi as, as well as just interacting with the ecosystem in general.Well, Amir, thank you for coming on the Solana podcast. Amir: Yeah. Thanks for having me look forward to, uh, hopefully being back sometime soon. Austin: Yeah. We'll have to, uh, have you at Breakpoint as well to talk a little bit more about this.  

Anatoly welcomes Jason Keats (Founder & Chief Hooligan, OSOM) to the podcast to talk about his epic career building hardware, the Solana Saga phone and all things mobile and web3. Pre-order the Saga now at solanamobile.com 00:09 - Intro00:25 - Background03:27 - Working at Apple08:07 - The Gem Phone10:15 - Privacy at Essential12:24 - Building for Mobile15:52 - Hardware he wants to build17:07 - Crypto x Cars19:02 - Do Apple or Google care about hardware and crypto?21:08 - Innovation in hardware21:56 - The saga phone22:56 - The manufacturing process26:29 - How to start building27:56 - Working with start ups29:15 - The innovation cycle in hardware30:36 - Privacy features32:42 - Working with non-crypto people36:08 - Outro DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. Those who appear in the content may have a financial interest in any projects referenced, and any content herein is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.  This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor. Anatoly (00:09):Hey, folks. This is Anatoly and you're listening to The Solana Podcast. And today, I have Jason Keats with me who's the CEO and co-founder of OSOM. Welcome.Jason (00:18):Hey, how's it going? Glad to be here. Glad to chat everything we've been working on finally.Anatoly (00:22):Yeah. Me too. It's been kind of a crazy journey. You have an awesome background. Do you mind just sharing it?Jason (00:32):Yeah. I've had a very, weird hardware background throughout my career. When I left Berkeley, I decided I wanted to go build something. I didn't want to sit in front of a computer all day. Well, my degree is in astrophysics from Berkeley. And then I went on to work on solar panels. And that was-Anatoly (00:54):Like...Jason (00:54):What was that?Anatoly (00:55):Yeah. How did you get from astrophysics to hardware?Jason (00:59):So my senior year, my professor asked me to... He knew I had access to a machine shop because I was working with the Formula SAE, which is a student racing program. So they knew I had access to a machine shop and they wanted to make parts for telescopes. So I offered and said, "Hey, I can do that." So instead of being a traditional GSI or something like that, I was the monkey who machined random parts. And that was a lot more fun. At the end of the day, instead of having a program, I was like, "I have a thing. It's built." And that was it. I wanted to build things.Anatoly (01:39):That's awesome. How did you get into astrophysics then? What was the reason for getting into astrophysics?Jason (01:48):I just wanted to be able to say, I was... It was a rocket scientist was the logic I had, 18-year-old me had. Little did I know that wasn't exactly how that worked, but it sure sounded cool. And nowadays it just sounds really cool to say, "Oh, I have a degree in astrophysics from Berkeley."Anatoly (02:05):That does sound really cool. So what happened after? You build telescopes, right?Jason (02:10):Yeah. I built little bits and bobs for telescopes. I didn't want to get a real job, so I started a motorcycle company that was a complete disaster. Not a complete disaster, but it was pretty rough. I learned a lot about running a company there. Basically, I learned all the things you're not supposed to do.Anatoly (02:29):I mean, that's the first one, right? You're supposed to do that.Jason (02:33):Yeah. I'm glad it didn't hurt me too badly. And then I ended up being a consultant for a company in Silicon Valley. It was like a design engineering consultancy and they put me on to Solyndra, which was a solar panel company. And that was a very fun couple of years building some really interesting technology and honing the skills that I use today and some of the ethos that I still use today because one of the things we were trying to do was how do you make a solar panel easier to install, because right now it's quite a time consuming process. So my goal was to design a solar array that could be installed with no tools and we were successful in that.Anatoly (03:14):That's awesome. That's awesome. I'm going to keep saying that the whole episode.Jason (03:22):Two years on of creating the name and it still doesn't get old. So eventually Solyndra went belly up unfortunately, that could be 10 podcasts probably as to what happened there. But my boss at the time was like, "Cool, we need to go over to Apple right away." So I think that was a Wednesday, the company went bankrupt and on Monday I was working on secret projects at Apple.Anatoly (03:50):Cool. So there's like a period of how many years of what you can't talk about.Jason (03:55):A few years actually. And actually I know for a fact that the program is still ongoing and is still super secret.Anatoly (04:02):Cool. That's pretty cool. What did you work on at Apple that you can talk about?Jason (04:09):So when I started Apple, my first project was on Mac PD doing the last generation of the MacBook Air, which I mean, people still review that as one of the best laptops ever made. And I'm still quite proud of that. It was a very difficult project with a very small team, but it was very successful. And at some point in between MacBook Air and the little tiny MacBook, I was asked to help on a small project with Jony Ive which was the Leica infrared camera. And it was myself and one other mechanical engineer working with the ID team, designing this, what was supposed to be a two or three-week project. And six months later, I had my own office where we were doing prototypes of little tiny bits and pieces because Jony wanted it perfect. And that really kind of made my career at Apple was working on that project with the studio directly.Anatoly (05:01):Is that camera like something you can buy now?Jason (05:03):I mean, if you got a few million bucks. No, we only made one camera and it was purchased at auction for around $2 million if I recall correctly. I think it's on display somewhere. It was super cool. It had so many bits and pieces that were just absolutely ridiculous. The whole thing was handmade. My favorite little anecdote about that is it needed to be... The tolerances were so tight that it needed to be hand assembled in a very particular way. And so if the owner who currently has it decides it needs to be repaired or refurbished, for whatever reason, if they decide to actually to use a $2 million camera, there's a little post it inside that says, "Call Jason," with my phone number.Anatoly (05:52):Eventually you're going to get like a call at 3:00 AM.Jason (05:55):Oh, yeah. I do know who has it. And we do travel in the same circle, so I'm sure there's a day where I'll be like, "Hey, I built your camera." Yeah, that was fun. And then from there I joined iPad which was a whole other journey and learning a little bit more about mobile having come from solar panels and motorcycles, and desktop products, and laptops into iPad was a lot of fun. And my first real claim to fame in iPad was leading architecture on the original iPad Pro, which is the original 12.9 inch iPad.Jason (06:31):It was a lot of fun because we got to try a lot of different things. A funny story there though, that totally you know and a lot of people who follow me know, I'm huge into racing in cars and I do a lot of silly things. We actually built in carbon fiber speaker caps inside the iPad Pro. Apple marketing made this big spiel about, "Oh, it's different. It does this, it does that." That's all BS. It's because I like carbon fiber because I like race cars and that's why we used it. I'm sure there's some marketing guy going no, but that's the honest truth is to why there are carbon fiber speaker caps in the iPad pro.Anatoly (07:07):I thought those are so cool. I ride bikes. All the cool bikes are carbon fiber.Jason (07:17):Let's see. I don't think I have one here. I had one somewhere. I had the caps and everything, but it was a lot of work and it was a lot of fun. It was really interesting, but I got really sick of the bureaucracy at Apple. It wasn't for me. One day somebody was interviewing for my team at Apple, and they told me about what was going on Playground, which was Andy Rubin's new incubator. And I thought that was super, super interesting. So I just straight up cold called Andy on LinkedIn and was like, "Hey, I've done this stuff. I'm interested in getting out of the Apple ecosystem. Let's talk."Jason (07:53):And the next day I got a call from their recruiter and I went and interviewed a week later and they were like, "Hey, we have something. We can't tell you anything about it, but can you wait, like two months and we're going to give you a job. I said, "Cool." So for that two months, I went off and worked on Apple Maps, which was everybody goes, "What the hell were you doing on Apple Maps?" I was designing all the things you see, like the rooftop boxes and the things that went in the planes and the balloons that went up in the sky. We built some really weird stuff to capture images for Apple Maps.Anatoly (08:26):That's cool. Wow. I mean, there is a hardware component to Apple Maps that people don't don't realize.Jason (08:33):Oh, yeah. All that stuff has to be captured somewhere. I mean, there's warehouses full of hard drives of people having to still go through that data and make sure it's okay to use. And warehouses and warehouses full of hard drives.Anatoly (08:49):Yeah, I can imagine.Jason (08:52):So, yeah, after Apple, I went and joined Andy Rubin at what was... What were we called? We were called Ninja Army for the first five months. And then eventually became known as Essential. I was technically the first hire, but the second employee at Essential and was there from the very beginning to the very end. It was a hell of a ride. We built the Essential PH1, which was a really, really, really exceptional piece of hardware with some pretty crap software on it, unfortunately.Jason (09:19):Particularly the camera side needed a lot of work and unfortunately was released too early. And we could argue for days about what the reason was, but ultimately that was the end result of that. And we never managed to bring another product to market despite building some really cool hardware there.Anatoly (09:38):So yeah, man, launching hardware is hard. Why did you decide to do this again?Jason (09:47):The biggest product that we built... Or the coolest product. No, that was actually the smallest. The coolest product we designed at Essential was Project Gem. And we are working on that up until the very end. And that was so revolutionary in the terms of mobile experience in which taught all of us that there was really an opportunity here. There was still things to be done and new things to be invented and new ways of interacting to be made available.Jason (10:13):So when Essential went out of business, when Andy told me that was that, it was obvious to me that I need to take this opportunity now. I'm going to do it. I have a team available that I know is now all unemployed and let's keep them together and build something really, really cool.Jason (10:29):So I grabbed the key team members and then kept a few on the back burner while we raised money, and we got to the point where we were ready to rock and start building a new phone. So while the first phone is a little more traditional device, I think in the future, we're going to have some really crazy things to build with you guys.Anatoly (10:49):Yeah. I have no doubts. The gem thing was a pretty weird piece of hardware. Right? It kind of looked almost like totally made out of glass.Jason (11:03):Yeah. So this is one of those things that I love showing off in person is that glass phone. It was a glass uni body, which has never been done in a cell phone before. The overall shape was... I mean, the best description is either a candy bar mixed with an Apple TV remote and...Anatoly (11:21):Yeah.Jason (11:22):Yeah. That's a great description. Piece of glass, size of a candy bar that kind of looks like an Apple TV remote.Jason (11:28):Yeah, exactly. But it was all one piece of glass. Even the camera bump, the flash, everything was a continuous piece of glass. And every hardware engineer I've shown that to goes, "How did you make this? And how did you manage to achieve the tolerances required to build that?" And it took a lot of work with our good friends at Corning and a third party in China. But we were able to build them. And there's a couple of them in existence. I think they're all in Andy's garage still, except for the two that are in my possession still. And they work.Jason (12:00):Some of the issues we were encountering was that GMS wouldn't... We wouldn't be approved for GMS with that device. So we were going to have to do some new and novel use cases there and come up with all new ways to interact with the device.Anatoly (12:17):So awesome you guys started with a really strong focus on privacy. Yeah. Was that your decision or something that was just you guys wanted to do at Essential anyways?Jason (12:31):No, that was definitely my decision and the decision of the team. We looked at what killed, Essential. A big part of that was a lack of focus other than building cool stuff. And that only gets you so far. There needs to be a reason why your customers want to join our adventure rather than go with a Samsung, or LG, or HTC, or Motorola or whatever was available at that time.Jason (12:54):So we realized that a big problem facing everybody today is a lack of consumer privacy. And that's when we came to the conclusion that we could actually address that as an OEM.Anatoly (13:06):And that's a really tough challenge because you still probably want to keep Google services around.Jason (13:14):Yeah, absolutely. So I mean-Anatoly (13:16):Do you think... Yeah, go ahead.Jason (13:18):No, I was going to say it's a great segue into what things that people keep asking us since we announced our partnership is when we decided to say, "Okay, we're going to build a privacy centric phone, there have been privacy centric devices attempted in the past, but they were too extreme. By cutting out GMS, by cutting out Android in some cases, you were left with a device that was so private, nobody would use it, which yeah, it works as a privacy device, but you don't sell any.Jason (13:43):I mean, I know for a fact that there are two different phone manufacturers who sold less than a thousand devices, despite putting tens of millions of dollars into it because we all use the same suppliers. So the suppliers are excellent sources of information. And so I know for a fact that one of them was like, "Oh, we only shipped a thousand speakers to that company."Jason (14:06):So what we said was, "We're going to give you control and we're going to give the user control and we're going to give them options and they can make the choice as to how much they want to share or not share." And if they want to use Twitter, and Facebook, and Instagram and every Google service, then at least they have knowledge that they're doing that and is less secure than not doing it. Or they are consciously making that decision.Anatoly (14:31):Yeah. Go ahead.Jason (14:33):And that goes to what we've talked about is we're going to do the same with all the Solana mobile stack that we're integrating into the phone. We're not taking anything away. We're giving users an excellent device, a high-end flagship device that gives them more options and more choice in how they use it and what they use it for.Anatoly (14:52):Yeah. If you've been a web 3.0 dev, you've been building applications and you've never started with like, "I need to collect a username and an email and a password." That concept doesn't exist. Right?Jason (15:09):Yeah.Anatoly (15:09):That's something that being building like in crypto for the last four years, I almost forgot how to build traditional applications. And when I had to remember, I was like, "Oh man, yeah, there just doesn't seem a way to build privacy without really starting from the ground up and building a whole new set of applications that people actually use. Right? And they deliver value to those users. People use them because they love them. But you need to start from the ground up. And that's really hard because getting product market fit, building applications and then competing with existing services is just like a uphill climb.Jason (15:54):Yeah, absolutely. Building that community, which was what made our partnership so beautiful is you have that community and you have that development group that really wants to be actively involved and emotionally involved, and that's super exciting for us to be like, "Hey, let's give you a piece of hardware that you can call home too."Anatoly (16:12):Yeah. I mean, this is the first time, honestly, I've seen anyone tweet that they will stop using an Apple product and switch to Android.Jason (16:21):That is exciting. If we can crack 5% instead of the standard 4%, I will be absolutely ecstatic.Anatoly (16:29):Yep. That would be awesome. Yeah, I remember when the iPhone launch and that was a real watershed moment. A lot of us, I was working on BREW and a lot of us were actually, like, felt really frustrated with the mobile industry because we had all these ideas. We wanted to build rich applications that are easy to code and totally different kind of UIs, dynamic UIs and stuff. And these big telcos would give us like 200-page spec of what a phone should look like because they their customers. And there was like this moment where Apple announced this thing and Steve Jobs showed, "Look, there's a browser. It's a real internet." It's just not this [inaudible 00:17:15]. It's not the mobile web that... I don't know if people remember what that even looked on a LG flip phone.Jason (17:25):I do.Anatoly (17:25):That was a big deal. I don't know if we're there yet with crypto. I don't know if there's a single application or anything like that when people open up and they're like, "Oh wow, this is it." Because obviously when Apple announced the iPhone, it was already after the internet. It was big. Right? Everybody was already using the internet and there was this obvious gap between desktop and mobile. But I think when people actually pay with tokens for their day to day stuff and all that whole loop works and it, and it's beautiful and it doesn't suck, I think that might like open up people to new ideas of what we can do with crypto on a mobile device that actually supports it natively.Jason (18:18):Yeah. The day that both of our parents can go and shop with tokens will be a watershed moment for crypto.Anatoly (18:32):Yeah. I am really excited about that.Jason (18:33):Yeah. When I think about the potential there, I mean you and I have talked about it a few times. It's immense and almost a little bit intimidating and staggering what the obvious potential is there.Anatoly (18:45):So what kind of hardware, what else do you want to build besides a phone? You don't have to announce anything, but you personally as somebody that's a super hardware nerd, if you had infinite budget, and could do whatever you want, what would you build?Jason (19:02):Number one, I want to bring back Project GEM. I loved using that phone and I'm probably the only person on Earth that used that phone regularly for a while because I wanted to make sure it was great. And that thing worked so much better than anybody ever gave a potential credit for, as a small side device, as something you could toss in your pocket, in your bag and not think about. It was beautiful. I mean, for me, designing a piece of hardware has to also be very physically attractive and I think that was the most beautiful thing I've ever designed.Jason (19:31):I do want to see the expansion of using your mobile devices, be it your watch or your phone interacting with the automotive sector. Obviously, we've chatted about it before. I have a problem when it comes to cars. Oh, wait. Nobody can see what I just pointed at. So I think the inner relationship between mobile, crypto, and automotive is even earlier than anything else in crypto, but there's a hell an opportunity there. And thankfully, a lot of the automotive companies are starting to catch on and realize there's different potential there.Anatoly (20:13):What would be like a hardware integration between mobile and cars?Jason (20:18):I mean, we've already patented this idea. So I will talk about it freely now, is the ability to track all your history of your vehicle. And when you sell your vehicle, you have everything written to the blockchain. The NFT itself will simply be a photo or a connection to the title, which is held somewhere else. But you can guarantee that if somebody sends you a NFT of a title, that it is tied to a physical object, which we've already patented that as well.Anatoly (20:47):So you want like the miles like the RPMs, like the actual raw data. I don't know what else you got. I'm not a car person.Jason (20:56):Like the service history or the maintenance history, the sales history. Do you know if the mile... You can guarantee that the miles weren't rolled back. You can know if it went through any... What do they call... Oh, when they call you to bring the car back in. Oh, recall notices. Anything with service was done. That's a real utility of that technology.Anatoly (21:24):Cool. And the kind of cars that people would really want this for like collectibles, like classic cars that you're getting what you're paying for.Jason (21:34):Yeah, I think so. But also with your average Toyota or Civic, at least you know what the history was on that car. Was it repaired? Was it damaged at any given point? There is utility across the board.Anatoly (21:45):Cool.Jason (21:46):And then especially-Anatoly (21:47):Yeah, I can...Jason (21:47):Last thing on that one, especially, if we go into the collectibles, like being able to take a cut down the road. Okay. I sell the car to you. You sell it to somebody else and I can take a fraction of a percent of that sale is pretty awesome.Anatoly (22:00):If you're the person restoring the car. Right?Jason (22:03):Yeah.Anatoly (22:03):And you did this... Yeah, that's actually like, I think been... It's weird that model has never been replicated in the real world, but works so well with NFTs.Jason (22:16):Yeah. Exactly.Anatoly (22:19):That's a use case that I think is way under explored for stuff like that, for physical art.Jason (22:26):Yeah. It's one of the things that we patented early on was the connection between a physical and digital assets.Anatoly (22:40):Do you think Apple or Google care about what we're doing right now? Is this like reached anyone's decision-making yet or is this still-Jason (22:49):I know for a fact that our name has come up in both those companies, because I know a lot of people at the highest level. One of my good friends is an SVP at Apple and he texted me. He's like, "They're talking about you in an executive meeting." I was like, "Cool. I've made it in life. Are they talking about suing me though?" I'm sure Google has people thinking about it and worrying about it. I mean, obviously Google is still a partner because we are a GMS device and they are thrilled to have us. It's like being an advocate for the Android ecosystem.Anatoly (23:26):Oh yeah, absolutely. I think if we convert people from iOS to Android, Google should be like making parades for OSOM. It's a lot of...Jason (23:37):I'm serious, I haven't asked yet, but I should ask them like, "Hey, if we convert more than the standard 4%, do I get a bonus from Google?" That'd be nice.Anatoly (23:43):Yeah. Absolutely. I'm not too worried. They're so big that it doesn't seem like there's anything to worry about because they're just like, it's like worrying about, I don't know, nation state at this point.Jason (24:02):Yeah, exactly.Anatoly (24:03):For a startup, it's such a big competitor that it's not even a competitor.Jason (24:08):Yeah. And I think the companies that people often compare us to, or talk about us, nothing or... What's it? Oppo and OnePlus. One of the things that I've tried to do is make sure I have a good relationship with those companies as well, because it's kind of silly for a bunch of startups to be fighting over the scraps instead of taking swings at Apple, Google and Samsung in terms of device sales.Anatoly (24:31):Absolutely, yeah. I mean, OnePlus made some awesome devices too. That was really cool to see them launch. When I was working at Android at Qualcomm, there was just always like this huge gap between quality and innovation in terms of like how the device looks and feels and they were able to really push the limits there. Yeah.Jason (24:53):Well, I think our next devices will be pushing some new limits, which will be a lot of fun.Anatoly (24:58):Yeah. I guess, do you think like mobile... Because it's so big, is there still room to innovate in terms of hardware?Jason (25:14):Yes.Anatoly (25:15):Besides like on the standard daily driver.Jason (25:19):Yeah. I spend a lot of time actually. Now, that I'm the CEO and I have other teams of people now working for me pushing vision, I can spend a little more time thinking about how I want to change that interaction of device, what new technologies are out there, or even what new use cases of existing technologies there are.Jason (25:38):So I have been working on something wholly new for how we interact with our devices in a way that I think people will naturally enjoy using it. It's a bit of technology that'll change how you actually touch and use your device, but it'll be done in a form factor in a manner that makes it approachable. And it's not foldable because I think that's kind of silly most of the time.Anatoly (26:06):Yeah. Foldables, not also not sure about them. I really like the steel on the Saga phone.Jason (26:14):Yeah.Anatoly (26:15):Why did you guys pick steel?Jason (26:17):Two reasons. Number one, we didn't want to go titanium like we did on the Essential phone. It was a little too exactly the same, but we couldn't go to aluminum because it just doesn't have the same touch. It doesn't have the same feel. It doesn't have the same strength. It doesn't have the same feel, which I want to feel a premium device when I pick up a phone that I engineered. An aluminum loses that a little bit. It's not stiff enough for my taste.Jason (26:41):So we landed on steel for the housing and then we landed on ceramic because we still did want a little tie back to Essential, but also because it does feel premium, it looks premium. It's not paint, it's not glass. It's real ceramic. It's incredibly tough. It's very hard and it does well and drop while also allowing to be RF transparent and just, I mean, ultimately looking and feeling super premium to your fingers.Anatoly (27:09):When you make those decisions, how many logistics need to change? How many companies, suppliers, machines, how big of a process is that?Jason (27:24):Less now than it was five years ago, but it's because I have the team behind me that is incredibly capable of making it happen where we have a ridiculous Rolodex, a contact list for everybody under 25 of people to call for different materials and different processes. The big one is, as you saw in the first EVT devices. First stainless devices, they were quite heavy. So one of the big changes we had to do was we had to optimize for aluminum on the very, very first prototypes. We switched to stainless, but we didn't change our cutter pass. We didn't change our processes. So into the current build, we've made a lot of changes to ensure that we bring the weight down just the right amount, but still have a super strong device.Anatoly (28:11):Are those separate companies like the company that makes the cutters and stamps the thing and puts on the ceramic. If you went from ceramic to glass, how big of a logistical nightmare is that?Jason (28:25):If we switched over to glass, it's a different company that would manufacture and process the material. And then because it's glass, we'd have to also find a paint shop to paint the device. Whereas ceramic has that color baked in, literally.Anatoly (28:40):Got it. That makes sense. Okay. So you have to do like a bunch of work. It's not just one company that you go to and they're like, "Sure, we can do everything."Jason (28:51):Yeah, that doesn't exist as much as we'd love to. It's all over the place in Asia. Prior to the pandemic, I probably would've spent the last 10 months living in and out of China.Anatoly (29:02):And most of the stuff is in China or all over Asia at this point?Jason (29:07):A lot of the supply chain comes out of China, but that doesn't mean we're manufacturing there. We have plants or factories both in China and in Vietnam, but it's still all in Asia.Anatoly (29:18):Got it. Is there any chance for that stuff to ever happen in the US or is it just like the world is like manufacturing shifted irreparably?Jason (29:33):I have had a few conversations with the Canadian government about this. I think the US will be still quite difficult, but in Canada might be possible. But the biggest issue is all the subcomponents are still made in Asia. So even if you were doing final assembly in North America, you'd still have to ship all the individual components from Asia. Your SOC is going to come out of TSMC, which is in Taipei. Your memory is going to come out of Korea. The display will come out of either Indonesia or China and there's no manufacturing plants for all those components anywhere in the Western world.Anatoly (30:13):Actually manufacturing those components in the Western world is impossible. Right? Why is it impossible?Jason (30:18):I mean, just the billions of dollars required would be cost prohibitive to build those plants. Those fab houses are huge and would take years to build.Anatoly (30:30):And that's because things have gotten so specialized in displays and everything that it's just like, "Yeah. It's basically Intel like level kind of commitment."Jason (30:40):Oh, yeah. I mean, you're talking massive, massive. And even the ones that are good at it already have issues now at the scales we're talking about. Like the four nanometer process, which is used to build the chip we're using in Saga is there are only two companies in the world that even understand how to make the fab devices to make those chips.Anatoly (30:59):Yeah. This is the Tungsten droplet, right?Jason (31:04):Yeah.Anatoly (31:04):You have like a droplet that refracts UV light.Jason (31:08):Honestly, I'm not that familiar with that process, but yeah, it is crazy, crazy. It's tough to explain to people how tiny four nanometers is. And then how many traces they have to put down in a tiny little chip that we're going to put in your phone and makes everything work.Anatoly (31:29):How do you find these places? How do you start? If you were like a 18-year-old that's like, "Hey, I want to build cool shit, build cool electronics," how would you start?Jason (31:44):I think if I were starting today, I would try to find the R&D team at either Google or Apple or a startup like OSOM and just go like, "Hey, I want to be your man on the ground in Asia and I want to grow my network. I want to go out there with a completely open mind and just be like everybody teach me." Which is how I really got out there. I said, "I don't know what I'm doing on some of this stuff." But I am a sponge. I will sit here and learn from the best and I will be super polite because I see... That was one of the things that used to bug me a lot is I saw Western people acting like jackasses with their Eastern counterparts.Jason (32:23):Now they get nowhere and I made it at a point to always, always, always be polite, always say, "Look, I'm here to learn. Let me help you. If I know something that I can share, I'm going to go out of my way to share it." And that has enabled me to have amazing relationships with the CEOs of all these fantastic supply companies.Anatoly (32:43):It's basically like a relationship thing and you have to know what they can build and know what they do well and stuff.Jason (32:50):Yeah. And go in there with an open mind and sometimes an open wallet. That always opens some doors and expect to try to make it a back and forth. Because you get a lot further if you can say, "Hey, let me offer you some of my knowledge in exchange for some of your knowledge."Anatoly (33:07):How open are they to startups custom work with these small scale projects? Because my imagination is that like they only work with Google and they want to sell a hundred million units or whatever.Jason (33:20):Yeah. That's the other hard part. And that comes later on once you have those relationships because it doesn't matter who you are. If you don't have that existing relationship, they're going to laugh you out of the building, if they even let you in the door.Anatoly (33:34):Yeah. Makes sense. If you're building, if you dream of building awesome hardware, I guess you got to start like work for somebody like OSOM or R&D team. That's pretty good advice.Jason (33:52):I think it's the only way to build those relationships, so you know who to call. And I think a big part of it is it's not always the CEO you need to talk to. You need to talk to his right hand guy. You need to talk to the CTO. You need to know the right person to talk to at each company, and it changes a little bit. You'll you learn who the movers and shakers are, the people who can actually make things happen for you. And that's where it gets super interesting. And it takes boots on the ground to learn that.Anatoly (34:20):So I imagine that's still true for big companies, as you get bigger, you still just need to keep those relationships going.Jason (34:29):If you want to innovate, you need to. If you just want to just keep grinding out the same BS you've been doing for 20 years, they'll usually just give you the C team and you can just grind and nobody moves anything.Anatoly (34:41):Yeah. The innovation part is hard. How long is the innovation cycle and hardware?Jason (34:50):Anywhere from days to years, right? I have been on the back side of things where it's like, "Oh, I have an idea. Actually, that was super easy to implement." Okay, let's do it. It's done. But I've also... Making the glass housing for GEM was an 18-month project to get the tolerance that we need to hold. For everybody who's listening, you need to hold 100 microns is pretty standard, which a 10th of a millimeter. Very, very-Anatoly (35:19):How many human hairs is that?Jason (35:22):Less than one. So we need to hold those tolerances on piece of glass and how glass is manufactured is that you literally take a molded part and cook it down into a shape. And you can imagine trying to hold... Like if you're baking something in your oven and trying to get it to stay within a 10th of a millimeter, it's never going to happen. So we had to help both Corning and our third party invent new technologies to achieve that result.Anatoly (35:52):That's really cool. That's pretty cool. Are people using these technologies anywhere else? Or is this something that is basically just only was built for GEM?Jason (36:06):I think they're still using... There's not a lot of applications where you need a deep draw, weird aspect ratio glass part, but I know they're using it for two and a half D or even light 3D shapes, that at least allowed them to make 3D shapes that weren't as extreme as GEM in a more factory friendly manner.Anatoly (36:28):Super goal.Jason (36:31):Yeah. I could talk about random manufacturing for hours.Anatoly (36:35):You guys also have like a pretty awesome software team.Jason (36:39):Yeah.Anatoly (36:40):And you guys did a lot of work in actually adding privacy features to the Android stack.Jason (36:45):Yeah.Anatoly (36:46):What are these privacy features?Jason (36:49):I'd love to have Gary answer that question if he were here. But mostly what we wanted to do is allow the user to just be more aware of where their data is going and how it's being treated by any webpage they go, any app they use and alert them if more data than they expect is going out and a place where they can work within their device, where they can guarantee that nothing is going out that they don't control, which we haven't named yet because somebody stole our name.Jason (37:21):And then the other one that I love that I cannot wait to use more of is what we called lockdown, but then Google used that name for what they were doing. But the ability to just turn off any module on the phone when you want to.Anatoly (37:35):And what do you mean by module?Jason (37:39):So right now, I think in lockdown mode that Google offers you can turn off the camera and mic. But we can turn off the camera, the mic, the antennas, the USB port, whatever. A module is any piece of hardware on the device we can individually completely disable that.Anatoly (37:59):That's really cool. Does the user have a physical notification that that thing is turned off? Are there like LEDs or something that light up?Jason (38:10):Yeah. We're still working on that with your team as to what those notifications will look like, what that UI and UX looks like. But yeah, there are both physical haptic feedback as well as visual feedback.Anatoly (38:22):Can you turn off GPS and things like that and other sensors. Or I guess the GPS radio. I don't know how baked in those are these days.Jason (38:32):It's actually super, super, super baked in. One of our investors is an Apple employee. And I was explaining to him like, "Look, man, you can put your phone in an airplane mode." That GPS is still working. And he's like BS. And I'm like, "No, no, no. Watch, watch, watch. Put your phone in airplane mode." And we were on a bicycle ride. "Go bike 100 yards down the road and see your phone is still tracking you." And he's like, "What the hell?" And the next day he invested.Anatoly (39:01):How has it been like getting folks like... You guys work with mostly non-crypto people, up until you met me?Jason (39:10):You. Yeah, basically.Anatoly (39:14):Yeah. What has that conversation been like? What has been their reaction?Jason (39:19):It's been all over the map. It says there were some very vocal, negative people outside of the company, which I completely expected and doesn't really bug me at all. We had surprising support within the company, to be honest. I think I told you, I fully expected 10 to 20% of the company to be like, "Ah, screw this. This is ridiculous." And we really only had one person do that. And then the counter to that, the amount of support where people were like, "No, this is exciting. This is the next generation of mobile will be built on web 3.0. And I think the definition of web 3.0 remains fairly fluid and we get to be involved with really defining what that actually means to the end user.Anatoly (40:03):Yeah. I think this is like a huge opportunity for us to set the standards and really push for privacy first and just build something that can be a really good base. The bricks that web 3.0 is built on.Jason (40:19):Exactly.Anatoly (40:21):I guess, what was like the detractors? What was like the any points that they brought up that you think were interesting or worthwhile?Jason (40:30):I think that was the biggest thing is none of the negative comments I heard were worth that much because it was the standard anti-crypto comments, which is like, "Oh, I don't believe in it. This is scam. I don't see it." And I was like, "Okay, I'm not going to try to fight anybody over that. That's fine." People thought Facebook was stupid. Frankly, I still think Facebook is a little stupid, but they sure are worth billions and billions and billions of dollars. So there is a market for it.Anatoly (40:56):Yeah. It was really hard for me too, to accept, to believe in Facebook in those early days too. But in my mind that is like the quintessential internet company, more so than Google. Because it was really like... All they're doing is connecting people. And that's a very weird thing to think about that, that could be worth half a trillion dollars or whatever it is these days.Jason (41:22):Who knows? They're probably more than that.Anatoly (41:24):I have this analogy that Facebook has a social graph where you have to hop through people. Right? You're connected through some intermediaries, but crypto, it's all public keys, super connected or like a single censorship resistant message bus. Everybody in the world is now in like a single chat, basically, which is why it's a bit chaotic.Jason (41:46):Yeah. But I also see why... It's kind of interesting because you have that community, everybody is connected, which is inherently non-private, but it is also... Everybody in that group has a strong desire to keep certain things private. And it's that ability to choose what you keep private when you don't keep private, which makes this partnership so incredibly powerful.Anatoly (42:05):So obviously, a public data structure is really strong forcing function for developers to understand that this data is public, therefore I need to minimize how much it collects. It's almost like if all your interactions are over a public database, then you really, really try to know the least amount of the users that you need. And I think that's just been kind of a design constraint on web 3.0 devs from day one. And you forget about web 2.0 that you need to create cookies and store people's passwords and stuff like that.Jason (42:46):Yeah. And I think what we're going to bring to the fore for web 3.0 is that improved user experience and that UI. I mean, you and I have chat about it almost daily lately about the issues around that. And having a piece of hardware that can bypass a lot of the frustration that's there right now is huge.Anatoly (43:05):Agreed. Well, thank you, Jason, for being here. It's been awesome talking to you.Jason (43:10):Absolutely.Anatoly (43:10):I'm super excited to work with you. It's going to be great. Folks, if you've been listening, go to solanamobile.com and pre-order the Saga.

Sid Powell is the CEO & Co-Founder of Maple Finance. Maple is transforming capital markets through technology and count traditional finance and crypto-native firms as customers. Joe McCann guest hosts.00:35 -  What is Maple?                    01:32 - How does Maple determine Credit worthiness?02:55 - Expanding the addressable market  04:35 - Who uses Maple and how they get started08:18 - Defaulting and the recapture of collateral13:21 - Maple's advantages against challenges lenders face in crypto16:45 - Why use Maple: Governance and growth19:27 - From Ethereum to Solana Integration                23:37 - Maple and Composability          27:13- Partnerships and future initiatives29:56 - Bringing non-crypto folks into DeFi / Partnering with Circle32:33 - Views on Contraction              34:59 - How Maple started and where it is going                  39:04 - Monetary policies and how they affect Maple DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. Those who appear in the content may have a financial interest in any projects referenced, and any content herein is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.  This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor. Joe (00:09):Hey everybody. Welcome back to The Solana Podcast. I'm your guest host, Joe McCann. And today, I have the pleasure of speaking with Maple Finance CEO and founder, Sid Powell. Sid, welcome.Sid (00:22):Hey Joe. Thanks for having me. Great to be here.Joe (00:24):My pleasure. I've been looking forward to this one. For the folks that aren't necessarily familiar with Maple Finance. Can you just maybe give a brief introduction as to who you guys are and what you do?Sid (00:35):So, Maple is a DeFi lending platform. We think of ourselves as a marketplace for institutional lending. So, the right type of mental model to think about that with is, in the same way that Shopify provides out of the box tooling to run an eCommerce business. What Maple is trying to do is provide tooling to run a lending business that just happens to be on chain. So the way that Maple works at a high level is you have managers of pools, we call them delegates, they'll set up a pool, which is like an on chain lending business or on chain credit fund, people and institutions deposit into that. And then, the manager goes and originates loans to corporate borrowers out of it. So, it's recreating a TradFi credit fund or a TradFi lending business, but doing this on-chain.Joe (01:18):That raises a first question for me, that is, if I'm providing a loan to an actual business, how does Maple go about determining the credit worthiness of that particular business?Sid (01:32):It's a good question. And, what we've tried to do with Maple is be asset light, in that, Maple does not want to be the lender or the balance sheet lender itself. Instead, what we're trying to do is give people who have the expertise to underwrite and assess credit. So I think, people who were in credit teams at financial institutions before, or they might have been in investment banking, but they understand credit and underwriting loans. What they're doing is they would follow a fairly conventional process where they would meet the management of the borrower, assess their financials, so balance sheet profitability, and then enter a loan contract with them, and set commercial terms around it. So, it is replicating a fairly conventional and tried and true process of assessing whether a borrower can repay the loan. It's not really reliant on on-chain determinants of credit worthiness in that respect. Really where the blockchain comes in is actually settlement and management of loans and portfolios of loans.Joe (02:28):Got it. That makes total sense. I mean, you're really saying, "Hey look, TradFi folks that understand how to evaluate credit, and credit risk, and credit worthiness, here's a new avenue for you to do this, which is on chain." And so, does that imply that there's more or less a much larger market for this, or is it more just breaking down the barriers of how TradFi credit funds, or credit debts actually tend to work?Sid (02:55):It's both. I often like looking at business history and one of the things I was always really interested in was the way that when Sony released the Walkman, it actually expanded the addressable market of people listening to music, because they made it more portable and therefore easier to access. And so, I think with this, what we're trying to do is we're breaking down the workflows of running a lending business, but we're making it 10X simpler and less costly to run and operate that lending business or credit fund. And so, I think what that does, it actually expands the addressable market of people who can do credit to businesses, institutions and corporate borrowers. I think that market's really underserved, and I think that's actually going to crimp innovation and entrepreneurship in the economy and in the private sector.Sid (03:41):And so, what we're trying to do is expand the supply of people who can operate and run lending businesses, so that the private sector can get access to more and better credit. And the demand for that is not really being well met by the banking sector today. So I think, there are a few suppliers in the private credit or private debt markets. These would include players like Fortress Group. But I think with this technology, if we're successful, we should see a lot more of those types of players, because it will be significantly easier to set up and run that business. Those businesses will be more profitable to run. And, this is beneficial for the economy.Joe (04:19):And so, how does someone get started with Maple then? I mean, it sounds like there may be a couple of different avenues. I just want to make sure we go through the permutations of the opportunities for, say, individuals or actual companies that want to create this Fortress 2.0, if you will.Sid (04:37):Yeah. So, the central company or user of the platform, that role, we call it a delegate. But that's the manager of a pool. And so, they're, in effect, your lending business that's being conducted on chain. So those types of players, how they would get started, they go through due diligence with us. And then, once they're admitted to the platform, we really want to go through and see what sector they would be lending to, how they would attract institutions or individuals to lend into their pools, and then who on the other side are going to be the borrowers. We want to make sure that it's either a new sector. It's a growing, it's a profitable sector. It's one where there are fairly credit worthy borrowers. We're trying not to get into things that are too speculative. It's not for small businesses and for startups. It's more for established companies that are profitable, that have a great track record, and a big opportunity.Sid (05:31):So, that's one side. And then on the other side, institutions who are going to lend into the platform or individuals. I mean, this could be wealth aggregators, hedge funds, family offices, high net worths. But what they're looking for is a place to park capital and pretty simply earn a yield. That yield is going to be higher than going into things like AVA or Compound, because you're taking credit risk. You are lending to corporate borrowers. And so there is risk involved in that. But, generally these types of players have a fairly long time horizon and they're reasonably sophisticated in their understanding. So, that's lenders.Sid (06:07):And then, the other side is borrowers. Now these are typically corporates who are crypto native at the moment. So, that's the small wedge. If you think about, when you're going to attack a market, you have to start with a wedge. And what we did was started with crypto native companies who are generally market makers, high frequency traders, or arbitrage traders. But, that's one sector within the crypto industry that we can attack first. And then, next we want to look at other sub sectors, which could be infrastructure. So it could be players like Figment, Blockdaemon, Chorus. Could be Bitcoin minors, like Marathon, Core Scientific, any of these publicly listed players, or even large private players. And then beyond that, we want to start to look at SaaS companies. The goal here is not to live solely within crypto. We think crypto is tremendous infrastructure, but it's infrastructure that gives us an edge over traditional finance. And so, that's not really going to be successful until you can actually bridge and replace traditional finance in lending to those sectors.Joe (07:09):Yeah. That's really smart. Spoken like a true founder too. You got to start with your wedge and expand from there. I love that. This raises an interesting point though, today, starting with, say, crypto companies, I think makes a ton of sense. But more importantly, when folks create a pool and then, say, a family office or an institution decides to lend into that pool, what happens if someone defaults, right? So, in traditional finance and I'm definitely butchering this a little bit just to keep it short, but let's assume a business goes to a traditional bank and says, "I'd like to borrow a million dollars for working capital." And they say, "Well, what's your business?" "Well, my business is..." I don't know, "We build warehouses." Or something, right? And they say, "Well, what are you going to pledge as collateral?" Well, maybe they own the land, right, that they're going to build these warehouses on or something.Joe (07:56):In theory, and maybe even in practice, if they were to default on that loan, the lender would then have a legal claim against, say, the land that they pledge as collateral. How does that work? Not only necessarily just in the wedge that you're using with crypto companies today, but as you move towards, call it, infrastructure companies and even potentially SaaS businesses, how does default work in the recapture of that collateral?Sid (08:24):The way that lending began in crypto was largely over collateralized and it was using liquid financial assets, cryptocurrency, to serve as that collateral. And then, the lender would take possession of it, and then liquidate it if it drop below a certain rate, or if the borrower fails to repay. It's now evolved towards under collateralized lending. Certainly most institutions borrow under-collateralized now. And this means really what you're having to do is underwrite and assess the strength of their balance sheet. A lot of people think that this is an aberration, but this is actually most commercial lending.Sid (08:56):So, if you're lending against real estate, that would typically be an asset backed lend. But if you're lending to say Apple or a large technology company, typically they don't have a lot of property plant and equipment. They don't own a lot of land and you're not going to get your money back by being able to sell their land. Instead, what you're looking at is the equity of their balance sheet and the profitability of their business. And so, where this type of lending can evolve would be effectively a secured loan, but the security for that loan would be a charge over that corporate entity. So that's what we're looking at as we expand into other sectors.Sid (09:38):But, I think, to be able to actually serve the broad corporate market and eventually have Fortune 500 companies borrowing through DeFi, you need to get comfortable with that type of risk, which means assessing the balance sheet of a borrower. I will say that, if you take security over a house and a borrower defaults, the foreclosure process is about 18 months. You'll get your money back, but it will take a significant amount of time. So it's not liquid collateral. And anyone who thinks that DeFi lending against those type of assets is going to give them an instant payback if there's a default, is going to be disappointed. But, if you're lending against the assets of a corporate, you want to make sure, ideally, they're not going to default. Your recovery's going to be lower than if you're lending against a house. But, your probability of default is probably also correspondingly lower if you're lending to a large corporate than an individual who just owns a house or a small business, who's pledging a house as collateral.Sid (10:34):You are still lending against effectively the strength of the business and the profitability of the business. But, as crypto goes into other sectors, I can see asset backed loans also playing a role. We would look at real estate backed loans, but currently one of the main issues is that, that requires paper filing in any individual state that you borrow from. So, it's not even 10 years behind, it's 40 years behind in terms of actually having to file security and manage the opposite of that.Joe (11:02):Got it. Very helpful answer. I think, the takeaway really is, "Look, if you're lending money to Apple..." I love that example. "You're not necessarily having them pledge their One Infinite Loop address and ownership of that land as collateral." You're saying, "Look, it's Apple, right? They've got a ton of cash on their balance sheet, or they've got great potential for future cash flows, et cetera, et cetera. We're just taking that to something like Maple's platform and folks can assess." Like you said, it's really up to the lenders to assess the credit worthiness, right?Sid (11:33):One of the innovations that we've tried to build in is that if you're coming to the platform and you want to deposit into a pool, you don't have to be a sophisticated underwriter yourself. What we're trying to build is a way for you to assess that here's a pool that is lending to this risk profile.Sid (11:50):Let's say, mega cap companies based in the U.S., here's the historical performance. It's earned this much in yield. There have been X number of defaults. And then, you have a bio on the management team that is making those lending decisions. And that enables you to decide, "Okay, I'm going to allocate a bit into this pool and maybe a bit into a second pool." Rather than, you having to come to the platform and go, "Well, do I want to lend to company A? Or do I want to lend to company B?" Because, it's not really in most people's expertise or ability to devote that time to doing that. And I think that was why earlier peer-to-peer lending platforms like Lending Club didn't quite take off and achieve widespread adoption, because that model is just super inefficient for both the borrower who's coming to a platform and doesn't know who they can borrow from, as well as the lenders who come to the platform and don't know how to assess whether Apple is going to repay its loan. Apple's probably a poor example, but some other company.Joe (12:48):Well, and speaking of defaults, we would be remiss not to talk a little bit about some of the challenges facing the lending industry in crypto right now, without having to necessarily name names. I think it's pretty well understood at this point that there's been some stress in the credit markets, if you will, when it comes to crypto. Can you talk a little bit about maybe how Maple does or does not "hedge" against that, being more of the facilitator and it's really on the lender's ability to evaluate that risk? Or, are there any sort of advantages that Maple provides that theoretically could have mitigated some of the challenges that some of the lenders in crypto have faced?Sid (13:29):So there's probably three key advantages or differences for doing this in DeFi, which would've been risk mitigants. So, the way that Maple works is you have multiple pools, each pool is a basket of loans that you can deposit into and effectively you're lending to those borrowers on the other side. Number one is that, all of the loans and flow of funds is totally transparent and on chain. So if you go into a Maple pool, you can see who the 25 different borrowers are. So you'd never have a situation where you wake up tomorrow and you find out that a Maple pool was actually lending to a borrower that you had no idea about. And that that borrower was 30% of the pool. So, transparency is risked mitigant number one.Sid (14:05):Number two is that the withdrawals and flow of liquidity is all just governed by smart contracts. So, as cash flows back into the pools, people can withdraw. So, you'd never have a situation where you go and you find that on a discretionary basis withdrawals have been halted. At the moment, liquidity is constrained, but it's purely dependent on just paybacks of the loans, which are coming through over the next 60, 90 days and beyond. And then, element three, as you can see that, there is a reserve for each of the pools. So the reserve is there and it can absorb some of the credit losses. I would say, our reserves in the pools at the moment are probably undersized where they should be on a normalized basis and that's a learning, but conceptually having that reserve on chain, I think, gives people who are lending inter pools and into protocols comfort when they can effectively see the buffer that is available to protect people who are a senior there. Otherwise, contrasting that with more black box CeFi lending, it's just a feature that is not there.Joe (15:08):Weird. So you mean more transparency is actually better for market participants?Sid (15:13):Well, I think, yeah, at this stage with current events, it's a clear argument, yes. I think, where CeFi lending has advantages is obviously in flexibility, having a protocol and being governed by those rules obviously creates inflexibility and slows things down a bit. But, I would say ultimately what we're actually trying to design is a system that is resilient and robust enough to shocks that it doesn't require a bail in, or a lender of last resort concept, because over a long enough period of time, you will see enough volatility that stresses things that rely on a single counterparty. We saw during the GFC, everyone was insured by AIG. Well, when there was an out-sized level of defaults, AIG went bust, then no one was insured.Joe (16:03):That's right. Yeah. It's interesting, I was chatting with a coworker of mine who was at Lehman Brothers during the GFC and he was having a little bit of flashbacks to some of the stuff that's been happening in crypto today with the CeFi-related lending.Sid (16:17):Yeah.Joe (16:17):Let's talk a little bit about Maple itself. So the protocol, this is obviously The Solana Podcast, we're going to get into the Solana integration in a second, but I really wanted to provide the listeners with a fairly solid understanding of the actual product and the business, and also the business of lending. So they could understand maybe what Maple's token is, and what does the protocol do, and how does governance work? So, could you maybe just talk a little bit about if I'm a Maple token holder, and maybe I'm staking Maple, why have this protocol, and what does the governance actually do for the future of Maple's growth?Sid (16:54):It's a good question. And so, the way that the token fits into things is, it can be staked. So, that's the first use. The second is that, when you stake it can be deposited into that pool cover. Pool cover is your subordinate reserve. And so, the purpose that therefore provides is, providing a safeguard and some absorption for credit losses, in addition to being used as the governance token to make decisions on the platform. So, what you would do then, in terms of a workflow, so you might stake it, then you're receiving a portion of the establishment fees.Sid (17:27):So, Protocol Treasury earns about 66 basis points on loan origination volume, and then half of that goes to pay stake tokens. And then, the other element where the stake token participates, is that, if it's put in pool cover, pool cover is paid a portion of the interest. So, generally in most pools, it's about 10% of the interest cash flow. So, if a pool is a billion dollars, paying 10% on average, it's a $100 million in interest, 10% of that, so $10 million would go to pool cover. So it's going to pay effectively for credit protection there. That pool cover is comprised of the token and USDC. In future, we'll just have single-sided depositing of the token.Sid (18:10):But therefore, it receives a portion of revenues for actively participating in the credit protection of the pools and the senior lenders on the platform. So, that's how it figures in the platform both economically and from a risk allocation perspective. And I think, risk allocation is super important, because as I alluded to before, this is one of the ways in which we're trying to fix some of the problems inherent in TradFi lending. So, an alignment of incentives is super important and the pool delegate, so that team of managers who are deciding who are good borrowers, they have to put some of their capital into that subordinate reserve, the credit reserve. And they do that so that if there are defaults, they are among the first to take a hit. And that helps ensure that they are incentivized to maintain pretty good credit standards.Joe (18:57):It's really cool, because there's so many ways that you can participate in Maple. But also, the notion that folks have shared incentives and are aligned is I think one of the most powerful aspects of the protocol, but that raises the question of, "Well, man, it seems like a lot of scope for some engineering talent." Let's dive into a little bit of the tech, not get too deep, but certainly enough to give people an understanding of what it is that you've built, and ultimately why and when you added salon integration? What does that look like for your team? And, what has been the lessons learned from starting on Ethereum, and then adding Solana support.Sid (19:36):Yeah, it's interesting. I mean, looking back at our tech stack that we have on Ethereum. So, we launched the Ethereum version of the protocol in May of 2021. And then, we were steadily growing. So, Ethereum, or the protocol as a whole, has done about 1.5 billion worth of loans to date. It's pretty good for 12 months. But what we looked at as we built out Ethereum... So there's certain things that you really keep in mind when you're developing. So, upgradability was something we debated for a long time, because if you have upgradability, it gives you flexibility. And it means you can move faster, ideally not break things, but it gives you the ability to iterate, but it's less secure, because upgrading a protocol or upgrading a component of the protocol, that's how hacks and exploits can happen. So, we initially traded more on the side of security there and inflexibility.Sid (20:26):Now, as we near launching pools V2, we are thinking about upgradability and how we can have something that evolves. But, it was around late last year, I was actually at Breakpoint Solana in Lisbon, and I was meeting a lot of founders who were coming from TradFi backgrounds and looking at building things on Solana. And, we had been receiving comments from people who were using the platform about the transaction costs on Eth. And so, that prompted us to start looking at, "Could we build on layer twos? Should we evaluate alternative layer ones?" And, being at the conference, yeah, I was very much struck by, one, the level of development in the ecosystem, particularly on the DeFi side. Two, the level of talent that was moving across there. And, a lot of our clients and borrowers, like Alameda, obviously have a lot to do with the Solana ecosystem.Sid (21:13):And so, we started researching who was doing Maple on Solana. We met a team that was called Avari, and then we ended up acquiring them. And that meant that we were able to get live on Solana probably six months ahead of where we would've been. And it gave us access to really good talent in terms of Rust engineering, which was super short on supply. So, for us, it meant, one, speed to market. Two, talent acquisition. And, Jeff and Quinn, the two guys who came on board the team, really aligned with us in terms of values.Sid (21:43):And, it's given us now I would say the advantage of being on two chains is that you can start to build out a differentiated product that ideally isn't cannibalizing what you've already done on Ethereum. It should be meaningfully differentiated. And that's why I've been pretty excited to see things like the launch of the Solana phone, because the more differentiation and uniqueness that we have on the ecosystem that product is built on, the more we can serve a differentiated market, whether if you have something like, SolPay, that starts to introduce tech or SaaS companies into using crypto and blockchain to support their financing, then that's a market we could go and lend to.Sid (22:24):So anyway, that's a long-winded answer. But, that was why we started looking at Solana. And as we're evolving that product, so there's now about 113 million in loans on Solana, Genesis and X-Margin are each running pools there. We're trying to see, how can we build that product to serve either a unique customer base, whether it's like SaaS companies or a unique and differentiated lender?Joe (22:46):Got it. Yeah. The Breakpoint conference last year, I think, was really eye-opening for a lot of folks that were just getting familiar with Solana. And, the response I've heard from most people is that, just the developer activity and the developer acumen, the technical acumen of the developers that were migrating towards Solana was a super strong signal to why they wanted to participate, or in your case support Solana. One of the key features of Solana is this concept of composability. So, the notion that protocols can almost operate as Legos and you can build various things, developers can build various things. Is there a notion of composability with what Maple's doing? Meaning, could developers actually try to build something with Maple powering it, or as a piece of some bigger product, or protocol idea that they may have? Or is Maple more meant to be, "We're a vertically integrated thing that supports Solana's chain"?Sid (23:46):Yeah, it's an interesting concept. It's, do you go the Apple route and you be vertically integrated and control your destiny? Initially, the concept from Maple was for tranche fixed income, but then it evolved to be full stack lending. And that was because DeFi was so early that we didn't really want to be dependent on other protocols to get to market and to grow. And so, we took more of the Apple approach early on. Now as I look at DeFi, one, I think there's actually going to be a contraction in the scope of different products on DeFi for a while. And so, being vertically integrated is strategically pretty good for us, but the counter to the apple approach would be where Microsoft has found itself now, where I think, arguably before they might not have had a stronger set of products outside of Windows and Office.Sid (24:30):But, now when you look at what they've got, they've got GitHub, Teams, Xbox, gaming, Activision. They're actually adding this full suite of things, where when you go into their ecosystem, you have access to all of this. And it's a very interesting product to serve to institutions or enterprises from Microsoft's side. And so, I'm looking at what is within the lending product suite, whether it's yield. So this could include swaps, could include things like credit scores, could include flavor of insurance or credit default swaps, or it could include different types of credit indices. What are the adjacent or complimentary products that would, one, make our product offering stronger, and two, enhance the strength of a product that's trying to partner with us.Sid (25:16):So, credit scores are really a natural one. But, I'd say, at this stage, it is very early on in that space just because people aren't conducting most of their economic activity on chain. But other things like fix for floating swaps, or hedges, I think, are a pretty good complimentary one. It's still very early, but those are the natural ones that I speculate about, because that was what I used to do when I was in banking. We'd also have to go on frequently talk to a swaps desk, or a ratings agency. So I think those would be naturally the first ones.Joe (25:44):Got it. Yeah. There's a conversation that I have with a number of the founders that I advise on their companies about staying very tightly scoped to what you're building, versus opening up almost an API, or a set of SDKs, or a platform if you will. And there's just trade offs to both of those, right?Sid (26:01):Yeah.Joe (26:02):One is that if you are vertically integrated, well, you really control not only your destiny, but you also control the end-user experience, and what that end-user... How they're going to interact with your product/protocol. And that's super important, but it could potentially restrict the potential speed of the growth of what you could be doing in these adjacent areas like you're describing. Whereas, if you, say, theoretically, open up a platform with APIs and SDKs for developers to build on, you're not necessarily controlling that end-user experience, and that could be potentially detrimental to the brand of Maple, assuming someone has a poor experience. But, it's a great trade off to make, right?Joe (26:40):And I think, staying the course of what you guys have done thus far, the fact that you're even thinking about CDSs or credit scores. I mean, one of the questions that came to mind earlier was, if you're bridging a lot of what happened in TradFi, are we going to start to see a ratings agency? Are we going to start to see the CDOs and CDO squares, and for the listeners that may not know what that is, it's a collateralized debt obligation that could then also have various tranches associated with it, which unfortunately led to a big portion of the global financial crisis. And we don't necessarily want to recreate that. But I guess, from my perspective, how do you think about that roadmap that you're doing. And, where are you going to be doubling down, or are there other areas where you want to partner with folks? And, how do you think about that going forward?Sid (27:24):Yeah, I actually think about a lot. I mean, we get a lot of inbound interest in partnerships, because I feel like we've been around a little while and we've demonstrated a certain amount of traction. So that's good. But then, a big question becomes how do you decide and prioritize amongst those opportunities? And what I try and think about now is... I think, a big focus for us is which opportunities get us fastest out the gate in terms of serving non-crypto native customers right now. So there's a certain question of, how much do you want to be doubling down serving crypto native borrowers, versus say, leaping out and serving SaaS companies? And to serve SaaS companies, the types of product integrations that you might need, or just any customer outside of crypto, would be things like on and off-ramps.Sid (28:07):Now, that's a really intensive product development on the legal and compliance side. It's actually pretty simple build, but it starts to become a strategic question of, "How much effort do we want to devote to something like that, versus say, evaluating an alternative L1 or going to an L2?" I think, the scale's probably tipped in favor of looking at how quickly you can get out and serve just a wider set of customers. And I would say, part of our role at this stage is trying to educate people who are not actually in crypto already, and try and bring them into crypto and into DeFi, rather than bringing DeFi to them. Instead of evangelizing about it to the people who are already in crypto. I think what we're trying to do is just demonstrate a very workable product to people who are not already in there and wow them with what we think the huge benefits over doing this through the traditional financial system.Joe (28:57):I mean, look, I love the notion and the approach of trying to get a lot more non-crypto people into DeFi. I think, one of the things that I look for when I talk to founders or folks that are in the ecosystem... And I know that Anatoly and Raj did the same thing, and the Solana lab team more broadly is like, "How can we get more and more users that aren't already in the space?" And, there's a couple ways that you can do that. One is, you can build an amazing product that's very easy to use. Easier said than done.Sid (29:29):Yeah.Joe (29:29):But the second is some partnerships. And, what brought this to mind for me was I think when we met in-person, it was at a dinner that Jeremy Allaire, the CEO of Circle put on. Could you maybe talk a little bit about how maybe the Circle is an example of how you're thinking about levering someone in this space that is absolutely doing God's work out there, working with institutions and folks trying to get them into crypto and DeFi? Jeremy's done an amazing job of doing this with USDC and what he's been doing at Circle. So I'd love to get your take on if Circle is an example of how... Or someone that you would partner with to help accelerate some of those non-crypto native people into DeFi.Sid (30:08):Definitely. So, Circle, as you said, is a great partner. So, the pools lend on Maple in USDC, which is the vast majority of the lending that's happening on the platform, and also wrapped Eth. But if we look at USDC, this is absolutely essential infrastructure, I think, for DeFi, because having this secure stable currency in a digital form, which we can then distribute loans to corporate borrowers, as well as companies who are coming into DeFi and looking to earn a yield, are wanting that yield in stable coins. But, where Circle has been tremendous, and I think where there is a huge opportunity to grow is, one, there is the Circle yield product, which could potentially be integrated with Maple and a partnership there would offer people access to yields coming through the platform. What they've actually done really well, which is underrated is, the front-end of the Circle treasury and USDC product has, I think, the best off-ramp in the market.Sid (31:05):So, we use it for our own corporate treasury management and when we have to pay things in fiat. And, having that product, that's a really good Trojan horse, that if a regular non-crypto company starts using that, they have a seamless on and off-ramp through which they could access a product like Maple. So, I could lend to a company and let's say that company is doing SaaS, or it's a FinTech business, or even a business in real estate or construction. So, if we could lend USDC to that company, then they could take that through the Circle front-end, convert it into fiat, and then use it to pay vendors, suppliers, salaries. And so, I think, the growth and proliferation of stable coin usage is super essential and it's going to precede wider adoption of DeFi, because it's a necessary part, it's key, picks, and shovels for the space. But I'd say that's how the Circle partnership is super important for us.Joe (32:03):Yeah. The folks at Circle are great. I have nothing but positive things to say about them as well. And, there are other partners in this space that I think have been super helpful as well to DeFi adoption. As you think about these partnerships... What struck me earlier about when you said you think there's going to be a contraction in DeFi, how does evaluating how Maple is going to play in this space relative to the potential contraction that you're seeing? So, maybe to unpack this a little bit, can you talk about maybe your view on the contraction and how that may or may not influence how you want to go out and partner with folks to bring on those call it a 100 million new users into DeFi.Sid (32:46):The contraction is happening broadly across all risk on assets. So, people are going risk off for crypto for equities. And, what's happening is that because crypto is a much smaller market, the outflow is felt more acutely. But we've seen out general outflows from crypto and DeFi lending as a whole. And, what it's forced us to do is probably consolidate around a core working product. So, in this case, it's probably caused us to, say, push out potential partnerships that are maybe less clear in their scalability, because it's a bird in the hand, two in the bush. So, if you have a customer set that is working and partnerships that are working, you have to be more circumspect and conservative in the new ones, because you probably have less bullets. And so, what the pullback is forcing us to think about is, if we wanted to go and target a new set of borrowers, who is a new set of borrowers that we could potentially sell to lenders who would need to deposit into the pools that are lending to those borrowers?Sid (33:46):So, it forces us to think about matching and extending the markets that are offered on the platform, i.e., the pools that are offered on Maple. And, in terms of integrations, it forces us to concentrate more acutely on what partnerships, for example, Circle as well as off-ramps will help us extend our reach to serve customers who are outside of crypto. So things like credit scores, you have to be a little bit more conservative about, because probably the next six months, there's not going to be as much on chain activity. And so, the amount of value you could get out of, say, an on chain credit score is probably diminished for the next six months. It's not that it wouldn't work eventually. It's just that, probably that goes down your priority list in the near term.Joe (34:33):Got you. Yeah, that makes total sense. Can we talk maybe a bit about your company? We've been talking so much about DeFi, and of the product, and this and that. I probably should have asked this at the beginning of the podcast, but can you maybe just talk a little bit about the company? How old the company is? And, where you're located? Potentially remote, like most modern companies. And, what does the the roadmap look like for folks you want to bring on or folks that you're looking to add to the team? The reason I bring this up is that a lot of folks that tend to listen to the podcast are very passionate about participating in the Solana ecosystem and are interested to hear about how companies started and where they're going.Sid (35:13):We have an interesting structure. So, two segments, we've got the DAO, which raised capital. And the DAO is effectively governing the protocol and it has a multisignature that will implement any major changes, deploy new contracts. And then, we've got the operating company, which is employing developers, conducting business development and marketing. And so, that's domiciled out of Australia. And that company receives grants from the DOW, which cover operating costs and cash burn on a quarterly basis. And I suppose with those two segments, it's worth noting, so most of the team is remote. They tend to be based out of the US, Canada, UK, and Western Europe. We try to aggregate everyone around not too many time zones, so that it was easy to coordinate calls when I was living in Australia. I used to have to do 4:00 AM calls most days.Joe (36:02):Brutal.Sid (36:02):Yeah. But, we've got about 36 people at the moment. And so, we were hiring more aggressively. I think in current market conditions, we paired that back a little bit, but we are still hiring. So, if there are good people out there who want to join a team, we are looking for a couple of engineering roles at the moment. We're looking for a capital markets associate for anyone who is in TradFi or investment banking, and looking for a change into crypto. Never a better time to do it. And so, I actually want us to run a pretty lean model. So I think, me and my co-founder have always been of the opinion that you add people on the basis of jobs that need to be done, rather than just headcount for headcounts sake.Sid (36:42):And so, I've definitely been inspired by the FTX model there in terms of how much they've been able to ship for how lean they are. I would say, we've actually developed a sales team, operations marketing, as well as product engineering and design. So, we are a fairly complete core. And so I think, there are potential roles on the team for someone in sales, design, or engineering, if there are good people out there. Yeah, that's where we got to at the moment.Sid (37:13):But in terms of roadmap, the roadmap for us is we're launching pools V2. So there's a really complex engineering ask there. And, the team is doing a lot of research. And particularly with the market events of recent market volatility and some of the points and implosions we noted in the CeFi side, we're trying to take learnings and incorporate them into pools V2.Sid (37:37):So this would include things like, how to have a better withdrawal mechanism? How to have better cover support, i.e., credit protection, because people are really more acutely concerned about that. And that's something that probably wasn't a big market focus six months ago. And then, better asset liability matching, which is that point I made about sustainability of a lending business. You can't fund term loans without call deposits. And so, we just want to get better about matching those up.Sid (38:05):But then, on Solana, what we're focused on at the moment is things like open term loans, active collateral management. These are the types of things that we think is going to be super interesting tooling to bring more CeFi businesses onto DeFi rails. So I think, we recognize that is a core customer set of ours. And it's like, "How do we build the tooling that means that you would want to run a multi-billion dollar lending business on top of DeFi rails?"Joe (38:30):Wow, fascinating. And man, could we use that? If there's anything that we learned, I think, this year thus far is, self custody is definitely going to be a key thing going forward.Sid (38:40):Self custody is king.Joe (38:41):Yeah. Well, look, this has been an absolutely fascinating conversation. I have one last question for you. And, we will absolutely hold you to it long-term. You've been talking a lot about lending and there's an interest rate associated with those loans in the United States. And, I think some of the other central banks are following suit. We've been raising interest rates. So, how do you think a little bit about competing with some of the broader interest rate markets and something that Maple can actually provide? Does that actually factor in? How do you think about, I guess, monetary policy from central banks relative to the business that Maple's building?Sid (39:20):For a really long time rates on crypto were outside rates in, let's call it, the real or traditional economy. And that was because there was a lack of liquidity there. Then, what we saw, rates and traditional economies started to go up, but because there was actually more supply coming through, particularly earlier this year, we actually saw rates drop. And so, the delta between TradFi and DeFi/CeFi rates really compressed. Now, we've seen with the implosion of liquidity... Liquidity has totally dried up. We've seen rates go way wider again.Sid (39:54):So rates now blowing out to mid-teen levels, you can probably clear in crypto and DeFi. I'm a big student of financial history. And I look back at the last time that inflation was this bad, which was probably the Volcker era. And, cash rates got up to double digits to break the back of inflation. And I'm interested, because I still think that lending rates in the traditional economy are sub-inflation. And therefore, everybody who's lending in the real economy is still earning a negative real rate of return. Whereas, in crypto, at least you're earning a rate that clears inflation. But I'm interested to see, and I wouldn't be surprised if rates continue to go up in the cash rates and the TradFi economy up to high single digits. And then, in DeFi and crypto that probably pushes them close to high teens. And yeah, I wouldn't consider that out of the ordinary. I think, people assume that because we haven't seen that in 20 years that that's not possible, but I would say, in the 60s, rates were pretty normal low single digits. And in the 80s, inflation was double digits, so.Joe (41:00):So basically, to wrap it all up, you're saying, crypto rates will be clearing inflation, whereas the real economy, likely not so.Sid (41:10):Crypto you can't have that distortive effect of the central bank, where you have people who are lending out at negative real rates, because they're below inflation. I think, in crypto, there is a demanded risk premium. And, it's a more pure form of capitalism, I would say, where people are going to price rates so that they can clear a real positive rate. So I'd say, with supply inflows being limited, I'd say that effect is more exacerbated. So I probably expect to see the spread between crypto and TradFi actually widen over the next 12 months.Joe (41:44):Very cool. Well, we will absolutely hold you to that. And in 12 months, we will verify that you were correct. Sid, this was a great conversation. Thanks so much for sharing your story with Maple. And, if folks want to find you and Maple online, where should they look?Sid (42:01):So you can go to our website, maple.finance. That's where you can find the web app, any news and updates. If you're active on crypto Twitter, you can find Mapl @maplefinance. And you can find me @syrupsid, both one word. If anyone wants to reach out, happy to make contact with them.Joe (42:17):Great stuff. Thanks, Sid. Well, it was an awesome conversation. It was such a great time hosting The Solana Podcast again. My name's Joe McCann. I'll see you guys next time.Sid (42:26):Thanks, Joe.

Noah Prince (Co-Founder/ CEO, Strata Protocol) and Austin Adams (Lead Protocol Dev, Metaplex Studios) sit down with Austin Federa to discuss the integration of Strata's Dynamic Pricing Mint tool into the Metaplex Program Library.00:51 - What is Strata?02:12 - Challenges when launching a token04:43 - Why is Strata more successful than competitors?06:15 - Fundraise and the changing use cases of tokens on Solana08:47 - Changing mentalites around the function of tokens10:48 - How is Metaplex's approach different11:51 - Description of the flow using Strata13:25 - Mechanisms of dynamic pricing15:12 - Tools for dynamic pricing / Collusion19:06 - Metaplex and additional tooling21:54 - Optimizing Metaplex's architecture for the community25:05 - Advantages and drawbacks with metaplex's architecture29:44 - Metaplex and backward compatibility32:39 - Pitch for using dynamic pricing DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Austin Federa (00:10):Welcome to The Solana Podcast. I'm Austin Federa. Today we're talking about a new partnership between Metaplex, the NFT implementation on Solana, and Strata Protocol, a toolkit that helps developers launch tokens. They've built some new tools to help creators set dynamic pricing for NFT mints and these change the economic incentives around NFTs which will hopefully reduce the botting of NFT mints. We're joined by Noah Prince, the co-founder, and CEO of Strata Protocol, and Austin Adams, a software engineer and lead protocol developer at Metaplex. Gentlemen, welcome to the Solana Podcast.Noah Prince (00:42):Thanks, Austin.Austin Adams (00:42):Thanks for having us.Noah Prince (00:43):Glad to be here.Austin Federa (00:44):Great. So let's go ahead and start out today with just an overview of, Noah, what is Strata and what are you guys trying to do in the space?Noah Prince (00:52):So Strata Protocol at its core is a protocol for launching tokens and managing the liquidity around those tokens. So we have a variety of different auction mechanisms, and we can launch tokens anywhere from small tokens that you don't really know who the counterpart of the trade is, there's not going to be much volume, all the way up to large tokens where you want to do a large offering and then eventually put those on a DEX. How we ended up getting into this space is just that our auction mechanisms for tokens also offer a solution for the NFT botting situation. So we thought long and hard about how to keep bots from botting the token launches that we have. And if you launch one of those tokens and then put it as the entry price to a Candy Machine, you get a dynamic pricing Candy Machine.Austin Federa (01:39):So let's talk a little bit just to kind of roll back to what Strata really is trying to accomplish here. You mentioned it's a solution for launching tokens and providing initial liquidity for those tokens. What are the challenges that people run into when actually launching a token? I think if you look across the space, you'd see that there are hundreds of different tokens run by hundreds of different projects across the Solana ecosystem, the majority of which were not launched with something like a launchpad or basically a protocol to help them go through that process. What are the challenges that people are facing when they're actually looking at launching a token?Noah Prince (02:12):Yeah. So I think token launching kind of comes in a few steps, right? The very first step is the ideation phase, where you're trying to figure out what your token is, do you have multiple tokens? What are the tokenomics? And somewhat in that same phase is where legal comes in. And to a lot of degrees, that is the hardest spot is where you're going to figure out what your token does. But a lot of times for people launching a token, there's this kind of big okay, we know what we want to do, but how do we physically create that token? And then how do we go and do things like auction that token off? I want to sell some of that token to investors. I want to sell some of that token to all of my community, how do we actually distribute that thing?Noah Prince (02:54):And then after that, there's the step where you've distributed it, you've collected some money for the token that you can use to bootstrap the project. And then you also want it to be tradable on a DEX or on an AMM. And then you go and set that up. So Strata is really there to help with the creation part of the token and for really small tokens, we also manage the liquidity. So if you don't want to even care about what is an AMM, what is a DEX, who is the counterparty to a trade? We have a way you can launch a token and it's basically one click. The protocol just takes care of all of it for you.Austin Federa (03:30):Yeah. So if you think about maybe a year ago, when someone was trying to launch a token, there was lots of technical components in actually creating and launching that token, but you'd have to go and submit something to the Solana token registry. You'd have to then go ahead and set up a permissionless pool on something like Serum. You'd have to go ahead and try and get it verified to get it actually listed there so it would show up in the list. Someone didn't have to add it as a custom market and all these things are functionally automated through you guys at this point, correct?Noah Prince (03:56):Yep. So for the most part, those things are automated. You still need to go and set it up on a AMM after you bootstrap the liquidity, but yeah, we're basically making it permissionless to go and do this. So the idea was to make it as easy to launch a token on Solana as it is right now to launch an NFT which Metaplex has kind of done a great job of.Austin Federa (04:16):And so there's been a lot of organizations that have tried to create launchpads or create basically systems of easier onboarding on the Solana blockchain. And a number of them haven't really gone anywhere, or they've been sort of overrun with, I would say very low-quality projects that are just trying to find a quick way to launch a token. What's the reason you think that Strata has had a bit more success here and not fallen into some of those traps?Noah Prince (04:43):Well, I think the first big trap there is talking about projects that are obviously disingenuous, they're trying to cash grab. They're not actually a real project. And when you talk about creating something permissionless, you want to get away from that, right? The barrier to entry should be low so that anybody can do it because tech is tech, but we don't want to be the ones that are creating the list of all the different tokens that we think that people should buy, right?Noah Prince (05:12):Equally, Metaplex isn't doing that. Metaplex doesn't go out and tell you which projects to buy. There are plenty of Launchpads that have their own lists that'll tell you who they think you should buy, and there are plenty of Twitter influencers who will tell you that as well. So that's one way that we're doing it. And then the other way that we're doing it is trying to make it easier for these projects that are smaller and maybe don't have all the idea of how to do everything that's complicated with launching a token, they just want a simple token. Things like social tokens are like little community chat projects, making it easier for those.Austin Federa (05:47):Some of the interesting things you guys have done in addition to the ability to create a new token or sell an existing token bootstrap liquidity is this idea of a fundraise and the dynamic pricing of NFT mints. On the fundraising side, what did you see in the changing ways people wanted to use tokens or the changing use cases of tokens on Solana that really led to the idea of a fundraise being something that a launchpad protocol should build tooling for.Noah Prince (06:14):Yeah. Fundraise was inspired deeply by ConstitutionDAO, which if you didn't see it, was this thing where a bunch of people on Eth just banned together, they said they were going to buy a copy of the Constitution of the United States of America. There was an open bidding that happened. I think they raised like $30 or $40 million and ended up getting outbid, but it was still this example of a community coming together and bootstrapping a ton of liquidity to do something cool. And the idea was that there will be shared ownership of the Constitution, or at least this copy of it after the bidding was done.Noah Prince (06:49):And so how you do that mechanically is just, you're collecting money into a pool that somebody then uses for the bid. And then as you're collecting money, people are getting a token that represents their share of that pool. And so even after you've used the money, they still have the token. And so with the ConstitutionDAO you had the people token. And that's just one of many ways to launch a token and why a launchpad is formatted like a wizard because we want it to be like a no-code tool where it asks you the questions that you need to answer to get towards launching your own token.Austin Federa (07:20):It's super interesting to think about the implications for some of the stuff for the intersection of real-world assets like something like a constitution and then the intersection of the ability to have full liquidity through something like a token mechanism for this. So I think that's a very interesting use case for it. And one of the great things I think about ConstitutionDAO when we saw that all happen is it's still going, right? There's still a community there. It's still passionate about this thing that they failed to create, but now is turned into something else which is in a large part, a lot of the story of NFTs on Solana as well, is that they start with one mission and suddenly something changes and Trash Pandas are now fighting plastic in the oceans, and all these other projects are building real community service kind of components into them.Austin Federa (08:05):When you're looking at the idea of a no-code solution here, what was the reasoning for something like that for more complex protocols? I guess the thing that I'm trying to tease out here is there's an assumption from a lot of folks that if someone's not sophisticated enough to figure out how to launch a token, they're probably not sophisticated enough to launch a project on a blockchain. That's obviously not necessarily the case, but that is part of why you've seen launchpads in general, or less code solutions be something that tends to have a lower quality project coming out of it in general. How do you respond to some of that criticism or look at the different ways that we just need to change our mentality around what a token's meant to be used for?Noah Prince (08:47):Yeah, I think there is that tendency, but as a dev, it's all about tools, right? For me, it's how can I get something done with the least effort possible that meets all the requirements. And so when you give tools to devs so that they can launch a token really easily, the devs can spend time focusing on the things that matter and not the things that don't. So part of it is that but also you need this primitive and you need this primitive to be easy because we're in the infancy of tokens right now, right? There's just one token. We're starting to see more complex systems like STEPN pop up where you have systems of tokens where that's just two tokens, all the way up to things like WOMBO, and BitClout, and Rally, where you have hundreds and hundreds of social tokens. And these things all start to interconnect together, and you can start to do really cool things when you can create systems of tokens. And that's something that you couldn't do in the past without this kind of primitive.Austin Federa (09:43):Yeah, it's fascinating. So, Austin, let's talk a little bit about the interface here with Metaplex NFT initial mints. So one of the things that we've observed over the last few months is that the increasing demand for NFT is on Solana. And also I would say real success of projects in building a strong community pre-launch has created situations where there is both a high incentive to bot the launch of an NFT, but also there's just extremely high demand for these things when they're coming up for initial mint. Some of that's driven by expectations that they might be able to flip them, but a lot of this is just organic community demand for a project that they feel very excited and interested in.Austin Federa (10:22):There's been a few attempts to create systems that would either increase the fairness or would try and reduce the incentives for botting. One of these was the Fair Launch Protocol which was created as sort of an extension of the Candy Machine toolkit, but Fair Launch Protocol never really caught on from a community standpoint. So what is sort of different in the approach here that you think is going to be successful in creating better incentives and dynamics?Austin Adams (10:48):I think the reason that this will be more successful is we will market it a lot harder than we marketed Fair Launch, but also the mechanics of Fair Launch weren't really, and they could have been changed they weren't really a great experience having to wait and then not knowing if you were going to get things. The NFT minter, once that sort of casino-style experience, they pull the lever, they get the thing they know right away, they're having fun, it's addicting. With the dynamic price mint coming in we get that addicting and fun feeling while still getting some technical protection against bots and making it a little bit more advantageous for creators. If they've created demand, they're getting rewarded for that demand.Austin Federa (11:38):Yeah. That's super interesting. So let's walk through, I guess, from both of you, what is the flow that both a creator and a user goes through if the project that they're trying to mint is using this new dynamic pricing powered with Strata?Noah Prince (11:52):Yeah. So the flow right now is a little bit broken up and that's kind of the point of this partnership, but right now you launch a normal Candy Machine through Metaplex, you grab the ID of that Candy Machine, and then Strata has a UI where you can plug in that ID and it converts it to a dynamic pricing Candy Machine. Now from a user standpoint, this looks pretty much exactly like the usual mint interface that you're looking, they're used to, right?Noah Prince (12:18):You just click a mint button, but the price is changing. So the price is just slowly ticking down and occasionally it bumps up when somebody purchases something and you can also switch tabs and you can go look at a price history plot. But as a user, you're trying to figure out at what point do you want to enter, right? At what price do you want to pay? And bots are playing the same game which is an unsolvable game. When do you enter a live market is a question that nobody knows the answer to. So it feels very much like a normal mint it's just that the price is moving and it's a game of who flinches first.Austin Adams (12:53):That's the current experience but as I'm sure you'll get to, we hope to create a deeper integration together that can utilize Strata's tech and Metaplex's tech for the entire experience without needing to go from one place to the other but using our new UIs and CLI tools, they can create a dynamic price Candy Machine that also gives us even more bot protections than we had before without having to go from one website to another.Austin Federa (13:25):So what is the dynamic pricing set based on? What are the mechanics that go into actually setting what that amount should be and how much volatility do you expect to see throughout the course of a typical 10,000 mint that might sell out in the course of several minutes?Noah Prince (13:43):Yeah. So generally, you want to establish what is basically the order of magnitude of the price. So something that's going to be in the 0.01 SOL range versus something that's going to be in the 10 SOL range, they're pretty different and it would be hard for any system to account for that. So generally what you're doing is you're setting kind of a range that you expect. So in the case of Divine Dogs, they were one of the very first ones that we did this with, they were minting an NFT that they thought would probably sell for two SOL. Now they're associated with the gods. And so 3.33 is a magic number for them. And so they actually set the starting price at 3.33 SOL and the minimum price at 1.1 SOL.Noah Prince (14:24):And so the idea was the minimum that they were willing to take as a project to get the funding to do what they needed to do was 1.1 SOL and they thought that people would pay up to 3.3 but probably not much more. And so what happened with that was I think the average price ended up being 2.32. But generally, you want the prices start slightly higher than what you think people will enter at so that bots don't have an advantage to spamming, they're just waiting for it to fall down and then it'll hit some fair price and it just oscillates around the fair price.Austin Federa (14:57):You mentioned a few things there where it sounds like projects have to do a bit of estimation around what they expect to see. What are the either software or just like human tools that someone should be looking at when they're trying to figure out where do they start with dynamic pricing?Noah Prince (15:13):Yeah. I mean, I think to a lot of degrees this is similar to right now people are just deciding a fixed price for their mint which is even more dangerous. You have no idea if it's going to sell out for that fixed-price or not. If you're a really hyped project, it probably will as long as you set it less than 10 SOL. But there's also a stigma, right? SolBears came out and set it to 10 SOL and people got pretty mad about it. So I think for most projects, this range of I mean, it depends what SOL's current prices, but right? This range of 1 to 5 SOL is generally reasonable. If you get really far off on the price, it can go above the starting price but we haven't seen that happen in practice. Usually, projects have a pretty good idea of what they're going to sell for or at least like a ballpark. They don't know exactly but they know a range.Austin Federa (16:05):Yeah, just because this was one of the first prominent uses of the Fair Launch Protocol where the community of degenerate Trash Panda Minters banded together and actually crashed the price. They all basically colluded against the project owners to mint at 0.1 SOL when the pre-mint tokens had been trading at 3 or 4 SOL on the exchanges and obviously, the price has gone up from there, but it's a very interesting dynamic when you give the community the tools to set their own pricing, you do open yourself up to a certain amount of collusion which I think is fascinating. No one would've thought that in a free market open system you'd be able to get a bunch of degens who are trying to optimize for the most value they can create to all band together and try and basically drive down the mint price of an NFT.Noah Prince (16:52):They also got to change their vote in the second half which made it a little less risky to bid small.Austin Federa (16:57):Yes. That's true. So that sort of one-tiered system is part of the dynamics here that you think make it more robust to get something like that.Noah Prince (17:06):Oh yeah. I mean, so we've done a couple of mints with it now and every single time in the Discords I actually hope that someone proves me wrong because it would be kind of interesting from a psychology perspective. But usually, there's a band of people in the Discord that are like, "Nobody buy. Nobody buy. We're going to let the price fall really low, like the bid small." But because it's so real-time, what ends up happening is it hits a number that's really, really good and it's just like a prisoner's dilemma. A few people defect and then everybody sees that a few people defect and all of a sudden the faction that was trying to hold back and not buy everyone starts buying and the price starts ripping because it's the lowest price that they're going to see.Austin Federa (17:47):Yep. Totally. It's really interesting the way those dynamics play out.Noah Prince (17:51):Yeah. Honestly, if your project gets hit by this and the people actually manage to do a prisoner's dilemma experiment where nobody defects, you have an amazing community, I don't even know that you need the money. Your community is incredible.Austin Federa (18:04):Yeah. It's worth noting that for the more successful projects out there, they have made many multiples of the initial mint revenue on secondary sale royalties. So it's kind of this interesting dynamic where you really want to bring the strongest community possible into an NFT project but the same time you need to fund appropriately for whatever your medium-term goals are to make sure you can actually deliver on any roadmap you've sort of laid out as a project which is really interesting. So when we're looking at some of the underlying architecture here and how it interfaces with Metaplex, I know there's a whole bunch of work on Metaplex that's been rebuilding a lot of the way that some of these contracts work. There's a whole expansion of what's possible on Metaplex coming soon. Austin, how are you thinking about additional tooling like Strata and other types of partnerships that will make it easier for a lot of this work that's being done to actually be deployed and usable? So the difference between reference implementation engineering and actually production engineering.Austin Adams (19:06):I think on a case-by-case basis, we always look at where we can stay generic and composable meaning one contract calls into the Metaplex contracts and the Metaplex contracts stay as this secure core that we audit very frequently and we're taking care of all that nonsense for the community. But in other cases, we identify a piece of technology that's really good and the composable way of doing it doesn't give us the guarantees necessarily that we want. And so we look at a deeper level of integration. The recent gains in shipping velocity that Metaplex is getting are coming more from CICD and looking at ways to improve our software stability so we are not scared to ship.Austin Adams (20:00):And I think that's what Metaplex is moving into as we're stabilizing and as we're trying to remain the base infrastructure for NFTs as well as move into some exciting new landscapes. So with this specifically, we do have some big changes coming to canning machines soon. We have some big changes coming to optional changes for everyone coming soon, but this one here falls right in line with our anti-botting work. And so we're heavily invested in making this as deep of a integration as it needs to be and shipping it as soon as possible, as well as shipping it not just in the contract level, but shipping it in our UIs and CLIs that are coming out or are out.Austin Federa (20:44):Yeah. Interesting. So I'd actually love to dig in a little bit more on how you're thinking about multiple layers of contracts or interoperable contracts that all can, I guess, give optionality in terms of how someone wants to deploy something. What are those different components and how are you thinking about... So classically, every time you have a contract talk to another contract, you've created an attack vector. This is most of the hacks that you see across DeFi and on Solana and on other places in Solana are non-validated fields. There's some ability for someone to inject something into the contract at a point that someone thought wasn't injectable that ends up creating an outcome that's not desirable for the users of that protocol or that contract.Austin Federa (21:28):That's like a very standard attack vector. So not to go too far into the security of this because of course that's maybe a separate conversation, but when you're thinking about that sort of multiple contract architecture, talking back to one central contract, what are the types of things you are thinking about or the Metaplex protocol is really thinking about from an architecture standpoint to make that secure, stable, but also upgradeable and able to respond to the needs of the community quickly?Austin Adams (21:53):Yeah, that's a great question. So I do believe it does depend on what the contract does in a large part, but generically, when we think about Web 2.0 land, when we've all created public APIs that take in user input, we can think about those as if they're analogous to we're allowing someone to direct their digital plumbing pipe at our digital plumbing pipe to use the euphemism or the saying that we're just all digital plumbers. I think I like that. One of the ways that we approach this is just being extremely careful on validating the input and being very restrictive with what specific instructions and what specific things a transaction can do when calling into our contracts.Austin Adams (22:47):So for example, with Candy Machine, although it is not as composable as other programs may be, we restrict the specific programs that can call out to Candy Machine and we restrict what they can do. We look at the instruction data using the instructions this far. For those who are non-technical that just means we can inside of the instruction or inside of the program, we can look at the instructions that are coming in and we can validate the input that's coming in. But for other programs such as AuctionHouse, we actually have purpose-built it to be composed over. And the way that we handle that is by bringing all the things that we want to make sure always stay secure into the contract.Austin Adams (23:33):So the token account creation, the mint creation, for example, the transfers, all of those are in the core AuctionHouse transaction protocol, but we've created this other system of composability called Auctioneer where people can put their additional logic such as token gating, timed auctions, even dynamic priced auctions via Strata can be done at that layer. So like I've said in summary, it does depend on the contract for Candy Machine because it's such a target for bots. We are very restrictive but we hope to find additional ways to loosen those things to allow more contracts to compose over it while still getting more bot, anti-botting guarantees.Austin Federa (24:20):It's kind of an interesting question here. When you think about on most layer ones or layer twos, the implementation of an NFT is something that's sort of done, I guess you called it the L1 or L2 level at the protocol level, as opposed to at the application level. Metaplex is a little bit different in its architecture, right? The tokens that are built are fundamentally still SPL-compatible tokens. And they're built more like an application level. And by application, I mean, it's not hard coded into the base Solana code. It's actually running on top of it which is a little bit different of an architecture than you see on something like Ethereum. What are the both advantages and challenges that both of you have run into because of that difference in architecture?Noah Prince (25:05):Yeah. So I did a deep dive at one point on composability on Solana versus Eth. Fundamentally, the NFTs on Eth and even the tokens that are on Eth are just following an interface. So it looks a lot like interfaced extension. I'm going to get real deep in engineering if I don't be careful here.Austin Federa (25:23):No, no, no, let's do it. This is the back half of the podcast.Noah Prince (25:26):Cool. Okay. Yeah. So it looks a lot like interfaced extension and classical object-oriented programming. So you think Java is the big example of object-oriented programming. Now Solana actually ends up looking a lot more like functional programming where you've got these contract endpoints that are effectively functions that operate over some state and then output a state. And then the next function can take that state and do something with it. Now, a lot of people will tell you when they're learning functional programming coming from object-oriented programming, it's scarier at first. It's like chewing glass. It's a little bit more complicated, but there's a lot more that you can do with it. And so like my example of composability actually is the current state of the integration with Metaplex where you talk about how there are different security vulnerabilities with checks, but a token is the absolute interface between us and Metaplex and that's the only interface.Noah Prince (26:26):The single check is whether or not you have the token that allows you to mint this Candy Machine and we just output that token. So we are a function that takes in some SOL and outputs a token. They are a function that takes in a token and outputs an NFT. And actually, they don't have to know about each other at all. It's only the user interface that knows about it. So this is how we generally deal with composability on Solana and why I like this model a little bit better, but I am a little bit of a functional programming maxi, so …Austin Federa (26:57):Austin, what about you?Austin Adams (26:59):Yes. I believe that the Metaplex model for NFTs is actually quite brilliant. And I'll talk about the pros first and maybe the cons second. I believe one of the reasons for our enormous growth is because our contracts are like APIs. You don't need to deploy your own contract. You don't need to manage that. You don't need to have everything that can be known about your implementation done ahead of time and then deploy an immutable contract. You can iterate and fail and try again and do new things on top of our programs without having to, one, manage the security of the program. Two, without having to really be an expert. And I know that you don't have to be an expert to launch an Ethereum NFT series because there's some great tools. But I think that's one of the reasons people choose Solana. Devs choose Solana, creators choose Solana to run their NFT projects is because the Metaplex contracts were brilliantly designed as APIs whereas they could have been designed in an interface model.Austin Adams (28:07):Now the cons of that are the Metaplex development team now needs to look at backward compatibility every single day. Any change that we make we have to micromanage that aspect all the time because we don't want to break anybody's use of the system. And through our DAO we need to ensure that what we're doing is reflective of what the community wants. So another con would be that some people see it as less decentralized, but in reality, because it's a community project, it doesn't seem so decentralized when you can build right on top of it and do whatever you need to because we try to keep the protocol light and do less things. I see that we can move into both areas. We can produce an interface-like system while getting these contracts as API feel. And I think that's some of the backbone of some things that you'll see coming out of Metaplex soon.Austin Federa (29:07):So when you think about something like backwards compatibility, what does Metaplex see as its sort of role and responsibility there, right? So famously for a number of years, Android had like seven different versions of the Android API that Google had to support because folks just would not update their apps. And Windows still has backwards compatibility with stuff that was probably about when most of us were born. What are you guys thinking about when you look at that sort of backwards compatibility and how long or what kind of functionality needs to persist for X amount of time?Austin Adams (29:44):So what we try to do is never break you unless it's security-related. If it's security-related, we fix it as soon as we can and we announce as quickly and as widely as we can. That hasn't happened very often and currently, we think that... We kind of take the semantic versioning approach where we will give you a long amount of time. Now we don't have a rigorous set amount of time yet. We're very new as a project if you think about it, but we will always provide you a new instruction and deprecate the old instruction and it works perfectly fine for a long time. And it's very rare. In fact, it's only happened once where we will remove old instructions. Part of that is looking at our contracts as APIs. And when you look at microservice patterns because that's how we think about them kind of is our contracts are microservices.Austin Adams (30:43):Look at the traffic of your instruction. If you're seeing it the traffic go down, people have moved to the other one, you're in safe territory to start announcing that, "Hey, we're going to start moving on from this specific instruction." But if you see it holding steady, that's a good signal from your community that that thing still needs to live or you need to educate and do more work. And that's how we'd like to see it. I think in the future, we'll see probably more rigorous guidelines around how long we're going to keep things out. But right now it's we'd be nothing without the people using it. So they're our top priority when we're shipping new things, we don't want to break anyone.Noah Prince (31:22):Yeah. I think at least how we've been approaching it with Strata is that I am very, very bearish on the idea that I'm never going to have to change anything. And so actually every one of our smart contract endpoints, every one of our arguments, every one of our piece of state has a V0 next to it. Some of them actually have a V1 already. And then in SDK land, so like in JavaScript, we wrap these calls with things that don't include V0 and we wrap them in interfaces such that if we ever have to change anything, we just bump it to V1 at the protocol level, change the interfaces, leave the V0 endpoints around for a while and then like Austin said, watch the traffic and then slowly deprecate them. But yeah, I mean, I think you kind of have to accept that these things are living, breathing things and like most APIs, you just have to version them. Now, a lot of people who don't have V0 next to their things, don't worry, you can put V1 next to anything.Austin Adams (32:19):It's okay.Noah Prince (32:19):And V0 is just the lack of a tag. It's okay.Austin Federa (32:22):So all of this depends of course, on creators and people launching NFT projects actually adopting and using the dynamic pricing tools. What's your pitch for why someone who's launching an NFT project should do it this way as opposed to doing it the way that's currently done.Noah Prince (32:37):Yeah. So one of the big things, I mean, even if you watch Frank, he is talking all the time about how he wants people who are long-term his project. He doesn't want paper hands. He doesn't want flippers, right? So right off the gate, you've got to acknowledge that having people that are just buying the project to flip it immediately aren't really good for your project long term anyway. I mean, if you were going to overprice your fixed price mint, you just weren't going to sell out. And so this will help you sell out which is ideally what you want, right?Noah Prince (33:09):Because you're picking the quantity of the mint so that you have a certain size of community. Now, if you had underpriced your fixed price meant, this actually means that you're going to get more funding to do what you want to do, right? And that's what matters is that you can actually execute on your roadmap. Now it's not like that price discovery isn't happening, right? It is still happening. If you price your mint at 2 SOL and the NFT is actually worth 10 SOL, it just drives up to 10 SOL on the secondary. But you know who makes that money? People who are flipping it and don't care about the project. So I would rather have that money go to the team than people who are flipping it any day of the week.Austin Federa (33:49):I'd love to hear from the Metaplex side what the pitch is to use it that isn't just it doesn't break the network.Austin Adams (33:55):Then I get nothing.Austin Federa (33:56):Because this is the thing is like one of the things about crypto is we have to assume everyone is a evil self-interested actor at all times who cares primarily about what they're trying to accomplish from a financial standpoint and isn't a altruistic actor trying to make the world's best-decentralized computing environment possible or else all of the assumptions of how blockchain works start to break down. So I think that's one of those questions that if either of you have something addressing that sort of side of things and-Austin Adams (34:25):Yeah, totally. I'll go with Metaplex's side of why I use dynamic price mint. So from the Metaplex side, we realize that Candy Machine has been botted so badly and we want to increase fairness for the collectors, creators, and the community. Just like Noah said earlier, we want to incentivize long-term holders, people to be a part of the project because NFTs are showing us they're more about community than they are really like a financial mechanism. They are a financial mechanism, but they've exposed this incredible new, psychological phenomenon.Austin Adams (35:01):For collectors, we've seen click farms, and bots, and extensions, not even if it hurts the network, but just hurting the experience. So one way that dynamic price mint helps is by making these click farms and botters, I mean, have to think twice, have to actually do some calculation, and have to do it in a fast and real-time manner. So this helps them be able to take part in the project even if they didn't get into the discords or other things like that at the right time, it's also going to help us move past this whole allow list trend in the community where you have to do all these specific things to get a spot and then you get a spot and you get a chance to mint, but then you don't actually get to mint. And so, hopefully, this makes the work that's required just being a part of the community and having the desire and the funds to mint.Noah Prince (36:01):Well said.Austin Federa (36:01):Awesome. Well, I think that does it for today. Thank you both for joining us to talk about this new launch of a Stratus support for dynamic pricing on Metaplex and creating new tools for creators to be able to actually implement this. If folks want to read more about it or want to consider using this for their next drop, where should they go to find more information?Noah Prince (36:22):Yeah. So for now it's actually, if you go to app.strataprotocol.com and you have a Candy Machine ID, you can launch one directly right there. We also have on docs.strataprotocol.com. We have extensive documentation on how to set up one of these dynamic pricing mints and a YouTube video on how to do one and even do one with a white list. In the future, we hope that this is directly on Metaplex's documentation and kind of more built as a first-class citizen into the Candy Machine and Metaplex's new UIs such that you don't need to be bouncing around from Strata to Metaplex. It's just there for you.Austin Adams (36:59):Yeah. 100% stay tuned on the Metaplex Docs and on our blog, Twitter, radio station. Oh wait, we don't have a radio station.Noah Prince (37:08):Yet.Austin Adams (37:09):Yet.Austin Federa (37:09):Great. Well, thank you both for joining us today.Austin Adams (37:13):Thank you, Austin.Noah Prince (37:14):Thanks for having us.

Brett Harrison is the President of FTX US, a US-regulated cryptocurrency exchange. Prior to joining FTX US, Brett was Head of Semi-Systematic Technology at Citadel Securities, where he managed technology for the firm’s Options, ETF, OTC, and ADR trading globally. He began and spent the majority of his career at Jane Street, where he led the firm’s algorithmic trading system development. 00:34 - The role of FTX.US’ president01:24 - About FTX02:55 - Nontraditional brand marketing08:05 -  Educating people about Crypto10:46 - Being at the forefront of regulation14:52 - Collaborating with other players in crypto19:03 - FTX's policy in exchange and crypto23:19 - FTX and NFTs26:44 - CeFi / DeFi exchange and Cross-chains31:36 - Building interconnectivity between centralized crypto exchanges34:59 - Market hours in crypto?36:33 - Process of evaluating a token38:44 - Things he is hopeful for DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Austin (00:10):I'm Austin Federa. Welcome to the Solana podcast. Today, we have Brett Harrison joining us, who's the president of FTX.US. We got a bunch to talk about today, including the role of FTX in the markets, his sort of path there, and a bunch of what's been going on recently in crypto. So, Brett, thanks for joining us.Brett (00:27):Yeah. Thanks for having me on, Austin.Austin (00:29):I wanted to kick it off. What does the president of FTX.US actually do on a daily basis?Brett (00:34):Yeah, for sure. A good question. So yeah, I joined FTX.US exactly one year ago. Little bit of background first. So FTX is obviously the global cryptocurrency derivatives exchange. It's the second or third largest in the world. Around a year and a half ago, FTX.US, a separate company affiliated with FTX, was started for the purpose of creating a US regulated set of businesses to be able to do things like offer a spot cryptocurrency in the US, but also to satisfy some of our broader ambitions to enable other kinds of investment products for US customers such as US crypto derivatives, stocks, and things like that. My role is to sort of help run the ship over here, hire the team, and put people in the right offices, but also like do everything from think about regulatory strategy and policy to some actual software development in architecture and on some of our products. So it's sort of a little bit of everything.Austin (01:25):Yeah. It's kind of an interesting role. How big is the FTX.US operations at this point?Brett (01:30):We're around 80 people right now.Austin (01:33):That's pretty sizable for one year.Brett (01:35):Yeah, for us at least.Austin (01:36):Yes.Brett (01:37):For sure.Austin (01:38):You're at the top of a pretty interesting organization nowadays. When you joined, the pace of excitement and interest in crypto from a mainstream audience was far lower. The presence of FTX was far lower than it is now. There's many people who are familiar with crypto, who have been for both FTX for a very long time, as both the FTX international and FTX.US as two different entities that play an important role in pushing the concept of a centralized exchange further. Before you guys came on the scene, the role of a centralized exchange was maybe not quite as professionalized as it is now. There's sort of more of a lot of respect in the market for the speed that FTX is able to execute on and both sort of the pace of innovation that's come out of that.Austin (02:23):But at the same time, in the United States specifically, which is where we're talking about today, you guys have done a huge amount of what I would call very traditional marketing usually reserved for banks, and telecommunication companies, and these sort of like old Titans of industry in the United States. But this is a very new operation. Walk me through a little bit about that process of saying not only do we see a target opportunity here, but we're not going to take the path of most other companies, and run a ton of digital ads, and put up select billboards. But we're going to put our name on AAA, IP, and media.Brett (02:55):It's incredible to see where we are now compared to a year ago, two years ago, and FTX.US were fairly obscure in the United States. Not so much overseas where FTX had already really gained a name for itself as this leading cryptocurrency derivatives exchange. And it was really competing with the other top exchanges around the world that have been trading these derivatives products traditionally. But in the US, we had just started. We're up against 10 year incumbents in the space and very few people ever heard of FTX. And now we're on Super Bowl commercials. We are the subject of congressional hearings. It's like quite amazing to sort of see the way that we've sort of infiltrated the crypto ecosystem in the United States, in a way that's really established our presence as a brand that people trust, as one that feels innovative and fast moving.Brett (03:47):So I think just taking it back a bit. So we wanted to be able to get into the US market, and the US has one of the largest retail user bases in the world, maybe the largest retail user base in the world. So the number of people who are traditionally using their phone to trade stocks, for example, for themselves, is just much higher percentage in the United States than almost anywhere else. And so you have this broad class of people now getting interested in crypto, who want to be able to have access to that as a means of investment. But if you think about where crypto has been for the last decade, there's been a lot of ups and downs and noise. You have exchanges that lose customer funds, or they go down, or they get hacked, or they like suddenly become slow.Brett (04:31):And if people are going to invest in this still fairly risky, volatile, asset class, where there's a lot to learn for people, it's a very high learning curve. They're going to want some brand that they feel they're comfortable taking that leap, and putting their money in, and investing with. And so in the beginning, it was very difficult to acquire customers for us. And then Sam had this idea of, what's the largest thing that we could do, as fast as possible, and reach tens of millions of people. And it's not go out and buy Facebook ads. And the conventional wisdom here for us was, "Okay, when's the last time you saw an ad on Facebook for like Citibank or JP Morgan, and you are like a Bank of America customer? And then you said, you know what, I love this Facebook ad. It's time to move all my money from my checking account to this other one." I think it doesn't usually happen. I think it's a pretty high activation cost for doing something like that. It's not like giving some new website a try.Brett (05:28):Just plain and simply this is like a serious investment decision. And so we really needed to build that trust for people, and do it quickly, and in a way that really established ourselves as a unique player. And so the biggest thing someone could think of was, well, what if we put our name on a stadium. And it seemed crazy at the time, but then we did it and we put our name on the Miami Heat stadium, the FTX Arena. It was an amazing deal, the right place at the right time, because we got to also work with Miami Dade County on many of their anti-gun violence initiatives. So it was a really good fit. And short time after that, we did two other big deals. One was with Tom Brady and the other one was with the Major League Baseball.Brett (06:04):And for those, first of all, Tom Brady being this universally loved and respected individual for just his incredible talent and drive. And then for Major League Baseball for being this time modern institution. I think it, the signal to people was imagine what it took, what kind of due diligence was required for an institution like Major League Baseball to come trust FTX, crypto exchange no one's ever heard of. And let alone do anything in crypto. That's how I think we were able to sort of catapult ourselves into the US market very quickly was through this somewhat non-traditional way of doing this brand marketing. And since then, it's been amazing. I mean, we went from 10,000 customers at the beginning of 2021 to like 1.2 million customers at the end of 2021. So a huge growth in a very short period of time, on the eve of some of our new product offerings that we're launching. So pretty excited about the growth so far.Austin (06:56):What's very interesting for me on this, apart from just the growth of FTX.US in general, is this is against the grain for, I would say, the last 20 years of marketing. Which is that you really want to focus on identifying your core demographic, activating that core demographic, using them as voices and ambassadors. And this is the way that most crypto exchanges, and honestly, most cryptocurrencies have gone about growth as well. They've said let's put a bunch of resources into the very narrow domain things that are working, and then it will be an organic growth kind of coming out of that.Austin (07:32):And you normally see something like branding rights for an arena or a major partnership with MLB or some, or any sports team, something along those lines as being something that a company that isn't trying to educate customers, but is just looking for general awareness, goes through. Right? Staples Center, UBS, all the big banks have their names on these places. Not because they're trying to differentiate Bank of America's products versus Chase's products, but because they want general awareness. What was that process like to say, "Okay, we've got a stadium, but no one knows what crypto is still." What's that part two of that strategy?Brett (08:09):Yeah. I think we had to rewrite the playbook there. Because we don't yet know what the right demographic is for crypto, but also we don't want to pre-select a demographic. I mean, the whole spirit of crypto is to enable people to have access to investment opportunities, wealth creation, control over your personal finances in ways that have typically been difficult for many parts of the country. And if we just sort of start by saying, okay, well, who is the most obvious demographic to target for this? And let's just run Facebook ads that target them. I think it sort of misses the point. We're here to educate people, as you said, about not just the investment class, but also the promises of the technology itself. The fact that this will represent a new way of building internet based applications, in ways that allow people to share in the upside of those applications. It's going to enable for greater robustness and stability by using decentralized technology.Brett (09:11):I think these are all things that it's going to be difficult to teach people over time, but we have to start somewhere. And that starts with a general awareness. And it starts with trust, right? People have to understand that we are a very legitimate company. We are highly regulated, contrary to popular belief. We have, between FTX and FTX.US, we have something like a hundred different regulators. We have 50 different licenses. We need to be able to break through the noise and convey that to people. And that's why we started more on this general awareness. And now we're doing some of the other stuff. Like we're starting now to run some Google ads. We're starting to go for iOS App Store placements and traditional SEO. And we're doing that now that we have the product that we like and we're happy with where it is, although we're always trying to improve it. And we've built that general awareness and trust.Austin (09:58):Yeah. So, so you mentioned that you are both in a highly regulated industry and yourselves, highly regulated, by various regulators who look at the industry. FTX has, over the last year, put itself at the forefront of regulation in crypto in the US. You and Chainalysis are right up there together, testifying in front of Congress, and also putting out this FTX policy proposal that came out, was that six months ago or so, as well. What was the decision making process like internally to say, this is something that not only do we want to engage with, but to actually make a decision to be a face of. There are many exchanges that operate in the US. None of them have necessarily taken that as the mantle, as proactively, we are going to put ourself in this position. I'm sure that was both risky, and you saw a lot of opportunity in that process.Brett (10:50):Yeah, absolutely. So there's the part that's specific to FTX and the part that's general. Starting with the part that's specific, we would like to be able to offer an array of different products and services in the US. Some of those has to do with spot cryptocurrencies. Regulation in the US for spot cryptocurrencies are not well defined. And that is because of the two market regulators that exist in the US, and the US is one of the few countries in the world that actually has two separate market regulators not one, the SEC and the CFTC, the lines of jurisdiction over digital spot assets are not very well drawn. That's not true for traditional securities like Apple and Tesla and US government bonds, which is regulated by the SEC. And it's not true for the CFTC, which regulates commodity futures, and other sort of broad based index futures, and sometimes security futures as well in conjunction with the SEC. But for actual things like Bitcoin to USD spot markets, it's not clear.Brett (11:47):And what we want to do is help shape that regulation, such that we can safely innovate and offer products that also protect consumers. And in terms of how we influence regulation, do so in a way that doesn't push all of the intellectual property and all that innovation overseas. I mean, you guys know this too, that so much of the intellectual property, the founders, the CEOs, the developers come from the United States. And then ultimately move themselves to somewhere outside the United States because they don't feel like they have a safe place to be able to build their business and to be an entrepreneur. We really want to help that. So I think that kind of actually combines both sort of specific and general of what I wanted to say.Brett (12:26):Which is that on the specific front, we want to be able to offer all the spot tokens that we think are appropriate. We want to be able to list CFTC regulated margin derivative products in the US for US customers. We want to maybe eventually do more innovative, ambitious things like create tokenized stocks or tokenized treasuries. But then, at the same time, we want to make sure the playing field is great for all crypto participants in the US. And they really want to stay here and work here and build here, because we just think that's going to be good for the country. Now what's been interesting for us in this journey of being this sort of public face of regulation and policy, is that what we found is the most effective thing that we can do as a company is just showing up in person. You'd be surprised how many companies, and this is not just crypto, send these large teams of lobbyists and lawyers to Washington hoping to sort of engage in policy discussions.Brett (13:17):And I'm not in the room for those, but I imagine some of those come off as disingenuous. Or there are cases where you can't really get in the weeds of a conversation because the right stakeholders aren't in the room. The fact that Sam and Zach and Ryan and Mark and I just sort of like go to Washington, and email the Fed or the Treasury or members of the House or the Senate or the executive branch, and just show up and talk to them. And say like, "We don't have an agenda. We're just here to answer questions. We know we're in the education phase." Same thing with regulators. We talk with the CFTC, SEC, FINRA. It is just great to show up in person and show that we are open honest people who really want to engage in dialogue. It's been so useful for everyone involved. And I think that's really helped shift the narrative of crypto being like anti-regulatory or anti-government in some way. And that's been really helpful.Austin (14:09):Do you see this as something that you're primarily, obviously there's a lot of upside for FTX in getting greater clarity around regulations and having a legal framework that it can operate in with more definition around it. At the same time you look across at other industries, the credit card industry, the banking industry, agriculture, et cetera. They have very well defined and powerful industry groups at this point. And you often see like a lot of the big banks in the US moving in lockstep with one another. How closely does FTX work with other large exchanges in the United States or other people in the crypto space? And if that's not really as mature as it is in other industries, why do you think that is right now?Brett (14:54):Yeah. Great question. We do to some extent. We do more now than we did before. It's almost certainly not enough. And partly it's because this industry is very new, and it's not super well defined exactly what we need, and there's differing opinions of how we get there. I also think that crypto has done itself a bit of a disservice in the past by being somewhat hostile to regulatory involvement. And you see this a lot on Twitter. And I think it's not super productive. We want to be able to create a market environment that allows for all participants to participate in a way that it safeguards them. And to just completely throw away a hundred years of regulatory development to think that we can just sort of do the whole thing better from scratch, with no protections, is almost certainly not right.Brett (15:44):At the same time, I'm very sympathetic to the idea that you could, through the act of regulatory requirements, end up excluding individuals for not good reasons. For example, there's a lot of people who criticize KYC by saying there might be disenfranchised people who don't have good drivers licenses. And so therefore they can't KYC with an exchange. And so you're actually excluding a certain segment of the population by doing so. And I think we are receptive to those arguments. And so we would like to be able to push the envelope forward with crypto and allow the greatest number of people to participate without prejudice. But we have to engage collaboratively and cooperatively with regulators to do so.Brett (16:27):And so we are now starting to talk a lot more with the other competitors in the space about what are our shared goals for regulation? What do we think about who should be regulating us? What do we think policies would look like in the areas of spot tokens, of stable coins, of listing procedures, of licensing for exchanges. And I think that we're making progress there. Because the thing we've heard all the time in Washington is, okay this proposal of yours sounds great, but it can't be just the FTX proposal. Washington's not in the business of picking winners and losers in industry. We want to see you guys come together as an industry. And so that's, it's going to be critical for us going forward. And it's not just the exchanges. I mean, it's the protocol tokens, it's the stable coin providers, the infrastructure providers, miners. Sort of all across the board, I think we just need to come together more as an industry.Austin (17:19):Yeah. It's one of those things where you look at the Web 2.0 industry, and I think it's probably pretty obvious that they say at this point that their unwillingness to come together around issues of establishing common frameworks for content moderation, common frameworks for when a user should be banned from a platform, those sorts of things have really opened them up to a lot of attacks from Washington about... You see these hearings in the Senate all the time when they're talking one company, why your policy different from another company? And then there's a void there, where the regulators and Congress aren't really sure how to write a law, but they have a lot of ideas about what could be changed. Given the decentralized nature of crypto, there's one level where it's like, there are these centralized companies like FTX, like Coinbase, like Kraken, like Chainalysis that are on one side of things.Austin (18:10):But then there's organizations like Solana Labs or the Solana Foundation, which have a very different role and place in the market. And don't always necessarily have the same incentive alignment in those sort of areas. One of the beautiful things about FTX is, or any exchange, is that it's a entity which makes money on the aggregate state of cryptocurrency. And so the specific whims of one network is not necessarily of huge concern to it. For example, the shutting out of a certain type of user, based on a KYC requirement, is much less of a burden in the United States or for something like an exchange, then it might be for... Like if you have to KYC every user, that's not a problem. If Audius has to KYC every user, that actually puts them at a significant disadvantage compared to a competitor like a Spotify. How do you think about both the role of the policy work FTX does within the exchange industry and the wider crypto industry in general?Brett (19:07):It's interesting to think about where we need to head as an industry together. I think a lot about the role of CeFi and DeFi and how they interplay. I think there's a lot of people online who sort of draw this very bright line between them. And it's like, if you're on the left side, you're a centralized player and you are completely antithetical to the whole point of crypto. And if you're on the right side, you're part of the golden club and true decentralization means there can never be anyone who touches anything involving like regulation or identification or safeguards and things like this. And I think, again, these are the kinds of counterproductive discussions I was talking about earlier. I think that we need each other to grow.Brett (19:47):The more DeFi grows, the more equitable access to financial markets will continue to grow around the world. And the more the need for centralized regulated players, like FTX, who kind of bridge the gap between the traditional financial system and DeFi, will play that role as well. As far as regulation goes, you're right. It's not clear where you go with a project like Audius. And you like it to be such that it's the same as Spotify, but then you get into these tricky issues of like, well, what is the Audius token? And how does that interplay with who can actually buy and sell that token and interact with the system in some way? You have more ambitious projects, on the topic of music, like can we create tokens for songs where people can receive token distributions for the number of plays that occur? And does that make it sort of like a dividend and a securities offering? Well, I don't know. And this sort of is very difficult to understand.Brett (20:39):But there are two strategies when it comes to regulation for a company like Audius. And so one strategy is to sort of move as fast as possible and try to always stay like a step ahead of regulation. And eventually, maybe the feeling and the ecosystem around DeFi regulation catches up to an Audius and everything is okay. It allows us to do what it does, and it was worth the risk because they got to innovate very quickly and become a profitable business. But that comes with its risks, that maybe regulation catches up to it in a bad way, and says, "You shouldn't have been doing this all along. And please give me all your profits back from the last couple years."Brett (21:16):There's another way, which is sort to walk in the front door, and be sort of transparent and obvious about what you're trying to do, and to try to operate within the regulatory envelope of some jurisdiction, and try to get this properly vetted and allowed to occur. And that has the benefit of sort of establishing clear rules and allowing for other companies to tread similar paths. On the other hand that could slow you down. And if you have one of these competitors, that's going to run as fast as possible, you might lose to them, even though you're doing the right thing.Brett (21:46):So there's not really a right answer here. And this is sort of a tricky space for DeFi. I will say in either case, I do think it's worth it for these DeFi projects for Solana Labs, for the founders and companies involved, and this kind of entrepreneurship, people in the United States should really start going to Washington more and just explaining what this stuff is. I mean, people kind of get what Bitcoin is, but people do not understand what Solana is and why it's different. And that should change. People should understand what Solana is, what all these other layer 1s are, these layer 2s are. What these different token projects are. Why they're interesting. Why they're useful. Why they represent a departure from Web 2.0. Why that's important. Why that needs to be fostered and why that needs to be grown. I think that would be something that we could continue to work together on, as industry participants, is the education piece.Austin (22:33):So changing topics a little, we've seen FTX.US try and enter a few different, I would say different markets than are necessarily like the original core. So one of those was the NFT marketplace. I think there's been it probably mixed success in that. One of the things that I found fascinating is how different NFT culture is from crypto culture. Obviously it's a subset, but a lot of the applications and the platforms that have been very strong from a crypto trading perspective, in terms of fungible digital assets have not had much success in the non fungible space. And the non fungible marketplaces have either had no interest or no success in moving into the fungible asset space. Talk a little bit about some of the learnings that you guys had in that process and how that's informing the decisions of where FTX expands into in the future.Brett (23:25):Yeah, it's fascinating. So I personally worked on the NFT marketplace a lot for us. And when we entered this space, we thought there's not enough competition for Solana NFT marketplaces. There was really only one at the time. And we thought, this is definitely an area that's ripe for disruption. We were not wrong. But at the same time we did it, six other players did it. And they were able to move a lot faster for a number of reasons. First of all, they were able to really focus all of their energy on the user experience, which was super important. The second is that they were just sort of deeply in that culture and they were able to create, continue creating that NFT culture, in a way that like you have to spend 150% of your time on that to be able to actually really keep up with it and get what's going on.Brett (24:11):And the third was the decentralized nature of it. Whereas most of the trading in fungible assets is occurring on centralized exchanges in a custodial fashion. Just about all the NFTs are trading in a non-custodial fashion. Hook up MetaMask to OpenSea, you list your asset, you're done. And so I think we were disadvantaged by trying to, although I don't regret it at all, walk the sort of regulatory path of requiring people to custodian their NFTs with FTX in order to list them. And then we do proper KYC, and we make sure you're not like transferring an NFT from North Korea or something. So this is what we chose to do. And I think we ultimately lost out a little bit on that, but we're still very happy to have done it for a number of reasons.Brett (24:59):So first is that NFTs have been an important part of our various partnerships, like getting to do this really cool NFT drop with Coachella or for Formula 1. And having that as a platform has been very beneficial to us, even if we're not competing on Bored Ape Yacht Club. The second is that we have this longer term vision that majority of NFTs will not be in these like art or PFP collections. It will be in things like games. And to do that, you have to really build a platform and your average Tier One AAA game studio is not going to partner with a non-custodial solution. If they think it's going to hurt their regulatory standing at all. And so we're kind of building things out from the B2B platform side. With a hope that's actually going to be where this technology actually takes us. And so it's been definitely a learning experience for us and humbling in a lot of ways.Austin (25:53):So let's kind of talk about that a little bit. In a future where US regulations relax, and that there's a framework that allows for a little bit more flexibility and a little more certainty throughout it. We've seen over the last few months a rise in cross-chain DEX swaps. Whether that's enabled through something like Wormhole or whether it's these organizations that are sort of rolling a bit of their own solution. How do you see the competitive world, between what a centralized exchange offers and what a decentralized exchange, can offer evolving over time? I think in the early days of decentralized exchanges, a lot of people were like, oh, these are totally going to kill centralized exchanges. And we obviously have not seen that to be the case. But for a long time, the moat was described as being like, well, I can't swap my SOL into Eth on anything other than a centralized exchange, but we're seeing that change. So I'm sure this is a strategy that you've mapped out internally. What does that look like for you guys?Brett (26:50):I think you probably give us a little bit too much credit. I'm not sure we've like completely mapped out the strategy. I mean, between FTX, FTX.US, FTX Ventures, I think we have various either monetary or intellectual capital investments in a bunch of these spaces. Like FTX Ventures invests in a lot of DeFi and different bridging solutions. FTX itself is benefits and more people trading on our centralized exchange. And so we want to kind of to be able to benefit from the growth of both. I mean, again, we sort of see that, no matter what, FTX is going to be one of the major places to link up with traditional financial system. Like if you want to get Mexican Peso onto a blockchain, you're going to have to do this going through someone who can actually hook up to a Mexican bank.Brett (27:37):It's just going to be required.Austin (27:39):Yeah.Brett (27:39):But in terms of like you want to swap Eth for SOL then, yeah, I think there's going to be a couple different ways to do that. And I can sort of see the benefits and drawbacks of each one. One thing I think is sort of obvious, and I think people understand it but they don't talk about it enough, is the fact that DeFi still has a long way to go. Primarily because the entirety of the code is sort of laid bare for all to see at all times. Usually if you have a financial application and it has a bug, you're sort of protected by the network. And by network, I don't mean network of people who use it, I mean like the actual switches and routers that prevent certain kinds of traffic from getting in. And you have your moat around your application. And if there's a bug, you patch it and you're done.Brett (28:23):With DeFi, if there's the slightest bug, your whole smart contract gets exploited, and the funds are drained, and you're sort of back at square one. And again, I think that the discourse around Defi or CeFi as being kind of incompatible, has probably done DeFi a disservice in terms of its growth. Where probably some slight hybrid approach of building out smart contracts, iterating on them for like a long time, but doing so in a way that's sort of safe and secure, and doesn't mean that the first side of a bug means you are going to be drained, until it gets to the point where it's highly stable. And then you start to relax some of the centralized aspects. You follow the goal of making it completely decentralized, completely open, no intermediaries, and kind of get there over time. But I think the people who do that now would be criticized as being like too centralized. Everyone thinks everyone else is too centralized.Brett (29:17):So I think we have a lot that we can do together is what I'm trying to say. Whether it's us helping with KYC, or it's providing sort of the regulated entry points into DeFi. Whether it's helping create sort of these hybrid solutions between DeFi and CeFi, that will, I think, help DeFi grow over time. So we're trying to foster that innovation in a bunch of different ways.Austin (29:38):I would also say that if we are in a place where CeFi versus DeFi is a zero sum game, we've all astronomically succeeded as an industry.Brett (29:47):Right.Austin (29:48):That's still probably a five to 10 year away, before there are no new users left to onboard and instead a battle for who actually has those users' attention.Brett (29:57):Even CeFi versus CeFi is not a zero sum game.Austin (30:00):Yes.Brett (30:00):At all.Austin (30:01):That's true.Brett (30:02):There's a story that when ICE listed certain versions of energy contracts, that were being traded on the CME, the day they did that, CME volume went through the roof and the largest trading volume times per day were the times where the two overlapped with each other. And this is obviously because arbitrageurs came into the space and were interested and started trading the two off of each other. I think we cannot just have one centralized exchange. We need a bunch. And we will grow the pie together. And so, yeah, we're very, very far away from a zero sum nature of crypto, which is why I like crypto so much.Austin (30:39):So actually to that extent, I think there's a built in assumption there, which is that we need multiple centralized exchanges. And that is a, I think, a very valid assumption, but in some ways that comes from a world that predates computerized global interoperable connectivity. And that the idea that arbitrage opportunities should exist between comparable, centralized financial exchanges feels a little outdated, honestly. That the thesis of Solana as one global state machine to settle all of the world's trades and information, that's a very compelling, decentralized narrative story, but you can also see the exact same thing where you would have interoperable order books between something like FTX and Coinbase. Is that anything that, are there conversations anywhere about building some of those interconnectivities that you see in the traditional equities world still, within like centralized crypto exchanges? Because there is no NYSE for centralized crypto exchanges yet.Brett (31:42):I have actually the complete opposite take to what you're describing here, which is US equity markets have to abide by this rule called reg, or regulation, NMS, or National Market System, where you have to fill a customer quote at the best price seen on any exchange, any one of the lit exchanges, of which they're like 15 now. So that means like, let's say you want to go send an order to NASDAQ and NASDAQ thinks that they are one penny behind the price on BATS. Well then NYSE either has to reject your order or route your order to bats and get filled. There's a big problem with this. Actually, there are multiple big problems with this, in my opinion.Brett (32:24):One is that light is not infinitely fast. And so what is the kind of prevailing quote is going to depend on where you are. Because of those 15 exchanges, some of them are in Secaucus, New Jersey. Some of them are in Carteret, New Jersey. Some of them are in Mahwah, New Jersey. Some of them are in Chicago, Illinois. And so there's no one place where you can have the absolute truth of what the best quote is. And even above that, the second big problem here is you have to pay a lot of money just to get the market data required to make that determination. And then third, if you're going to do that, some HFT with slightly faster hardware and market data is going to detect that routing and probably beat you there. And they're going to profit off that opportunity.Brett (33:10):While I think that NMS was well intentioned at the time that it was created, which was somewhat before the real advent of electronic markets, now that we have electronic markets, I actually think that NMS has added a lot of complication, and fixed cost, and deadweight loss to the system of equities, and made things like very difficult to sort of spin up as a new exchange. Compared to, in crypto where there was never like an NMS routing between exchanges, but there doesn't really need to be because there's someone whose job it is to arbitrage between the exchanges and keep them in line. And they're paid naturally for the job of doing that. And so the market forces keep the exchanges in line and that works extremely well, and makes crypto very low cost and low barrier to entry for new participants.Brett (33:56):You don't have to hook up to every single exchange. You don't need to send your market data to some central thing, which has to display the quotes everywhere. And you can't accept orders, if it doesn't look like it's on the top of the book of that far away aggregator. It means that exchanges can exist sort of more globally instead of all being centralized mostly in New Jersey or something like that.Austin (34:14):Yeah.Brett (34:14):So there's been so many benefits to that. And then the other thing I want to say about this is, look, there's never going to be just one of anything. The only real way to kind of get rid of an arbitrage opportunity is to only have literally one order book. And even on Solana, you have different order books for SOL, USDC. And some of them might be kind of built off of similar primitives, but there's still going to end up being kind of arbitrage things between this swapping tool and this DEX order book and this centralized exchange, it's always going to exist.And so I think we should just thank the arbitrageurs for their service and just be happy with the fact that we can have multiple marketplaces. I think that's the ultimately right thing for competition.Austin (35:00):Do you think crypto needs market hours?Brett (35:02):No.Austin (35:03):We'll never get them, but I'm curious if you think it would help or hurt the industry?Brett (35:06):No, I don't. One thing I've kicked around in my head at some points is, something like whether one time per day, there should be an auction. Basically like a five second freeze or something, where people can submit bids and offers. And there's like a single kind of auction type clearing event that establishes an official mark for the day in that crypto. And there's a lot of different market structure theory between whether an auction type mechanism or a continuous trading mechanism is ultimately better and fair for our participants. And there's just lots of research in both directions. But that could be interesting to me to have some sort of discontinuous event, maybe once per day. It would help for things like ETFs that want to sort of mark their basket to sort of a day over day performance and they need sort of an official closing mark, and it would be nice to have sort of a single auction event for that. But I don't feel strongly about that at all. And in general, I think that 24/7 markets are the way that every other market has to go.Austin (36:05):Yeah. I agree with you on that. So I put out a call on Twitter that was like, oh, what are people most interested in learning about from FTX, apart from a rundown of all of your cats, which we don't have time for today. One of the ones is what is the process of evaluating the listing of a token looks like. Obviously replies are full of people shilling their specific coin. But there are also some real genuine questions in there about like, you see Coinbase having taken a very, very sharp turn in what the criteria they use for listing a token is over the course of the last 12 months. How do you and FTX.US think about that?Brett (36:40):So we have taken the position, as a company, that we would like to be very conservative on token listings in the US. And that is because a lot of the issues we talked about earlier in the podcast about the regulatory uncertainty around what US based crypto companies are allowed and not allowed to list. And I think there might become a point at which listing criteria becomes clearly well defined by regulators, at which point we will basically take as much risk as it allowed to us. But for now we think about what is our comparative advantage as a company? Is it to list the long tail of 500 tokens? Or is it some of these other things that we're doing that maybe some of our competitors are not going to be able to do in the short term? So the biggest one for us is listing Bitcoin and Ether futures for US customers.Brett (37:32):And we think that has such a greater potential to improve the health of the market. Give people opportunities for hedging risk, and being able to get capital efficient exposure, and to be able to trade the spot versus the future and capture the basis. This is much more important to us than listing that 200th asset on CoinMarketCap. And we're concerned that some of our actions in the latter might jeopardize our success in the former.Austin (38:00):Interesting.Brett (38:00):So we're just sort of, we have different risk profiles in the different aspects of what we want to do. And that's part of the decision there as well. We're also moving very much into some non crypto things. Like we're a student launching a stocks trading platform that's going to be vanilla US stocks through a broker dealer, all trading through like an exchange that's not ours. So we have just sort of different ways of thinking about diversifying our product set. And for now, I think as long as the regulatory environment remains this unclear, we're going to stay on the conservative side of that.Austin (38:33):One kind of last question before we wrap up here. With the amount of market volatility we have seen in the last few weeks here, the sort of precipitous drop in the first half of May, what are you excited for and hopeful for about the future of this industry in the United States?Brett (38:52):Yeah, it's natural for these times of great volatility and certain assets dropping a lot in value, for people to sort of turn inward and maybe lose sight of the broader mission. And we have to remember that we are building a generational opportunity for technology and for wealth creation. And many have already benefited from this, but we have much more to go on all the promises that we have. I mean, just think about how one of the main things people have talked about for crypto is creating this kind of global payments network for people to sort of cheaply or freely send money for remittances and things like this. I think we have yet to really fulfill that promise. So regardless of where asset prices go, we have to, as everyone says, keep building.Brett (39:39):And we're just excited for people to continue to push forward and continue to sort of responsibly innovate, and hopefully show people in the United States, especially policy makers, that even though assets can be volatile... I mean, equities have lost more money in value in the last month than crypto has, and people sort of forget that sometimes. But in spite of downward cycles in markets, there's a real intrinsic value to what we're all doing here. It's not just pure speculation. And we need to do everything we can to keep that going, and keep building, and keep investing.Austin (40:13):Well, Brett, thank you so much for joining us today on the Solana podcast.Brett (40:17):Yeah. Thanks for having me on.

Welcome to a special episode of the Solana Podcast focusing on Crypto & National Security featuring Ari Redbord (Head of Legal and Government Affairs, TRM Labs) and Sigal Mandelker (former Under Secretary of the Treasury for Terrorism and Financial Intelligence). Amira Valliani (Policy Lead, Solana Foundation) guest hosts.00:09 -  Intros02:11 - Origin Story05:53 - Correspondent Banks07:37 - Why crypto resonates personally09:54 - Use cases of Crypto in humanitarian applications12:13 - Looking at the opportunity vs the risk16:06 - Typical Day at Treasury17:14 - What it takes to stop bad actors in Crypto24:53 - BitFinex Hack and Large seizures29:05 - Compliance and self-policing31:13 - Advice to other people in regulationDISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Amira (00:09):Hello and welcome to the Solana podcast. My name is Amira Valliani and I run public policy at the Solana Foundation. Today we're talking about an issue that's really been at the forefront of a lot of people's minds since war broke out in Ukraine earlier this year. And that's the topic of crypto and national security. We've brought two of the world's foremost experts to talk about how crypto links with foreign policy and the movement of money all over the world, and they are Sigal Mandelker and Ari Redbord.Sigal Mandelker is a general partner at Ribbit Capital where she deals with FinTech and crypto. But before this, she was Deputy Treasury Secretary and Under Secretary of Treasury for Terrorism and Financial Intelligence. She's joined by Ari Redbord who's the head of legal and government affairs at TRM Labs, the blockchain intelligence company. Before joining TRM, Ari was Sigal's senior advisor when she was the Under Secretary of Treasury and worked on a range of issues, including sanctions, anti-money laundering and a bunch of other scary and really important issues. Sigal and Ari, thank you so much for being here. We're excited to have you.Ari (01:15):Thank you so much for having us. I will say just to get things started, I'm a huge fan of sort of what you guys do at Solana and the team that's building with you and a huge fan of Sigal and just an amazing honor to be on a conversation like this with someone that I worked for when she was the under secretary and just really consider a close friend and colleague in the space now. So it's particularly cool. So thank you for having us.Sigal (01:40):Oh, it all goes back at both of you. I loved working with Ari then and I love being in this space with him now. It's pretty exciting.Amira  (01:48):I'm here for all of it. I think it's going to be a very exciting few minutes. I think the backgrounds are really interesting and you all know that this circle of people who come from government into crypto is growing, but it's small. And so very specific journeys I think got all of us into this space. I'm curious what got each of you interested in crypto? Why are you passionate about it? Ari, I don't know if you want to kick us off here. I know Sigal has a particular story.Ari (02:13):Sure. Yeah. No, happy to. Everyone has their sort of crypto origin story. And so many times you hear about "I bought Bitcoin 15 years ago." And for me it was really a lot different. We started to see it 2015 or so in a lot of our sort of large money laundering investigations that actually involve some of the sort of nation state actors like North Korea that we'll be digging into today. I think we sort of realized even then the power and promise of this technology, but also that if it was going to grow and flourish and they were going to build this new economy, that we needed to stop illicit actors from doing it. And that was sort of as a prosecutor and then honestly getting an opportunity to work with Sigal and the team at Treasury on some policy related issues in the space, I think really, really also got me interested in.At TRM labs, it's sort of like we sit in this sort of intersection, because I think we obviously believe very firmly in the potential and the growth of this new crypto economy, but at the same time, sort of understand that trust layer, anti-money laundering national security is critical infrastructure for it. And that intersection that we're going to be talking about today is really sort of where I see the most work that can be done.Amira (03:19):Yeah. I think that's incredibly important to remember that trust is really important to make sure that the space thrives. Sigal, I'm curious about your crypto origin story. Tell us how you got into it and why you're so excited about it.Sigal (03:31):When I was at Treasury, my job was very much a global job, so I would travel all over the world. In those travels, I would often meet with senior government officials from heads of state on down, central bankers, CEOs of banks, et cetera. And along the way, it became increasingly clear to me for a number of different reasons that our banks, US banks had massively de-risked all over the world. It became clear to me because in so many different countries, particularly in the developing world, in emerging markets, in so many different countries these senior officials and CEOs of banks would ask me if I could help them get access to US correspondent banking. We really studied to look at it and study it. And the trend is clear. Like if you start looking from 2012 to today, just as one example, the number of US correspondent, global correspondent relationships is very, very much on the decline.And so when I left Treasury, this became like an issue that I was very passionate about. How do we get great financial infrastructure and companies out of the US and elsewhere to be able to provide a variety of financial services in the developing world, in emerging markets, where in my opinion, in many respects, we had left them high and dry. And I came to the conclusion personally, that the only way we were going to do that was through disruptive financial technologies. And so I decided to find a place where I could pursue that passion. Along the way, I met our founder, Micky Malka, who has founded Ribbit along with Nick Shalek and some others about 10 years ago. I very quickly understood that really the mission of Ribbit is to change the world of finance and to do so exactly in this way through disruptive financial technologies that we're going to open up access to many, many more people in a much more efficient way all over the world.And so a week later, Micky called me and asked if I was open to having a conversation about joining Ribbit. It was definitely a road less traveled for a former undersecretary, but it was a super exciting path to go down.Amira  (05:36):I want to stay back on the beat that you mentioned about the drop of US correspondent banking all over the world. It would be helpful if you describe what exactly does that mean? What is a correspondent bank and why were you concerned about that as an undersecretary of Treasury? Why is that important to you?Sigal (05:54):For many reasons. First of all, correspondent banking, it basically allows banks all over the world in part to get access to US dollar accounts among other things. And when you don't have that correspondent banking relationship, when you're being de-risked, there's just less access to the US financial infrastructure in many different ways, which means a lot of things. One of the things that it means is that if you think about our various sort of tools of financial leverage, we're seeing that play out right now in Russia, right? Where sanctions has become a major tool of national security. But if you're issuing a sanction in a country or a region that has very little touch points with the US financial infrastructure, then that economic leverage no longer actually really works, or it's less likely to work. It's more complicated than that.Also, the US traditionally has been the exporter rate of democracy and American values. We have always prided ourselves in innovation and being like a center for ingenuity. And again, when you don't have US capital or those kinds of relationships all over the world, I think that's not only really to the detriment of the US, but also to the detriment of people all over the world. And then they're just going to go to alternatives. And that's definitely happening as well.Amira  (07:14):One of the things that we've chatted about before is, it's not just a whole for US national security, but there's a bunch of people out there who when US banks aren't abroad, they're still looking for financial services. One of the interesting things about crypto is it offers that.Amira (07:29):Sigal, I know you have a really personal story of why crypto and access to financial services are important to you. Now I was wondering if you could tell us a bit about that and why this industry resonates personally.Sigal (07:39):Yeah, so it's really in part because my parents are both Holocaust survivors. During the Holocaust, they were in hiding in a part of Poland that is now Ukraine. They were kids. So they were separate, but they happened to be relatively close to Lviv. And the only way at the time that my dad, for example, could have ate, had access to any food, was my grandfather would go out in the middle of the night and he would steal potatoes. Once he stole a pig ear and brought it to my dad and my dad said "It's not kosher dad, I can't eat this." And my grandpa said, "No, it's the only way for you to get nourishment." So when I think about, I imagine what would've happened back then if this technology existed and they had access to a phone and they had relatives far away who could actually send them some value that they could use to barter for food, something like that was just totally impossible back then. You couldn't get anything from your family members who were in another country.Actually when I was at Treasury, there was somebody who had brought this idea to me of being able to use crypto to provide humanitarian aid, for example, to refugees in Syria. And I thought it was a really fascinating concept. And of course, it's so prescient today because the crypto community, including very much the Solana community, has really stepped up and used crypto working with the Ukrainian government to do exactly what we couldn't do in the forties '40s, which is to provide aid to the government in their fight for freedom, to help people get access to food, medical supplies, and elsewhere. And for many reasons, we could, I know, get into. I don't think banking is really necessarily set up to provide that kind of access in that way. It's too difficult. It's too complicated. Our banks don't operate in those parts of the world often where people really need that assistance. But crypto is global. It's everywhere where you can get access to it. In many other respects, it's just like a really groundbreaking innovation.Amira (09:31):It's kind of amazing, I mean, how much history repeats itself and how much access to these tools they were needed 80 years ago, they're needed today. Ari, I remember you telling me an example of how the US government I think, maybe it wasn't, was able to get aid into Venezuela directly using crypto. I'd love it if you could tell us a little bit more about that example.Ari (09:51):I think that was Sigal's story so I'm going to give her that one.Sigal (09:56):Okay. Well, this actually happened after I left Treasury, but I think it's also incredible. So when we had very heavy sanctions on Venezuela because of Maduro and what he was doing in that country, when we had the sanctions program, I made sure, or at least when I oversaw it, I made sure that in the Venezuela context we had the most forward leaning general license for humanitarian aid in particular that we had ever had before. I basically told our team like, "Everything that's ever been on the cutting room floor, we need to put it in this program because we need to help people who were literally starving to get access to aid." The other challenge was that it was very, very difficult for the US government to get anything resembling humanitarian aid into the country. I mean, literally, there were shiploads of stuff that the US government had sent and Maduro wouldn't allow it in or accept it.I will say that even though we had these very forward leaning general licenses, NGOs would come to us, to me and to Ari, I had a call that Ari will remember at the state department where these NGOs would say, "Look, we know you've got this general license, but the banks were all de-risking us. They won't allow us to continue." And I said at the time, "Well, tell them to call me. I mean, this is why we had that such a forward leaning general license>" but banks are just very risk averse in that way.And so fast forward, actually after I left Treasury, what was the one way that the state department working with Treasury and I think with Airtm and maybe with Circle, they were able to get USDC to help something like 60,000 or 80,000 doctors and nurses who are fighting on the front lines of COVID in Venezuela. Again, it's just like Ukraine. It's another really amazing use case where our banks weren't able necessarily, maybe some did, but many weren't able to get humanitarian aid in. But boom, instantly you could send it in and you could account for it because it's transparent, so you can audit it. You can make sure that if it lands in the wrong hands, that they can't use it. So it's a really incredible tool to allow access to, again, just like Solana is doing to allow access to a very fast payment system or a transfer of value for humanitarian purposes while also ensuring, helping to ensure at least, that it's used for the right reasons.Ari (12:14):I think what's so interesting is there's this narrative that crypto with these sort of qualities, decentralized permission list, cross border value transfer at the speed of the internet, somehow it's only used by illicit actors. But the fact is those are the qualities that allow it to sort of move outside of traditional financial systems to provide aid to people that would otherwise not have access to it. And I think this Ukraine moment in this really horrific situation is this incredible example of how communities, decentralized communities have developed in order to support a resistance movement in a government. I mean, Zelensky talks about Twitter being a tool of the resistance or a tool of Ukraine in this moment. Well, what you see happening on Twitter is communities developing to send cryptocurrency to support movements there.Admittedly, I think Sigal and I are often talking about sort of the financial crime and the money laundering risks and the things in sort of that space, but you do have to step back and say like, "We have to stop bad actors from using it because it's so good and there's so much power and promise of it to do good." I do think we're having sort of a watershed moment in Ukraine where you're having this sort of global event where we're seeing hundreds of millions of dollars ultimately will flow to Ukraine in cryptocurrency and really arguably sort of the first maybe use case at scale of what the power of this technology can do. I think it's an exciting moment. Obviously, it's a moment you never wanted to see, but I think this will be an example that will be able to use as to why this technology has so much promise.Sigal (13:47):Yeah. And I would say just to add to that really quickly, what I like to talk about when I'm talking to policy makers and regulators, et cetera, is that you have to stop looking at everything through the lens of risk. Risk is important. We want to mitigate risk, but really what you need to do is start looking at the opportunity and how this technology will enable so much opportunity. Because what we have today are a bunch of developers, innovators, builders, dreamers, right? Who are literally thinking about how to build out a more efficient financial infrastructure for the future that many more people ultimately will be able to access and use.That part of the infrastructure that deals with illicit finance and investor protection, that's being built too. So you can do those things really in parallel and therefore really drive out. In many ways more successfully than what we have in traditional finance, the illicit part of it as what we're seeing is like the vast, vast majority of people in crypto, they're just builders. They want to grow new things whether it's NFTs, games, payments, access, Ukraine, et cetera.So if you only look at things as a regulator from the perspective of risk, then you're never going to let anything grow. You really have to start talking about how to use this technologies as a great opportunity, including one of the reasons that I came into this space, right? Which is because I thought like this is this great opportunity to build out potentially much better financial infrastructure, which many, many more people will be able to access in the future. And if a portion of that remains in the United States, then the United States will be able to continue to be a center of financial innovation for years to come. If it doesn't, that's a different story.Amira (15:29):A lot of folks in the audience have never actually been in your shoes or anywhere close to it. I want to take a second to dig into sort of like that Carrie Mathison type stuff, which is like, let's look behind the shroud and see what it looks like to walk into your desk at Treasury every morning and understand what's coming past your desk from the risk perspective. Let's help figure out why regulators might be so concerned and help listeners understand what it was like to track down bad actors when you were in Treasury. So what did that look like for traditional finance specifically? What would you see? What does the process look like? How do you start your days even?Sigal (16:06):I used to start my day every day with an intel briefing. Basically with a briefing, where I would learn about all the potential terrible things, terrible things around the world that were happening and potential terrible things that could happen. So when you're in a job whose title is terrorism and financial intelligence, that's just the way your day is going to start. You're constantly thinking about how to protect not only Americans, but people all over the world from bad actors. So that's how you start. Literally, the framing of your day really starts with hearing about bad stuff that could potentially happen. And then in many respects, you said about your day in part to ensure that that bad stuff doesn't actually come into place. There are all kinds of different ways in which that happens.Another big part of my job was also to think about how do we reform, how do we provide much more guidance to the private sector which we did really with the FinCEN guidance in 2019 and in lots of different ways through our sanctions programs, through advisories that we issued to help the private sector also work with us to better protect themselves against being abused by bad actors.Amira (17:15):What does it actually look like when you're stopping bad actors? So you talk on sort of vagueness, but think about a case where maybe you had to take traditional tools of finance to stop a bad actor and what that process looks like. And then how does that actually contrast when you're thinking about a crypto bad actor? What are the differences in that process?Ari (17:32):One thing that we did at Treasury and at DOJ when I was in AUSA is you put together great teams and you reached out to all kinds of different pieces of the inner agency, the executive branch. So when we were prosecuting a case, we would want to ensure that we had a team of the best IRS CI agents and HSI and FBI. It was very similar at Treasury, right? I mean, if you were going to do a sanctions' designation on North Korea for example, you would want to ensure that you had the right policy people in the room from TFFC, and that you'd have the right intelligence from OIA, that you'd have exactly the right subject matter experts from OFAC on sanctions and FinCEN on money laundering and financial crime. And you would put them all together. And I think this is what, why Sigal was frankly so successful, is that you basically would reach out to teams of subject matter experts. And you'd put these teams together and they would inform great policy.I think one thing that sometimes is missing is that there's this sense that sort of like from the private sector that the government doesn't know what it's doing and this sense from the government that the private sector just has a certain agenda. I really do think at the end of the day, some of the best subject matter experts in the world are in both places. When you have those public-private partnerships, you're going to have much, much more success. So to me, it really is about putting together great teams of subject matter experts. I think we're seeing that today quite frankly. I mentioned North Korea.For example, you have this hack of the Ronin, Axie infinity blockchain a few weeks ago. And very, very quickly, Treasury essentially identified Lazarus group, a state actor from North Korea as having engaged in that attack. I'm not there anymore. Sigal's not there anymore. But what I imagine happened is they put together teams of experts from those different places who were using blockchain analytics tools to watch the flow of funds in that attack. And then you saw the designation, the sanction of a specific address for the first ever time associated with Lazarus group. And then you saw those funds flow to three other addresses, and immediately you saw those addresses sanctioned. And then you saw those funds flow through mixing services, which are basically exchanges on blockchains that mix funds and send them out, sort of clean the other side. And you saw those funds flow through a mixer called Blender.io that was ultimately designated sanctioned by OFAC.So again, while we're not there anymore, when I see these actions, I sort of picture a skiff, a secure facility within Treasury a few steps from where Sigal and I sat. I picture this group of true subject matter experts sitting around and laying out game planning, these types of actions. I think that's as inside baseball as I could do here. But I do think that like the key is great teams, and we were always very lucky to work with great teams.Sigal (20:22):Speaking of which, I was also really smart to bring brilliant people to work with me in my front office. And of course, Ari was very much at the center of that. We're in war mode all the time at Treasury, right? You're always dealing with really bad actors.Ari (20:40):I picture Sigal running when I think of Sigal, in heels down.Sigal (20:45):Clicking.Ari (20:45):And I remember actually ended up buying shoes that had sort of sneaker styles soles on the bottom because you were so constantly running up and down the hallways of these marble floors, because that's exactly what it was. You were always in a rush. It was always because the work you were doing was important.Sigal (21:01):I lost a lot of shoes that way. One thing I will say when Ari's talking about Lazarus, the first time that I really understood the power of blockchain analytics and blockchain technology was actually when we had sanctioned a big network. I think it was the first time we sanctioned... I actually included wallet addresses. Literally within a day, maybe it was that same day, I don't even remember, Chainalysis had put out a piece that literally identify all the different addresses that were linked to the ones that we had sanctioned so that people could very, very quickly know what to stay away from, like what was really bad news and actually protect themselves from interacting. Ideally, we could freeze funds.I remember at the time saying to a different senior advisor, Leah Bressack, like, "Yes, this is what we want industry to do. We don't ever see this kind of analysis from the banking industry." And that was really in part because that capability doesn't exist in the same way. I mean, sure, we saw lots of SARS and sophisticated SARS from banking, but for somebody, a Chainalysis or now TRM to go out and very quickly publish reports much more quickly than we may have been able to do that really helped immediately track, detect, and deter illicit activity was really quite extraordinary.Ari (22:25):Yeah. I mean, it seems so obvious to probably most of your audience and certainly to us, but the ability to follow the money to watch financial flows in cryptocurrency is extraordinary compared to the traditional financial system. I mean Sigal and I both cut our teeth as prosecutors doing bulk cast smuggling cases and networks of hawalas and shell companies and Russian real estate and London and high value art, right? There's no TRM or Chainalysis for those things. Those are very hard. And in crypto you can follow the funds with great financial crime investigators at US law enforcement and globally can follow the funds using these kinds of tools in ways that were unimaginable before. So yes, you can certainly move money faster in larger amounts in many respects, but you have tremendous visibility. I think a lot of times that's missing still even from the conversations around sort of fraud and financial crime in crypto.Amira (23:22):So let me push on both points because I think this is really textured and no one knows more about this than you two, I think. So there are two people that might push back on what you just said. One is, I would say the folks that I think are especially concerned about crypto's usage for money laundering. Those people might say, "Yeah, but you're seeing the rise of privacy focused chains, of blending services, these things just make it impossible to obscure the movement of money. It's only a matter of time before we see these things succeed." And so maybe the technology's working for us now, but you're the first to say that this tech is early. How are we going to be able to catch terrorists and oligarchs once stuff advances?Ari (24:02):Yeah. No, it is still a little bit sort of a whack-a-mole. But it always has been in sort of the cat and mouse game between law enforcement and bad actors. I will say that so many of the big crypto investigations over the last few years involve mixing services, they involve privacy coins. Law enforcement ultimately was able to make those investigations using a combination of blockchain analytics like TRM, like Chainalysis, but then just great police work, off chain police works, subpoenas and search warrants, putting together the pieces.Amira (24:30):Is there an example that you can go into on that front?Ari (24:33):Yeah. I would say the Bitfinex case is a tremendous example actually. So I mean, essentially what you had there was a 2016 hack of an exchange where the money just sat there in a wallet. And then all of a sudden you started to see it move over the course of years across blockchains.Amira (24:49):And for background, for folks who aren't familiar, tell us what the broad strokes, the Bitfinex hack.Ari (24:54):Sure. Yeah, so really just that until recently, right? It was at the time one of the largest crypto hacks. About $70 million of Bitcoin was stolen from the Bitfinex exchange. A hacker breached these cybersecurity and stole about $70 million in Bitcoin. That money basically sat on an account for a while and then started to move in these individuals. They basically used every office station technique in the book, from mixers to privacy coins, to dark net markets and automating transactions which means you programmatically move funds across blockchains in order to obfuscate. Well, ultimately law enforcement used blockchain analytics tools to trace and track those funds through mixers and dark net markets. And ultimately, to be able to seize what grew to be about $4.2 billion, the largest seizure in US history, ultimately sees those funds.What's so interesting about crypto, and I think Sigal made this point earlier, is the blockchain is forever. So you don't just have to be ready for whatever the analytics tools and whatever the investigation tools is when you do the hack and when you start to launder funds. You have to worry about what it's going to look like five years down the road, what the technology is going to look like. Because law enforcement was able to follow those funds across years and across blockchains, ultimately actually arresting a couple in New York city a couple of months ago and charging them with laundering the largest seizure in US history. So there are definitely powerful, anonymity enhancing tools out there, but I will say that law enforcement is still making a lot of these cases.Sigal (26:38):Yeah, I would just add. I mean, like in this very early days, still nascent technology, the reason that some of the largest seizures of illicit assets in history has come from crypto is not because there's more illicit activity in crypto. For all of the reasons that Ari just mentioned, it's just in many respects easier to trace and ultimately to disrupt than what you have when people move all kinds of assets through shell companies and like all sorts of different parts of the world. That's really important because if you just look at the headlines and you say "Bitfinex, largest money laundering seizure in history," then you may just jump to like, "Oh, of course, because it was crypto." But no, people are just using crypto for bad things. It's really because law enforcement now with blockchain analytic firms, et cetera, and prosecutors have all these amazing tools at their disposal.Silk Road was another example. I mean there was a seizure last year or the year before of a billion dollars worth of, I think it was Bitcoin, that traced all the way back to maybe the earlier days of Silk Road. And boom! All of a sudden, money moved and they were able to pounce. I mean, frankly, if you're a bad actor, I would say as more of these cases are like coming to a fruition, stay away from crypto. There's a very decent chance you're going to get caught.There's also this narrative that I think has largely tamped down, but there was a narrative that crypto was going to be used on mass for sanctions evasion in the Russia context. And for a number of different reasons, I just don't think that, and I think Ari would probably agree, that's just not going to be the case. It's not that it couldn't be used for some, but Russia has been very good at money laundering for a very long time through things like real estate and shell companies and all kinds of different mechanisms that we've investigated for many, many years. With crypto, there isn't like the liquidity to move assets at the volume or scale that they would need to do that. Plus, if they try to, boom, the TRMs and Chainalysis and law enforcement kind of actors would likely be able to, at some point, quickly detect it, plus you have all these regulated exchange who have done really a terrific job working with law enforcement to be able to help trace and track and disrupt this activity.Ari (29:06):The only thing I would just kind of add to that, I think Sigal makes a great point at the end there in particular around compliance. I think there's this sort of sense that, "The wild west" is what you hear thrown around in terms of sort of the regulatory landscape. And at least on what we're talking about today, sort of that AML national security space, look, crypto businesses that operate in the United States are treated as like any other money service business for purposes of this. When you're looking at sort of the large exchanges where so much of the liquidity is today, they have robust compliance controls in place. They have compliance officers, they have policies and procedures. They use tools like TRM and Chainalysis in order to monitor transactions. This is not the wild west when it comes to stopping sanctions evasion when it comes to stopping bad guys.Ari (29:51):I mean, look, I think the reality is, there is certainly illicit activity occurring in crypto, but honestly, illicit activity occurs in any thriving financial system. Bad actors would not want to use it if it wasn't working, that's certainly true of cash. That's certainly true of sort of anything else. And as we see the growth of this economy, we're going to see more illicit activity just by the nature of it. But as an overall percentage, it's going to remain very, very low because I think as Sigal mentioned, it's not a great way to launder funds. It's not a great way for illicit actors to move money because we're watching it all the time. It's not just blockchain analytics and law enforcement. I mean, the coolest thing is when you jump on some of these Discords or on Twitter and you watch these super sleuths and parts of these different communities develop that are in these like open source tools that are following the funds in a hack. There is a self-policing element too, in this community that has never existed before when it comes to sort of following the money, watching financial flows.Amira  (30:50):I think the headline from this episode's going to be advice from former Treasury officials, if you're a terrorist financeer, don't use blockchain.Ari (30:57):100%. Never use crypto. Yeah.Amira (30:59):This has flown by, and I feel like I have a million more things I could talk to you both about. But in our last couple minutes, maybe any advice you have for your peers who are in your shoes today, talking about sort of the growth of this new industry. What would you tell them? What do you wish you could whisper in their ear? Or maybe you've already whispered in their ear.Sigal (31:14):Look, what I say is, number one, you have to interact with the technology. You have to meet the entrepreneurs, the developers, the founders, to really understand what's being built. I mean, I had amazing folks around me in the government, but there's nothing to teach me to talk to me about this stuff. But there's nothing like interacting with someone like Anatoly or what have you to really see and envision what the future can look like with this infrastructure. So if you really want to understand what's happening, get out there, interact with the technology if you can. There's all kinds of ethical restrictions that don't allow enough people to be able to do that, but there should be mechanisms to allow you to interact with the technology, number one.Sigal (31:55):And number two, be open minded. Learn what's happening, what can the future look like, why do we think ultimately, why are there so many of us who've left government who are investing so much of our time and energy in these technologies because we actually believe that it's quite possible that this is where the future of finance lies. That's number one. Number two, if you're looking at how to regulate it, don't just put your mind around all the old tools that you know that you've come to rely on for the last century, right? This is a fundamentally new technology. It's transparent in a way that we haven't seen before. It's open source. There's so many different attributes of the technology that can help mitigate risk. And so be open to fresh new frameworks that potentially in my opinion not only, let's say on the AML side, can continue to drive illicit activity out, but really, really importantly can bring many more people around the world access to the financial ecosystem.There's 1.7 billion people, at least as of 2017, who didn't have access to banking. We got to solve that problem. It's not enough to go to inter agency or multilateral meetings all over the world and talk about it in five minute interventions, which is often what happens in these meetings. We got to really find the technology that can help solve those. And then US people, they need to really focus on how can they maintain that leadership. It's not going to be by calling things wild west and it's not going to be by only seeing things through the lens of old boxes and old frameworks that were built up when we were using the telegram. I mean, not the app Telegram, like those telegrams that they used in the '30s. And then also, perhaps not the same frameworks that we were using when we were still using the rotary phone. I mean, this is fundamentally new technology. Let's understand it and regulate it in a way that makes sense in light of the technology and allow it to experiment and grow so that we can build something out really together that can be truly extraordinary.Ari (34:13):I think that's so beautifully said. I share a lot of those sentiments. I've been lucky to have really the coolest jobs that you can ever have, so don't take this personally, Sigal. But I have the coolest job that I've ever had now. I think it's because I've just gotten to sort of engage with this incredible community of builders and innovators. And they all understand, I think, uniquely that we're building essentially a new financial system. I think it's so important that regulators sort of also embrace that moment, that this doesn't have to be the same. We don't have to do what we've done before. We can work with the technology. We can work with these builders sort of build something new. I think Solana is an amazing example of this because the focus on speed and the focus on sort of that incredibly strong community of NFT builders and gaming, and really I think all the things that are starting to develop to me are like really the future not just of kind of the technology, but really also compliance and regulation.The metaverse is not going to be a place that is entirely unregulated. It's going to be regulated, but it needs to be done in a super smart pro innovation kind of way. I'm so hopeful that these communities that I feel like I have been lucky enough to engage with over the last year or so, that regulators and policy makers are also engaging with them. So yeah, no, it's an incredibly exciting time. I don't know, I get up every morning kind of feeling that. I think it's sort of like, how do we inspire regulators and policy makers to kind of feel that same way.Amira (35:39):I'm revved up just hearing you about talk about this. Let's go.Ari (35:41):Let's go.Amira (35:41):All right.Ari (35:45):Sigal and Ari, thank you both so, so much for your time. We really appreciate it, and in giving us the inside view of what it's like to be a regulator dealing with these issues. I think I've learned a lot and I think our listeners have too. Thanks a bunch.Sigal (35:56):Thank you so much. And thanks for bringing us back together.Ari (35:59):Thank you so much. I loved it. Thank you so much.Sigal (36:02):Thank you. 

Kanav Kariya (President, Jump Crypto) joins the Solana Podcast to discuss his optimism for the future and the many areas in which Jump Crypto is innovating in the crypto and blockchain space. Austin Federa (Head of Communications, Solana Labs) guest hosts. 00:49 - What is Jump?03:07 - The path to operationalizing crypto06:00 - Optimism for Crypto10:49 - Discovering and Building in Crypto with Jump14:24 - Personal Journey at Jump16:43 - What's being built at Jump?17:55 - Reasons to want to build19:39 - What does Pyth offer?22:22 - Criticism about conflict of interest26:30 -  How Web 3.0 facilitates resource coordination28:46 - Data contributors benefiting from onchain data31:01 - Token Plans for Pyth31:46 - Message bridging34:48 - Wormhole, stable coins and asset tokens37:36 - Time synchronization for cross-chain dApps39:14 - State storage on wormhole for dApps40:21 - Is Wormhole layer 0?41:14 - Wrapped NFTs44:13 - Jump's position towards NFTs48:36 - Exciting things in the ecosystem49:43 - Custom silicon / FPGAs53:22 - A parallel execution model? DISCLAIMERThe content herein is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. Those who appear in the content may have a financial interest in any projects referenced, and any content herein is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.  This content is intended to be general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented without undertaking independent due diligence and consultation with a professional advisor. Austin (00:10):Welcome to another episode of The Solana Podcast. I am Austin Federa, sitting in for Anatoly again this week. Today we've got a pretty special episode I think. I'm really looking forward to this conversation. I think it's been a long time coming with a few false starts. Today we have Kanav Kariya president of Jump Crypto, or do we just say Jump at this point?Kanav (00:32):Yeah, Jump Crypto is good.Austin (00:34):President of Jump Crypto, which maybe this time last year very few people knew existed, very few people knew what you guys were doing, what you were building, what your role in the ecosystem has been. So yeah, I guess let's just go ahead and Jump right into it. What is Jump Crypto and how did it come about?Kanav (00:51):Yeah, thanks for having me on Austin. So for context for the audience that aren't very familiar with us, Jump is historically a prop trading firm founded over 20 years ago in the pits at the CME. Today one of the largest quantitative trading firms in the world. And we started a crypto division over seven years ago. It started as an intern project at the University of Illinois, where we were running a miner in a closet and building some trading infrastructure.And today we've got over 150 people on the crypto team doing a lot of different things. So the way I like to describe our business is spitting it into three primary pillars. One is prop trading, which is exactly what we do on the other side of the house, we build trading intelligence and we scale it. The second piece is building and that's the piece that I hope we'll get to talk a lot more about on this call and it's closest to my heart and closest to the heart of the team.And that's in building pieces of infrastructure, really streets and sanitation for the space and a couple of the marquee projects that we've really focused a lot of our efforts on have been Wormhole and Pyth. And of course, along the journey, we've aligned ourselves with a lot of the major ecosystems in the place, including Solana, Terra and a whole number of others in building a lot of different things across those platforms.The third bucket is venture, I like to call ourselves accidental VCs in that we found opportunities to add value, or we had requests come in to work with partners over the last six years in various different capacities. And we found that we could be meaningful in those contexts and work with people that were solving problems for us. And that has now grown into the venture division that's deploying across the space.Austin (02:31):I want to get into a lot of the work that Jump is doing as core code contributors and supporters of projects in the ecosystem. But I kind of want to start a little bit with that journey. I would say that the transition from prop trading equities and commodities to prop trading crypto, that feels pretty organic. And there's a number of firms in the space that have also made that transition. Albeit you guys seem to have made it sooner than a lot of other firms in the industry. What was that process like of going from deciding that you wanted to add crypto to actually operationalizing that? And then we'll get into some of the journey to actually becoming builders.Kanav (03:07):The project started as an intern project at this thing called Jump Labs. There was a research lab at the University of Illinois and was meant to work on cool stuff with the university on working on fun problems. So alongside the crypto stuff we were doing when I was an intern, there was a VR project working with professors at the university to abstract away trading screens. And there was work on some interesting machine learning and networking problems.And the group has grown out of that. And of course matured out of these things, but we've definitely strongly retained that ethos. Now I want to caveat this by saying we definitely didn't have oppressions in being infrastructure builders. When we started the project in the lab that many years ago. It's been a very organic and natural process for us. And it's hard to make the instant leap from prop trading to what we're doing today, but it's easy to reason through the steps along the way.As one of the earliest large trading firms in the space, we had a lot of requests from institutional liquidity exchanges, OTC platforms, and importantly projects that were looking to solve trading and liquidity related problems. And those conversations gave way to us exploring a lot of DeFi projects and a lot of L1 platform projects that shared a lot of the problems they were thinking through on complex financial system design or programming in resource consumer environments, which are very natural and germane to a quantitative trading firm. And those conversations led to jamming about foreign ideas to implementing governance proposals, to maybe starting to write a little bit of code in them. And then all the way into committing over 50, 70 engineers that we have today in building through the space. And that process involves a few different steps. One, it involves the willingness for the institution at large to be mentally long the space. It requires a recognition and frankly a little bit of a taste of the upside.It requires flexibility, which of course, prop trading firms just generally naturally just have to have. And then everything else you can just learn along the way, right? We've done a lot of things wrong. We've stumbled over ourselves a hundred times, but you've got to keep digging shots on asymmetric upside and with all the resources that we've had at the firm I think we've been able to make some good ones.Austin (05:20):Going back to you last year, Jump Crypto had sort of a moment where it decided it wanted to make itself public. You wrote a blog post that was laying out. I wouldn't quite call it a thesis, but laying out an idea of how you view the space and the role that something like Jump could play within it. One of the things I was struck by going back and rereading this is your level of optimism in this post, right? Which is something that you don't see from many financial trading firms. You see them seeing opportunities to make lots of money. You see them making lots of money. They're very profitable endeavors, but you usually don't see optimism contained within it. Where'd that come from?Kanav (06:01):That's a pretty good question. So quant firms today are basically research and development firms, right? So the people that build trading systems, that build the intelligence behind trading systems are generally of quantitative background. They generally have PhDs in either statistics, machine learning, physics, those kinds of endeavors. And the people building the platforms are low latency high performance systems engineers that there are different optimizations across every level of the stack to build robust, scalable, fast infrastructure.The environment down to the lab five years ago was about exploring this space. It was like, what does this space mean? Right. And it wasn't about, okay, how are we going to make X billion dollars kind of getting into this endeavor? It was about exploring it. And I think it attracted that kind of people and it occurred that kind of environment.And the leadership that stays since then has kind of embodied that. And just personally I'm a raging optimist, I believe in technology, I believe in the future, I believe in building towards something bigger. And thankfully I think the firm has shared those ideas and I hope I've been able to shape a lot of the culture and behaving that passion.Austin (07:10):Where do you think that optimism in yourself comes from? There's a lot of things you could have gone into coming out of school. What about both, something, an organization like Jump, which is undoubtedly a great place to go work. But you stay there for a while now, you've worked your way up, you're now in charge of the crypto division. Where does that sense of optimism in you come from and what makes Jump the right place for that?Kanav (07:33):I feel something for Jump because they had a cool internship program and they had a lab on site and they were working on really fun problems in a well resourced environment, that just made it fun and attractive. And after I had the opportunity to intern there for eight to 10 months, I kind of got a sense for the possibilities that existed. And this is the flexibility that the whole space had. And it was like, you come in, you get to make a lot of bets, you get a lot of resources. And if you make good bets, you get more resources and then you get more resources. This is the only place I've ever worked. I think it would be rather unique to have that kind setup. And again, no, I wouldn't say it was a passion moment to come in to Jump and know that I would be able to build suites and sanitation for crypto. But I knew I would get to do a lot of really cool stuff, work on fun problems with smart people. And where does optimism come from?Austin (08:25):Yeah. I mean, you look at a space like this. It's been through boom and bust. There's tons of amazing projects being built in the space that end up going nowhere. And especially from the vantage point of a trading firm, right? One of the secret sauce of a trading firm is it can make money in an up marketing, it can make money in a down market, right. And that is the advantage of a professional trading operation versus a more passive trading operation. But again, like those are not usually characteristics that breed optimism. Those are usually characteristics that bleed margins, where you're optimizing 1%, 2%, 3% here. So you can compound that over a year and it will make a marginal difference. But again, that's not usually an optimistic space, that's a very functional space to work in.Kanav (09:10):Yeah, it is. And traditionally I don't think it lends itself to naturally just exactly this. Jump culture has kind of always been a little bit unique. So Jump also has a number of other kind of divisions that work on non-high frequency trading stuff. Historically, since about 2011 or 2012, had a VBC arm called Jump Capital that invests in growing technologies in this space. They've had some cool endeavors in the biospace working on automation there in healthcare.And so the founders have generally been optimist. They definitely believe in the future. They've been able to take shots at things that are going on. And even if it's not naturally germane to the trading business in and of itself, the culture itself lends itself to being able to do something like this, which is a really awesome combination of knowing how to monetize, but then also knowing how to build. Yeah, it's been an absolute pleasure to be able to soak in from that environment.Austin (10:04):Let's look at the building for a bit. I think it's pretty open secret at this point that Jump are core contributors to Wormhole and Pyth, you've been very heavily involved in that process. Take me back to some of the early days there where you are internal to Jump, and you're saying like, "Hey, we need to do more than just trade and invest in this space. I think we can actually build." And especially you're talking about this from the perspective of sanitation and roads and the very base level infrastructure. Crypto's been around for a long time. I think most people coming into the space in that time horizon wouldn't have necessarily looked at and said like, "Oh, there's very base level features that are missing from this ecosystem." What was that both discovery process like, and then the process of convincing everyone internally that this was worth dedicating resources to?Kanav (10:50):Yeah, the discovery process was very organic. We had a lot of inbound from people looking to solve trading and liquidity problems because a lot of people in the space, even though we were quite kind of new of our trading presence, and as one of the early trading firms that really was trying to make bigger pushes in the space. When you get to talk to awesome founders every day about all the problems that they have and get to build relationships with them, you start to uncover a lot more of the problem space that exists, start to internalize a lot of it.And once you've got the opportunity to sit in that for a little bit, and I'm sure you see this today. We are much later on than we were when we made a lot of those big switches, but there's still a lot of opportunity, right? When we were kind of ideating on the origins of Pyth, the conversation we had was, look, our whole thesis at Jump Crypto is to be as long aligned with the space as possible, right? We're trying to get the maximum exposure we can on the space that we think is going to be explosive. And we're trying to ideate this ways which we put that quote unquote trade on, right? The best way to put a long trade on in a growing space, and the best mode to value capture is value creation. There's definitely a lot of inefficiencies created by hyper growth, right? And there's room to capture those inefficiencies. But those are small in magnitude relative to the absolute value creation at play.And then there's a value creation capture correlation that you think about there. So if you think about it in that lens and you know that you want to be big contributors to the space and just aim to create a lot of value to both, then you start thinking about what the opportunities are within your realm to be able to engage in that capacity.Austin (12:27):But at some point there's a meeting, or you have a boss who you report to, and you have to go down and sit down in front of him or her and say, "Hey, I want to spend a lot of money to hire a lot of engineers to do something that's going to be totally public and totally open source at a firm that historically likes to stay out of the news."Kanav (12:46):It was a few meetings.Austin (12:46):Yeah, I'm sure.Kanav (12:46):And it's kind of baby steps along the way, or big steps along the way that compound into a complete shift and a big switch of that nature. We had this summit, we called the August summit a few years ago. And we went down to an offsite location and we talked about what being in this space means for us and how we differentiate. And I remember we showed up with these sheets that we went around and distributed to people. We were like, this is the toolkit that we have. This is the opportunity set in the space.And everyone kind of had their own, things went on, but that was one of the approaches that I've taken. And if we believe this is where the space is going, this is the opportunity set that we can tackle. And these are the levels that we have to pull, right? And then you socialize that and you try to convince them people that there is opportunity to be had here and you get buy-in to take a first little step. And once you get the buy-in to take a first little step, and you kind of really show the big medics of differentiation in a native space, you get the buying for the next step.And then suddenly it's the entire [inaudible 00:13:47]. You get the whole kitchen sink thrown behind you, and then you are kind of propelling to this part that you want to be at. And that's the whole thesis of Jump everywhere. You take bets with asymmetric upside and we throw the kitchen sink at things that are working. And a lot of the stuff that we were doing started working.Austin (14:02):How is that journey for you personally, going from an intern involved in a few projects now to the Jump Crypto teams over a hundred at this point?Kanav (14:11):Yeah. We've got over 150 now, hard to keep track.Austin (14:14):Wow. Yeah. From a leadership role, and from your own perspective, how has that transition been? What parts of it were easier for you? What parts were harder than you were anticipating? Scaling yourself is often much harder than scaling a company.Kanav (14:28):Without a doubt, yeah. I started in the team as an intern like you pointed out, working on software problems. I came back to the team a year later in a formal full-time capacity, working on quant problems, which was to do with predicting crypto markets, building alpha and kind of scaling that piece. And the early conversations with projects where we were trying to solve liquidity problems was an area that I got really, really interested in. And I just kind of went about trying to build that a little bit further.Over time that led to a transition from engineering and quantitative work to more conversational business development work, just having spent years across all those functions and natively knowing how to live them has been the biggest tool that I've been able to build in the toolbox. Now that doesn't teach you how to manage a hundred people, that doesn't teach you how to propagate culture. It doesn't teach you how to scale hiring strategy. Doesn't teach you how to value the troops when things are low.I definitely want to make a claim that there are many who are close to a finished product, rather than trying to be good at everything, good at every one thing, we always try to be excellent at a few things. And then by force just propel everything forward. I'd say some of the biggest lessons I've learned, the biggest mistakes we've made, definitely been in the shape of trying to shove square bags in a round hole. Where in a trading environment it's like the only people you have on your team are engineers and quants. They're just smart people that can solve any shape of technical problem you throw them at. When you move that towards sales and marketing and product and everything else, that all kind of falls apart.Kanav (16:05):And you need people that are able to natively live within specific sub domains across those functions. And that's something that we've been trying to scale in. I spend basically all my time hiring and trying to focus on making sure our zero to one projects have a lot of momentum. But yeah, it's been an awesome journey. And of course I have support from a company that's grown to a 1500 people as the largest quant trading firm in the world and so lots of guidance and help along the way.Austin (16:33):Let's talk a little bit about that work you guys are doing and actually building. So if I understand correctly, the two projects that you are mostly core contributors to is Pyth and Wormhole. Is there anything else that you'd put into that category of engagement?Kanav (16:46):That's the highest level of engagement for sure. We do a lot of things across the big ecosystems of course. We can talk all of what we're doing with Solana. We're always trying to get deeper. We built an NFD project on the Metaplex landscape after their investment as an intern project. That was a real fun one. We've been core contributors to some of the projects that are coming out on the data landscape today. We've worked on a lot of the mechanism design that goes on, on the other one. And there's a few other projects, but the highest levels of engagement have definitely been with Wormhole and Pyth.Austin (17:18):Looking at over that landscape, Pyth high frequency Oracle. But again, Oracles, they've existed for a long time. There's a number of name brand ones that got their start on the ecosystem in the 2017 range. Lots of people have had ideas about Oracles over the years, some of them have worked, some of them haven't. Similar to Wormhole, bridges have existed for a long time. Bridges are actually the basis of how any L2 works, right? Both of these are hardly new ideas I would say. What about looking at the landscape gave you guys the confidence to say, not only there's a need for something different, but we can help build something different and better.Kanav (17:57):Again, just like 100% organic. In that August summit, we were looking at some of the biggest things we could do. And a big problem that everyone kind of kept voicing to us is that they don't have access to equities data. They don't have access to fast data so that they don't have to have things like clawback mechanisms and all these different things that LPs don't get direct on every turn, right?The fundamental thing with financial oracles is that they're used to settle risk transfer. They're used to set a price at which two parties exchange value. And if that price is latent or slow or not accurate, one side gets left folding the bag. Now, DeFi, the way protocols are constructed, the side that gets left holding the bag is either the LP that's contributing to the protocol or the protocol stakers or a key stakeholder in building the ecosystem.And the takers are able to take all that value. If you are going to build something that's going to house all of OTC, if we're building something like synthetics for example, and your protocol stakers are taking the other side of every trade that happens on S-Oil or SSNP, you need to make sure that's the right price. Otherwise you're just going to get up the way down to zero. When we were ideating on what the biggest ways we could contribute is let's contribute our data. And the first idea was in let's start, let's go and figure out how we bring together a network of people to build an Oracle.It was how do we contribute our data, right? And we browsed through the category of solutions. We had all the conversations. We spoke to dozens of investors and builders in the space. And there wasn't an easy way to slot in high fidelity financial data, into existing Oracle solutions. And so we spoke with some of the founding partners of the Pyth program and came to consensus that there was an opportunity here. And that led to the first step and we just kept building sets.Austin (19:39):In your mind, what is it that Pyth offers that other Oracle solutions don't offer?Kanav (19:46):Pyth is a very hyper specialized tool for high fidelity financial data, specifically financial data for settlement of risk transfer, right? If you think about the way the market data landscape looks today, it's different across asset classes, but there is a class of people that have access to high fidelity, streaming price data that they can legally distribute and make available to a protocol, create like an Oracle program.One you need access to very fast financial data, which is hard to get and even harder to have a legal right to distribute. You want to make sure that the people who are publishing the prices are the real owners of the data so that you can set incentives for the data to be accurate, right? If you are staking the value of a third party aggregator, their third party aggregator has no skin in the game. That's one of the other kind of fundamental things that you have to think about.And third, you need to acknowledge the fact that a price is not absolute. A price for Bitcoin has about 20 liquid trading venues that are distributed across the globe that can often be fractured, that can often have all kinds of different idiosyncrasies. And that being able to accurately determine the price on most relevant venues and build a dispersion is really important. If you think about kind of all those things together, you want very fast access. You want a broad range of access of independent sources, not reporting from the same source.You want very high liveness and uptime of course, and you want kind of good legal clarity that that price can continue to be distributed because you don't want the application to suddenly get turned off when the regulator says, "What's going on?" And those are the kind of key things that Pyth has really focused on very heavily to build that piece of infrastructure and Solana was the perfect opportunity. Before Solana there wasn't a way to create a high fidelity fast Oracle. There just wasn't a need for it and there wasn't a platform for it, right. And so all those things just came together.Austin (21:49):One of the criticisms that you'll hear about Pyth is that because of its structured model here, where the people providing data are permissioned at this point and are also like firms that are professionalized trading operations themselves, that there is an inherent kind of conflict of interest in that system. With any system in blockchain, you have to assume everyone is trying to cheat, everyone is trying to extract the most value possible. How have you gone about setting up incentives to make sure that the users of Pyth and the contributors to Pyth are not at odds with one another?Kanav (22:27):Yeah. I think you made a totally fine point there in that we are building for byzantine systems, right? And so that's the kind of incentive design you've got to keep in place. I'll frankly say I think that claim is a little bit ludicrous for a few different reasons. Once you peel back the onion just a little bit, and I'll talk through some of the reasons why.Austin (22:43):Let's peel back the onion.Kanav (22:44):One, you've got to first understand that the amount of value that can be created in actually pulling something like Pyth off successfully is dramatic. And the forms that are building this are now incentive aligned to make that happen. But two, this is an open sourced protocol, it is decentralized, and you can look at exactly what the inputs are, how they're being aggregated and what their resort in price output is.Three most importantly, there are about 50 financial firms that are submitting independent price data to this article to construct final outputs. And these financial trading firms aren't friendly with each other. This is the very first time that a group of highly adversarial trading firms, banks, exchanges, and ODC players across the entire space have come together and said, "Let's go build a piece of infrastructure." And one, I think that needs to be celebrated a lot, it's a huge win.But two, the trading firm, there are 50 global financial trading firms contributing their proprietary prices directly to Solana on the Pyth program today. We have realized that these 50 comprise of between 60% to 80% of global asset class volumes at this point, given the network of participants that have aggregated around this protocol. When you are that big of market share that you're covering that kind of breadth, the participants in the protocol themselves are on the other side of each other's trades almost by definition. And so who's manipulating the price against who? Let's kind of just start there.The system of incentives that set up in this taking protocol, you can read through this on the Pyth white paper has some really intelligent aggregation algorithms that put all this data together, that identify the quality of each of these independent data publishers that then sets out a mechanism to aggressively punish providers that don't have good prices. And good prices can mean I published a malicious bad price. It can mean I have slow prices. It can mean I published, I had a bug, it can mean anything.The incentive design mechanism is meant to reward data providers that are not honest, but that have great data. And that's a fundamental difference in how system designs, we're not kind of rewarding agreement, we're rewarding prediction. And so you are rewarded for correctly predicting the price that would come up rather than for rewarding agreement between parties, and which can both have different kind of models and can both work in different ways.But there is almost no possibility for one collusion across these landscapes, given the composition of the people in the network. And the incentive structure again is obviously explicitly set up to discourage that. Third, all these forms are heavily, heavily regulated. I spoke about 20 years of its reputation and a giant, giant business behind kind of making a lot of this happen. And we're definitely incentive aligned to make this thing as successful as it can possibly be.Austin (25:39):The Web 2.0 world and the rise of FinTech apps has largely taught people that organizations that claim to be on their side often aren't. There's very legitimate reasons from a market making perspective that during the game stock run up and squeeze, users of Robinhood and other FinTech applications, their trading was turned off. Now, there's a bunch of really good backroom reasons for why that might have happened. But the effect is what matters to the retail trader, which is that they were using a platform that they thought gave them equal access to a market, that platform did not provide them equal and neutral access to a market.I think when people look at something like Pyth, it wouldn't be crazy to say that, well, the same incentives that made us think that Robinhood was on our side, could also be applied to Pyth. What is different about the Web 3.0 space and the construction of something like Pyth in your view that makes that not something someone should worry about.Kanav (26:37):Web 3.0 is fundamentally any means of resource coordination, and it facilitates that by, one, facilitating the export of trust. And the export of trust is actually one of the big reasons why the whole Robinhood debacle went on, right. They basically ran out of margin requirements in order to continue to clear trades on one side, since it was so directional.And there is this massive web of intermediaries that set up all throughout traditional finance for the express purpose of establishing trust as the FCM, the DCM, the clearinghouse, all the other three letter acronyms. And all of them exist to make sure that when a match occurs on any platform that actually settles into a financial trade.In crypto the match is the execution. And that's facilitated by the fact that you can export all the trust of executing a piece of code onto Solana, onto Ethereum, onto the blockchain itself. And that's unlocked this completely new means of resource coordination, which makes things like Pyth possible. It means that you can explicitly lay out a system of incentives in a closed loop fashion. And regardless of who's uploading the code, or who's proposing designs or architecting any of this, everybody is independently participating according to the incentives laid out very plainly by the program itself.And that means DRW and Jane Street don't have to trust Jump when they decide to publish prices to pay. That means they look at the program that's running on Solana that they can read. They look at Solana's trust model and decided they can or don't trust Solana as a platform. And then contribute to the platform that then self executes and lives on its own terms. And the fact that we can allow different kinds of state to compose in a trustless fashion is the entire revolution Web 3.0, that's basically what the whole space has been building for the last 10 years. And that's what makes Pyth possible, it simply was not possible before.Austin (28:32):What does something like Jump or Jane Street or anyone who's a data contributor to Pyth, what do they get out of it? What is their incentive apart from any rewards that might be generated from contributing data. How are they then going back and using this on chain data in their own operations?Kanav (28:51):There's a few elements. And so one, it is fundamentally a two sided marketplace, right? It has data publishers and it has data consumers. And the other interesting thing like Uber did for taxi cabs, where it created a marketplace where cars could now come online, created this marketplace where data that was once latent came online.Jump is publishing its own trades to the Pyth network. That is IP that it has the legal rights over, has only just been a cost center so far, and now has the opportunity to get monetized. And that's the same for all of the trading firms that sit in the network. It's a lot of people to turn cost centers into potential elements in the marketplace and that bootstraps the supply. The consumers of the data obviously are paying for this extremely created highly robust set of data inputs that then get aggregated. And that creates kind of flows in one direction. And then like your regular two sided marketplace, it accrues value, right?All the data publishers today in Pyth have some sort of stake of asset interest in the thing succeeding. And there is a set of incentives that then rewards them for the correct participation going on with fees, rewards, all those kinds of things. And all that is in gross detail laid out in the white paper and we can go over some of that. But the off chain applications and some of this stuff is also quite interesting, right?So if you look at kind of back office systems around the world at forms like Jump, you don't need microsecond level access to financial data, but you need that for your trading engines because otherwise you're playing at a disadvantage related to the field. But in order to make sure that your clearing prices have happened correctly in order to make charts in order to do something like a trading view, in order to get on the Bloomberg terminal or to be on a ticker somewhere, all these applications are now easily facilitated by subscribing to something like Pyth, that's living on an open kind of blockchain area. And so a lot of the off-chain use cases are getting more and more interesting I think over time. The fundamental value is in creating the pricing source for on chain data. And this is kind of like an awesome thing that just falls out of it.Austin (30:56):That's a really interesting way of thinking about both the incentive alignments and the rule that the data providers versus the data consumers play in the market. Are there any token plans for Pyth?Kanav (31:07):Yes, there is a token plan for Pyth. You can read all about it on the white paper, no comments on timing or anything of that at this point. And that's going to be a networking governance decision, but I'm sure in the near future.Austin (31:16):Transitioning over to Wormhole, which is the other project that Jump is heavily involved in as a core contributor of the code. When people look at wormhole, I think it's very easy to look at it and say, asset bridge, multi chain, cool, fundamentally utility. The first thing I noticed when we were talking about this and looking through it is this whole component of allowing different smart contracts on different blockchains to communicate with each other. I think most people understand how asset bridging works. Can you talk a little bit about this whole concept of message bridging?Kanav (31:51):Yeah. And this also kind of goes back to your question on, how do you decide that there's an opportunity here when bridging is something that people have talked about for a while? When we were kind of ideating with everybody else on kind the Pyth's team and the network on how Pyth goes across chain. Hendrick and team were building Wormhole as Solana Eths token bridge on the hackathon project at [inaudible 00:32:17].And I called Hendrick and I asked him, "Look, is there a way to generalize this thing so that we can get Pyth messages across?" We're building this Oracle thing on the best, fast, scalable censorship resistant message bus we can, but we want to get it to all the other ones that operate on a slightly different resolution. And through the course of that conversation, we came to a conclusion that enabling generic message bosses to allow this cross chain composability in a much more high dimensional fashion than just the token bridge word was a massive opportunity set that had to be filled.And so when we launched last August as a completely generic message bus. And what that means is that any piece of state that is created or lives on a blockchain can be included as a message that then gets communicated to any other blockchain environment. And so if you think about Oracles, you think about a governance board, right? Uniswap passes a governance board on Ethereum, produces workloads on a lot of different chains. The outcome of that governance board has to, in a secure, reliable fashion, be communicated to all the other geographies that Uniswap lives on. That needs to be encoded as a message.And so Wormhole has outpost contracts on every chain that is deployed, it is deployed over eight chains today. The outpost contract just listens for a message that is sent to that contract and the Wormhole network of guardians attests to that arbitrary binary block. That block can then be picked up, relayed to any other blockchain environment, verified that is coming attested from the homeowner network and then decode to do anything arbitrary and interesting. And so generic message process have really exploded over the last year. We've seen so many awesome applications being built on it. And I think we're just kind of scratching the surface, right? There's a lot to do here.Austin (34:04):When I think about messaging, I think about how a lot of the models right now for cross chain communication of assets are a little tedious and maybe have more risk inherent to them than are necessarily required. A very centralized example, USDC, right? You can go to FTX and you can withdraw USDC as an ERC-20, as an SPL token or across several different networks. And what's happening there largely is because the mint authority to that is centrally controlled. They're able to issue new, quote unquote new USDC natively on each layer that USDC is supported on. Do you see the capability of developers using something like Wormhole to make that possible for fully decentralized, both stable coins and just asset tokens?Not only possible, but already widely adopted in the Wormhole X asset framework, right? There's over four and a half billion of assets in the token bridge today. And the word token bridge kind of has meant a lot of different things to people at different points in time, right? The old token bridges were bidirectional, state sponsored bridges that sovereign ecosystems would run to communicate to Ethereum, to get liquidity in as soon as possible.And then if you send that across a different bridge, then you would have like a double wrapped and triple wrapped implementation and just an absolute UX nightmare. When you use something like Wormhole's X asset framework, you retain complete path independence as you move assets across the ecosystem. Once you're registered as an X asset, let's take USD as an example, there's a couple billion dollars of USD on the bridge today. It flows throughout the ecosystem using Wormhole on the back end, Terra bridge money, uses one more on the back end to expose one of many front ends to users.When USD flows from Terra over to Ethereum or to Solana to Polygon and then to Avalanche, it retains the same representation on Avalanche that USD flowing from Terra to Avalanche directly or through any other part in the ecosystem would retain. It's a truly cross chain native asset. It doesn't fracture liquidity, it fungus seamlessly, and it allows a lot of cool composition.If you look at something, now like the result in second order effects of this, it's this theme that we've been calling X Dapps, right? So cross chained apps. And we've seen kind of the first marquee deployment of one of these apps in the form of X anchor, which is deployed on the Avalanche chain now, right?And X anchor is just a light set of endpoints that's deployed on Avalanche. And all that does is it lets you kind of hit some functions that then really assets and/or messages bundled or separately or back to the Terra blockchain and then trigger state transitions on the Terra site. Anchor contracts don't need to be deployed to every chain. You don't need to replicate state everywhere, you don't need to stay synchronized continuously. But you allow for outposts and communications and different chains to then communicate back to the home chain using messages and assets. And now the USD that's in the X asset standard can be deployed to X anchors everywhere. And it's a much faster, much more robust getting strategy that has far less communication over.Austin (37:07):Let's dig into just a little bit on like a technical level too. When you're talking about X Dapps or cross chain Dapps that are communicating via Wormhole, you're inherently talking about fractured state across multiple L1s or L2, it's unavoidable when you're ... anything cross chain is inherently working under a fractured state model. How fast does that time synchronization need to be for developers to actually deploy something like an AMM or a club across chain and actually maintain price parody and appropriate liquidity between them.Kanav (37:42):Yeah, I'm glad you brought this up. There's a few different programming models for how cross chain Dapps works, right? One is you try to state synchronize as aggressively as possible. You keep sending messages back and forth. You have allowances, risk limits, tolerances that allow your apps to communicate. And the other is this X Dapps framework where state only lives on one chain and you allow people from other chains to then interact with it.Now, of course that also comes with its own downsides, right? If you look at something like a club and you're trying to trigger a cross chain swap using the club from another chain, you are inherently incurring the latency of the two blockchain transactions and the finality assumptions that you want to kind of work with that. The more stateful your application becomes, obviously the more latency and risk constraints everything through. With something like a lending protocol or like a cross chain anchor, things like that. They are less stateful than something like an order book, but order book is probably the most stateful you can get right in the spectrum of applications.And so any cross chain swap design inherently has to have some additional liquidity back then, that's like fundamental, right? You can ask people to take risk on your behalf. You can have the protocol take risk on your behalf, but that risk exists. There's a lot of ways to program around it and create better user experiences, but fundamentally that's a real problem and somebody has to be compensated with that risk.Austin (38:56):For the X Dapp framework, are you looking to actually be able to offload compute to the wormhole level there? Or is it really just ... The natural extension of this seems to be that eventually there's some sort of state storage on Wormhole that Dapps are able to actually access and leverage with some functionally side chain compute resourcing. Are you guys thinking about that as well?Kanav (39:19):Yeah. The fundamental cross chain thesis is that there are going to be independent, specialized compute environments that attack their own communities, their own audiences and their own apps. And Wormhole is away for folks to leverage state that results from these autogenous environments and compute the solutions on these environments to compose.And you can cut that in a million different ways. You can leverage Solana as a state execution machine. You can leverage Terra as your stable coin asset layer and you can represent this third thing as a NFT thing, or you can bundle them all in. But the Wormhole vision itself right now with all the genetic message capabilities that are out there, in the near term roadmap doesn't need to build an execution layer of its own. It can naturally extend to it. I think you're definitely kind of pointing to something that's relevant.But I don't know if that's the lowest hanging fruit given the capacities that exist in current blockchain compute environment. The vision of course is to make people, Web 3.0 users rather than blockchain users or L1 users. You basically want to deploy resources to the most relevant execution environment with the right community, that's creating the right apps and then expose that to at a higher order to consumers.Austin (40:24):Would you describe Wormhole as layer zero?Kanav (40:28):I’m rather old school, I think of layer zeros as networking protocols and internet backbones and things like that. I think it is maybe a useful analogy for kind of blockchain audiences given how we've very economically can't use the word L1, so I don't have an allergic reaction to it, but it's not my first word of choice.Austin (40:46):What would your first word of choice be?Kanav (40:49):Interoperability protocol. I'm not that creative.Austin (40:51):Yeah. Wormhole is also supporting wrapped NFTs, which is kind of an interesting concept. I think most people don't think of NFTs as something that's been bridged and quite frankly, the numbers on Wormhole on bridge NFTs are quite low compared to the success as an asset bridge or a messaging bridge. What was the original idea of using wrapped NFTs? And why do you think it hasn't caught on as much yet?Kanav (41:20):I think cross chain NFTs as a story are just beginning to play out. So there's about 16, 1700 on the NFT bridge itself. And again, NFTs are also cross chain fungible and composable across environments. They are also part of the X asset framework. And so X assets can mean anything. It can be in rebasing assets like STE, it can be in NFTs. It can be in fungible assets. It can mean anything else, right?The NFT story started to play out as a result of new other ones trying to access marketplaces that supported one or the other chain, right? And so you get to access as new audiences, you get to create experiences with different communities. You get to access different user bases, but we're seeing the experiences get a lot richer. So you see something like [inaudible 00:42:00] come out recently, they got featured on Bloomberg for new cross chain staking program where they have in game elements that kind of change based on cross chain NFT staking that are different experiences with different communities. And much like the asset bridge has that kind of globalization and cross pollination of commercial kind of elements. Cross chain NFTs are globalization kind of culture. And incorporating a lot of those elements across games that live on Solana, that live on Terra, that live on other environments and just creating those kind of richer experiences.And so we're seeing people make NFTs on one chain, come to Solana, fractionalize them, trade them, put them back in, move them over to OpenSea on Ethereum. There's all kind of interesting use case patterns. And so it's definitely been less aggressively adopted than the explosive token bridge or the other generic message applications. But there are still 16, 7,000 NFTs, there are a lot of teams using it for cool and innovative stuff that we just kind of keep up out of the wood works every some time.Austin (43:02):Do you think that's social? Do you think that's technological? Do you think that's just like the ecosystem hasn't matured enough? I think I'm surprised how much ... well, I guess surprises maybe the wrong term. People have a lot of emotional attachment to an NFT, in the same way they don't have an emotional attachment to a Bitcoin. They may have emotional attachment to the concept of a Bitcoin, but I would be upset if I lost my particular Degen ape, even if I got a different one for the exact same value. Do you think that factors in at all to how people view the concept of wrapping an NFT, that it somehow weakens the authenticity?Kanav (43:39):I think for a lot of purists, it does. I think it was just so worthy, right. For the most part, people aren't even going to realize, the large end of this consumers like buying these things, an NBA top shot or air, or any of these other platforms, it's something on the app for them. And eventually it's going to be extracted away as we draw to Eth, we draw to Solana, we draw to wallet, connect wallet, and it's going to be kind of as simple as that. And so we're always going to have purist stakes, but I think that's going to remain within our little chamber here.Austin (44:05):For Jump Crypto in general, how do you view NFTs? There are obviously firms now that are dabbling and market making and NFTs. Is that something that you've looked at and if not, what was the decision not to enter that space yet?Kanav (44:19):It just doesn't take a lot. We are looking at trading opportunities. You are looking about margins, you're looking about what predictive offer you can have, like what the edge you can have on a traders and then how many times you can apply that edge, right? It's just as simple as that. And even if you can get a 30% margin on something that trades a hundred million like week one, I mean, [inaudible 00:44:40] now.But if you have a low volume asset class, even if it has slightly higher edge, and it is harder to predict and more dimensional, this is on a good researching decision. So as that volume changes, we will continue to stay on top of it. And I don't know if these are trading tens of billions of dollars every day, and have really interesting datasets, I'm sure we'll be trading them.Austin (45:00):If the market hundred X in size, you wouldn't be opposed to it, it's just the sizing opportunity issue right now.Kanav (45:08):[inaudible 00:45:08] you can't be the richest man. It's about identifying if there's opportunity and executing all native there is.Austin (45:14):Looking at wormhole, one of the things I do want to touch on is the wormhole hack and exploit that happened a little while ago. It was one of the larger bridge hacks at the time. It was eclipsed a few weeks later by an even larger hack of another bridge, also targeting stolen Eth in this process. I'm sure that activities and projects that Jump has been involved in have had larger losses of money or similar volumes of money just based on the area you operate in. But this is one that inherently to the nature of Web 3.0 is very public. How is that like internally knowing that your core contributors to a project that suffered this kind of exploit, and also that failure is now a public failure, as opposed to maybe where it would've been a private failure beforeKanav (45:56):Building is hard, building in the open is even harder. And building in a decentralized open space where there's a large network of participants, consumers, affected people, the stakes we're playing in, right? That's the stakes that every DeFi application, that every L1 at every bridge and that everything in Web 3.0 that aims to do something meaningful inherently adopts and has to learn to deal with.The hack was big punch in the gut, obviously a big financial loss as well. The fundamental nature of smart contracts is that the code and code can have bugs. And this exploit was kind of deep, deep, deep down in the stack, in kind of like Solana instruction verification account check that was missing. The auditors listed our team that has independently been one of the biggest bug bounty finders in the space missed, and code based at the opportunity to be out in the wide for seven months, kind of had unchecked.The day of the hack, of course really, really rough. Jump is not used to being a public institution. So this was like you said, a very public kind of fallout in nature. I can't possibly have been prouder of the way the team reacted to this incident. We kind identified it within short course of it happening. We pulled the meeting room together, identified the bug, fixed up a batch, managed to coordinate the guardian network to bring it up, bring it down, announce our intent to refill the gaping 320 million hole within an hour of the incident being reported on, and brought the bridge back up within 18 hours to end to end.Building bridges and building cross chain is very, very hard. And that's where the reward for it, building it right, is even harder. You don't even make 320 million decisions very lightly, and this should hopefully signify you how much conviction and faith we have in the code base in bringing it back up in 18 hours. It should tell you about where we think this whole space is going and where Wormhole is going and where interoperability is going and what a core piece of infrastructure in that realm would mean.Security continues to be extremely, extremely top of mind. We have a 10 million bug bounty. We have an internal red team that's basically thinking about breaking Wormhole and our key projects every day. We have multiple audit from [inaudible 00:48:12] with lots of audits going on, pretty intense security review practices, all of which can be found publicly online. And I'm incredibly confident that Wormhole has come out more stronger from this incident. The team has come out kicking and that we're building one of the best and most trusted inter op solutions out there.Austin (48:32):Looking across the ecosystem, let's say over the next 12 to 18 months, what are you personally most excited for and what keeps you up at night? What do you still have worry around?Kanav (48:44):I'm looking forward to a whole bunch of things. So definitely very excited about all the advancements that we are seeing in the succinct proof and zero knowledge space. That stuff is just awesome, it's magic. And I'm just so excited to see all the things that's going to unlock for us. There's a lot of interesting problems in the hardware acceleration space that need to be made to make that possible. There's a lot of problems algorithmically that are kind of being uncovered there. And I think hopefully this conversation has lent on that we have a big infrastructure mindset. When I say streets and sanitation, that's kind of what we think about every day. That's what we're looking forward to. And on what we can build to and contribute to that.Austin (49:19):You said something I got to get a little more info. You said specific hardware to accelerate certain kinds of applications. The only place we've really seen this so far across the entire crypto landscape is ASICs for Bitcoin mining. You see GPU mining optimization, but again, nowadays I wouldn't necessarily even call GPU specialized hardware. It's really commodity hardware at this point that's just deployed for a specific application. When you're looking at the space, where are you seeing actually custom silicon or FPGAs becoming something that it makes sense to deploy?Kanav (49:50):Yeah, I mean, definitely for zero knowledge provers, right? So like two verification times have compressed a lot to the point where it's pretty feasible on most blockchain environments today. But proving itself is still super, super resource intensive. That's where there's a lot of simple math operations that can be encoded into Silicon and into FPGAs or ASICs to speed up the process significantly. And that's where we are seeing a lot of adopt. There's already a lot of people working on this on hardware acceleration using FPGAs, maybe even ASICs on zero knowledge provers.It's a little bit of like it's tough to say when the right time is because there's new changes like algorithmically coming out all the time with the new advances in new papers. And so when you spend a whole bunch of time just optimizing Fast Fourier transforms. And then the next paper makes Fast Fourier transforms not relevant. It's tough to make a decision on when the right time is, but I know there's a lot of work already going on into it. And it's a space that we are very familiar with and that we are also excited about. And mostly, mostly positive stuff on the regulatory side.Kanav (50:56):As of recently I think there's a lot of good faith engagement from regulators around the world on setting frameworks and policies for how kind of all this stuff gets put into place. Outside of maybe China we haven't seen anything very aggressively or handed on cutting off innovation. We even saw India now finally starting to open up. And so I feel more optimistic about the regulatory landscape than I did 12 months ago. We need a new influx of builders to keep coming and building cool experience and leveraging this technology where we're seeing that happen. We need capital being continued to commit to this space where we're seeing that happen.Austin (51:35):The inverse of that question, what are you most concerned about on a macro level for the space still?Kanav (51:39):Asset pricing is of course highly dependent on macro environment and that is unrelated to crypto, right? And there's just like, it's its own thing. And so we'll see price movements on a different time scale. And if you see a very sustained global macro depressed environment, then we're going to see less capital, less builders and less momentum in the space. And I think that's probably the biggest overhang we have today.Austin (52:03):In the long run we're all dead.Kanav (52:05):In the wrong run we're all dead. That's right, so let's keep building.Austin (52:09):Yes. One kind of last question here, I think if you rerun the clock maybe three or four years, the prevailing wisdom in this space was not that traditional financial institutions were going to expand their vision and embrace blockchain and we'd call it Web 3.0 at the end of the day. And you'd have Twitter profile pictures of NFTs, you'd have Jump Trading building software that's open source for a decentralized environment. And we really have seen that that is what was originally pitched as a forked parallel path of economic development.Austin (52:42):It's a little bit more twisty curvy than we thought it was going to be. And there's a lot more integration with traditional companies. As crypto has a thesis about it, that it's moving more consumer, right? Across the spectrum you see more normies getting into crypto in one way or another. Does the existing market of specifically the United States and Europe where you see very few competitors within an ecosystem.Austin (53:07):There's basically only two phone companies. There's basically only three cell phone companies. There's basically only four internet provider companies. Across the spectrum you see very non-competitive markets. When you look at the consumer landscape in the United States, do you imagine that we're going to see similar patterns rolling out there as we saw in the financial industry, or we really are going to go back to that idea of a parallel execution model?Kanav (53:30):Yeah. I'll strongly state that I don't hold a heretical view of this kind of being a completely forked off parallel path that has no relevance to anything that we do today. I think it's an amazing technological invasion that gives us tools to coordinate resources in an untrusted environment. And that's unlocking a lot of magic.Kanav (53:49):But that again bleeds in with the rest of the real world, which is also big and has its own dramatic pieces of innovation and with a whole bunch of other stuff going on. I think one of the most exciting things has been kind of the global equalizer that crypto can serve to be. Yesterday we saw Polygon come out with an integration with Stripe. And these are three kids from India that had no early supporting or backing that kind of boosted the network on their own and are now competing on a very, very competitive landscape with people from every single part of the world that are very well resourced, competent teams.Kanav (54:23):We see [Inaudible] coming from Korea. We see teams from Australia and New Zealand over the [inaudible 00:54:28] guys. We see people from Berlin and the US and everybody competing on the same, not only the similar consumer markets, but also on the same capital markets. And there are network effects that accrue, but not cannibalistic network effects that accrue. That makes me very excited about where the space is going overall. When we talk about integration points itself, it's going to largely depend on [inaudible 00:54:52], right? And that's like an unsatisfactory answer.Kanav (54:55):But if you're talking about financial markets, crypto is already integrated heavily into the financial markets with 15 excellent international venues that are competing, so we already have a fractured environment. That is before the [inaudible 00:55:08], the NASDAQ, the CME groups have made their moves in the space. And they're clearly not going to be monopolies in crypto, obviously, right?Kanav (55:16):If you look at something like a telco and interactions with like cell networks still remains to be seen, whether like decentralized constructions of those kinds of things can be competitive. I mean, building telcos and stuff has such strong network effects and so many economies of scale. And it's unclear whether a Web 3.0 means of accruing that value to a decentralized organization has the ability to accrue the similar kind of network effects and so remains to be seen. But I'm excited to see it play out.Austin (55:43):I always enjoy getting to pick your brain about where these technologies are going and the intersection of a very traditional financial world with this new global system that we've all been building. But thank you so much for joining us for spending some time digging into this stuff.Kanav (56:00):Thanks a lot for having me on Austin. This was super fun and as always, love chatting, so yeah, we'll see you again soon.Austin (56:04):Thanks.

Chris Osborn is the Founder and CEO of Dialect, a smart messaging protocol that powers seamless, on-chain messaging experiences, starting with wallet-to-wallet chat and dapp notifications. Joe McCann guest hosts. 00:49 - Origin Story02:06 - What is Dialect?05:59 - What are the blockers in Web 3.0?07:46 - Why Solana?11:11 - Looked into other ecosystems?13:52 - What is the process to use Dialect?22:31 - Using Solana Pay with Dialect27:22 - In-game messaging28:36 - Dialect's operations and current projects31:03 - Exciting projects in web 3.034:53 - NFTs and Messaging DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Joe (00:10):Hey everybody. Welcome back to the Solana Podcast. It is Joe McCann here again as your guest host, and today we have a very special guest, founder and CEO of Dialect, Chris Osborn.Chris (00:23):Hey Joe, it's great to be here.Joe (00:25):It's great to have you. So I'm really excited about today's episode because what you are doing at Dialect, I think, unlocks a lot of really interesting use cases in the Solana ecosystem, but first I think it might be useful for the listeners to kind of get a sense of who you are, your background and frankly, how you even got started with Dialect.Chris (00:49):So my background is actually in physics. I did my PhD in Atomic Physics at Columbia University. So this WAs like laser cooling and trapping of atoms, precision time measurements and quantum computing stuff. I learned pretty quickly that what I really loved to do is write software and build technology, so I knew after graduating that I wanted to move to the West Coast and work on some cool technology problems. I actually had an opportunity to split the difference and I worked at Rigetti Computing. I don't know if you're familiar, they're a quantum computing startup and got to work on almost every part of their stack, including a lot of software and technology.I helped lead one of the three teams that launched quantum cloud services, which was like AWS for quantum computing, and that helped me realize that I really love kind of like bridging the gap between hard tech and consumer problems and how do users interact with hard tech, and got the itch to build a startup. So actually I started this company outside of crypto and participated in YC. We were building a consumer investing product and pivoted the company actually last fall or early last fall full force induced Solana and started building Dialect.Joe (02:01):Yeah, that's great. I mean, can you maybe just in a few words, like what is Dialect?Chris (02:07):Yeah, so with Dialect what we're doing is we're building what we're calling a smart messaging protocol for DApp notifications and wallet-to-wallet chat. Those are the first two use cases that we're working on. And the best way to think about it is kind of like a decentralized inbox, a way to enable the messaging primitive between wallets. I personally like to think about kind of like hair on fire burning use cases, the things that people need today, and one of the major use cases here is giving DApps a way to connect directly with their users. And that's through the main mechanism that users identify themselves on the blockchain, which is with wallets.Joe (02:46):So cool. So, I mean, I remember meeting you many, many months ago last year and was really blown away because one of the kind of gaps that I was seeing in a lot of Web 3.0 Applications, irrespective of the underlying chain, was the ability to have like native notifications that are genuinely on chain and not using a service like Twilio or a Web 2.0 or cloud computing context. So the users kind of better understand what Dialect is and can enable, you can kind of walk through maybe some canonical use cases of Dialect?Chris (03:22):Yeah, absolutely. So the use case that got me into it right away like that first just really compelling use case is if you're using a collateralized lending protocol. You lend in token A and you borrow out token B and as prices move, if you become under collateral, the protocol or many protocols will end up liquidating your collateral on an underlying market. And in a world without messages and notifications, basically up until today, a lot of early DeFi users relied on just like a poll mechanism. Like I got to constantly come back to this product and refresh the browser and see how are my positions doing? And there've actually been some like kind of remarkable situations where when there were dramatic price movements, people could see that there was a wallet address on chain that was at risk of a very large liquidation and folks were like, "How do we get in touch with this user? How do we actually contact them and let them know that there's a problem?"And so there's no question that there's like a huge need here. Liquidations were the start, we're now working with projects across DeFi in various capacities, DAOs is another really big use case we can talk about in a little bit and NFTs. So alerts about really important situations, obviously those are kind of like that first use case, but the holy grail with messaging is user retention and engagement. So even if you get beyond emergency situations across whether it's like NFTs and more social, or whether it's DAOs and collaboration, there's just like infinite use cases for technology like this.Joe (04:58):That's really cool. I mean, I agree. It feels like almost every Web 3.0 project or protocol is going to need notifications in some capacity. I mean, I know myself I've been in those positions where I need to add more collateral to a position and I have to keep going back to it, or more recently using some of the structured product vaults that are out there where you can... if you want to say redeem some of your investment, maybe the interest that you've earned, you have to just kind of set a calendar invite.Chris (05:27):That's exactly right. That's right.Joe (05:28):Yeah. So to me that's some friction for end users, but it seems like a solvable problem and it sounds like that's what Dialect is doing. But I'm curious because today in like a Web 2.0 Kind of cloudy world, push notifications, email notifications, in-browser notifications, they just seem so commonplace to implement. So why is it that you think that this hasn't really been a thing yet in Web 3.0 ? What's been kind of the blocker and maybe then we can talk about why you chose Solana?Chris (06:01):Yeah, this is actually a really... This is a super cool problem. The blocker is the following, and obviously nothing's ever truly a strict blocker, it's really just a question of sort of like what are your priorities and what are you working on? So in Web 2.0if you're like a typical startup, you're already running some backend service that's got a database and it's got some synchronous and asynchronous processes. And if you're building in Web 2.0, there's tons of Web 2.0 tooling to support you. And so right into one of those backend services, you can sign up for Twilio, get your authentication keys, store them as environment variables and then anytime there's a specific process where you want to send a user a text message, you just fire it off. Same exact kind of Web 2.0 SaaS system exists for Apple push notifications, Android, SendGrid email, all that. Where things get interesting in Web 3.0 is typically, and especially with like the more really Web 3.0 native projects, whether that's in DeFi, NFTs, wherever, your backend is the blockchain.And there's some basic things that are different with most blockchains like Solana or Ethereum, and that's that most information is public. So you can't store sort of like secret credentials on chain and then in addition, you can't make HTTP requests to some other SaaS. So like the SaaS model breaks down when you start building in blockchain, so if you want to support these use cases for your users, you basically have to like expand your engineering footprint, spin up some Web 2.0 services that perform two processes. One is monitor the blockchain for the events that you care about and then number two is decide that you're going to send messages accordingly, whether that's like Twilio, email or push notifications. So that's part one and then part two, to answer your question about why Solana, and this comes back to my personal journey in crypto.So a friend told me about Bitcoin way back in like 2011. Around that time, I was first exposed to the proof of work concept. It's like easily top five most incredible things that I've learned in my life. I didn't start working in crypto until now, but that had a huge impact on me and I've been following along with everything that's been happening in crypto since then. So heard about Ethereum in 2016 when it... I think it launched in 2016. And what Bitcoin did with proof of work decentralization and then Ethereum did for generalizing compute on-chain and in a decentralized fashion, I discovered Solana in late 2020, I think early October, 2020. For me what Bitcoin and Ethereum did, Solana's proof of history and how it scales technology for ultra fast transaction settlement times, ultra low transaction fee costs, that to me was as impactful. So I see that in the direct lineage of technology.So, that was like late 2020, and DeFi Summer was in full force. I was starting to use more and more technology like more and more Web 3.0 native apps. Over the course of that year I mentioned I was working on a separate project, I saw the Solana ecosystem just absolutely explode. It was like a literal Cambrian explosion. So by the time it was like late summer of 2021, I was taking a hard look at what I was currently working on and then I was looking at Solana and saying every extra week that I'm not working on solana is just a huge missed opportunity. And pulled the trigger and moved full force into Solana. Solana's transaction costs and speed opened up an enormous new design space that is really not feasible if you want to build a truly on-chain messaging system on some other blockchains.So if you're looking at fractions of a tenth of a penny in terms of the transaction costs and then subsecond, you know 400 millisecond block times, that enables a very large new design space. So what I saw at the time was this opportunity to build a whole new SaaS layers. So with Dialect we're building developer tooling, we want to provide this end user experience for developers to build into their own DApps. And when you have any orders of magnitude improvement in performance, it just opens up a very large new space to build in, so to me it was a no brainer. There was no question in my mind. So I've been a blockchain enthusiast for over 10 years, but Solana was that threshold. That was sort of that Rubicon where I just knew this is this, it's now time to build.Joe (10:22):Yeah. I mean, I feel like in other ecosystems, something like this... I don't want to say it's not possible, it just seems like it's impractical. And I think Solana's design where it has this incredibly cheap transaction fee and speed is perfectly suited for something like Dialect and on-chain messaging, if you will. But have you dug into say other chains like maybe something in the Cosmos Ecosystem or even just Ethereum? And did you evaluate whether or not this could be done or was it just kind of like at the baseline look, Ethereum is like pretty expensive for transaction and relatively slow block times, this is just going to work for say push notifications or wallet-to-wallet messaging?Chris (11:12):Yeah, so that's a great question. I would say the following: there are some wallet-to-wallet chat and communication tools on Ethereum and with many of them, what you do is you authenticate with your wallet, but the messages may be stored off-chain somewhere else. And that's not obviously a total deal breaker. In general, I think the authentication problem... I know it's not specific to messaging, but it obviously takes really like a front seat in messaging of who's sending these messages, and the general problem of authenticating with your wallet is just a fun design space. So we're personally really excited to see messaging come online on some other blockchains. If you really want to run a fully on-chain experience where the message source of truth is on-chain, Solana really has several orders of magnitude on a lot of these competing chains.Not that that's necessarily the future that exists long term, it may actually make sense for there to be more of a data centric L1 that stores these messages. And so the choice for us coming full circle on this question is Solana presented an opportunity for us to build relatively small architectural footprint. That means let's just keep as much on Solana as possible. We're decentralized first, we're not storing any messages in say fire base or any other Web2 services, and really provide that great experience, and it's really just a question now of where go.Messaging between wallet is such an important and compelling use case, and I think we're seeing a lot more projects come online now that this problem's inevitably going to be solved in a cross chain manner. We are excited about that future, but we're a hundred percent focused on Solana for now. We also say, I didn't necessarily explicitly say this earlier, but Solana's proof of history concept and the way that it works, some of the first podcasts I listened to about that in summer and fall of 2020, just really blew my mind. So another big piece of it is go where there's just exciting technology, where the developers are extremely talented and everybody's really enthusiastic. For us, there's just a no brainer, we a blast on Solana.Joe (13:15):I hear that very, very often these days, there's been quite a bit of interest from developers; in a lot of cases, developers who have never written an Ethereum app or any sort of other Web 3.0 app or just diving into Solana and loving it. So speaking of developers, as a developer, how do I use Dialect? Can you kind of walk us through the scenario? Is there an SDK? Is there a token I need to have? What is the kind of process if I'm a protocol or a project today that wants or needs on-chain messaging or notifications for my protocol or project? How do I get started?Chris (13:54):Let me answer in two parts. Number one is what you do today. Our messaging protocol is live and audited on the Solana main net, and we have open sourced our protocol and Web 3.0 client we build with Anchor. I really love anchor, it's one of our favorite toolkits we've worked with. So you can import that Web 3.0 client directly into your web app or some other process, some other service that you're running and you can get started sending messages right away. As I mentioned, even for DApp notifications, the primitive is wallet-to-wallet messaging. So in the same way that you might receive an email from a business, some kind of notification they're sending from an email address that they manages the business, the same thing goes here; you manage a key pair that you do your messaging with. So you can import our protocol and just start sending and receiving messages.The main way that most projects interact with our tooling is two-part though, two layers on top of that core protocol. Number one is if you're a DApp and you need to send a notification to a user or a message saying that they're at risk of liquidation, let's come back to this liquidation example. You need to be monitoring the blockchain to detect that there's this event where you then programmatically send the messages. The same thing goes historically with Twilio or SendGrid, you incorporate this code into your services. So like we talked about earlier, you need to be running these off-chain services that help determine that events are happening and to write messages. And we offer open source tooling around this, it's called our monitor framework and our monitoring service, which is our opinionated way about how to host that. And you can then basically spin this up yourself, or you can host with us and you use that to write the very minimal code that's specific to your protocol.So let's say you have some way to query for the users or the wallets obligations, which is a term that lending protocols use, and you can get your collateral health or your risk of liquidation directly from that data. Our monitoring service allows you to fetch that data, basically write the code that's specific to your protocol and then that gets piped into kind of like a reactive framework that we use to determine whether or not to send messages. So this is monitoring tooling that's specifically custom built for figuring out to send a message and it can work very flexibly with other kinds of tooling. Maybe it's like you've got a Kafka messaging queue, or some other kinds of... Some projects actually have fairly sophisticated Web 2.0 infrastructure, but they're still interested in working with us because we handle the hard problem to just making sure at most one and just at least one message get fired off to a user.The second half is how do you surface these messages to users? So today what we're solving, what we're live with are what we're calling in-app notifications. So think about your favorite Web 2.0 product; you sign in, and maybe somewhere in the nav bar you see a little notification bell and it's a button and you can click to see that there are messages or something you need to know about from that product. Today, we offer basically like a single React component. We're prioritizing React, most projects, web apps are built in React, where you can drop that single component into the nav bar of your DApp and right out of the box if a user clicks that notification, they have the opportunity to fully onboard to the notification experience all within that single component. So it's like a model that pops up that allows you to say yes, I'd like to enable notifications for this app.And then once you've done that, you can kind of see what are you going to get notifications around. So it might be warnings about pending liquidations, it might be liquidations themselves, it might be actually more receipt style messages. So it might be an order filled if you're using a DEX where orders fill asynchronously, it can be things around DAO collaborations. So one of the major use cases that DAOs we've been speaking to have been interested in is engagement and retention on voting. So you might receive notifications from a DAO telling you that you have six hours left to vote on a proposal, or that there's a new proposal, or that maybe you're near a quorum on the voting threshold needed to pass or reject a proposal. So there's all these different use cases and really you get that right out of the box directly in your nav bar with this single React component. So that's in-app notifications.What's coming soon and coming back to this question of just the broader messaging thesis, we're launching support soon for email, Telegram, possibly text message, other kinds of Web 2.0 means because the reality is even if the thesis and the vision is fully on-chain messaging, we live in a world where many users rely on and really appreciate getting messages via Web 2.0. So email's a no-brainer, and a lot of projects have asked us to support that so that's coming online very soon. And then Telegram is a little more of like a Web 3.0 native messaging solution that's still off-chain, and a lot of projects have asked us for support on that. So you can think of the Dialect standard as both the on-chain messaging standard, as well as a suite of really out of the box tooling to allow DApps to reach their users however they want.Joe (19:13):What's really interesting about how you're thinking about building out your company and the protocol and kind of the suite of products is that it reminds me of kind of like early days of Twilio. So I wrote a blog post many years ago, probably 10 years ago now about how over-the-top messaging was really kind of this new platform play. We've seen through the myriad messaging apps and then kind of the power of iMessage on Apple and the blue bubble versus the green bubble. I think there's now a regulation coming out of the EU that all these messaging apps have to inter-op with each other. But that took many, many years and I think Twilio really captured a lot of the developer mind share around creating these kind of suites of messaging products and it started with SMS. And so you mentioned something like Telegram, which I think everybody in crypto lives and dies in Telegram. I can barely keep up with myself.Chris (20:17):That's right.Joe (20:17):I've written some Telegram bots and they're pretty easy if you have a fundamental understanding of how webhooks work. Is that something that Dialects will enable? Is that like maybe some arbitrary webhook could fire? Or is it something that needs to be actually he baked into the on-chain program itself?Chris (20:34):Yeah, so it's not actually for support. We want to keep the part on-chain as light and simple as possible and so you can think of these web two channels such as Telegram as really just parallel rails. So you have the detection of an event that a user wants to hear about and that's monitoring data on-chain, and then you have various channels which may purely be in one user's case, "Oh, I just want to get an email, or I just want to get a Telegram message from a bot that's managed by the project." The developer experience around Twilio and Telegram and whatnot are excellent, but what Dialect provides here, if a DApp is interested in reaching their users by these means is you just get it all out of the box right away. You write a little snippet of code that fetches the data that determines if a message needs to be sent, and then you say how you want each message to look and that's really all you have to think about.The user will choose how they want to be gotten in touch with directly through the front end tooling that we provide. I think it was actually you, Joe, who mentioned this to us, that one of the key metrics is time to success. Crypto is moving at just an absolute lightning pace and while every project that we've talked to really wants this tooling, it's never quite the first priority that they have. So what we're trying to do is really make that as simple as possible for these projects to integrate us.Joe (21:53):So let's talk about some of the categories that exist, not just broadly in Web 3.0, but I would argue is probably more suited towards Solana, particularly the payment space. So Solana Pay has launched, there's lot of people building a lot of really interesting stuff with Solana Pay from point of sale solutions to web apps and mobile apps, et cetera. Can you kind of walk me through an example of how say someone that wants to build something with Solana Pay would utilize Dialect. Chris (22:26):Yeah, this is actually a really fun topic. Ever since Solana Pay got launched, the team and I have just been super excited about the messaging use cases there. This is also a good template for talking about our smart messaging thesis, so I'm going to segue from Solana Pay into a broader discussion here, but I would start by saying the following: Solana Pay is a standard for being able to perform transactions, being able to perform transfers between wallets on-chain and there is a very compelling messaging use case here. If you think about some of the standards in Web 2.0 , whether it's Apple Pay for transferring, or Venmo or Square Cash, that kind of dynamic experience of being able to message between users and actually take action on the message. One of our key insights with Dialect is this smart messaging standard we're building toward, and you can think of that kind of like an interactive link preview.In every DApp that you use where you connect your wallet, you have signing privileges everywhere. And so where we're building and this... A few minutes ago I said, "Here's where Dialect is today and the question is where we're going." In this smart messaging future, we're allowing users to send basically interactive link previews and you can think of a transfer request as one of the simplest use cases there. So for example, if you want to send a transfer request by a Dialect message to one of your friends directly at their wallet address, you can send that and then they can take action right in the message, whether that's scanning a QR code that's rendered for them, or it's clicking a send payment message. Coming back to some of the use cases we talked a little while ago about such as liquidation, warnings or DAO proposals and voting prompts, the holy grail in user retention and engagement is being able to reach them and have them be able to take action right where you're messaging with them.In Web 2.0 beyond these app specific use cases, whether it's a Venmo transfer request or similar, most of the time if you get an email, there's a link in the email and you have to click that and go out to another app. And maybe you're not logged in on your phone so you say, "Okay, in five hours when I'm back at my computer I'll take care of this." Or similar with a text message. What's really unique about messaging in Web 3.0 is that we can build a standard where you can take action right in the message. So whether it's Solana Pay, whether it's a vote yes or a vote no on a proposal, or it's a quick deposit to top up your collateral to avoid liquidation, any of those things with Dialect and our smart messaging standard, what we're building toward is that kind of Web 3.0 native future. So the last thing I would say about this is, yes, it's true that messaging and notifications are this really critical missing piece of Web 3.0 and it's just a really known hair on fire problem. When we got started on Dialect, the question we asked ourselves is not just how we fill in that missing piece, but also how we take Web 3.0to a place that Web 2.0 can't as easily go. And this is because our thesis is Web 3.0 is going to reach mass adoption because of exciting and really compelling delightful new use cases that products are going to start to come online, whether they take advantage of universal authentication like we're talking about now, whether they take advantage of composability of sort of the global shared state of all the data existing on a single blockchain, those are the use cases that are going to make it really compelling for the first billion users to onboard to Web 3.0. This is our thesis with smart messaging and Solana Pay is a really key and interesting part of that picture.Joe (26:18):I'll be honest, that is fascinating because one of the cool things about what you're mentioning is that push notifications or in-app notifications become actionable. You can actually do something right there-Chris (26:33):That's right.Joe (26:34):... versus it being this sort of delayed or async process. And so the use cases really open up pretty dramatically because of the fact that these messages are now interactive and you can do things with them.Chris (26:50):That's right.Joe (26:50):And have you guys thought through maybe where this could potentially work in like the context of a video game or even like the metaverse? There's a lot of Web 3.0 games/metaverse type environments being created and I'm curious if sort of in-game messaging makes sense or if it's something that is slightly different?Chris (27:18):Yeah, in-game messaging I think is a fantastic use case, and we've spent a little less time talking to gaming projects. I think just because that's a little early on, as we have say, talking to DeFi, NFT, DAO projects. But one of the things I'm most excited about is sort of the universality of NFTs as assets and all of the infrastructure that's being built around the things that you achieve and the assets that you acquire in-game end up having a life and a value beyond that game. It's really compelling to us that there be interactive sort of like smart message experiences around that content, at the very least. So I think gaming is an incredibly exciting in use case.Joe (28:05):Awesome. Yeah, I could see a lot of really cool integrations being utilized there and they just kind of don't exist today. I mean, frankly, there aren't a lot of Web 3.0 games period, but I know a lot of them are coming online later this year. What about like the traction of the company and folks that you're working with today? I know since you pivoted Dialect into this smart messaging protocol business things have really started to heat up. Can you talk about maybe how many people you're kind of signing up or any projects that are currently utilizing your product today?Chris (28:38):Yeah, that's right. We're talking to a few dozen projects right now across a lot of the verticals that I mentioned earlier. We're going live with a handful of our first projects that we've publicly announced so far. So that includes Squads and meaning on the DAO tooling side, Jet Protocol on the lending side, Bridgesplit on the NFT and NFT fractionalization space. Oh, on protocol Friktion is another project, you mentioned structured products earlier and it's been a real joy working with them. One of the things that we believe is it's best to like dog food your own tooling to make it better. So we've just straight up been rolling our sleeves up to help build out with them, and that helps us get better and better at our developer tooling.Then there's just this other wave, as I mentioned, a few dozen other projects that we can't talk about quite yet, but are extremely excited to support. And to support all these projects, we've also been growing the team pretty quickly as well. So there's a lot going on right now and as we talked about earlier, it's an incredibly compelling use case. This technology has to exist, at the very least receiving an email or a text message or a Telegram message. But where things really catch and where we really have a great time with our conversations is around this smart messaging future that we're building out, and that's when I think folks get really excited about the opportunity.Joe (30:07):Yeah. I mean, I completely agree. It's really hard to imagine a scenario where an app isn't going to need some form of messaging or notifications. And given the direction and the future of the company and where you guys want to take the product and protocol, it seems inevitable that folks are going to be adopting this. So maybe talk a little bit about how you're envisioning the future. You know, you have a very specific view into what you're doing with Dialect, but by engaging with all these different projects and protocols, you can get like an interesting view into what things are happening, what things are coming out soon, and maybe where you see things heading. The space is evolving and changing so rapidly and quickly that it's hard to predict anything, but what are some things that you kind of see in the future not necessarily just for Dialect, but also you Web 3.0 in general and how maybe Dialect plays a role in that?Chris (31:05):Yeah. I think if there were a single theme and I'm not alone in saying this, it's just really what got me into crypto in the first place and it's incredible to see it beginning to happen. I would say the thesis here is composability, so any blockchain that really makes global shared state a possibility. I think it might have been Chris Dixon who said composability is like compounding interest, it just causes this exponential runaway in technology. And the things I'm most excited about and we are most excited about at Dialect is that composability. So whether it's being able to exchange information and perform financial actions between DeFi protocols or it's the financialization that's going into some gaming tools that are coming online, like you said, that rely on some DeFi infrastructure like... To me, this is why it's going to be the sort of killer consumer experiences that come of composability and global shared state that are really going to make for the next big wave in Web 3.0.Chris (32:09):And the way we're interested in that in our own small way with Dialect, and I didn't mention this earlier, is one of our visions here with smart messaging is creating a kind of decentralized inbox. So as we mentioned, our tooling today supports these on chain messages delivered directly to any given DApp where the user enables and then can consume those messages in the DApp itself. But those messages can be consumed by anyone and so there's this other half of the problem that we're working on that's coming online soon, where for example, a mobile wallet could have an entire inbox and messaging section. And now you're talking about no matter which DApps you've enabled, you're receiving a true iOS or Android push notification directly to that mobile messaging experience that you have there, and that's just yet another example of composability. And so, like I said, I'm not alone in being incredibly excited about this but it really is, I think, the kind of compounding developer experience that's just going to create a whole new set of really exciting consumer... Like a new kind of internet consumer experience.Joe (33:18):That's awesome and I agree. I think one of the areas that is no short of discussion in Web 3.0 is NFTs. I've talked about this on some Twitter spaces and other podcasts where right now we're just kind of in the infancy of what NFTs can unlock. You know, there's obviously the art aspect of it, there's in video game assets, et cetera, et cetera. But one of the things that I am interested to hear your take on, and maybe how this correlates to Dialect is NFT is in a person's wallet, it's on chain, but the person interacting with the wallet is a customer, a user, and I think a lot of companies want to be able to engage with their customers and users more directly. So is there a scenario where I have an NFT in my wallet and depending on the NFT mentor or something, maybe it's a brand, maybe it's a company, maybe it's an artist, maybe it's a musician, has a way to either via the NFT directly or utilizing Dialect, be able to kind of communicate with me directly?Joe (34:31):An example I always give is imagine Starbucks wants to airdrop, I don't know, some seasonal loyalty program thing, right? Christmas, Easter, or whatever, spring break, you name it, and it's for people that have this NFT in their wallet and they want to airdrop them something or be able to communicate with them. Is this something that Dialect would unlock or do you think this is something that's more kind of NFT specific?Chris (34:55):To be honest, I thought you'd never ask about this. This is this third part of smart messaging that we are just beyond excited about. It touches on a few different things, but maybe I'll just say briefly that another key aspect of Web 2.0 messaging that I think to many of us feels very broken is this question of sort of like cold inbound and marketing and spam. With Web 3.0's inherent financialization, there is this very natural situation where you can basically tokenize messaging and create markets around how different entities communicate with each other. And on the two extremes there, or maybe let's talk about three, two to three points on the spectrum here. If you Joe and I just want to message with each other, there's sort of mutual opt-in in the exchange of a token and we can just message with each other.Similarly, if there's a business that I really love and I want to opt-in let's say, like you mentioned, I think you said Starbucks, I'll opt into that and there may be some implicit under the hood kind of exchange of a token that allows for that messaging. There's also scenarios where businesses want to get in touch with individuals that they think are high value, and that's a cold inbound scenario. In that scenario, a business might need to actually buy one of these tokens of yours on an exchange in order to engage with you.By financializing that component of cold inbound, I think one, it creates a much more harmonious kind of like cold messaging experience in Web 3.0 that in many ways is a bit much in Web 2.0, but in the mutual opt-in scenario or the messaging is effectively like vanishingly small cost or effectively free. And powering all of this, kind of coming back to your point about NFTs, is the NFT primitive. So this is a technology in an architecture we're exploring right now and it's very likely that NFTs will serve that use case. It's a kind of technology in a use case that we're just like beyond excited about.Joe (36:59):Fascinating conversation today with you, Chris. I really appreciate it. The future's bright for Dialect, the use cases that you've outlined are kind of no brainers, but what I'm really excited about is what we unlock in a Web 3.0 native context for smart messaging. I want to thank you today for joining the Solana Podcast. How can people actually get in contact with you? Are you on Telegram or Twitter? If they want to contact Dialect and get in touch, what's the best way of doing that?Chris (37:26):Yeah, the best way to get in touch with us is on Twitter and our Twitter handle is @saydialect, that's S-A-Y D-I-A-L-E-C-T. We love engaging with the community. Developer feedback, we live and die off of that, and so if you have complaints about our technology, have feature requests, any of that, send it our way. We're also on Discord. We have a Discord community, you can join that from our bio in Twitter. And then the last thing I would say is we're hiring, and so if this technology is interesting to you, we would love, love, love to work with you.Joe (38:02):Well, you heard it here first folks. Chris Osborn, computer scientist in the quantum physics space turned smart messaging protocol engineer and architect. Chris, thanks so much for joining the Solana Podcast. Looking forward to chatting with you again soon. See ya.Chris (38:18):Thank you very much, Joe. It was my pleasure.

Nigel Eccles is the co-founder and CEO of Vault Laboratories. VAULT is a new creator platform that uses the power of Web3 to unlock the next generation of fan experiences. Joe McCann guest hosts.00:32 - Origin Story04:48 - Vault09:47 - Use case of Vault14:38 - User experience in Web 3.018:01 - Why choose to build on Solana?24:01 - BetDEX25:51 - FanDuel vs BetDEX27:41 - Regulation and user experience31:04 - Youth as an inspiration?32:48 - SAMO34:42 - Exciting Projects on SolanaDISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Joe (00:09):Hey everybody. Welcome back to the Solana podcast. It's your guest host once again, Joe McCann. Today I'm super excited to introduce the one and only Nigel Eccles.Nigel (00:21):Thank you. Thanks for having me on.Joe (00:22):Nigel, I want to jump right into it. Can you talk a bit about your background and ultimately, how did you get into crypto or Web 3.0 or however you want to define it?Nigel (00:33):Yes. I've got about 20 years experience in consumer tech, mostly in sports. I'm originally from the UK. I'm originally from Northern Ireland. Around 2000 I was involved in a, I guess a dot com. It was a company called flutter.com as a product manager that I launched them as a betting exchange.Nigel (00:51):Since then I've been involved in a lot of different startups. The one that I launched in 2009 was a daily fantasy sports product called FanDuel. A lot of you if you're into sports, you almost certainly will be familiar with FanDuel because not only is it a very big fantasy sports operator, it's now a very big sports betting operator. Long history, I've always built consumer products. I've always been focused on B2C and trying to innovate and bring new consumer products together. Since then, I left FanDuel about four years ago and since then, I've actually launched three companies that are all in the consumer space.Joe (01:32):Wow. Three companies. When are you going to do something with your life?Nigel (01:37):Yeah. Well, they're all in their early stages. They're all in that promise space so it's exciting, but every day is still... There's still a lot of challenge. They're all still pretty early stage.Joe (01:50):Got you. We'll dive into each one of those in a minute. Can you maybe talk just a little bit about your journey of getting into crypto and then specifically, Solana?Nigel (02:00):I'm not super early. I've always, I've been aware of it for a long time, but 2017 was when I first got into it. Given that I've only ever really been interested in the consumer side, in 2017 I really dived in and was like, "Wow, this looks awesome." I remember reading about Ethereum. I never really had any interest in Bitcoin because I never really felt I had much money. And so I never really thought what's the point? I don't really have much money. Bitcoin to me seemed to be a great place if you had money and you wanted to store wealth. I didn't have any so it seemed mute to me. Whereas Ethereum seemed incredibly exciting so I get really interested in Ethereum. I also spent a lot of time looking at all these alternative coins in 2017. I remember going through CoinMarketCap coin by coin and going, "Okay. That looks totally pointless. That looks all promise, but no technology. That looks like that one above."And really getting down to about 50 and I see chatting to some friends who are in the sector. Or that one looks totally scammy and just being fairly disillusioned. In the end I bought Ethereum and toyed with some of the stuff that was closer to being consumer ready like I think CryptoKitties. One of my former colleagues actually set up Rare Bits, which was an open sea competitor. Which was an NFT product back in 2017. He dabbled a bit, but really at the end of 2017 said, "This isn't even close to being ready for consumers. This is so hard to actually buy an NFT." It wasn't even clear what you would do with it regardless of any other form of transaction or paying for something, it was slow. It was expensive and I didn't see in the short term it was going to get there. I went back to focusing on Web 2.0 things over the following few years. In 2020 then, I started, I used to get interested in NFTs again. Interesting enough the first ones I looked at were Top Shot, which bubbled up very early in 2021 and then crashed again. And Nifty Gateway. Similarly, they had nice onboarding and that both of them you could buy-in with a credit card, but they both were a gateway for me to say, "Oh, I get this now. This is actually pretty smooth." Once I had an NFT, I was pretty beaten by it. It's like, okay. Because the first NFTs I ever bought was through a credit card. Then I went through the whole process of really understanding and trying to get my head around the infrastructure underneath it.Joe (04:30):Got you. That landed itself to probably some ideating on your end. One of these three companies you launched or projects, companies, whatever we call them these days is Vault. Can you talk a little bit about what Vault is and where the idea came from and frankly what's the plan with Vault?Nigel (04:49):Sure. Absolutely. Yeah. Vault is still very new, but we had been working with creators for about three or four years and what we'd been trying to do was to help them find a way to create a small space where they would bring in their very top funds and they would monetize them directly. If you ever read any material from this, [Ligen 00:05:11] is by far the leader here and we were talking to her three, four years ago and what we were trying to do is create this native mobile experience. Native was very important to us because if you look at consumption of media by consumers, 90 to 95% of it is mobile.It's a native app. Whenever you do anything with consumers, they'll always say, "When's the app coming out?" You'd try and probe them and say, "Well, we got a really good mobile web." Then they'd go, "When's the app coming out?" Instead of fighting, we were like, "Look. It has to be a native mobile." We spent several years trying to build that native community, but it's really hard. What we found was it's hard to get people off existing platforms like YouTube, Instagram or Spotify. It's just hard to get them off.Then secondly, it's very hard to monetize them particularly when Apple and Android are going to take a 30% cut. In about early 2021, when I started to dabble quite seriously with NFTs, I realized that actually this was a really interesting technology and we said, "This is a fascinating technology because I as a creator can actually monetize my work. I can actually sell something." Actually, if you think about it, it's much more in the analog world where I can create something of value and sell it. Previously to that in a digital world, it was very, very hard to do that because the person really struggled to buy something. When you could always right click copy something, it was very hard to do.Now with the NFTs, that had provable providence. You had ownership and so we thought this is really interesting. We could definitely use this technology. When we dabbled with the NFTs, what we discovered was that lots of artists were really fascinated by it. Immediately they said, "This is great." But what we also found was a lot of them felt excluded. If you're a graphic artist, you're like, "Fantastic. Finally, a technology that people can discover art." If you speak to the graphic artists, NFT is just such a revelation to them. But a lot of the other artists, particularly music artists were like, "NFTs are fantastic, but it's not very authentic to what I do."If you actually look in early 2021, [Grime 00:07:20], [Stevie Oke 00:07:20] and a lot of other music artists actually experimented with the NFTs, but they didn't really perform that well. Those NFTs are done between 60 and 90% in value from their meant price and a lot... More musicians actually just didn't do them. They just said, "Look. It just doesn't seem authentic. It doesn't seem to be the artist I am and it doesn't feel the right thing for me to be selling to my fans." We said to ourselves, "Well, why should this technology limit the art that could be shared? Why should it just be limited to graphic art?" Also, we thought it was interesting, everyone laughs at the right or they mock right click brigade. But they actually do have a point which is yes, you have ownership, but you have no exclusivity over this content.There's anyone can see it and we thought there was something interesting if, what if we could A, remove the restrictions from the artist and B, create some exclusivity. Maybe only the people who own that NFT can actually see this piece of content. That was basically the background of the idea to Vault. What Vault is, is a platform where artists and some of the biggest artists that are coming on will be music artists would create a vault and they would then make keys to that vault and they would say, "Okay. I'm going to create a 1,000 keys and I'm going to the meant price of $50, a $100, a $1,000." Whatever price they set. That's fully set by the artist.Then those NFT keys act as keys into a vault, and in that vault the artist can put any type of media that they want. That can be music. That can be video. That can be picture. That can be text. It could even be hyperlinks into other things like into merge or into live experiences. But the key thing there is that only the people with that NFT key can actually see what's in the vault.Joe (09:10):That's so cool. You hear a lot in the NFT world about these token gated communities. You're quite literally giving out keys or the artists I should say are literally giving out keys to get access to things that only the folks that have those keys can access to. It's a really cool concept. Have you seen novel or unique things that these artists are doing or is it pretty straightforward like, "Hey, here's me eating breakfast or this is my workout playlist or whatever." What are the interesting use cases you've seen that artists I've come up with in their vaults?Nigel (09:48):Yeah. It's a really good question. Something just before I come to there, the other thing that we've done is we've made it very simple for the fan to consume the media and we've made it very simple for the creator to create the media. On the fan side, typically when you have this NFT gated community, you have to go to the discard and then you have to authenticate via club ladder grip which takes about 23 different attempts. And just in frustration it seems to have worked, although you're not sure. Sometimes the channels show up and sometimes they don't.It's a really clunky experience and I'm not really criticizing them. I know it's a technically challenging thing to do. What we have done is that we allow people to create account that then links to their NFT and authenticates very smoothly. That's number one. The linkage between account and the NFT is very smooth. If they then sell that NFT, we actually know the address to look in and we automatically look and say, "No. They've sold it. They don't have access anymore."Secondly, from the artist's perspective, again, that's a challenge for them. It's like, where do they put their content? What we've done is we've allowed them to add content to this native app that is seamless. Basically, if you can add media to Instagram, you can use Vault. It is literally one click, grab the media, drop it in. On the question of what use cases, we've seen a huge range but I'll give you a couple of examples. One that we're seeing is the artist album drop. When albums are being dropped, now normally they're going straight to Spotify. Sometimes some artists are also doing vinyl because they have a fan base that wants to collect.What some of the artists we're working with are saying, "Actually, that vinyl's $30. Why don't you have $60 premium vault drop, which will not only have the music in it, but will also have some other special things? It will have some of the inspiration behind the music. It will have the cover art. It will have Voice Memos from me. Some all of backstory to the album." That's been a really interesting one. Another one music artists are working with us on is the tour drop. I'm going on tour next month. I'm going to be traveling for the next three months. Both myself and my team will be taking lots of social media. What I'm going to do is every day drop pieces of content from that tour so my fans can actually travel the country with me and see behind the scenes material that they would never otherwise see.That's a really exciting one and we've got a few artists we're talking to about doing that on upcoming tours. Then the third one and a different category which is athletes. Last year college athletes got name, image, likeness rights. Before they couldn't be paid. They couldn't monetize their name. That has changed. But the challenge for a lot of them is like, "Okay. But what do I sell?" We've seen some of them advertise the local car dealership.But they feel it. Again, it feels a little inauthentic. They have this huge fan base and what we've been talking to them and say, "Well, what you really should be doing is creating a vault and showing people what goes into that Saturday game day. What goes into getting to match madness." We're working with a number of athletes now that are doing vaults like road to the NFL. This is how I got to the draft. The training that goes on behind the scene. The interesting thing at a college level is we have boosters on the other side who want to buy the keys.We have a really brilliant market emerging, which is boosters said, "Look. We want to support these athletes and we have these athletes coming into the college. God, well, we'd love to tell the story of what we're doing." That's becoming a nice market.Joe (13:15):It's so cool because I think one of the cool things that happened with Instagram is that when it really started to take off with celebrities and athletes and musicians, it's that fans felt closer to them  because they could see, hey, they're in this tour stop. Or they're just literally eating their lunch or whatever the thing may be. It just felt more personable. What it sounds like, this feels like maybe the second derivative of that where not only are you going to start to be able to see, hey, the behind the scenes of such and such band on tour, but also the spectrum of the media that could be produced and consumed by the fans is huge.Nigel (13:56):Yes.Joe (13:57):One thing I wanted to point on that you mentioned earlier that I think is important is the user experience. You mentioned just authenticating really easily and being able to add content as simple as Instagram. Given the experience you have in consumer related tech, can you talk a little bit about maybe your broader ethos on this?Because I know that certainly with DeFi 1.0, it was hey, we're just a bunch of hackers and academic engineers and we're just creating primitives. But some of these apps are just painful to use and now we're starting to see a big emphasis on user experience because quite literally it will help onboard more people. Can you walk us through that being at the forefront for Vault and even potentially the other products that you're working on?Nigel (14:40):Absolutely core. The co-founder of Vault, my co-founder at Vault also co-founded FanDuel with me. He was our head of product design and user experience. He had leveraged from the design of the product through to customer service. He's a world class designer. There's no way, two ways around that.What he brings to it is just a completely smooth flow. We want to get millions, hundreds of millions of people into crypto, but we want to make it a smooth experience. And we think that one day, yes, maybe everybody does self-custody, but that won't be their first experience. We have to give them value that isn't just coin goes up. It has to be something that is cool that like me, I go, "That's cool. I'd really actually like to learn and understand the underlying technology and what else it does."If we look at what Vault works, we've actually enabled in our payments. People were like, "I didn't even know you could do this with Apple." We're like, "You can." They're not opposed to this. What happens is a creator creates a vault. They set a price. Let's just say they set it at a $100 a key. It can't go as low as 20. One of the beauties about Solana is its low transaction costs. Things shouldn't cost hundreds or thousands of dollars.If somebody's a fan of a band and they want to buy a vault, they should be able to buy something for $20. We could price it as low $20. The user can either buy with Solana. We give them the option with Solana. Or they can buy within in our payment. And that in our payment is two clicks.Most people have their credit card already in their phone and suddenly they are owning an NFT that is built on Metaplex, built on Solana that they can then take off platform at a later date and self-custody. But they can have the full experience of owning that NFT and seeing the content without ever touching Solana or ever buying crypto. Without ever installing a wallet.Joe (16:36):Amazing. Yeah. Isn't it weird how people just want things that are fast and cheap? Such a novel concept.Nigel (16:45):Yeah. There's a very good book in usability. It goes back a few years called Don't Make Me Think-Joe (16:50):Yeah. Great book Nigel (16:50):... and it's perfect.Nigel (16:52):So many times people are like, you give them options or give them this, they're like, "No. Just make it real easy."Joe (16:58):Make it super easy.Nigel (16:58):If you can give them a straight line for them to get to where they want, the number of people you'd on-board will be several magnitudes higher than if you make them learn every step along the way.Joe (17:09):I totally agree. I think this may get to my next question around why Solana. It seems probably patently obvious at this point, but given that you have this experience in consumer tech, given that you built FanDuel or were co-founder with FanDuel, I don't want to diminish the massive team that brought this to market and maintains it.While you were evaluating Web 3.0 related tech, and this is not meant to be a layup question. But you look at Solana versus some of the other ones and it's not that these other chains are bad, but when you're trying to design an experience that is seamless and as friction free as possible and using the principle of Don't Make Me Think, what was it that made you and your tech team say, "You know what? We're going with Solana because user experience is going to be so much better."Nigel (18:04):Yeah. It's a good question. It's funny the level of maxiness on Twitter. We have gone all in on an L1, but we've tried to be very clearheaded objective viewpoint because we're betting millions of dollars that this is the right decision. We're investing in an L1 because we think that this is going to be the best platform for us.If it was a different one, we would totally have gone that different route because we can't be religious about it. We don't have the money to say, "Hey, we're going to invest in L1. That's not going to be the winner but for some reason we're going to do that." We started the process and even today we continue to look at other alternatives. I regularly look at Polygon. I regularly look at Arbitrum. I look at Avalanche. I look at NEAR because again, we're not religious. What led us to Solana though, was a number of factors.Obviously the obvious headline was fast and cheap. But not just fast and cheap, but actually that being it was designed to be that. That was the criteria around how it was built. That was important to us because we knew that if in three, four years time that it got more congested, there was more demand, that the core team wouldn't be going, "Well, that's okay. We are fine with that because other things are successful."We felt that there was a commitment for the core team. Though fast and cheap is core to this product, we're not going to the core to this platform. That was really important. The other factors we felt were that even at that point and this is early 2021, it had good momentum and that again was important. We didn't want to make a technically great choice, but all the momentum was going another direction and everything over the last 12 months has continued to convince us that was the right decision.Nigel (19:56):We also were impressed by this core team. Raj and Anatoly were straight on very first call. Somebody who's come from Web 2.0. Personally, I thought that was great that we can reach out to somebody and say, "Look. We're having issues with this." They've been incredibly supportive. I thought that was a huge factor as well.Then the last thing I'd say that I've noticed about Solana is that I think there's a much stronger design ethos in Solana than I've seen in the other blockchains. I don't want to say it isn't bad, but these other ones. But some of the blockchains I've been on are, I think I cannot understand how they've made these design decisions. I think some of it is a laziness about EVM. Which is like, well, it just works. It's EVM compatible so people will figure it out. I think Solana has gone down a slightly harder road, but it has forced people to say, "No. We're going to design this for humans."I guess that handicap in a way has actually improved it. Something like Phantom, it is 10X better than MetaMask. Without a doubt I use MetaMask every day and I'm always still fascinated that for example, NFTs that I've sold six months ago are still in my wallet. I think there's a setting somewhere where I could change it to take those out. But the idea that they don't understand that would be something I would want natively is weird. Those are, it's four or five major reasons. I think there's still a very, very large gap. We made the decision. We committed about 6 to 8 months ago. But since then it's only got stronger the thesis.Joe (21:23):Yeah. You bring up a number of points that I try to bestow upon a number of the founders of startups and projects that I'm advising is, look, you don't have to be religious about your technical solutions or choices. But I do think it's important to recognize that, hey, if your application or protocol is super successful, are you going to have to do what actually Infinity did and build your own scaling solution?Are you willing to staff that or do you have the resources for that? Do you have the desire to do that? I think the second aspect is, and again, this isn't a NTL2 conversation. It's that in my view, when you add an L2 to your technical architecture, I have this running joke that the reason it's called an L2 is because now you have two problems. It's not just the L2 that you're building on, but you also have an upstream dependency on the L1.I think a lot of the technical decision making early on is critically important to understand in the case that you do have this wildly successful app or protocol. Furthermore, to your point, Solana made some intentional design decisions that added some constraint around the protocol and furthermore, the applicability of the protocol.I think, we're still early days-ish with what's possible on it and we're definitely have been pressure testing the network quite a bit. But I think longer term, this is currently going to be the chain that's going to enable those types of truly immersive rich internet experiences that users are accustomed to on mobile apps and Web 2.0 without having to have all these additional complexity. I take your point a 1,000% with MetaMask and I take nothing away from that team. But at the same time, Phantom has brought user-centric design to the wallet and that's super important for onboarding and more importantly for the apps that will ultimately be connected to those wallets. I hear you a 100% on that.Because I know we're coming up on time pretty good, I wanted to switch gears quickly to talk about BetDEX. Because this is actually how we met. We were introduced by a mutual friend. He told me about your background and he told me that you were considering building on Solana and it was a fascinating idea. I said, "Would love to convert him to build this on Solana." Can you talk about what BetDEX is and what you're excited about BetDEX for? Then also again, maybe the design decision as to why you chose Solana.Nigel (24:05):Yeah. BetDEX is a sports betting protocol. The way to think about it is there's something like $2 trillion bet every year on sports globally. But that $2 trillion is basically split among tens, maybe even hundreds of thousands of different sportsbooks. We take FanDuel's example. FanDuel is quite a big sportsbook, but all the money they take, they're the counterparty. They take that counterparty risk. All the money that DraftKings takes or say some of the other ones, BetRivers takes, they all take that counterparty risk.If you're one of those smaller sportsbooks and somebody Mattress Mark comes in with a million dollars, you can't take because you can't take the counterpart risk. The way that BetDEX imagines the world is says, "Well, what if all of those sportsbooks could basically share their liquidity in a central pool?"Now, prior to crypto they probably wouldn't have wanted to do that because who would own that platform? What the governance would be. There will be lots of different challenges there on that actual protocol. Well, what BetDEX works as is, because it's going to be a decentralized protocol which will be owned through its token holders which may be many of those different applications, they then can pool their liquidity into a central exchange.And so someone betting on FanDuel could be in effect counterpartied with somebody in the UK betting on a completely different website and they don't actually need to know that. Basically, BetDEX is the glue that's going to plug together all these different sportsbooks that gives us global liquidity pool.Joe (25:40):Super cool. Given your obvious experience with FanDuel, how would you juxtapose the two like FanDuel was for this type of a world or environment, and this is how BetDEX is different?Nigel (25:54):Yeah. They're actually very different. One day my aspiration is that FanDuel would use BetDEX. They don't have as immediate a need because they're a big sportsbook so they don't... Mattress Mark comes in and they'll say, "I'll take that liability." The way we want to see it is, we'll actually build the very first application which will also be called BetDEX. That's a licensed sportsbook in Malta that will take bets from over a 100 different countries. Unfortunately, not the US. Certainly initially.But basically what will then happen is we will actually opensource that code and say to other operators, "Look. You can also build your own application. In fact, take our code. Put your own logo on it. Put your own brand on it and then you can interface with BetDEX as well." Then existing operators like DraftKings, like FanDuel can say, "Wait a second. There's this huge liquidity. Why are we managing all this risk ourselves? Why don't we pull some of our liquidity in here? Maybe I carry 90% of the risk of the money coming in and I just blow 10% onto this exchange." BetDEX is really a protocol and FanDuel really is an application that then would use that protocol like all of these other sportsbooks.Joe (27:01):Got it. Very cool. You mentioned something that hits home for me as an American that once again we are unfortunately geofenced, if you will, to a lot of the innovation that's happening in crypto and Web 3.0.Nigel (27:14):Yeah.Joe (27:15):Given your experience with FanDuel and certainly setting up BetDEX, can you talk a little bit about the policy risk? You mentioned a 100 different countries and how do you navigate that? Because the sports betting regulations in say the UK are very different than they would be in say New Jersey. Maybe even different they are in South Africa. How do you think about managing that? Again, not sacrificing the end user experience for folks that are using BetDEX.Nigel (27:44):Yeah. That's a very good point. Largely the regulatory issues set at the application layer, are very similar to... AWS typically does not have to deal with betting regulations. It's the application that builds on top of it. BetDEX is very simple. It's just their protocol it's up to those applications that build on top. For example, BetDEX the application is regulated in Malta. We are going through a very long process with the Malta's Gaming Authority and I was on the call with them yesterday going through my source of wealth and they want all my bank details. I've been fingerprinted. That's a process.That's a process that happens at the application level. Basically the protocol just works with those applications and so it's agnostic to do that. It's the applications that deal with the regulation.I will say that with FanDuel before we went through a lot of regulatory issues with FanDuel as a fantasy sports product. Then becoming a sports betting product. I'd say my personal view in the US regulatory process is, it always gets messy before it gets better. I see that with crypto as well. I'm actually probably one of the few crypto regulatory optimists in that I see what's happening today and some of it is ridiculous. A lot of it is through lack of understanding, but some of it, I think it is genuinely vested interests. Acting in their vested interests.But I also feel that like fantasy football was, crypto is just too popular. Means too many people have it. It's too beneficial to consumers and it brings two things to politicians what they love, which is money and votes. I am very bullish longer term, but there's going to be speed bumps on the way.Joe (29:29):Yeah. I totally agree. I think you and Sam at FTX are definitely regulatory optimists. I am cautiously optimistic. But I do believe that there's a growing momentum, certainly in the United States about bipartisan support for candidates who are pro crypto. I think this is a very real movement that's happening in DC. I know there's lobbying groups. There's super perks being set up. I agree with you. I think that there's going to be some bumps along the way. There will probably be some blunders and bureaucratic mistakes if history serves as well.But at the end of the day, I think that to your point, it's so popular nowadays and the rebranding of crypto to Web 3.0 which now encompasses things like NFTs, which is bringing culture in the crypto. Which is bringing video games into crypto. Which is bringing fantasy sport and sports betting into crypto. It feels we're on a path towards this reaching some consumer safety slash normalcy. I guess the next question that I had was, if I'm a kid nowadays, I know you have some kids. I have a son, but he's much too young to even be using a computer.One of the fascinating things that I think about kids these days is that the concept of a video game or the concept of art or the concept of a sport is just so different. Can you talk a little bit about maybe how even just conversations with your kids or your view on the youth is influencing some of the decision making in what you're doing with the projects that you're helping launch?Nigel (31:09):Yeah. It is very interesting. I've got three kids and they're all gamers and they're from 17 to 28. It's a broad range. It's interesting how they're discognitive, I would say. Obviously discard is prevalent in crypto. I'd say that they're all very familiar with NFTs. It's not such an alien concept to them that I think it is to people maybe my generation.It's really you spend money on something that's virtual. They have that experience. When they're gamers, I think they're little skeptical of NFTs and games like a lot of gamers are because I think they see that historically a lot of the games companies have used innovations like this to, not to make the game experience better, but to actually make more money.They look at them a lot of times and say, they like NFTs in their own right and they're interested and they've all bought and sold them. Because they look them and they say, "Okay. These are load boxes. This is another way to get money from me for something that I probably should have got in the first instance." That's been really interesting. They are very natively digital. I think that's what's very clear that a large part of their life, a vast majority of their life is digital. And so the concept of a digital life is something that's totally new to that.Joe (32:25):Yeah. You and I were chatting at one point in Lisbon actually at the Solana conference and you had mentioned something along the lines of how fun it was for your kids to be sending SAMO to each other.Nigel (32:38):Yeah.Joe (32:38):And how it's this meme coin on Solana, but it was just this fun experience because they're not going to be sending each other hundreds of dollars in USDC, but hey, they can send each other hundreds of SAMO and it's this cool experience.Nigel (32:53):Yeah. I'm unashamedly a SAMO enthusiast. I think you are as well.Joe (32:58):Oh yeah.Nigel (32:59):SAMO and Dogecoins are fun and they're popular. As someone who's tried to build lots of consumer businesses many of which have not been successful, popularity is hard to get. While they don't... Dogecoins don't do a lot today, that popularity I think is incredibly powerful. I'd say that BetDEX, we deliberately have been working with the SAMO community and we've done some fun things with them because they have something that we really want as a company, which is popularity. We definitely want to do a lot more with them and I'm very bullish in SAMO. I'm actually quite bullish on Dogecoins in general which is, it's very rare that you get something that level of popularity. That they don't figure out something to do with the... I think it's a very strong community. I think it's got a long way to go.Joe (33:44):Yeah. I agree. One of the most fascinating things I think that's occurred over the past couple of years specifically with the GameStop saga is that internet culture is a force and it doesn't necessary really have to equate to some business case study or some scientific proof for something to work or be popular or have utility. That's one of the most fascinating things about crypto to me is that the internet culture around it and how it supports things that on the surface appear to be maybe trivial in nature, but there's a huge community behind it and there's something to be said for that. I think maybe the last question I'll ask because I know we're coming up on time is, given the crazy expansive growth we're seeing in Web 3.0 and particularly in the types of applications on Solana, what are a handful of the projects or applications that you're really excited about now?Nigel (34:47):I think a few things. I think Phantom is an incredible wallet and I think they have a long way to go. I'm very bullish on that. I really think that's going to be critical onboarding people onto the L1. In terms of NFT projects, I have a Monkey. I'm incredibly impressed by that community and I've joined a lot of NFT communities and that one is just... It's so hard to keep up.Joe (35:12):I agree.Nigel (35:13):Yeah. I think they've done an amazing job. I do think there will be a bit of a... By verification of ones that clearly could become like that and ones that don't. I think a lot of entities at the moment are sitting in this nether land of, are they going to maybe get there or not? I think when it becomes apparent, prices will reflect that. I think that's really interesting one. I'm very bullish on the Monkeys. I think it's a great community. In terms of games, it's still very early. I'm really interested in Game Fire. I think NFTs could be really interesting on games.Filling games is hard though and I feel that a lot of these games are all have an amazing game priced in. Even though no one's seen a line of gold or... And so that does worry me. I feel there's going to be a lot of failures. The only one that I hold a bit of is Panzer Dogs. I've actually played their demo and it's a pretty cute game and the studio has evidence of building good games before. I'm quite excited about that one. I've liked what they've been dropping.I am very nervous in general about the whole Game Fire. I think that 2022, it might be the year that we discover in crypto that building games is hard and building games with NFTs in them is just as hard as building games. Those are probably the major ones. I do think that games is going to be really important though. But it may be more games like the Cops Game or Wolf Game, which is on Ethereum. It may be more games like that, that are not... Or even Loot. Loot was a fascinating project last year. Obviously it lost a lot of steam. But new game format where the community is actually core in building the next stages like I just gave you the building blocks and we build it, I think there's a lot to go there given that Solana is priced at a level where a much younger audience that doesn't necessarily have a lot of money can innovate.That's where I would be more excited as opposed to triple-A games porting over and suddenly their skins which weren't really worth anything anyhow, suddenly are tradable assets. I'm not as excited about that. I'm more excited about games that are weird that we don't really understand right now coming up organically.Joe (37:22):Yeah. I think that's a fair assessment. In almost any startup boom cycle, you see people just trying to innovate in myriad different directions, which is awesome. But ultimately the ones that have something truly innovative that people can gravitate towards are going to be the ones that really make it. Right now it's up for grabs.I'm always on the space like you are in general. I think that the caution that you're hitting is worthwhile, but man, there's a lot of really cool stuff out there. I will tell you, a lot of the game developers that I've been meeting with that are launching games are seasoned game devs.Nigel (38:02):Yeah. Yeah.Joe (38:03):They just see this as a way to like, hey man, I always wanted to have an Indy game studio or do my own game and this is a means to facilitate that. I think the key though, to your point is how are we going to integrate these things in a way that feels it's accretive to the game?What's fascinating about your kid's view of being skeptical of these things is very wise because what we don't want is just things to be bolted on. We want them to actually add value to the experience. TBD on that. We still got lots of time to see when this is going to pan out.Nigel (38:36):Yeah.Joe (38:36):Well Nigel, this was awesome. Where can people find you on the internet, Twitter, or Telegram or wherever you're comfortable with?Nigel (38:43):Twitter's the best place. I'm Nigel Eccles. I'm fully docs. You'll see me. I'm a nice little red monkey. Yeah. I'm @nigeleccles on Twitter.Joe (38:51):Amazing. Well, you heard it here first folks. Nigel Eccles, man, has so many projects and companies. We couldn't even get through them all. But thank you so much for joining us on the Solana podcast and we'll see you guys next time.Nigel (39:04):Thank you.

Tristan Frizza is the Co-Founder & CEO of Zeta Markets, an under-collateralized DeFi derivatives platform, powered by Solana and Serum. Matty Taylor (Head of Growth at Solana Labs) guest hosts.00:26 - Origin Story03:08 - Winning the Solana Hackathon05:59 - What is Zeta?08:49 - What's appealing about options?11:17 - Why is Zeta more successful than other options projects?16:44 - Using open-source primitives vs. building20:15 - The front-end24:22 - Mobile user experience28:49 - Rapid Fire Questions: Anonymous Crypto teams30:21 - Rapid Fire Questions: The Metaverse31:18 - Rapid Fire Questions: Insurance in DeFi34:40 - Rapid Fire Questions: Singapore36:12 - Rapid Fire Questions: Sleep38:27 - Rapid Fire Questions: Solana DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Matty (00:09):Hey everyone. Welcome back to the Solana Podcast. My name is Matty. I'm the head of growth at Solana Labs. I'll be guest hosting today and we have a special guest Tristan from Zeta. So welcome.Tristan (00:20):Thanks for having me on Matty.Matty (00:22):It would be great to know just a little bit about yourself and maybe how you started your crypto journey.Tristan (00:27):Yeah, absolutely. I can give you the long and the short of it. So I think I started getting into crypto back in the day, probably in 2017 when I think a lot of people got into it during the last ball run. And that was mostly just speculate on coins, looking what was going on in the ecosystem. DeFi didn't really exist yet at that point. And I feel like a lot of people were still grasping at what is the real use case of crypto at the moment, other than this buying these coins and seeing the moon. Didn't feel like there was a real kind of engineering need for it or some kind of real product market fit. And so that's kind of why I tape it off a little bit after a year in that space, just kind of checking the things out.I went back finished my degree, actually ended up doing a bunch of courses in distributed systems and computing, because I started getting interested in the whole blockchain side of things from the engineering standpoint, it was like creating your own coding up your own proof of work blockchain, which I thought was really cool and just understanding the fundamentals of Bitcoin. And then I think over the years I took a bit of a breather on it. I unfortunately missed DeFi summer, which I was pretty firm about. And then coming back to it, I'd been hearing so much about smart contract programming, what you can build in this kind of new DeFi Boom and what was going on there. And so, I came back into the space after having worked for roughly like two years as a data scientist, kind of in the Bay Area.I think I was a little bit tired of the remote work kind of grind there, even though I enjoyed my job. And so I decided, hey, in my free time over Christmas, I'm just going to go and learn how to program on solidity. And so I made a few kind of smart contracts learned what was up there. Randomly was just putting together a DeFi idea, looped in some of my best friends from kind of more of a trading and finance background, we decided to put our brains together and just be like, "Hey, what can we build in this space?"And then yeah, after throwing around enough ideas, I think we ended up settling on something that was really cool. We thought the derivative space was somewhat untapped, especially options seemed like such a huge market, but no one's really done it. And randomly, we reached out to Dom, fellow Australian, and then we basically, he put us in touch with Tolley and Bartos, and after talking to them a bunch and reading the whitepaper many times, I got really sold on Solana and I've just been developing on it since.Matty (02:40):Nice. And if I remember correctly, you guys were the winners of the Solana Season Hackathon, which was extremely competitive. I think there were like 13,000 plus participants, which I believe is the largest hackathon, not only in crypto, but ever in the technology space. So it would be great to just hear like how you guys worked through that whole event and what you guys came up with coming out of it.Tristan (03:10):Yeah, absolutely. So that was definitely a tough experience and an interesting challenge as you mentioned. Yeah. 13,000 people to compete against. And that was really when we were finding our feet in the crypto space, not having as much of a network or I guess like a reputation being new builders in the space and I won't go too much into it, but we went through a team split and stuff during that kind of time. So it was a really tumultuous period. And so, we just thought, "Hey, we got to give this hackathon 110% and do what we do best. Like we're all engineers and X traders. So we got to build man, because that's what we're really good at. And that's how we can prove ourselves. So we went into that.I pretty much quit my job, I would say two days before the hackathon started to give it 110% as did like a couple of the other guys, and then we just went in there pretty much worked out of the same apartment for three weeks, I would say, putting in 16 hours a day. So we must have worked over a hundred hours a week, just ridiculous hours. It was pretty much like wake up, code, go to bed. Which got pretty tiring by the end, I was pretty exhausted, but we pumped out a lot of work and we built out this very early stage binary options, MVP platform of which is very far cry from what we have now. But, it was amazing to smash that out in three weeks, learn Anchor from fundamentals, still in the process of learning Rust at that time.And then whipping together a front end, we ended up getting the product out, which was fine and it was a little hacky, but it worked. And then we ran into so many infrastructure problems. We didn't fully understand or appreciate the difficulty of RPC Nodes and trying to service all those requests. So our front end got rate limited crazy. So to actually get it out there on Devnet that people could use it, we were like, we have this funny photo where it's six laptops side by side, all hotspoting off different Wi-Fi hotspots, just so we get different IPs so we don't get rate limited on all of them. And then we were all doing what's called cranking, to process orders on the back end, all through these mini distributed cluster of computers in the same room. That was an awesome experience. And yeah, it brought the team together, we pretty much got a lot of our friends to come in who were our colleagues and then we hide them off the bat. And then we grew the team pretty quickly to seven or eight people straight off the bat to hackathon.Matty (05:28):Wow. That's insane. I didn't know that story about running your own cluster of computers to not get rate limited. That's amazing. And so I think you mentioned your initial idea in the hackathon and what you worked on initially was binary options, but that's not exactly what's in the product suite today For Zeta Protocol. So maybe just walk us through one, why didn't you pursue that idea and two, what is Zeta today? What is the actual product?Tristan (06:01):Yeah, absolutely great question. So I think with binary options, that was never really the plan for us. We didn't want to box ourselves into that very niche vertical. I think they have a bit of a bad rep in traditional markets. They're kind of banned in a lot of countries because I think they are a little bit of a degenerate product to be honest. It's kind of glorified betting. And so we wanted to move away from that. We want options that people can actually trade properly in a sophisticated manner in financial markets and Hedge Exposure and do all these things that you currently can't really do in crypto markets. People tend to just go bulls long right now, a 100x leverage and either get liquidated or they become a millionaire. So we're like, there's probably some in between where people can be a bit smarter and this is pretty much what all the pros use on Wall Street and all these other places pro traders are trading options and other derivatives.So we're like, this is a great element to have in your toolbox. So we straight away from, I think binary options, even though the reason we did it was because the math is a ton easier and it was easy to implement. So we got that out there. It proved that we could build something like this. And then we backed away from that. We went for Vanilla options, which we think are far more interesting. There's far more market demand. It's like a multi-trillion dollar industry in traditional markets. People use it all the time, super popular. You even see people getting into it from more user friendly apps like Robinhood in the US, has just blown up in popularity. So we're like this clear market fit. And then now we're trying to, I think historically we've been seen as just purely an options platform, which we were for a period of a couple of months, but now we're really broadening our focus to all derivatives, which is really exciting. Having everything cross margin and viewed under the one umbrella platform, I think is really cool and always building into creation. So what we have right now is futures and options. So we are the first one to offer dated futures on DeFi, I'm pretty sure. Even across Ethereum, I don't think anyone offers it, which is pretty interesting. Everyone seems to go fully PERPs, but we do futures, we do options, which is nice because you can kind of hedge out using the futures for your options. And then we're going to be looking to list stuff perpetual swaps as well. Probably broaden it into a bunch of other categories for derivatives based on demand and what's feasible to build on chain. But really we think the options are pretty limited and trying to build out a whole suite of trading products that people can get dug into.Matty (08:21):That a great overview. I guess kind of double clicking on one of the things you said, which is options are really popular product in institutional, traditional finance. And even now thanks to Robinhood of making it a great user interface for retail to even participate in options. Why exactly is that the case? What is so appealing about options that it applies to both audiences?Tristan (08:50):I think for more casual users, I think the payoff structure is just very appealing. I can't demonstrate it here on the podcast, but essentially you have unlimited upside. So as if you were to get a PERP or hold spot, if Solana rips to a thousand dollars, you're exposed to that whole upside, which is really nice to see. But the cool thing is your downside is essentially capped. So if Solana tanks, you only ever lose what you put up for the premium, which may be a hundred dollars or something or other. So it's almost like you're buying this insurance. You've got unlimited upside, limited downside, which is in stark contrast to say, you buy a PERP and Solana tanks a lot. And then suddenly you've lost a ton of money, you get liquidated, which is pretty tough.So I think that's pretty cool. It's also options are inherently cheaper than spot as with like most derivatives. That's why they're more efficient. That's why people trade PERPs because it's easy leverage, I guess, with options they're inherently kind of under collateralized, you're only paying a fraction of what you would for the actual Solana coin is a spot asset. So that's pretty nice. And then I think from the institution side, and hopefully you're going to start seeing this more from the DeFi user side as well. I think it's a really good tool for hedging risk and this is their primary use case I would say in traditional markets. And you can almost think of it like you're buying fixed insurance on your portfolio. So what you'll do is say, I have a net long huge position on Solana or some other coin, and I want to protected on the downside.I'm just paying a small amount of money essentially to buy put say, and so if the market does tank, I've got this nice thing that's protecting my downside. I think those are all really appealing things. And you can start to pair up a lot of these different options so you can buy calls and puts, and then you can build these very interesting payoff structures. Things like straddles, which are kind of this V-shaped payoff where I'm basically market neutral. I'm Delta neutral. I don't have an opinion on where the market's going to rip up or rip down, but I just know it's going to go a long way in one direction. So you essentially start speculating on purely volatility, which is an interesting new trading paradigm that I don't think a lot of people do. So you might be unsure, I don't know where the market's going to move, but I know it's going to move a ton and you can start placing bets on that, which is really exciting.Matty (11:04):Yeah. That's really interesting. I mean, Zeta is not the first project to try to tackle options and bring it to a bigger audience in DeFi. Why do you think previous attempts that this haven't been quite a successful?Tristan (11:18):Yeah. Awesome question. And this is really what spurred us to start in the first place. We were looking into this early 2021, we spent a good month or two, just not even coding that much, but just surveying the landscape, seeing what was out there and where we would necessarily fit in. And so I think at that time, pretty much nothing existed on Solana. There was what? Serum, Bonfida, Raydium had only just launched. It was very early days, but obviously most of the competitors, or people in that landscape were on the eat side. And so I won't name any platforms, but there were a couple out there. They're mostly these one sided AMM pools, which basically all they do is sell options. And so that's not really satisfactory. You're not doing the buying and selling. You're forced into one.And whenever you are placing your capital into this AMM pool, you're a forced seller all the time. So basically you have no choice whether you want to sell the option and you always get done at really poor prices. It also requires people to have pretty good pricing to make sure they get a good deal for their LPs. But from what we saw with some of those platforms, they've priced them really poorly. You have this parameter called implied volatility that you will have an opinion on or put into your pricing model. And I remember the founder of this one protocol was updating it once a week. Whereas, crypto's very volatile, change is intraday. So, if you looked at the gene analytics dashboard, a lot of the LPs were just down 20% to date, which was like, why would I put my money in this pool? It's just losing me money consistently.Matty (12:46):Yeah.Tristan (12:47):And then there were other nice ones that were more like orderbook based, which I think were cool. But the only problem was Ethereum, gas fees were crippling, you try and put on a call spread, it'd be like $200 in fees. And I'm like, that just wipes out all my PNL. I've got to be a whale that's putting on this massive trade. Otherwise, any kind of smaller fry, just going to get completely priced out of the market. And their liquidity was just nonexistent. They've got one strike on their orderbook that had two trades on or something like that. Everything else was just blank. So I was like, there's no way that I'm going to trade on this willingly versus like Deribit or some other kind of options exchange out there.And so I guess the way in which we're different, we're obviously built on Solana, so you get the really nice performance aspects of the network. A big sell for us was being able to use Serum. So the decentralized orderbook infrastructure, which is a feed of engineering there and powers pretty much all our markets, which is pretty incredible. And something that we've tried to do, I guess the four main points we've tried to hit capital efficiency is super important. So we want people to be able to put on positions without having to go over collateralized or fully collateralized and put up a ton of capital, which makes it really inefficient to trade. It means like, hey, I can't open a lot of positions. Suddenly, I've tied up all my money in this one position. And so this is really bad for individual users and especially market makers. Market makers need to put on 50 different positions across all different markets.So that makes it really tough for them, makes it really inefficient to trade. And if you don't have market makers who can trade efficiently, you're just going to have not very liquid markets. So, that brings me into the second point. We want to aim for liquidity, obviously trying to onboard these market makers. We have two dedicated market makers, which is really cool. They're providing liquidity 24/7 and kind of quoting our markets, which is really exciting. The third point is user friendliness. I think options scare a lot of people and derivatives in general, can be scary, because they're a little bit more complicated. But they're nothing to be scared about. And we're trying to bring down that barrier entry, we've seen what other platforms like Robinhood have done in terms of making it a lot more user friendly, building stuff like a mobile app and having more explainers in product.So we've taken some notes from that. We've tried to build a really intuitive trading interface first and foremost. So people can go in there and it somewhat makes sense on how to trade. And it's not this really opaque, confusing Excel spreadsheet looking interface, like you get on some other platforms. And we just really want to lower the barrier to options and make sure that everyone's able to access them and try and use them. And then the last bit is I think safety is really important because they are a volatile product and like options, prices can change quite a lot because they're kind of non-linear in nature. We want to make sure that users are protected. They're kind of managing risks, so we've got like a lot of safe margin parameters at the moment. So people can't get too over levered and then it's getting liquidated really easily.And we also have this internal risk engine. We have what's called a Mark Price or our internal fair for what we think these options are worth these updates pretty much every block. So half a second, essentially it's based on the fifth Oracle, we update it really quickly. It's kind of calibrated to trades and other things that happen on the platform. So it's meant to be really reactive and we basically built this because we don't want prices to drift off what they actually should be. And then people just get randomly liquidated for no reason when they shouldn't be. So far it's been going pretty well. We've had barely any liquidations. I think people have been pretty happy, but always improvements to be made.Matty (16:05):Very Cool. One of the things you touched on was how you're starting with Vanilla options and you're interested in more perpetuals and maybe other derivatives and creating this suite of a variety of products that folks can use and you need cross margining across all of them. How do you decide from a product standpoint, when to use other open source primitives, maybe you can use Marginfi for cross margining or another protocol DeFi primitive for futures, contracts. How do you decide what you guys build versus plugging into this open source composable ecosystem that already exists on Solana?Tristan (16:47):Yeah. This is a really good question and saying we've been grappling with for many months. I think it does come with a set of trade offs and we do have to put our heads down and think about it quite a lot. I think in the early days we were really looking to integrate with one of these linear trading platforms. So anything that's like PERPs or spot or futures. So, obviously talking to teams like Mango and a bunch of others out there on integrating because we're like, "Hey, we need these futures," and we didn't necessarily want to build them ourselves. Because it was extra time. The one thing that's slightly tricky with early composability is so many of these platforms and protocols were changing every week. So it was like trying to hit a moving target.Their code base is changing how they're doing stuff and we're like, we're also changing and trying to be agile. So in the early days that was a little bit tricky to kind of integrate Mango margins, their stuff's a little bit differently to how we do it. So it's really hard to consolidate and do a cross margin across two things. I know Marginfi's trying to tackle this now, which is why we're trying to work really hard with them and trying to integrate because I think it's such a cool product. But yeah, for example, with those futures we realized there's a clever trick where essentially if you treat a zero strike call, it's more or less a future. And so that was something that we could just pretty much chuck straight into our framework and pretty much pop out futures within a day's worth of work, which is pretty cool.But now in the future we're really focusing on composability that's a massive thing for us. So working with say, some of the borrower lend platforms, I think they've got nice functionality and it allows us to do a multi collateral, because currently we just do cash margin for stuff, if we want people to margin with SOL, they can kind of borrow cash on their sole or something rather. And then yet now there's this whole ecosystem of derivatives apps that they are building on top of futures and options. And so we're really trying to service them. So you've seen these DeFi options vaults really blow up in probably the last month or two. There's this whole popping ecosystem of these now whereas, if you were to look at this, maybe like three, four, five months ago, there was pretty barren. No one was there.Everyone was telling us like, hey options have no product market fit, no one cares about it. And now you've got Katana, you've got Friction, you've got like tap a bunch of others. You would've seen the news. We just brought over Ribbon Finance from Ethereum and we helped them launch on Solana, which to my knowledge is the biggest EVM kind of project to move over to Solana properly, which is pretty exciting. So yeah, we're just trying to service this ecosystem and really composed with all the projects that are trying to build up on us. And you've got like five hackathons happening now almost concurrently. You've got like serum convergence, a bunch of cool stuff came out of there. That looks really exciting. You've got this Solana global hackathon, which is coming up shortly and a bunch of others. So very exciting times.Matty (19:33):Yeah. A related question and you answered some of it, but Zeta, it seems like at its core, it is a protocol and you want external developers to be integrating with your protocol so that they can build things like structured product, things like Ribbon or Friction or Katana. But at the same time, you do have a really nice front end that you guys have obviously spent a good amount of time on, how do you view that piece of it where you are a developer platform in a sense, because you're composable with all these other systems that could plug in and provide value to the underlying protocol. But at the other end, how much work do you put into your front end to make it a trading destination for end users?Tristan (20:18):I think we started very much from the singular mindset of let's build this really amazing exchange ourselves and then have realized that, hey, we only have so many hours in a day and this is quite a grand vision. And you really get this exponential payoff or this nonlinear scaling when you start integrating developers from the community, people start building on top of you and you start growing a bit of an ecosystem. I think Serum's like a really great example of that. Obviously they've got this great orderbook, but now it's used by 50 plus projects. It really scales pretty amazingly. And it's like this core primitive in the ecosystem. And so we want to offer that because we've spent like six months trying to engineer this really complex and sophisticated options and future's protocol. We don't want people to necessarily go through the pain of figuring out how to do under collateralized trading and margining and settlement of options and all the pain points that we've had there.And so we want people to leverage that, build cool things. But at the same time we needed like a front end. We want people to be able to trade. I'm not expecting people to whip up type script or get a CLI going and start placing trades programmatically. That's not going to really appeal to the majority of users so it was us coming up with a really sleek web app. We also built not a mobile app, but you can access it through a mobile browser and we're going to integrate that obviously with Phantom mobile, which I think will make for a really nice experience. But yeah, other than that, we've been focusing hugely on DevTooling. That was kind of a pivot in our focus from, we've built this exchange and it works really well internally.And then I think I pushed pretty hard from our side to focus on composability and how we integrate with a lot of other projects. And so that was releasing a typescript SDK, which basically all the market makers and programmatic traders use. It just makes their life a lot easier. And a lot of people don't necessarily want to click trade through our platform. So if you're running a market, making bot, doing all those kind of essential functions, then that's really convenient for you. And then something else I wrote, which is our kind of like Rust cross program in vacation library. This is basically what the vault projects and all these other guys have been bugging us for months for. And I kept basically pushing back on guys like Katana and just being like, "It's coming, we're focusing on the platform. We're trying to get that out then I'll kind of service you guys once it's ready."And so ended up kind of doing it in parallel. I'm like these guys are pretty important to our strategy, we really should be supporting them. So ended up just writing out that client. I even built a bit of a sample vault implementation just to make it as frictionless to move over as possible. And they've kind of taken that and run with it. And the feedback that we've gotten is everyone's like the developer documentation is really good. It's easy to use. They don't even need to ask questions. So it scales well for us where I don't need to get on a call for two hours and walk them through how our stuff works. They just read the docs, fork it over, start running it, make their own changes. And they've got a product working within like an hour, which is pretty amazing.Matty (23:10):That's awesome. One thing you also mentioned was mobile, which is interesting. I mean, yeah, for those who don't know, Phantom, the browser extension wallet has released an iOS app recently and getting a ton of downloads and it's getting the ecosystem thinking how do we optimize for mobile? Obviously part of the promise of DeFi, is that there's billions of people around the world, they have smartphones, they maybe don't have access to first world financial infrastructure. And so if they have a smartphone and they have a Phantom wallet and they can get some funds into the wallet, you get access to this next generation financial system. But on the other hand, and maybe that works well with simple things like I want to get a loan or I want to make a trade or invest in a stock.Matty (23:56):But when you're talking about using pretty advanced derivatives, whether it's futures or options, screen space matters. You just envision the Wall Street trader with 17 screens loaded up. How do you think about that? Are people, do you think going to be trading perpetuals and stuff from their mobile phones in Indonesia? Or how do you see that of playing out?Tristan (24:25):Yeah, definitely see it happening. To be honest, I think I went through a period where I used to pretty much exclusively use binance and FTX from my desktop computer. And then it got to a point where I just got too lazy and it was so convenient on my phone. If I just hear like, this coin is probably a good buy now, I'll just kind of check it on my app and go and place an order. And it's super frictionless. It's super easy to do and very convenient. So I really like that. And I think what spurred us was kind of a twofold thing. One is seeing what our audience was and what people wanted. And obviously it's a global audience.If you're looking at the whole span of things, a lot of people do use mobiles actually, which kind of shocked me because I came into this being I've never used a DeFi app on mobile and I don't think I ever will. And then I looked at what our discord statistics were. We put out actually like a survey or two, how PM guy wanted to do a survey and figure out a little bit what our user base was. Turned out like this huge proportion of people, I forget the exact percentage, but were accessing and using primarily from mobile.Matty (25:31):Interesting.Tristan (25:31):And I think that tends to be probably more of a third world geography type thing. People tend to be very big on the mobile phone stuff. We were like, "Hey, we can't ignore this customer segment. There's clearly like a fair bit of demand there. And this is something that we should probably cater to." And it was really good from the design side. So this second part was we obviously want to simplify, but still have functional options. We don't want to simplify to a case where it's like click one button and it does stuff for you. It's like, we just want to make it intuitive and easy to use without making it unnecessarily complicated.So we're like, "Let's hide stuff like Greek exposures and all this stuff in options. That's like probably for the pros and it's probably overkill." And so we're like let's design for mobile first, which is actually feedback from Josh Taylor, from the Solana team. The designer there gave us a bunch of good feedback of design for mobile first it'll force you to be really efficient and think about screen real estate and then go back to the web one after that and then you'll probably have a much simpler or more compact information dense kind of screen there.So that worked really well for us. We kind of rolled with that, we had these two apps. We actually kind of split it up. We didn't want to have necessarily the same exact experience for both web and mobile, which we had initially. And I think our binary options won. It was just like a clone of both, but we realized, hey, we're going to have different audiences catering to both. Probably the more pro traders are going to get on the web app so we're going to have essentially the options, kind of the layout of all the options. You've got a lot more kind of parameters and knobs to look at. You can look at like open interest and probably we'll add in like Delta and all these other things that I think the pro traders really appreciate.But when we're looking at the mobile app, we gave the normal interface and we put in other stuff, which is useful from the price. And you can kind of get these little metrics, like what's the probability of the option finishing and the money. And I feel like that's a lot more tangible than I just look at an option and it's priced at $2 or 70. And I'm like, what the hell does that mean? Whereas if I'm like, "Hey, this has a 20% chance of finishing in the money," then that makes a lot more sense to regular users. And we changed the flow a little bit as well, where it's like, if people aren't really comfortable placing options, we made a very simplified flow, which is like, I think the price is going up or the price is going down, which kind of caters to the people who are only familiar with these up-down perpetual products.And that basically auto fills out your kind of, I'm buying a call or I'm buying a put with some nearest to expiry, some other parameters. So it kind of takes some of the decision load off people. Because otherwise people come in there, they're like, "I want to buy an option. I don't really know what I'm doing, but I've got to put in things like expiry, I've got to select the strike and then I've got to select all these different parameters. I've got to buy or sell it. Which one do I do? I don't know. It's kind of a lot of mental load." So we are just trying to minimize that for people.Matty (28:15):Nice. That's awesome. So maybe the last section here, we can go through some rapid fire questions. So I listen to this podcast from Tyler Cowen, who's an economist and professor in the United States. And basically how this is going to work is I'm going to say a word or a phrase, you're going to say whether it's overrated or underrated.Tristan (28:37):Got you.Matty (28:38):And then you can give a brief definition of why you think it's overrated or underrated. So, I'm going to say something first, a word and it's just going to be rapid fire. We can talk a little bit about each. But, you ready?Tristan (28:49):Yep. Let's do it.Matty (28:50):All right. Anonymous crypto teams.Tristan (28:53):I think underrated.Matty (28:54):Why is that?Tristan (28:54):I think they do pretty good work. And I think coming from a background in traditional software engineering where people care a lot about credentials and things like that, I think what you should really be measured on is your meritocratic thing where people just do good work. And I think people go out there in the crypto ecosystem, they don't make a big fuss, but they launch these protocols. And I think people do really good work and they don't need to have a Stanford CS background or something, although to contribute to the ecosystem. So it's really nice and refreshing to see people who might be self taught in crypto. And a lot of people are, I think they take it on their own initiative and they go out there, build amazing products and change and push the financial narrative forward or whatever they're building the crypto ecosystem. So I'm pretty bullish on those teams for sure.Matty (29:39):Out of curiosity, why didn't your team go anonymous?Tristan (29:43):Most people in the team I think are pretty anonymous and want to stay that way. I think it's me who's had to be the doxed individual on the team. But it's more like, you want to do these speaking opportunities or go and publicize or get the name out about your protocol. And I think it's very hard or at least for me it was tough to do that. People don't necessarily take you seriously, especially when you're trying to raise capital or do other things, people don't really... That doesn't fly with a lot of people when you're trying to talk to people from more traditional industries, they laugh it off as a bit of a joke. So I don't mind too much from my perspective, I'm pretty comfortable with it. But yeah, at least we have a little bit of a mix.Matty (30:24):The Metaverse.Tristan (30:26):I think overrated. I just hear it is this buzzword, you hear it from everyone, especially guys like VCs and other people. I hear it from a lot of my, I hate to say it but normie friends from outside of crypto. That's start to become a bit more of a tagline, but especially in relation with NFTs, this is something that everyone gets into in the space. And I think that's good to broaden adoption and onboard the next billion users, but I still don't have a really good understanding of what exactly the Metaverse is. And now I'm seeing all this stuff.Matty (30:55):What is it?Tristan (30:56):I don't know.Matty (30:56):I don't even know.Tristan (30:57):No, one's got a definition. It's just this buzzword that gets thrown around and now I'm seeing Facebook rebrands to Meta. You've got this corporate BS coming out and we're going to build the metaverse and I'm like, I don't really want to be part of Zuck's metaverse necessarily. So I'm a little bit bearish on that.Matty (31:14):Yes, I too do not want to be a part of Zuck's wonderland. Insurance and DeFi.Tristan (31:22):Definitely, I think underhyped. People go to the really quick and easy stuff to understand. And obviously NFT is a nice bridge gaming stuff like that I think is really cool. And not to downplay that. Then I think something, the narrative for DeFi is really strong. We're building a new financial ecosystem. If you're looking back at what's happened in traditional finance, obviously there's been like decades of innovation stuff. I feel like that's kind of slowing down and is not really suited to this web enabled world that we live in now. So there's kind of obviously this Web3 meme that everyone throws around, but I think it is genuinely true and it's going to be a bit of a paradigm shift.Even now, I try and open a new bank account or do a cross-border payment or something although it's a huge pain in the ass. There's so many things and steps you have to go through, it takes forever, you get clipped on fees on absolutely everything. Whereas, I remember the first time I opened up a Solana wallet and I just sent someone USDC, it's confirmed in a second, pretty much. I paid a fraction of  cent in fees. I'm like, this is incredible, nothing beats this. And I think Anatoly brings that great statistic of 20% of global GDP just literally gets dedicated and used up by just moving money around and having all these middle men take commissions on things. Unlike, wouldn't it be incredible if we all got a day back in our lives that we didn't have to work if the whole financial ecosystem was a little bit more efficient and more transparent.Personally, I really like it because having worked in the software industry where open source is pretty king there. And the only reason anything works is because people have built all these libraries and other things underneath that all build up. And you can build your application in 10 lines of Python now. And this is kind of like, doesn't obviously happen in traditional finance. You've got all these firms who guard their secrets, it's world gardens. And now you've got this transparent financial ecosystem where everything's, majority stuff is open sourced, it's composable, people don't need permission to go and place and execute orders through Zeta or build whatever their protocol is, their default product on top of us, just go ahead and do it. It's a piece of public infrastructure.So I think that's pretty awesome. And I'm super excited when we live in this world where everything can talk to each other. You're actually earning productive yield on your assets and not the 0.2% that I probably get in my bank account these days. And then following on from that, I think derivatives are pretty cool. I think when you look at any financial ecosystem, you've got a few stages of where you're going through. So, we started with the simple token swaps, then you're going to these borrow lend protocols, then you're getting more into PERPs and leverage. And then I think the last piece of this derivatives puzzle is just trying to get to options and then on the very end of the spectrum, you're starting to get to exotic options and this crazy stuff and you're seeing a few protocols popping up for that. So it'll be interesting to see how it plays out, but I think it's such a natural fit. And yeah, when we started this, we're like, it's such a obvious play that this will take off and we've already seen perpetuals swell to multiple billions, if not more of volume on centralized exchanges, even stuff like dYdX is just blown up massively all of last year and this year. So yeah, I'm super bullish on that. And I think it's under service still. I think it's just going to grow more and more. And if you look at traditional markets, derivatives eclipses spot by 20X or something although it's just huge.Matty (34:42):Singapore.Tristan (34:44):I think under hyped right now. I think it's still fairly under the radar. I think it's a pretty cool part of the world where it's like a nice melting pot between western and east. So it's cool. I think being around here and seeing that it's still an English speaking country, but you get exposure to that kind of side of the world. It was just kind of convenient for us as well because it's that whole kind of APAC time zone. And so far it's been pretty enjoyable. I think there's a really, really fast growing crypto ecosystem. So it's still behind. I would say the US, is kind of the leader. I think all the main people are there in the Bay Area or New York building cool stuff. You're definitely to starting to see more people move here.I think it's a big crypto hub and I think kudos to the regulators for not just trying to outright ban things and trying to have a little bit of a conversation, which I think is pretty rare when it comes to crypto. You have everyone trying to shut it down and label it as this kind of like, this is some black market thing and people are using it for all these nefarious operations, when you have actual legitimate builders trying to build awesome financial infrastructure that will hopefully change the world. So yeah, I'm definitely see like more people moving here. I think hopefully growing a little bit of a Solana footprint, we'll have this Singapore Hacker House going and hopefully a more longer term installment and looking forward to having more startups around.Matty (36:05):Yeah. Completely agree. Huge fan of Singapore. I've been there handful of times and I've always had a really good experience there. So okay, next one. Sleep.Tristan (36:15):I think under hyped for sure. I have a lot of friends, probably more in the kind of banking sphere who are just sleep is for the weak type mentality. They're like I did sleep three hours and go back to my desk job like Goldman Sachs and then just do all my stuff there. And they're like, who needs to sleep? Doesn't really matter. They have fucked up sleep schedules. I've read a couple of books on sleep. I think there's that classic, like Matthew Walker one, on why we sleep and a bunch of other good ones and yeah, it does seem pretty critical. I know at least myself, when I get less than six hours of sleep, I'm super grumpy and just have a lot of brain fog and cannot think straight. And when you're trying to code up smart contracts and Rust, I think you need your mind to be performing pretty well.So we have a bit of a weird sleep schedule going in our team somewhat, we're trying to service 24 hours of the clock. And even though some of us are in the same time zone, say we just have to like stagger our hours. So I'm personally a bit of a early bird. So I try and get off earlier and I enjoy the early hours because I tend to get very tired at night and can't problem solve. Whereas, I'm fresh in the morning. Whereas some other guys in the team, especially on the engineering team, love to pull the late nights and be up until like 3:00, 4:00, 5:00 AM. So, it kind of works, but we're around on the clock. So if a market maker or someone throws a fuss and the platform's breaking, we're always there on call. But I think sleep in general is super underrated. I think it's pretty important in the long run, you want to be getting your six to eight hours.Matty (37:43):I asked this question because I think you had a pretty infamous tweet and I think it was, "Peak crypto living." And it's just a picture of a rug and a ma and a mattress on the floor. I just wanted to get to the bottom of this.Tristan (38:00):That's right. My sleep is terrible. That was when we moved into a new place and I pretty much had no furniture. We bought a wide screen monitor before we bought a bed. We were working super productively, but then I would go up to my room and just more or less sleep on a yoga mat on the floor, which was maybe not the most comfortable thing, but I got by it for like a week and then managed to buy a bit more furniture. I have at least a basic bed now. So my sleep has improved incredibly since then.Matty (38:26):Nice. And this will be the last one. Solana.Tristan (38:30):That one's a hard one to say. I think if you were to ask me last year, it would definitely be under hyped. I still think it's under hyped. I think people have been fighting it and being like, "Hey, this isn't a real chain. It's overblown. It's VC chain bad or something." Although people are kind of always trying to put shed on it, which I don't think is justified. And I look at those people now and I'm like, "Clearly you haven't used any of the apps that are on the platform where you have no appreciation of what the people are trying to build." Because I think being, I wouldn't say an insider, but at least like a builder in the ecosystem, you're like, hey, there are a lot of really cool teams building cool stuff. And there are so many products yet to be launched.So I still think it's in the period where it's under hyped and we're going to have just so many more Solana apps just because it can scale and we're not going to hit these really crappy limits like you hit it on Ethereum L1 where suddenly everything is costing an insane amount of money. So I still think the space has so much room to grow and the way that Solana is built, I think does scale pretty nicely. I think it has definitely gotten some hype towards the end of last year. I think it did feel a little bit toppy, I think in crypto in general and going to break point and there was so much hype and so much crazy sentiment going around. Everyone was feeling really good because their bags are getting pumped and people are in Solana 200 plus dollar territory. And there's this whole NFT thing going on, you've got to listen to announcements from founder of Reddit and founder of Brave and stuff.And you're like, "Wow, this is mainstream adoption. What's going on? Solana's going to infinity." And then the whole market nuked and then kind of brings you somewhat back to reality. And I think now is probably the best time for builders when price is a little bit suppressed. People can kind of put their head down because, I got to say, end of last year was pretty hard to concentrate on just pure engineering. There's a million different distractions going on. So I think it's nice that things are a bit more low key now and it's a bit more of a healthy growth trajectory.Matty (40:20):Yeah, for sure. This is definitely Solana Season from my perspective, because this is the best time to build applications, I think. Yeah. Really happy that you guys are in the ecosystem. I'm really excited that Zeta is now on Mainnet. And yeah. Thanks again for coming on this show.Tristan (40:38):Awesome. Not at all. My pleasure.

Ahmad & Danial Abbasi are the co-founders of Syndica, a Web 3.0 blockchain infrastructure company focused on the Solana ecosystem.00:35 - Background in Crypto02:09 - Why Solana over other platforms?04:10 - User Experience and Web 3.006:16 - What is Syndica?08:54 - Syndica and Web 3.012:33 - Syndica’s focus on infrastructure14:36 - Differentiating from other providers16:55 - Syndica and the data18:29 - Their user base20:03 - Plans on offering validator services?22:05 - Best practices for building on Solana24:49 - How should new developers approach web 3.0?28:16 - Storage33:03 - Interesting projects in the ecosystem37:53 - Solana Hackathon39:19 - What would you love to see built on Solana? DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

On a special episode of the Solana Podcast, Sergey Vasylchuk (CEO, Everstake) talks about Aid for Ukraine, a DAO created by Everstake and endorsed by the government of Ukraine and Anatoly Yakovenko to support Ukraine during the ongoing crisis — and how it came together on Nation.00:38 -  Intro02:51 - Origin of the initiative / How it works06:25 - Ukrainian government receiving FIAT currency 09:13 - Banking, a legacy system10:04 - News on the ground12:39 - What can people do to get involvedDISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Austin (00:09):Hello, and welcome to a special episode of the Solana podcast, I'm Austin Federa. Today we're joined by Sergey Vasylchuk, who's the CEO of Everstake, but we're actually not here to talk today about Everstake. We're here to talk about aid for Ukraine, and the situation in Ukraine and the project that Sergey and a bunch of others from the Ukraine and connected to the Ukraine have launched. Which is a fundraising effort to help raise money that's urgently needed for the government and for people there. Sergey welcome and thanks for joining us today.Sergey Vasylchuk (00:39):Yeah. Hi guys. Thank you for listening and thank you for helping us in this difficult situation. And yeah,the  situation in Ukraine is quite terrible. So we have been protecting our country for close to a week and we are struggling with one of the biggest armies in the world. But we still resist and sure, we'll win soon. But this will need... It's not just a magic maker, many of the people trying to protect their country, military are dying, military are fighting, the civilian are also trying to do all they can. And generalization is that every citizen of the Ukraine, it doesn't depend where he is located and what he can do, they do something. I do not know anyone who just sits in the idle and observes the news. First, probably two days for me was shock. I cannot believe what has happened. I was just stuck to the news and seeing what is going on, calling some relatives, asking what I can do to help and what's going on? It's just shock. And I was stuck, but sooner or later, I had the conversation with Anatoly Yakovenko from Solana, he is originally Ukrainian. He asked me, "Hey guys, what is going on? How are we going to help you? Let's do something." I said, "Yeah, I cannot sit and cry, and wait and I need to do something." And it was the case when we started to understand that we need some impact. And that's why we decided to start this activity.Austin (02:17):So the process here that's been running on is there's Ukraine.soul, which is a Bonfida name routing layer address, that routes to a wallet that's controlled by a MultiSig Dow on Solana. You can go to nation.io/dow/Ukraine, you can see this there too. There's about $1.45 million contributed so far, as well as several NFTs from projects that will also be sold and liquidated to generate funds here. There's a lot of different efforts, raising different kinds of crypto to aid the government and the people. What was sort of your thought to do this, to start this up? And can you talk a little bit about how the country's actually involved as well in the government?Sergey Vasylchuk (02:59):Well we have quite an unusual ministry, which called Ministry of the Digital Transformation. It was created a few years ago, and many of the politicians were skeptical and it was a bit like late in the day. It's just few guys from the IT ground. They will not change nothing. But for the least two year guys made the great application. We probably have the digital ID have digital, driver license, have the digital vaccination certificate, whatever. So it go digital. The many of the services, the country are become in our smartphone. And those guys are quite trustworthy and respectable in our community. They just start to accept the donation, in any form of the money that is available. And you should understand that currently there is marshal law in the Ukraine and central bank put limitation that is hard to transact in the foreign countries, foreign currency, sorry for us is Euro a dollar.So for example, I cannot transfer some USD to any other recipient outside, Ukraine. And many of the volunteer organization need to pay because, for example, night vision, like equipment or other stuff is outside Ukraine. So crypto become the obvious things to transact probably the only without the bureaucracy without need to go to the bank because, it's impossible to go through the bank in the middle of Ukraine is war is real war. So why crypto is obvious why government` and Montesquieu is because I was asking for many of partners asked me how we can help you. And I said, Hey, just donate. Many of them were skeptical. But what the source of this donation who are controlled those money, can you guarantee us that this money will be controlled by some legitimately people?And yeah, it was a good question. I was calling the guys from this ministry that the digital ministry and say, can you help us to make it more legitimate? Hey, make some, posting the Twitter with this other, they say, yes, of course we can, we can do. So I take some of the guys is deputy of the ministry, which have provide his own Solana key to the Montesquieu. I also call him like few respectable companies, founders of these companies in the Ukraine who are well known. They also provide their keys and we create the Montesquieu with like 60% of the threshold and linked our Twitters to each of the keys to be transparent. So everyone see who is signing, what is signing and is blockchain is totally transparent. You can go to this nation now, which like Solana and see our dow and see what is going on.Austin (05:56):Yeah. The multisig is also, I mean, if you just think about the logistics of operating in a war zone, you don't know who's available to sign a transaction at any specific place. So having it split up into a multisig that has a proportional threshold requirement just allows the whole project to be much more nimble. So, funds that are create are, are collected into the, this Dow they're they're then going to the request from the government is pretty much to receive Fiat currency at the end. Is that correct?Sergey Vasylchuk (06:25):Yeah. There is two problems here. Problem one is there marshal law with restriction. Problems two that currently in the Ukraine, there are not much exchanges, which are able to transaction the, in the hryvnia or in the foreign currents that we need to convert. And if there are some, they are not very scalable and sometimes vendors, don't have the crypto. So we trying to find the way to make it sustainable, unlimited, out ramped solution to be able to liquidate crypto and to put this to the account and second issue here that also people need to know that we are spending money , in the right hand, in the proper proportion and so on. So, and you should understand that the only trustworthy for the everyone, outside the Ukraine is government. So government is resisting, is successfully resisting for the biggest army in the world.So, you can put the there, reputation, yeah this is guys who are saving us. So that's why, we are going to you to build this unlimited gateway and put money directly to the central bank. Why central bank, because they own entity who is able to transact freely with outside the world. And they have special account, which were opened recently to all donation for the military operation, for the humanitarian operation, whatever. And we going to fund those accounts. After we try this to the sound scale amount, not significant amount. I believe that 1 million is not significant amount to have the impact in this strategy war, will we try to advertise this solution for the wide, for the wide audience? I want to build these something that would allow like every, every crypto holder, like down the Bennett from the, his size, it'll be hamster or whale, to donate any impact, as easy as $1, the 10 million, this is something that we going to build. Probably just tomorrow.Austin (08:35):Yeah. That's I mean, that's great to hear. And especially the ability of crypto to step in here and be a transfer medium that works 24/7, 365 days a year, even with the restrictions of having to get to Fiat currency at some point, it means that at least, you know, what's in the account and you're not waiting on banking hours in order for this to happen. And I think there's, there's probably also a safety component too, where people can donate in a more anonymous fashion compared to having to donate with a credit card or an accountant transfer. If, they themselves are in a situation where it may not be safe for them, maybe they're inside of Russia and they're actually still donating, you know, to something like this.Sergey Vasylchuk (09:14):Yeah, sure. Is just the new tool, the new generation tool, in our company, in between us, we call banking legacy system. So for us, the new finances, blockchain and everything that comes with the bank is legacy. So, but yes, sometimes we need the bridge become the system. But obviously for me, crypto is the new generation and this market for the 10 years. And, I am a 100% crypto guys, and this is how I can be useful for my country.Austin (09:39):So there's a real asymmetry of information here, as far as the media's been reporting that many people who are in Ukraine are not able to necessarily always get information out. And it's a little bit hard to understand. What's always going on over there, especially for someone like me, who's in the United States. What have you sort of been hearing from, from friends and family and colleagues about the situation there now?Sergey Vasylchuk (10:04):Well, I'm on the ride every minute. So you and understand, my parents stayed there. My sister stayed there. My friends stayed there. Everyone who stayed there, the males putting the guns and protecting the territory, female trying to be helpful with volunteering with the medicine, with anything. Even kids try to do something, but it's not possible everywhere. After the five days of trying to win our nation by the fire contact, Russia, understand it doesn't work. And now they try to use rockets, ballistic rockets, missiles and to hit our civilian cities. So what is going on Kharkiv is currently is bombing, like Kyiv is bombing. Zhytomyr is bombing. So they try to scare the people. One thing that they don't understand that they just bring more hate and angry, not the scary.So we are the nation that we unite against the enemy. We have the problem with 214, they took some of the territory and those situations, the country was weak. So probably they tried to use the same approach, but it doesn't work right now. So each strategy is a full scale war, with 1,000 of the deaths, with a civilian, with a 1,000 the death of the military and with the damages of the infrastructure. So it's not a movie. It looks like a movie, but this is real life that currently where Ukrainian are facing.Austin (11:52):And, and just in the last few days, the, I would say that the international community has moved very slowly, but they, they are moving especially financially to have there be real consequences for this in terms of freezing foreign assets from the Russian government and imposing stricter restrictions on it. Do you have an idea? Do you have a sense of the magnitude of the need right now that Ukraine has that both from the inner, like there, there's obviously there's donations that people can do. There's also Congress people, they can call there. There's other political actors that they can call. What are the right steps for someone who's trying to get involved beyond just donating?Sergey Vasylchuk (12:36):Well, the biggest problem for the Ukraine is our sky. So we have not advanced systems to protect from the missile and rocket. And, if somebody can close our sky, no chance for enemy to win us. So all current attacks are away from the sky. So if anyone could call the congressmen, the government and impacts something that the vest could close our sky, be sure that we will resist. We kick the earth and we go away. We go away from, from our territory, we hitting this, just fighters, just because the excellent pilots, but our is limited. So the more, just the more weapons, the more something that protects our sky will help us. Probably we do not need anything more from the point of view, if you want donate us, like donate, but you should understand that sometimes this money will be useless if they will not go out to like some specific like direction.So for example, Kharkiv, they need medicine, they need everything, but there is no logistic around because, everything is destroyed. No roads around. So the best way is to contact some volunteers who live in some specific places, which have, have the access to the some logistic and have the context with civilian military to ask directly, what do you need and what you want to have. This is why we also want you to interact after the building this crypto gateway to the central bank, we probably will try to onboard for, for the big exchanges, for the crypto exchanges funds, who will be able to make this direct support. And after this, we'll be able to send the crypto to liquidate the, and the exchanges and to help this way.I know many of the suppliers, like a, already a certain crypto, because some of the solutions probably FTX a Coinbase base, make it quite seamless transactions. So they send the invoices probably in the US dollars, but, we're receiving this in the form of the crypto. Some magic happens inside the exchange and guys receiving the Fiat and the more these guys who been born with the crypto, it will be more of widespread and something that you would call adoption. Unfortunately this mass adoptions go in such situation as a war with the thought that will goes organically. No, it goes in the extremely situations.Austin (15:17):Well, Sergey thank you. Thank you so much for joining us today. We'll have to have you back to talk about Everstake at some point, which is something I've been meaning to do for, for a long time, but this obviously takes priority today. If people are interested in learning more in helping out, you can go nation.io/do/Ukraine. That is connected to the same backend as the SPL governance program. So you can also just donate directly on chain at Ukraine.soul, which will accept any SPL token and any NFT as well.Sergey Vasylchuk (15:46):Yeah. Thank you guys for listening to me, please try to donate something to support like our survival. Thank you, Austin. Thank you Solana community. You are amazing. Please contribute something. It'll be your small, but very important and impactful contribution to save Ukraine as a nation. Thank you guys.Austin (16:04):Thank You.

In this episode, Dan Albert (Executive Director), Lily Liu (President) and Mable Jiang (Board Member) discuss the role of the Solana Foundation in advancing the Solana protocol and ecosystem with support and initiatives around the world. Austin Federa (Head of Communications, Solana Labs) guest hosts. 0:43 - Intros / Roles3:13 - The appeal of working at the foundation level07:48 - Establishing scope for the foundation12:42 - What’s working in the ecosystem?20:01 - From the ecosystem to the foundation21:21 - Growing Solana in new markets33:50 - Shared Ownership of the network36:21 - Predictions for 2022 in crypto and web 3.0DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Austin Federa (00:10):Welcome to the Solana podcast. I'm Austin Federa filling in as guest host today. We spend a lot of time on the show talking to founders and builders in the space, people building on the Solana blockchain or otherwise involved in the Solana ecosystem. But today we're actually going to be talking about a different component, which is the Solana Foundation. Today with us, we have Dan who's the executive director of the Solana Foundation. We have Lily, who's the president of the Solana Foundation and Mabel, who's one of the board members of the Solana Foundation. Welcome to the Solana podcast, guys.Lily (00:39):Thanks for having us.Dan (00:40):Great to be here.Mabel (00:41):Thank you.Austin Federa (00:42):All right, Dan, let's start out with you. Tell me a little bit about what the Solana Foundation's role is in the ecosystem.Dan (00:49):Sure. The foundation is really here to help foster the growth of the Solana network and really the Solana ecosystem kind of in broad strokes at the highest level, what can we do to make sure that the Solana network continues to grow in the most kind of sustainable and decentralized manner as possible? And how can we provide resources and help the community grow to onboard the next or the first billion users to the Solana ecosystem and crypto in general?Austin Federa (01:24):Lily, what attracted you to the Solana Foundation? And how did you get involved in it?Lily (01:30):Well, I've been in the crypto ecosystem for a little bit and I must confess that in 2018, 2019, I actually spent a good bit of time being a Bitcoin maxi. And then I even was part of Little Bitcoin Book and which is not to say, sometimes I feel like people in crypto are a little bit maybe too tribal, which is not to say I don't love Bitcoin. I still consider Bitcoin to be king. But when I took a little bit of time out of crypto, when I came back to crypto, I started just using a lot of the apps that had sort of emerged out of DeFi Summer and I was totally floored by using Raydium in April. I really could not stop talking about it for just about a month because it was very squarely Web 3.0 but it felt like Web 2.0 and it was just so obvious to me at that moment that this was going to be how the next billion people, if we were going to get a billion people into crypto, anytime soon it was going to be on Solana.Solana to me is just such a unique combination of being technically so innovative but at the same time, really understanding that to bring people into the ecosystem, it has to be a good experience. And sometimes for your end user, it really just is as simple as saying, "It's fast and cheap." And that's why ethernet is just better than 56K modems. And sometimes it just has to be that simple to the end user if you're going to appeal to a billion people.Austin Federa (02:48):Yeah, I completely agree with you. There's been so many of those moments I've sort of heard over the last year of people just trying something on Solana and having this experience of, oh, it just works. It's fast. It feels like a Web 2.0 application but it's delivered in a fully decentralized way. Just based on that, what was the decision in your mind to, tons of people have that experience, they go build something, they go work for a company building in the space in terms of a service provider company. What was the sort of appeal of something that's more at the foundation level?Lily (03:19):To me, I think that, I come from a background where I spent a lot of time, I originally started working in more traditional industries. I worked in McKinsey, I worked at KKR and I kind of fell into Bitcoin back in 2013, 2014, which at the time was not a very obvious thing to do. And so for me, I think one of the things that I maybe add to the ecosystem is helping run effective organizations and thinking about sort of how to scale a commercial kind of go to market strategy and having been in the ecosystem for a little bit. And so for me, what's always attracted to me to crypto and Web 3.0, is these kind of new ultimately end user experiences that you enable for, not just those of us who've been kind of nerding out over technical sort of minutia left and right but really making that accessible and available.Lily (04:17):Some of the things that I'm really excited about facilitating through the foundation is kind of new markets growth outside of the US, outside of Europe, outside of the parts of East Asia that are already very familiar with cryptocurrency. And to me, it's so clear that if these types of applications, call it DeFi or sort of more metaverse or social or NFTs are going to take hold, then it's most likely going to start on Solana first. And so just being a part of that and sort of making that more accessible to a broader rate of people is really what's exciting to me.Austin Federa (04:51):And Mabel, you tell us a little bit about your path to becoming a board member at the Solana Foundation.Mabel (04:57):I think among all the people here, I probably joined the board the earliest. I joined when the board started, the foundation started. That kind of history just goes back to when I think before the token launch of Solana happened to that Anatoly and Raj, they were in China and in East Asia. And then that was even before my time joining Multicoin. I met them, obviously at that point it was 2019 and then it wasn't really easy to raise fund for sure. But then we kind of just happened to hang out a lot in Shanghai, in Seoul. I think another places like Beijing and whatever. And then we spent a bunch of time over those three weeks and then talked about, oh, how do I think about or how do we usually think about go to market strategies for public chains? And then how do people really differentiate one smart contract from the other?When they go back to San Francisco, they ask, "Can you maybe write us some sort of expansion or kind of go to market plan for Solana in East Asia?" And I did that. That was right around the time when they're forming a board for the foundation. And then, that's also around the time when I joined Multicoin. They invited, it's like since you're part of the ecosystem and then you are pretty unique kind of position compared to some of the other board members, are you interested to kind of help Solana Foundation or raising the Solana awareness in a global sense? I was like, oh, that was really interesting in a differentiated way to contribute to the ecosystem so I said, yes.Since then, that was start of 2020. Since then over now, I've been doing quite a bit of things, always related to those lines, raising the awareness for Solana in China specifically because that's where I'm sitting. And also in some other places in Asia and also try to just kind of talk to different projects in multiple different ecosystem. And obviously now it's a multi chain world and then people would have different trade offs, like when to choose different things. But when they learn about Solana and learn about why they're optimizing certain things in the design, they're always willing to try it because back in 2020, there aren't that many people know about it. I think the first step really is just to having people understand how the system works and whatnot. I've been doing quite a bit of those. I think that's kind of my experience involved with Solana Foundation.Austin Federa (07:31):And Dan, as you kind of think about your role as the sort of executive director at the Solana Foundation, how do you define scope for an organization like that? What are the sort of things you're thinking about when you're thinking about initiatives that the foundation is engaging in or things the foundation is not doing and shouldn't be doing in your view?Dan (07:52):Yeah, that's an excellent question. Really, I see it as two primary areas of focus with kind of the overarching goal being broad growth of the network and the community itself without an eye towards turning a profit for the foundation. This is a nonprofit organization. We're not taking any equity investments or really taking the position to be picking winners. There's plenty of incredible innovation that's happening on Solana, lots of competing projects, lots of new stuff. And the foundation really wants to position itself to support, really talking how to provide support equally for everyone in the ecosystem. And so one of the primary thrusts, one of our main operational kind of focus points these days is really on growing the network itself from an infrastructure standpoint. That's really been my personal area of focus for really a long time now is how can we get the most number of high quality validator operators, the most humans running the most number of nodes, be it validators or RPC nodes, which serve as the API endpoints or API gateways for applications using the Solana network?And to that end, the foundation has rolled out a number of programs, really leveraging kind of the foundation's holdings of tokens, which are really allocated to grow the community and grow the network. Kind of as I see it, I don't know, maybe a bit of a personal tangent here. I originally started engaging with Solana in early 2019. I was working on the engineering team at Solana Labs and it was early stage startup. We hadn't even launched the Testnet yet, just kind of scrappy early days, trying to get everyone to understand and hey, proof of history is a real thing. We're really going to prove out this tech. And one of the things that was really hard was trying to get people to run validators. A lot of our early stage validators that helped us launch Testnet for the very first time and get Mainnet off the ground were a lot of them came from the Cosmos ecosystem.And so, we have a lot of these kind of OG longstanding validators who really helped get the Solana network off the ground came from standing on the shoulders of giants. The Cosmos ecosystem brought so much innovation to the proof of stake universe and kind of where this ties back to, in early days, myself and a couple of the early labs employees in true startup fashion, we were actually working out of one of the co-founder's basements and we hand built some of the first bare metal validators to run on the Solana network. Ordering parts on the internet, showing up in a bunch of boxes and just going forward kind of hacking on the hardware, trying to see how much performance we can squeeze out of these individual machines.We went and installed them in a data center here in the Colorado area and those nodes are still running today. Some of them are pointed at Mainnet, some of them are Testnet. And that was sort of the, I don't know, the genesis of, at least for me personally, a lot of my personal investment in seeing the growth of the validator ecosystem on Solana, having kind of physically hooked up and bootstrapped some of the first ones. And now having transitioned earlier this year to take on this role at the foundation, we maintain a program for anyone who wants to run a validator, can engage with tier one data centers all over the world that the foundation has. We've really kind of went to bat for our validator community and helped a lot of these infrastructure providers understand that, yeah, it takes a lot of horsepower to run a node on Solana and it can be hard to get your hands on some of these machines.And so in working with some of these execs at some of these older school, I'll say more traditional telco or infrastructure oriented companies, helping them to understand the value of what a powerful and secure and distributed Solana infrastructure ecosystem looks like, that's really been an exciting kind of growth track, I think for the foundation in helping to bring more hardware online and helping more people to learn to run it and get more nodes running and keep the network flying.Austin Federa (12:16):Yeah, I love the parallels to the Cosmos ecosystem being a validator ecosystem being early, early supporters of that because of course, Tendermint is also notoriously computationally intensive and runs better on bare metal than cloud so it seems like a very natural validator group to bring over in the early days.Lily, from your view, as looking over the ecosystem, what are the parts you see that are working really well in the Solana ecosystem? What do you see are areas, be it tooling, Dan talked a little about infrastructure, areas in which the foundation can make a difference in help evolving?Lily (12:53):What I think is going quite well right now is a lot of the interest in the energy and kind of the inbound on various stakeholder groups within the community. I think there's a lot of excitement from a general audience also because it's very accessible to a general audience. Again, as we were saying earlier, if it costs dollars versus hundreds of dollars to mint an NFT, that's a very meaningful difference to many people. I think general awareness has been amazing. I think there's a lot of increased developer interest and accessibility. And if you look at sort of the hackathons that we've had, probably every two or three months, three or four months in the ecosystem, the number of sort of people who are new to Web 3.0 that are starting with Solana, I think is really impressive and has grown tremendously in a very short period of time.We want to continue to extend that in various ways. And we've got a number of ideas as to sort of increasing the accessibility to even a retail audience, putting out sort of better documentation, better tooling to continue sort of onboard both maybe existing Web 3.0 developers who might be building in solidity or on sort of an EVM type environment. As well as, increasingly there's pretty substantial influx of folks coming over from Web 2.0 and thinking about where to get started and are starting off by making choices between essentially now it's really solidity or Rust and Rust, implicitly sort of Solana. And so I think that we can continue to invest in various ways of sort of helping people start within the Solana ecosystem. And I think that because Solana has grown so quickly in a very short period of time, there are also sort of ecosystem tools that are catching up right now.One thing that we hear a lot about is kind of indexing within Solana is something that we can probably improve as a community, data analytics on Solana, given that a lot of the applications are very sort of more consumer retail audience oriented is something that I think is also, actively being worked on. And so those are of the sort of near term things that people are thinking about. Obviously with the pretty tremendous growth of the ecosystem, also making it easier for people to run nodes, have access to baseline infrastructure. That's also something we've invested tremendous resources on through data center partnerships and it's known that Solana some higher hardware requirements but we've invested a lot to try to take down those various barriers. Those are some of the things that we've been thinking about.Dan (15:38):Yeah. And I would actually just kind of add to that. Some people do like to kind of harp on the interesting hardware requirements or high end hardware requirements for Solana. In the broad scope of things, when kind of the history is written about at these sorts of things, it's like, this is going to be something that's in a number of years or maybe even just a couple years, it's going to run on whatever machine you want to plug in to your home. We do have some validators that are running infrastructure out of their home. Some people choose to run in data centers. Some people do, God bless them, choose to run it in the cloud. But I think to Lily's point regarding the incredibly rapid growth of the Solana ecosystem, I think one area where we're really starting to dedicate more resources, particularly me personally and from the foundation side is on helping more people understand what Solana infrastructure really looks like.We've seen Tremendous resources and the developer relations team has put out incredible resources for new developers for Web 3.0 but the kind of tooling and community knowledge base of what does it take to run a good validator? And what does it mean to run a validator? Why should I care? I think it has a little ways to go in sort of advancing that narrative a little bit. In particular to lower the barrier to entry from, oh, you must be a sysadmin or a DevOps expert to, what I'd really love to see is all of these Web 3.0 teams and Web 3.0 app developers who are having a great time enjoying Solana and building on Solana, also participate in running the network that they so appreciate. I'd love to see more community buy in of teams that are vested in their project being built on top of a working Solana to help Solana run.What we've seen, even in just the last couple weeks or so, a number of these sort of NFT based Dow communities that have popped up on Solana over the last six months or so have started really taking this message to heart and are launching their own validator, which is just really cool to see. I know, I think Monkeydow claims the title of first Dow to launch a validator on Solana. I know the Degen Apes and the Degen community have also launched. And so it's just really cool to see these communities that really organically popped up around people enjoying NFTs and collecting these cool RNFTs that kind of blew up on Solana this summer now really starting to take a stake in the consensus and ownership and management of the network itself. And so I'm really excited to see that to start happen and really something I want to hope that the foundation can foster. And it's just something I also am excited to see the community really kind of taking it into their own hands more.Austin Federa (18:39):Yeah. I kind of love that, that it's so easy, even a monkey can do it. Is kind of the tagline there.Dan (18:47):It's perfect.Austin Federa (18:48):And the other, the Degen Apes, which are famous for having probably the least technically successful NFT launch to ever have been done by any organization have now their own validator. It's a good testament to how far we've come.Dan (19:02):It was incredible. It was such a struggle. There were all sorts of technical issues, like with the Metaplex standard had recently rolled out. They had various challenges with the mints and it was this saga that we all kind of watched unfold on Twitter and on all these channels over a number of days. And I got to give them credit. There were frustration, there was joy, there were tears. And it came out with one of the most unique, strong, enthusiastic communities on Solana having kind of gone through the fire of this rocky birth that was the minting process. More power to them. I just thought it was just so cool.Austin Federa (19:48):Yeah. I love how that all gets constructed. Kind of, along those lines, you Dan, you came initially from Solana Labs, you were one of the early engineers in the ecosystem. You're now working at the foundation. What's that transition been like? How closely do you still work with people like Raj and Anatoly? What's that relationship like?Dan (20:08):Yeah. I think the working relationship it's really interesting. There has been obviously, Solana, the whole network was built and originally launched, all the code came out of Solana Labs, where Raj and Toly run the organization. And they're obviously major players in the Solana ecosystem. This is the vision and the hustle that they've really brought to the table has been instrumental in kind of getting the whole community and the whole Solana ecosystem and the tech stack to really where it is today I think. Where we relate from the foundation is as sort of industry peers, I would say, sure, I talk to Raj and Toly, I talk with a lot of the ecosystem teams, I talk with our board and Lily and so many people that have an interest in Solana's success on the broadest terms and that's to really what the foundation is here to foster. As we continue to grow and expand and evolve our kind of working relationships with a lot of these organizations, I think just continues to evolve and expand.Austin Federa (21:22):And Mabel, looking at, you mentioned a bunch of the work you were doing was helping grow Solana in new markets. Can you talk a little bit about that? And I think, a lot of people, especially who are not working in the region, there's a lot of information around whether cryptocurrency is going to be banned in India or China, sort of how do you view some of those approaches?Mabel (21:44):Yeah, definitely. I'll answer the first part of the questions. I think it's going to be pretty much the same line as what Lily and Dan just mentioned but I'll kind of carve out those into details. I'd say, at the beginning you are also, you definitely need to engage a lot of these staking facilities but these people here it's quite differentiated because many of them are running the mining pools, meaning the proof of work mining pools. I remember back in the days, in 2019, 2020, we were talking to a bunch of those and happened to be that a lot of those are just crashing their wifi in the office. It's pretty funny. But at the same time, Dom who's from Solana Labs, we're trying to age of all of these mining pools and then we're just giving out some of those GPUs.But I think that's in the past. Now a lot more validators are actually starting from East Asia. I think there's some problem with in the past, with your location being far from the US so that's it's harder because Amazon cloud and whatnot but I think basically there's what Dan mentioned earlier, I think this will be a problem that can be solved in the future. I thought that was a pretty interesting thing to bootstrap at the beginning. And then the other things like wallets and non-custodial wallets, custodial wallets, because I think for East Asian crypto, you can never kind of ignore the centralized parties and players, especially I think in the past 24 month all the way till the next 12 month or whatever. I think a lot of those custodial wallets, including some of those exchanges, it was a lot of very pivotal work to try to engage them to support Solana, to support STL, USDC, USCT and a lot of the other stablecoins. I think, those steps that we were able to achieve in the past year in order to get a lot of these centralized exchanges to support those, I think that's also pretty interesting.Mabel (23:50):I think the other thing is that you just generally need to go to wherever because like back in the days in 2 18, 19 and 20, not that many groups are fully aware of how Solana works or even if it's like in Rust, I think people here I'd say safely were more familiar with things like Polkadot than Solana back in the days. Talking to some of those developers and just telling them, there's a few different options and then go to some of the hackathons or just developer meetups or even just the Rust China conferences, and then to promote about it. Justin Stery, he spoke there. A lot of these engagement opportunities definitely helped over the past two years for Solana to really get the writers here.I think that work still continue. And I think I believe that there will be a lot more application focused developers coming over, given from the history of Web 2.0, you see a lot of your infrastructure was built in the West but then application wise actually quite a few of them came from the East. I think, for Solana, for anything that's building on top of the smart contract platform, we could probably spec on the same track. You'll see a lot of people are going to build on top. Now once all of these are available.I think one interesting thing is that for things like wallet, you have Phantom for browser because I think in the West, people are pretty used to using browser wallet but I think here in the East, you also need something that has really good user experience and people like to go mobile first. And that's why Slope Finance, which is one of the leading mobile wallet for Solana in China, they were doing really well because they understand the user behavior and all of those to deliver to the specific audience. I thought this is like quite interesting how you will need to focus on specific areas, the same thing for East and West but then you want to make sure that people get to have the best culturally fitting choices for them so that way you can actually get it around.And then to answer the second part of the questions, so I actually the other day had a tweet about similar lines. There's a lot of Web 2.0 venture capitals and then some of the other funded funds, they're trying to deploy money and then we're asking it's still East Asia or some of the other places around still relevant because of the policy. The way I read this is that crypto is really global. I understand that there's certain restriction for developers to issue cryptocurrencies in China or in some of the other countries. However, I think the language circle and then user behavior, what I just mentioned was always going to be something more pivotal than the actual restriction. These people will move to somewhere else in Asia but they will continue to build. And then for people who want to use the kind of user experience for those products who are sitting here.I think crypto liquidity is global but user experience is always regional. And I think, if you're growing an ecosystem, you can't ignore that. I'd say I'm still bullish. And I think people are recognizing some a lot of those things are just better built on Solana because it's higher performance. And then at the end, it's just about how you make sure that you are compliant to the place that you are at. And then not definitely go with the compliance part but then also not hindering yourself building.Austin Federa (27:23):Lily, Dan, do you have anything to add on growth in new markets and that process?Lily (27:29):Yeah. On new markets, we started to invest in building out the ecosystem in India, back in June and July. And it's no secret, there's extremely large both user bases and also developer communities. I think in the most recent hackathon, after the US, the second largest contributor of developers, developer submissions to the hackathon was from India. And I think Indonesia was in the top four as well. And so I think as we continue to look to Eastern Europe, for example, Latin America, Africa, some of the early narratives as to what applications would be unique and sort of the 10X type of functionality on crypto, have been talked about and written about for years, if not decades. And for example, payment applications Which become supercharged when you take DeFi functionality, global liquidity pools and they make that adjacent to an actual you potentially consumer transaction.And I think that that to me, it's very clear that that's going to happen on Solana first. And so, what I'm particularly excited about is some of those seemingly sort of everyday type of transactions but those actually becoming very unique when you, for example, can take a stablecoin and have a Venmo feeling type of transaction or a WeChat pay feeling type of transaction but it's actually fully decentralized, fully on chain and also comes with a potentially a suite of financial services that are kind of baked into the ecosystem adjacent to that. I think those are the types of things that are going to resonate hugely in emerging markets, in new markets. And those are some of the things that I'm excited about maybe exploring in new markets.Austin Federa (29:10):Yeah. I do love how sort of culturally infectious the crypto mindset is. That to use a network, you also have to be an owner of the network and that the success of the network and the success of you as a user are tied in a way that they're really not in the setup of a stock corporation or something along those lines. You can sort of think of these things in some ways as giant digital co-ops that are all working towards this goal. It's really interesting to kind of hear that. And I'm really curious to see in the future, how that starts influencing culture. I think we're already seeing crypto just barely start to influence culture and that might take off a bit in the future. Be interesting to see.Lily (29:54):I think it is. And I think what's under the surface with crypto but what rapidly rises to the surface is that it's been talked about, written about philosophically for a very, very long time, this whole idea of a veil of ignorance, that your opportunity set is determined in large part sort of where you're geographically born today, rather than you know who you are as a person and what's in your heart and what's in your mind. And with crypto, you sort of have this radical accessibility. It's almost sort of radical equality if you will, in a way that we haven't really observed in a long time. And so I think that's really upending in so many different ways and that for me is a big part of why I continue to be interested in cryptocurrency. And also why I think Solana is really going to be at the forefront of that because all of those sorts of ideas, the accessibility, the sort of the very concept of why Web 3.0 is important and where people are most likely to get started on that today is the sort of general awareness funnels.People will hear about Bitcoin. They'll learn about Bitcoin. They'll learn about store value and people will resonate with that. Your average person will resonate with that because it sounds so much like digital goals. But then once they start to learn about Bitcoin, they're like, okay, I've bought it, I get it. It's kind of like gold for the digital age. What's next? Well can I do DeFi on Bitcoin? Eh, no, not really. Lightning, we've been talking about it since 2015. Soon.And then very quickly from there, people move on to, okay, well here, well that's really amazing. These sort of new applications. And I have some friends who bought NFTs and then they click a button and it's a $100 later. Gosh. Oh, that was painful. And I think that's kind of what a number of people have gone through so far. And so people sort of get onboarded to why this is important, why this is really sort of very exciting and part of the future. And then eventually what I've seen is so many people sort of end up with being in the Solana ecosystem. I guess what I'm excited about is accelerating that and maybe making it a little bit less of a circuitous journey.Mabel (31:59):I have a story to share related to what we were talking about here. I think, I now all of these protocols are starting to talk about Shopify type of experience, which is you have an underlying protocol and then you just have different ends. You just host a different way. It's actually not just for the cultural purpose. One story was shared by Roneil who's the co-founder of Audius, last week with me. He was saying that he realized because Audius is actually not, I think the main front end was not allowed in China at some point but then somebody actually set up a separate front end that's actually and filter out and then based on whatever the local compliance should be let a whole thing run. That front end actually works.He was exactly kind of explaining to me how he was amazed by Audius should be the underlying protocol and then it should be determined by the front end itself on the ground, what to feature versus not. And everybody can have their own choices. That's a freedom choice. Nobody's going to question that. I thought that was like really amazing. It's definitely beat beyond just kind of I think this is really relevant to what we were talking about earlier because I think for Solana, it's the same thing, a lot of the things. It may not be compliant for a certain reason in the region but I think at the end it's about the front end. It's not about the protocol. The protocol should be permissionless. Anyone else can just do whatever they want but for the ones that you want to make it work for a certain region, you can just do that. I thought that was really, really amazing and very unique about crypto.Austin Federa (33:30):Yeah. I love that, that sort of view that because of the financial incentives with crypto, you can decouple the application layer from the protocol layer, that those two things can be separate. This is in some ways, this is the dream of Twitter. We had this glorious few years where there were all these Twitter clients and then it all got, because the app engine was introduced, it all got consolidated down to twitter.com and the Twitter mobile apps. And RIP all of our favorite Twitter clients from back in the day. I love that, that the way this technology is built, it allows you to really separate those two things at origin, as opposed to having to think about the business models that support that over the long term.Dan (34:09):I would actually add, I think there's interesting things happening, both in the decoupling of that, like you said, the application and the protocol there but also an interesting sort of coupling there kind of to Lily's point about this shared ownership of the success of the project. And that's really this kind of shared ownership of the network is really the kind of core underpinning, this core idea that underpins this idea of staking on a proof of steak network. Which is your success is tied to the success and this really the security of the network. And what we're starting to see now are applications and DeFi applications, particularly stake pools that have recently launched on Solana that really bring the ability to participate in the shared security and shared ownership of the network to the application layer.There have been a bunch of community launched stake pools. There's some private stake pools. The foundation is in the process of transitioning its entire treasury over to stake pools, which are really this, I think we did a whole podcast episode on this recently so I won't belabor the technical details here but basically it gives people an easy way to enter and exit from a liquid position, which is actively helping to secure the network via staking to various validators in the underlying smart contract. But what I think is really interesting about this is we're starting to see these public stake pools that pop up, Marinade Finance, JPool, Socient, Lido and a few others that are really bringing the application experience, that really slick, fast, fast and cheap promise of what does it feel like to just use a useful service built on top of Solana and oh, how cool that a normal user can transact in these stake pool tokens rather than unstaked SOL.And I think we recently saw the first, there was an NFT sale or an NFT mint that was accepting stake pool tokens, a staked SOL positions, rather unstaked SOL. So we're starting to see this adoption of people who are not only just developing apps and playing around on the application layer but also recognizing that there's tremendous value in sort of moving the denominator of how we transact value on Solana to be pegged to the participation of securing the network itself.Austin Federa (36:40):Yeah, that's a really great point. Looking forwards, Looking into this year of 2022, what are the things that you see in Web 3.0 and crypto that have potential that could become trends that are going to advance and increase? I'll kind of start out. One of my big ones that I think is we're going to see a lot of the sort of tech-ish companies adopting decentralized Web 3.0 technologies as a competitive advantage to compete with a lot of vertically integrated companies. I think you're going to see a lot in payroll. You're going to see a lot in merchant payments, concert tickets. These companies that don't have platform scale are going to look to Web 3.0 as a competitive advantage. And you might see that role into the rest of the ecosystem. Dan, I'm curious kind of what your thoughts are. And we'll just go around the room here.Dan (37:30):Yeah, I think your spot on there, Austin. And I think one of the things that's really going to help unlock that is these sort of higher levels of abstraction of developer tooling and more sort of almost enterprise API access, if you will, to provide a more Web 2.0 like interface experience that someone could just plug in and it's Solana as a service. There's your SaaS for 2022 and it's instant settlement in stablecoins on Solana but no one needs to worry about the fact that it's a stablecoin on Solana. It's they integrate this API and the money transfers or the token transfers from merchant to customer or vendor to seller, whoever, immediately. I think that starting to see people using crypto and using blockchain without realizing that they're using a blockchain technology.Austin Federa (38:22):Lily, what are your 2022 predictions?Lily (38:25):I think industry wide I'm with you that Web 3.0 is going to become the starting point rather than sort of the periphery. I think that we're well on our way where Web 3.0 is going to sort of foment this decentralized center. And I think that there's a few things that are sort of going to happen alongside, in my perspective. One is this kind of movement towards multichain slash interchain future is just accelerating. I think that there's a few sort of different consolations within the ecosystem. There's clearly sort of the EVM world which we're going to have a connection to through Neon EVM. There's a lot of sort of obviously energy within Solana. There's some other, IBC, we talked about Cosmos a little a bit is probably another sort of approach within that and then connectors within these.And so I think there's various foci that are going to emerge there and increasingly there is going to be sort of those sort of layer ones are actually, I think, going to be abstracted away over time as they probably should be when you talk about sort of appeal to your average person. I think that another theme that I see emerging is as more institutions want to get into this and compliance with existing regulatory frameworks, institutional KYC and tooling to allow institutions to participate in decentralized liquidity pools, which I think is going to be pretty exciting. And so that's where the existing world is actually going to start getting onboarded in earnest into Web 3.0. That's going to be quite interesting.I think with that, there's a big theme around a sort of identity and privacy and on chain identity and having a little bit more control over your data on chain is another big thing, the theme that's going to evolve. And then, certainly in a consumer area, I think that NFTs went from being a very analog sort of digital representation of physical art and have now morphed into basically being the entry point into sort of Web 3.0 communities and metaverse and these kind of almost new communities, dare I say civilizations that are starting to sprout online. And so those are some of the from the more institutional to the more consumer, I think there's just so much happening out there. That's all really just going to continue to develop at a rapid pace in 2022.Austin Federa (40:49):And Mabel, what do you see for 2022?Mabel (40:51):Yeah. I'd like to maybe talk a little bit more about the application as in the middleware layer. Especially the crypto native ones. We've seen a lot of DeFi activities, 2020, 2021 for on Solana specifically because people like how fast transactions are like. But I think what's more excited, also something that I've been spending a lot of time thinking about and then exploring is that the actual kind of Web 3.0 application experience, what does that mean? People have been talking about metaverse so to speak for a long time but the things people can do beyond finance is never really happening before but I think there are, we've seen from a lot of the recent hackathons that you'll have address to address IM protocols, you have some of the Web 3.0 social graph where you can just basically have the relationship you with another person.And then another, some of the other things open C collections or some of the other things that you did. And then you also have things like on chain credentialing protocols. All of these, we are seeing them happening on Solana. And then with all of these composable, with each other, you can actually see that you have relationship between people in a game, for example. Or when you bootstrap a new application with the social graph, you can you customize the front page that you push to the users based on the social graph because like you have all those data. Obviously what Lily said about privacy preservation was very, very important. You don't want to share everything, which kind of it's kind of against the purpose but I think the idea is that for Web 3.0, you own the data.You are the one who approves the blockchain or whoever else to access your data of all eth and you control whether you approve someone to be your public connected contact. And then things like on chain credentials, you can prove, what are some of your achievements based on the contribution off chain. At this court discussion or things like whatever you've provided liquidity in the past for certain period of time or you just basically voted every single time in the community snapshot. All of these become your kind of on chain resumes or on chain badges that can later on help whatever you prioritize into a community. It's the such thing we call gated community. I think all of these are coming together. We're going to see actual consumer experience available on Solana. I thought that was extremely exciting because I think with all of these enabled, people will have no difference of experience compared to some of the other Web 2.0 application experience. I thought that's going to be very huge.Austin Federa (43:35):Well, thank you all for joining us today. It's fun to talk about some of these things that are not quite as pressing, as user facing that developers aren't picking up and doing but are nonetheless integral to the network and it's growth and its future. And I think it's really fun to talk with the names and some of the people behind the Solana Foundation. Thanks for joining us today.Lily (44:00):Thanks for having us, Austin.Mabel (44:01):Thank you.Dan (44:02):Great to be here. Thanks a lot.

In this special Payments episode of the Solana Podcast, Austin Federa guest hosts a conversation between Jeremy Allaire (CEO, Circle) and Sheraz Shere (Head of Payments, Solana Labs). They discuss merchant payments, stablecoins and Solana Pay: the newly released, open, and free-to-use payments framework built on Solana.00:45 - What is Circle?03:35 -  The use case for stablecoins and the mechanisms to build them09:34 - Solana Pay13:42 - Integration of USDC and Stable Coins18:45 - How could Solana Pay become mainstream? 25:27 - The Solana Pay toolkit27:39 - Can businesses operate without a bank account?30:05 - Looking at Data Privacy in Solana Pay and Circle 34:35 - Hopes for Solana hackathon outcomes00:39 - Intro01:51 - pencilflip’s background03:30 - Working at facebook vs. web 3.007:31 - How pencilflip got into crypto08:52 - Views on NFTs10:45 - Getting into Solana15:29 - Experience working in lower level17:56 - What was his method to learn Solana?21:01 - What’s the hardest concept on Solana?23:53 - How fast did he move from Rust to Anchor?27:35 - Building on Solana33:24 - Advice to people moving to Web 3.0DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Austin: (00:09)Hello and welcome to the Solana podcast. I’m Austin Federa guest hosting this week. Today we're going to be talking about stablecoins, USDC and Solana pay. So we're joined today by Sheraz Shere, the head of payments at Solana labs and Jeremy Allaire, the CEO of Circle. Welcome to the show.Jeremy: (00:27)Thank you.Sheraz: (00:27)Thanks Austin.Austin: (00:28)Great. Well, let's start off with Jeremy, talk a little bit about Circle. Can you tell us a little bit about what is Circle and what's its role in the US DC stablecoin?Jeremy: (00:37)Sure, absolutely. So Circle is a global financial technology firm. We operate a suite of services to help businesses take advantage of digital currency in payments and treasury applications on the internet, which is all really a mouthful. But specifically we have a couple of really critical things. The first is we operate a stablecoin market infrastructure as we call it called USDC, and we'll talk, I know more about that, but USDC is a dollar digital currency that is an asset backed or fully reserved digital currency that can be used for payments and settlement on the internet. And it's already used really, really widely in the crypto economy.And so we run that infrastructure and provide that to businesses institutions, and through many, many of our partners out to tens or perhaps even hundreds of millions of end users that interact with USDC. And then we also operate a suite of services for companies to have payments and treasury management and other things that are needed to integrate this into the way that they operate. So almost like a crypto native bank account for businesses to store and transact, and then alongside that a broad set of API products.So basically Circle APIs that connect the existing fiat system, credit cards, bank accounts, bank transfers with stablecoins, with the custody, security, blockchain management, and other things that are needed to use that and integrate that into your own application. So lots and lots of fintechs, startups, companies like building on those APIs to kind of integrate stablecoins and fiat in their applications. So hundreds of companies use those and those are the key things that we do. And we've been growing with other products in what we call to treasury services. So Circle yield, which is a stablecoin yield product, which has been growing really fast too.Austin: (02:50)Yeah. I want to get into that kind of in a minute. So stablecoins, they're foundational to a lot of how DeFi has been enabled over the years. So there's lots of different applications for that. Sometimes it's just as a common transacting layer between multiple currencies. There's lots of different applications for it, but as you mentioned, there's more and more sort of enterprises and traditional companies, as well as fintechs that are in that space that are looking to use stablecoins in their business operations. At the same time, you have a bunch of DeFi Degens who are sort of the original core audience for a stablecoin. What does that decision making process look like at Circle when you're trying to balance such a diverse user base?Jeremy: (03:33)Yeah, it's a great question. And sometimes I'm asked "What's the use case for USDC," and my answer is sort of "What's the use case for a dollar?" Well, the use cases are incredibly broad, and we see that actually today, we see people who are making personal point to point payments internationally. We see people making micropayments for digital IP through NFTs, and at the other end you see institutions that are using USDC to settle half a billion dollar bilateral trades. And that's a pretty broad range of use cases that are out there. I think more importantly, conceptually when we built USDC and you can go back and read the original white paper behind it. And the idea of fiat backed digital currencies, our ultimate belief is that what's needed is a sort of protocol layer for traditional money on the internet.So you can have dollars and euros and pounds and yen and other currencies that just function on top of the internet, the same way that other protocols support the exchange of information and communications. And if we had that, and we could use those protocols at the speed of the internet with the cost efficiency of moving data, which is what I think blockchains hold that promise, Solana's executing really well on that, but hold that promise, that it could really unlock the storage of transmission of value to be a kind of commodity free service on the internet. And so ultimately our belief is that anything that any person or household or firm might need to do in the digital economy on the internet could be done with stablecoins.And so we definitely expect that to grow. Now, when we got started, it was anchored in what I call crypto capital markets. So it's anchored in market participants that, for all the work that they do and all the assets that they might be interacting with, they're all digital assets, and they all move at the speed of blockchains, whatever that is and the efficiency of that. And so they need their dollars to work the same way, and so that kind of gave demand for payment and settlement mediums that could kind of work at the speed of those markets and those blockchains. So, that was a good bootstrap use case, and that's really what brought a lot of this into existence. But now the way I like to describe it is stablecoins are both protocols and money formats. It's a protocol that works on top of a blockchain with assurance and security and finality settle a transaction, but it's also a particular representation of value of a dollar or a Euro or whatever it is, and protocols and kind of formats our network affects businesses.And so the more people who have that, the more valuable or more useful it becomes, and the more products and services that are plugged into a protocol, the more useful and in utility that exists. And so we're now seeing the spillover of the use cases go into everyday businesses more and more everyday businesses saying, "Wow, this is a very, very efficient medium. It's very inexpensive, it's very fast, it's secure. I know it's final and it works globally." So we're certainly seeing that pick up. And at Circle, as we think about use cases, we really believe that the acceptance of payments in a business context using digital currency like this is going to proliferate pretty significantly in the coming years, because it's got so many attributes that are superior to existing electronic payments methods.Austin: (07:12)Yeah. And so you touched on something that's really interesting, which I think everyone thinks of USDC as a protocol, but unlike most organizations that have launched a protocol, the underlying token of USDC is USDC. Its whole point is it does not fluctuate in value, it does not go up, not go down. It stays solid at an equivalent of one US dollar. But Circle, it obviously for-profit organization, what are the mechanisms there that actually allow you to run a business as an organization that has created USDC?Jeremy: (07:48)There are a lot of pieces. So the first is today USDC is approaching 50 billion in circulation, and Circle administers and reserves those assets. And so we generate income from that, from that $50 billion we generate income. And as that grows to be a hundred billion or 200 billion, we'll continue to generate income from that, and certainly in a rising rate environment, that's significant. The second is we run a whole set of, what we call transaction services and treasury services, and those are services that we charge fees for. So transaction services are taking traditional fiat payment methods, using our infrastructure to do blockchain, native, custody, and payments. And so those are kind of usage based and scale up kind of like a Stripe or equivalent type of transactional service.And then we also provide treasury services. So people who want to lend their USDC can lend their USDC in a self-service way through our platform, and get fixed term fixed rate returns on capital on USDC, and we generate a spread income from that as well. So we're building out this sort of suite of commercial services that are globally available increasingly, and that provide a lot of incremental value. So those are several buckets as well, that are really helping us scale our business.Austin: (09:14)So we were talking about transactional services. Again Sheraz, You have been intricately involved in building and launching the Solana pay protocol. Can you give us an overview of what that is, and how stablecoins are an important part of that system?Sheraz: (09:29)Sure. Yeah. So Solana pay is basically a new blockchain based merchant payment system. It's open, permissionless, and decentralized, and it's premised on enabling merchants to connect directly with consumers in a peer-to-peer fashion with no intermediaries. And it's really premised on the notion that merchants would accept stablecoin like USDC. Most merchants, unfortunately for crypto natives, don't really care that much crypto per se, they care about running their business. And that's why having stablecoins, US dollar denominated stablecoins are critical, because what this affords us is the ability to move digital assets at speed and cost of the internet, as Jeremy mentioned.So for Solana pay, what we're really trying to do is enable for merchants, things like instant settlement, near zero cost transaction processing, and something that's really important is the removal of intermediaries. If you think about it from a merchant perspective the most important thing a merchant does is collecting payments and engaging with their consumers with commerce, but there's a lot of friction tied to enabling payments of and commerce. And with friction comes intermediaries and with intermediaries come cost and the loss of control. So if there's one headline for Solana pay, it's really about giving power back to the merchant for the most important function, which they do.Austin: (10:48)So can you talk a little bit about that? Payments is obviously a many billion dollar industry globally. There's some big name that have reached some pretty astronomical valuations nowadays based off of providing credit card payment processing solutions and that sort of thing to e-commerce and non e-commerce business. What's the sort of difference of approach here? How would you compare something like Solana pay to a company maybe like Stripe?Sheraz: (11:15)Sure. Yeah. And Stripe, I would say that the removal of intermediaries doesn't mean that a lot of the traditional payments companies don't have a role to play. The actual act of moving a digital asset from a consumer to the end merchant, that's the piece where there isn't need to be a friction, right? So with the Solana blockchain and a stablecoin like USDC, the movement of digital currencies from a consumer's wallet to the merchant wallet should happen like an email going on the internet, it should happen instantly with no cost. However, once a merchant has accepted a USDC stablecoin or settled in a stablecoin, there's a lot of interesting services that are needed to be done that merchants typically don't want to necessarily do themselves. So setting up token accounts, doing treasury management, reconciliation, integrating into legacy bank accounts.So there's a lot of work in the core stack of post settlement of payments that traditional payment companies can be involved in. The protocol itself is just trying to simplify one component of payment processing, which is the most critical one, which is that the transfer of value between the consumer and the merchant. One of the interesting things that we're building on the spec is the ability to also have a bidirectional communication. The benefit of having a true peer-to-peer connection between a merchant and a consumer and not having an intermediary is that this allows the merchant to, for example, send digital assets back to the consumer. So what this could look like is something like, let's say you buy a new shoe, using this protocol the merchant can send you back an NFT of that shoe into your wallet, which you can now take into the metaverse. Just an example, but illustrating why the notion of a peer-to-peer, a true peer-to-peer interaction between a merchant and a consumer can open up a whole new set of new things.Austin: (13:09)So Jeremy, Sheraz was talking there about one of the pieces of the stack that Solana pay is trying to solve, that payment from a consumer directly to a merchant. You in Circle work with companies that have extremely complicated payment flows that are trying to bring USDC into. What are some of the areas that integration has been easy and straightforward for these companies, and what are some of the areas that are still challenges for enterprise adoption of USDC and stablecoins?Jeremy: (13:37)First of all, just to say, as you know, we're really excited to be supporting Solana pay. And we believe that the problem space here is a really critical one, and solving this problem of how to build a better connection between an end user and a business and building beyond just the underlying digital asset transfer and solving some of these problems is really, really critical. The way I would kind of answer the question is there's sort of the base layer of you've got a blockchain and you've got addresses and wallets and you've got this settlement finality mechanism of moving an asset like USDC as well. And that part is kind of fairly low level.Jeremy: (14:27)And so businesses that want to use this as a substitute for say, a card payment, they can implement that out with Circle APIs, they can take Circle APIs and they can automatically generate new addresses automatically for each payment. They can then track that payment to a given payee. And then they can collect that and store it in USDC, or they can sweep it out to their bank account through an automated API that pushes a wire or other things. So there's like critical kind of behind the scenes treasury kind of infrastructure that's there. The problem is most end users, they don't really necessarily know what all these things are. And so I think being able to introduce things like having metadata associated with a payment, such as what the price is, what the product ID is, any other kind of merchant information that would be needed to kind of tie that payment to a commerce transaction, to be able to have of follow on interactions that are associated with that payment.All these problems are I think really important and become things that people expect, whether it's through a traditional legacy payment mechanism, like handling something like "You sent me the wrong product I need a refund," is like the most common, or some loyalty mechanism that maybe is inducing me to want to use the payment instrument. And so how can I use a blockchain to provide that loyalty mechanism as an inducement as well, building a stronger connection between say the business and the user?And so I think the pain points are more that there's incremental value that's needed for both the end user and the merchant to kind of bring this to a point where it's a superior payment, medium to legacy payment rails. And so those are the kinds of things that we see, but certainly the getting started piece is there. There's so much low hanging fruit. And I think so Solana pay is a really good start at hitting some of the low hanging fruit and creating a way for wallet creators. And then folks like Circle on the other end to make this a little bit more seamless for all the parties.Sheraz: (16:41)I would say that if you're a developer, a founder, or even a legacy payments company, there is a tremendous amount of interesting stuff to build. We just kicked off a hackathon and we have a payments track in that. And as Jeremy mentioned, the protocol itself is pretty low level, it's pretty basic if you look at it, right, it's just a very simple... The most native transaction on a blockchain is moving value from one token account to another token account.And we've put some specifications around that to put in like transaction identifiers and things like that. The real innovation is really going to come thinking about what are the new features that can be built on top of this. Now some of this will look like traditional commerce things like offers and loyalty, but there's a whole new set of commerce related features and consumer value props that have yet to be discovered. And I think that's what's really interesting is that there are going to be new businesses built on top of these protocols that will leverage the power of the blockchain. Because this technology opens up, again a peer-to-peer connection between a merchant and a consumer, eliminates the need for intermediaries, and now it gives power back to the merchants. So both the customer relationship, the data, and power in terms of controlling costs.Austin: (18:00)Sort of to push on that little, payments has been the killer feature of blockchain since blockchain became a thing, but there's been no real successful blockchain payment systems that have really emerged. I think the closest is there are some exchanges where you can get a debit card that allows you to spend out of your exchange account, but that's still a custodial relationship with the exchanges holding your tokens. The places where USDC and other stablecoins have been really successful is not on the payments level as much as so far has been on that sort of collateralization level or within the DeFi space. So Sheraz what about both Solana pay or Solana is actually making this a useful place for payments to actually go mainstream?Sheraz: (18:48)So yeah, absolutely crypto payments have been tried before. I mean, it's been talked about ever since maybe the pizza example. The problem is the traditional approach to crypto payments have been settled with several problems. So the first of all is that merchants don't want to settle in volatile currencies, right? With some edge cases aside, most merchants say, "I want to settle in US dollars or something that is the equivalent of a US dollar." Second is that the blockchains in the past have taken minutes or longer to settle, and that just doesn't work when you're trying to complete a transaction right? On an e-commerce site every second, that delay is more card abandonment, so waiting minutes for a transaction to settle just doesn't work. And then blockchains, transaction fees that exceed the actual cost of the item that you're buying just doesn't work.So to alleviate all this intermediaries came in and said, "Okay, great, look, I'll remove some of this friction for you. I'll exchange the Bitcoin and settle with you in US dollars. Oh, and by the way, I'll take on some of the risk of settlement taking 10 minutes. I'll give you an instant authorization and I'll just settle with you 24 hours later, and I'll eliminate some of the fluctuations in network fees. And for all that trouble, I'll charge you 100 basis points." And then it starts to feel and look a lot like traditional payment systems where you've got an intermediary, there's a lot of friction and a lot of cost and an intermediary is saying like, "I'll simplify all that for you, and I'll charge you a hundred basis points. And by the way, I'm the intermediary between you and your end customer."And that's really, well from what I've seen, what the attempt at crypto payments have done. What's different now is a couple of things. So one is rise of stablecoins and specifically USDC as a US dollar backed stablecoin. And then the Solana blockchain technology that has the speed throughput and low cost that eliminates a lot of that friction. Right now you have instant settlement, you have costs measured infractions of a penny, and you have throughput. You're not dealing with congested blockchain networks.And then the other thing is we now have a growing interest in crypto, there's tens of millions of wallets out there. People are more and more kind of normies as we call them, I guess, are dabbling into crypto. And I think you're going to see two kind of mental models, right? One is I buy crypto for speculation and investments, but I think more and more people are going to realize like, "Oh, I can use this for transactions. There are transactional currencies that I can use that provide me utility." So I think there's the combination of all of these factors coming into place with these new technologies are kind of going to give crypto payments a new shot in the arm.Jeremy: (21:36)Yeah. And I would just add to that just at a high level, I think one thing to note is stablecoins and public blockchains have achieved an astounding amount as payment system. I mean, these are decentralized infrastructure, running globally, supporting literally trillions of dollars of transaction throughput, and supporting pretty material volumes that have grown, and including in a wide variety of payment use cases. And we see that all the time, the number of businesses that are just signing up for Circle accounts, because they want to use USDC as just a payment medium outside of the markets themselves. And so it's a pretty amazing achievement, and that's happened in a very short period of time. I think there's many, many thousands of products and services that have integrated USDC.It took like 50 years to get to like 10,000 issuers, which are people who have integrated the visa credentialing. And so the adoption of these standards is happening at a really fast rate, which ties into the other piece, which is there have been a number of things that have been really necessary. I think one has been regulatory clarity, people being comfortable that this form of dollar is as good as an ACH dollar or a credit card dollar in terms of its usefulness and its legal clarity. Businesses knowing that these are legitimate financial infrastructure that they can rely upon and build upon. The other's been, as we've talked about here already is just the reality of the economics, the unit cost of transaction, the speed of a transaction, and through platforms like Solana, we're seeing that be solved for.And so I think what we're seeing is many more businesses, large merchants, traditional digital wallet companies who have large installed bases of consumers who want to wire up these protocols. And I think it's not just that they want to wire them up because this is a way to pay businesses. They want to wire them up, because these are interoperability standards that make it possible for digital wallets everywhere to kind of share value with each other, which is kind of moving outside of walled gardens and into the open internet of value. And so we're seeing all those kind of combined with each other and those are all mutually reinforcing factors that will then I think have more and more businesses saying, "Why don't I just add this as a payment method?"Sheraz: (24:00)As Jeremy said, I think in payments more broadly, tremendous traction and use cases and international remittances B2B. My view is a little thinking more about specifically about like retail, consumer emergent payments. And I think there's this open question that I keep hearing is like, "Well, we can't use USDC to buy milk." Well, we ran a physical point of sale transaction using so Solana pay and purchased a gallon of milk. So we're happy to share the video of that, but wanted to demonstrate how simple it is to use this currency and set up a small mom and pop with our in-store web app.Jeremy: (24:40)I mean, it reminds me of when the web was taking off and it was like, "Well, you can't use the internet to do this, this and this." And people are just wiring this stuff up and it's going to become something that's just so extraordinarily common and every business will be... they'd be idiots not to take digital currency payments as an alternative to the things that they do now, just like they would've been crazy not to set up email accounts or let customers contact them through the web, or through an online forum or through a Facebook page or whatever. It's just, these are just going to be, you have to do this if you just want to be a native internet business.Austin: (25:15)Look, the Internet's great, but all I can buy on amazon.com is books, and I can do that at my local bookstore.Jeremy: (25:20)Yeah. Right. Yeah. Yeah.Sheraz: (25:22)That's right.Austin: (25:23)So Sheraz, when you're talking about this tool kit for Solana pay, what is actually live now, if someone is interested in actually setting this up for their business and enabling people to buy a gallon of milk with USDC, what's that toolkit look like, and how could they get started?Sheraz: (25:39)Sure. Yeah. We have a physical point of sale client, which is a simple web app. It's a very dead simple onboarding experience as well. We have an e-commerce SDK as well, so if you have your own website, the tooling is there to support both QR code payments and browser plugin. And we have a great set of partners that are working with us to both distribute these tools and help us build the future of this protocol and specification.We have integrations with a set of wallets, FTX, Phantom, and Slope and others on the way. You know, part of the goal of this is that this is the first at bat at the first inning. We've built some of these tools to provide some reference implementations and tooling for people to start building, but there's a whole roadmap of additional things that we want the community to build with us.Jeremy: (26:53)Yeah. And we're super excited at Circle to support this. And we see getting these kinds of standards adopted in more and more wallets, it's great to see. And I think we're hoping that standards and efforts like this can get adopted in many, many other kind of crypto native wallets and other digital wallets that are kind of coming online to support USDC payments.Austin: (27:15)So, Jeremy, with this sort of front end component where you can now receive payments and USDC via Solana pay there's a whole series of other tools you're talking about, whether it's deposit into accounts for merchants. How soon of a future do you think it's going to be possible for someone to run a business, and make payroll and accept payments without actually having a bank account?Jeremy: (27:39)I think we're getting really, really close to that. I think with a Circle account, we provide businesses with the ability to open an account, it's got multi-user support, and administration so you can have multiple employees or people in your finance department using it. It provides on chain payments across multiple blockchains, it provides legacy bank payments, so if you need to get money out into legacy bank accounts, you can do that. We have a pretty exciting roadmap for new things that we're going to build there, so that kind of interoperability with legacy payouts is important as well. And then you have the ability to take your working capital and put it into yield. And so as you collect payments and you have working capital, you can deploy that and generate high interest rates on your USDC.And so those are things that are there today, and there's obviously a lot more that can be built out there. We have a pretty exciting roadmap for things that we're building. We want really any crypto native business clearly to sort of make this their global financial account for their startup or their growth company, but more and more traditional companies as well, who are getting into this who want to use this as payments infrastructure, but then will tie it into some of their working capital management and treasury management.And then underneath that is like any developer that really has something they want to do custom, everything is just a platform. Everything's a set of APIs that you can build on. Developers can automate all the different rails. They can automate how they store and move funds. They can kind of control all of that in a very, very fine grain way. And so while there is like that self-service experience, but a lot of startups want to kind of do this unique to their business so they can automate more and more of it. So we think this year is going to be a year where these types of hybrid digital currency bank like products are really starting to take more and more hold.Austin: (29:33)Yeah. So, sort of along those similar lines, the existing payments rails and industry is one where a lot of it still runs on data collection and data marketing as a way to help subsidize the cost of running a lot of those rails, right? Whether it's American Express offers or whether it's something like a company that actually is tracking purchases that are made in-store and using that to do marketing through direct mail or other means. How does data privacy play in both with Solana pay and Circle, and how are those things part of your decision making framework?Sheraz: (30:08)I think one of the most important aspects of the whole notion of the peer-to-peer transaction and removal of intermediaries is that now when you're accepting as a merchant, accepting a payment through this per protocol you're not necessarily going through Google or Apple or MasterCard or Bank of America or some other intermediary, right? You have a direct connection with that consumer, and because of that you're not potentially losing data. You don't have third parties accumulating all of this data. And the beauty of this protocol is that it's open, so any merchant could take this. We're not pushing an end solution down anybody's throat, this is an open decentralized protocol. Any merchant could take this and build the equivalent of the Target Red Card system, which is a very popular solution that Target built or the Starbucks closed loop payment system.So I think the most important thing is that if merchants have control over commerce and the protocol is open and they can kind of craft on top of it, it gives them much more control over their data. We also have under development APIs as part of our core token program that can provide additional layers of data privacy. So we have a confidential token API that's under development. And there's a lot of technological solutions that can be built in to give either the consumer or the merchant more privacy, or whatever level of privacy they're interested in, but the key is they have control, they're building it in the way that suits their business needs.Jeremy: (31:41)One of the principal benefits of digital currency and stablecoins and public blockchains is the higher degrees of privacy and security that they afford. And I think that's something that people value and it's inherent in the architecture of these cryptographic forms of money and that's really key. And so we merely provide ways to interact with that infrastructure, and so we don't really stand in any specific data around users in that way. And even new technologies that we're working on in digital identity are designed to use cryptographic proof of identity, not pass around a whole bunch of PII. And that's going to be really critical as you start to marry digital identity with payments, with merchant behaviors. How can I, as a consumer present myself and prove to a business that I'm a legitimate individual that's been compliance checked, and make a payment to you without bleeding all my PII to you, and for me as a business to say, "No, I know this is not a drug trafficker or a terrorist or what have you that I'm transacting with," and have those settlements be fast and secure and final and private?So I think those are really, really important things. At the same time I think that the building blocks of crypto give us new tooling for incentivizing customer relationships in new ways. NFTs and commerce are really powerful, powerful phenomenon, which we're seeing early experiments in. But I think for businesses that want to entice customers to give them more information or have a more direct relationship and where that information exchange can be valued in some way, I think NFTs create a really interesting and powerful way to do that. And that's something that can be direct between the consumer and the business and not something that's, again, bleeding all that information and out to other networks that are repurposing that. And so I think there's a chance to rebuild customer loyalty, incentives, loyalty marketing, and secure privacy preserving payments in a way that's superior to what we have with existing electronic payment systems today.Sheraz: (33:58)Yeah. It's like being a founder or an entrepreneur in 2000, right? Think about all of the things that needed to be built then and were built. And we are just on the starting point of this. So I think it's an exciting time to be an innovator and a developer and a founder and an entrepreneur.Austin: (34:20)I love that vision for the future. So, one last question before I let both of you two go. Riptide, the Solana global hackathons going on right now, if there's one thing that you would love to see a team build coming out of this, what would it be? And Sheraz, we'll start with you.Sheraz: (34:38)Sure. I mean, there's a bunch. I think one thing that could be really interesting is what does buy now pay later on chain look like, right? So we have so many crypto users that are sitting on SOL, and other assets that they want to hold that right, they're hold all that. They don't want to use that for transactions. So how could we enable so someone to purchase from a merchant using Solana pay, over collateralize their SOL holding and just buy now pay never? Use your staking rewards to pay for the purchase, call it buy now pay never. That's one example, that one could be really interesting.Jeremy: (35:18)I think we're excited to be part of the hackathon and putting forward some of our APIs that can be worked in conjunction with Solana pay as well. And so, I mean, just generally, we'd be very interested in seeing people who are building wallet experiences that are geared towards payments, whether it's a P2P payment or a person-to-merchant payment in particular, but really building experiences that are optimized for that flow, as opposed to being a DeFi Degen, or trading. And so I think those kinds of products that combine person-to-business and person-to-person payment experiences that abstract away some of the complexity, and then do that around these standards, I think we're super, super excited about that. And we're obviously excited to see what comes out of the hackathon. We're investing in a lot of companies now, and so we'll be watching really closely, because this is a space that we'd love to be investing in as well.Austin: (36:20)Well, Jeremy Allaire CEO of Circle Sheraz Shere end of payments at Solana Labs, thanks for joining us today.Sheraz: (36:26)Thank you, Austin.Jeremy: (36:27)Thanks. 

Vasiliy Shapovalov (Tech Lead, Lido), F.P. (Co-Founder, Socean) and Ella Kuzmenko (Product Manager, Stake Pools & Delegation Program, Solana Foundation) chat with Anatoly about the complexity and game theory surrounding stake pools, decentralization and censorship resistance.00:10 - Intro01:38 - Collaterals, maximizing censorship resistance07:40 - APYs and investors09:31 - How to get penetration across DeFi14:58 - Governance in a liquid stake pool18:23 - Automation vs. programmatic on-chain governance20:44 - Factors in selecting validators29:27 - Growing the validators set32:21 - Stake pool token in DeFi35:09 - Liquidity fragmented between too many pools41:01 - Who controls the network?44:46 - Increasing decentralization00:39 - Intro01:51 - pencilflip’s background03:30 - Working at facebook vs. web 3.007:31 - How pencilflip got into crypto08:52 - Views on NFTs10:45 - Getting into Solana15:29 - Experience working in lower level17:56 - What was his method to learn Solana?21:01 - What’s the hardest concept on Solana?23:53 - How fast did he move from Rust to Anchor?27:35 - Building on Solana33:24 - Advice to people moving to Web 3.0DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Anatoly (00:10):Hey folks. This is Anatoly and you're listening to The Solana Podcast. I have a super exciting episode today, it's all about Stake Pools and decentralization and censorship resistance. And I have a group of guests that I'm going to let them introduce themselves, just to make it a little easier. So Ella, why don't you start first?Ella (00:29):Sure. Hey guys. Ella, I'm a Product Manager of Censorship Resistance at The Solana Foundation working on Stake Pools and the delegation program.Vasiliy (00:39):Hey. I'm Vasiliy, I'm tech lead at Lido. Honestly, I think that the person who should be here instead of me is someone, of course like Felix or [Uto 00:00:49] or maybe Brian, but they couldn't make it, so I'm here instead as a second best option.Anatoly (00:58):Awesome to have you. We'll take the second best.FP (01:03):Hi, guys. I'm FP. I'm co-founder and CEO of The Socean Stake Pool. Nice to meet you guys all today.Anatoly (01:11):Awesome. So censorship resistance Stake Pools, I've been pounding the table on this for two years as the most important thing and proof of stake networks, because I have this crazy belief that if we have liquid staking as collateral and DeFi than financial analyst to analyze systemic risk and these things, we'll actually prefer collateral that maximizes censorship resistance. And that is a crazy thing, because it would tie incentives for maximizing censorship resistance in the network to its actual use and primary use being DeFi. Is this real or not? Is this going to happen?Vasiliy (02:00):I probably got some experience to tell here because we were in production longer, not on Solana, but in general, longer than most liquid staking pools. And I can say that it's less pressure to decentralize than I thought it would be on one hand. On the other hand is much more pressure than we usually have as a stake provider, as node operator. I come from a stake provider, P2P.org that is pretty big itself. So about 4 billion stake of fire down depends on phase of the moon, the day.And people who usually stake, there is the kind of weak, very weak, but it's a prisoner's dilemma when people are incentivized to stake with best node operator. And when there is no clear best, they go by brand but there is a number of pretty good node operator that people are incentivized to stake with because these good node operator don't lose the mistake and give them good profits and stuff like that. And basically it leads to centralization because they are not incentivized very much to the centralized stake. And it's probably on goodwill and many stakers don't give enough thought to goodwill, but stake and pools always do. Basically, they're professionally obliged to do this and better holding up to hold the node operator accountable.I think in Lido, we have a better monitoring system for node operator around for us. And most of the big stakers like changes and funds and stuff that we're monitoring people who stake for us way better than most stakers. And I can say that the trade of is real here, when that liquid stake can token hold us, are not putting a lot of pressure on us, but they're putting some and we are well equipped to react to that. And we would honestly welcome more pressure on this front.Anatoly (04:14):So, Ella, has this been easy to convince people that censorship resistance matters or is it like they're just learning about it for the first time?Ella (04:24):Yeah, that's an interesting question. I think I definitely would second what Vasiliy was saying about how it's surprisingly harder than you would think. People definitely will follow where the rewards are. And I don't think that is surprising. I think there's an interesting opportunity for Stake Pools to play with that idea and give rewards while also touting the benefits of censorship resistance. So, "Hey, we will give you great rewards, but you can also get governance tokens and you can help us build the future together."And I think there's an interesting way that you can frame that discussion where you don't really have to pick one or the other. And I think to put a maybe crazy idea out there, I think we're only seeing the beginning of what can be built on top of Stake Pools. So it's pretty standard to take your Stake Pools tokens and you go stake them and then you earn some additional yield there. But I don't think we've really unlocked the potential of realizing that the underlying asset that you're staking will continue to accrue value every epoch and you should be able to build crazy financial things on top of that, that actually give you way better rewards than staking with an individual validator will ever do.And as the product person, I just put crazy ideas out there and wait for other people to build them. But I think we're at the very early stages of that. And so I'm super excited for a year from now, what crazy things people have built, where the rewards are actually way sexier in Stake Pools. And you don't even have to care about censorship resistance by the fact that you participate in Stake Pools, you will be helping that. So that's the future that I'm really excited for.Anatoly (06:09):What do you think FP?FP (06:12):So the first question was, what do we think about the efforts towards decentralization and I think we're getting there, but I think it's still early days. If you add all of our Stake Pool operators together, we may have 10 minutes all between us and that's less than ever stake. That's less than one validator. So there's still a long way to go. And they charge 8% fees. What's going on? So definitely it is not a rational choice. It's more of a possibly just like inertia sort of thing.And then I would say, to me, there seems to be a little bit of a trade off between Stake Pools and decentralization. And what I mean by that is even between Stake Pools, there are Stake Pools that decentralize more and there are Stake Pools that decentralize less. And in some sense, there is a trade off here because if you stake with too many validators, then you don't get good APY and people don't want to stake with you. And of course, if you only stake with the best ones, then you're not really doing your job as a stake pool. So there's a little bit of a delicate balance here, but I like what Ella said in the sense that there's interesting financial instruments you can build on top, which should make the APY discussion, it just falls out.Anatoly (07:30):So the APY is between all the pools and validators are pretty close. They don't really deviate by more than like 10%. Do investors actually optimize for that right now or participants? Are they actually looking at that or are they making a decision once and not even thinking about it later for months on end? What kind of behaviors do you guys see both as a normal stake operator and a pool operator?Vasiliy (08:00):As a stake operator, I can say that there is a lot of people who absolutely look at returns. We usually, when we go into network, we prepare profit reports for them and show them they are staking with us and we get better returns and stuff like that because that's one of the points that node operator can actually differentiate on. And there is not a lot of them, basically. We offer the same service to people.But as a liquid staking protocols, there is a lot more of thing that can be a differentiator, way lot a lot. The node operator selection is one thing. Other thing is the opportunities to use your stake token in DeFi and CeFi and financial use for it. And this stuff beats these 0.1% point difference squarely. People don't care about the 0.1% point difference. But when they can actually use your token in 10 more protocols than the other person. So I think like, that's going to play as a serious factor way, way in the future, not for the few first years of stake, the liquid staking.Anatoly (09:20):So this is the difference between stable coins. Is how much penetration they have across DeFi protocols or exchanges even. Do you think exchanges are going to start having liquid staking like Lido, so Lido token?Vasiliy (09:38):Yes. I know it'll happen. It's not the matter of I think, I know it'll happen. It'll be inevitable. It'll start with smaller changes that don't have capacity to develop their own stake, liquid staking and don't have the network effect to make it a good option for people to use their exchange liquid staking. And then it comes to basically everywhere, I think. There is a pretty serious trading volume on liquid staking tokens right now and it's growing bigger month by month. So eventually, it'll be stupid not to waste them.Anatoly (10:19):FP, is that what you guys are most worried about or most working on? How do you get penetration across DeFi?FP (10:26):Yeah. I think so. Something that worries me is a lot of the protocols giving out emissions and the TVL is growing and all that. But I just wonder how much of it is organic growth because Stake Pools are very different from AMMs like ORCA or trading Texas, Mango where whereby in ORCA, they make their revenues from you doing stuff, from you trading or doing stuff. But in a stake pool, you want to do nothing. I mean, what we want our users is just literally put the SOL in us and just do nothing.So it is a little bit of a different incentivization. And I wonder whether these incentives are sustainable, because look, if you're chasing the people who are farming short-term yield, these are not the people that you want in your stake pool anyway. You want people who are in it for the long haul. So I'm a little bit worried about this.Ella (11:17):Yeah. To piggyback off of that. I think something that's uniquely interesting for Stake Pools that is not true for staking to an individual validator is yes, you want them to just hold their stake tokens in your pool, but you also do want them to participate in the broader project. And what I mean by that is when you have of governance tokens, you have the ability to actually impact where the project will go. And you have the ability to be active in a way that you can't be, if you are, let's say, in CeFi buying an index fund from Vanguard. They're not going to ask you, "Hey, do you have opinions about where Vanguard should go next?" And I think similarly, if you're staking to an individual validator, like sure, they might be earning you great rewards. That's very important, obviously. But I think at some point, everybody gets to a point where they say, "Hey, more rewards would be great, but what I really want is a community."And so I think Stake Pools that lean into this idea of, hey, we're going to give you this governance token, yes, hold your tokens. Do whatever you want on DeFi. But more than that, tell us what you want to see in the community and where you want the future of this project to go. I think that's a very unique power to Stake Pools that will organically grow. We just have to figure out how to market that in a way that's appealing to people who are institutional investors, retail investors, total crypto newbies, who don't even know what a Dow is. Don't know what governance tokens are, don't know what a stake pool is. So there's a lot of work to do there, but I think we have our work cut out for us because it lends itself to this very unique dynamic between all of the stakers.Vasiliy (12:56):The way I think about that is it will be a lot more market driven than participation in governance doing. People are usually who are staking as node operator and provided most of them, don't care to make governance decisions. You can actually look at how it will works with Cosmos and other proof stake blockchains, where governance is a part of staking. And you can see that most people don't vote apart from how they validate the votes, where they do.They select basically a company that is aligned to them or maybe select the person that give them best returns. And then they don't take a look at governance usually. That's not true for all people, but that's a clear majority that delegates the governance power and it'll be pretty much the same with Stake Pools with liquid staking protocols. They won't be able to even to connect with most of the holders of the staking tokens, because they won't be like passionate enough to connect back, to understand what they want. So it'll be very indirect.There will be staking pools that gouge some of the governance decision from stakers, but not from all of it. Not even from most of them, like from 10% of them, by volume and not by number. By number, it'll be like probably not 10% like about 0.1%, but they will take much more or maybe about the same pressure from protocols that uses staking token from the stakeholders in the blockchain ecosystem that don't use a liquid staking token by important like develop teams, develop clients and researchers as an ecosystem and stuff like that. And liquid staking pool will be a nexus of governance that will try to combine all this pressure in the single direction from stakers, from protocols, from major participants in the ecosystem.Anatoly (14:58):What is governance in a liquid stake pool? What is the function of it for the community that owns the token? What should they be looking at?FP (15:08):First and foremost, the delegation strategy. I think the community needs to decide the delegation strategy. I don't think this should be left to the founders or the creators of the stake pool. It should be democratized. I think another thing is fees. So I think the community should decide the fees that a stake pool should charge. And the last thing I would say is, we would like a lot of the associated infrastructure to be run by the community as well.So for instance, the program, the upgrade authority is already given to the community. Treasury decisions are already given to the community, but there are still things like the front end or paying for a custom RPC note and things like that right now is centralized. And we would like that all to be on chain eventually. So I think that's all quite important.Vasiliy (16:02):My thought here is that the role of governance in a good liquid staking protocol is to drive itself to extinction. So it won't be easy or it won't be fast, but essentially liquid staking is walking in the outermost part of the security of the protocol. It touches the most important parts of the protocol like censorship, resistance, and decetralization and security and all of that. And if it gets a significant power in this parts and if it's not credibly neutral, it's like a great thing.It should be credibly neutral and you can't be credibly neutral for long when your governance is overpowered. It's a natural thing for all governance to take too much power and use it in not a great way. So it basically has to, in order to be accepted by stakers and ecosystem as a ligand liquid stake protocol. The ligand part of staking, it should be self-depreciating to a point that where governance power are time locked and very light and mostly algorithm driven.Anatoly (17:27):This is interesting point because I think the goal of governance of a layer one is also to obsolete itself. Is how do we build the structures? And part of the reason of building out Stake Pools was because the foundation was running its own delegation program. And it really felt like why don't we get the community to do its own delegation programs. And then how do we get zero to one thing working, how do we now go want to earn? And that's always a way to disintermediate yourself from the governance work and then eliminate it all together. I think it's interesting that like inherently there isn't a drive to eliminate it from the community. We just want to push it out of the foundation and have you guys figure out what does that fine line between automation and having everything be programmatic to on chain governance?Vasiliy (18:32):Well, not yet. It's a work in progress. We are working on maybe systemizing the ways we can... What inputs do we have, is this programmatic governance, to understand where we can get the signal from, what we can use as a strong signal. We can't get rid of the governance entirely. We can just make it in a way that... Well, like I said, the role of governance in the mistaken is to take all this input from protocols and ecosystem and stakers and the outside water is large and fabricator of consensus out of it.So part of this can be automated because we can have the signals in bits and bites and we can use algorithm to aggregate this signals into party of decision maybe. Right now, we're looking at stuff like what is objectively good characteristics of a node operator for example, for selecting node operator like up time and special risk and the reputation that is proxy by amount of stake can all the other protocols that they are staking.And this is a strong signal. We can look at like time of operation within Lido, which is roughly correlate with reputation and outside Lido as well. We can look at stake as preference and the stake token can hold the preference to understand what they want, which is also a proxy for reputation, which I don't have. The things I don't have a good solution for getting into account, what people who run protocols think and what people who are major in the ecosystem think, because it's not directly correlated to a stake in stake pool. And we don't have a good way to get these signals yet, maybe ever.Anatoly (20:29):You guys like Lido and FP have two different approaches from what I can tell in terms of building out the validator set and the delegation strategy. FP, what are your thoughts on this? What are you guys driving most as the number one factor in selecting validators?FP (20:48):So I think it's important not to have a white list of validators because I think this is exclusionary. I think it's important not to dictate what fees validators should charge, because I think fees are only important in so far as they affect performance. So in some sense, we don't want to control validators. I think we shouldn't. We shouldn't dictate how validators... That being said, of course performance over time is very important. I think if not the most important. Yeah.And the other thing I would say is, the decentralization, obviously we shouldn't be staking to nodes that are in the MSG, they have too much stake or nodes that are in one of the data centers that is in the MSG. So one of the top three data centers. But that being said, there also a middle ground. You don't want to spread your stake among, let's say, 600 validators, for example. And the reason why you don't want to do that is because then you can't make a meaningful difference in decentralization. You want of do want to reward validators that are doing well, that are also out of the security group. So yeah, I would say it's a bit of a balancing act here.Anatoly (22:13):Vasiliy, you guys have a totally different approach. I'm excited too, why did you guys come up with that system? And what is the Lido way?Vasiliy (22:19):To expand a bit on what the system is, we've got a wide list of node operator that run with Lido and charge the same commission and get the flat amount of reward. What the reason behind this, the whitelist selection is done by basically a peer review. We've got a lot of node operators, already validating Lido in different protocols in Ethereum, in Terra and now in Solana. And we have a submission process where people submit, they want to stake for Lido and we get the node operators. They took a look at them at the setup they have and historical performance in Solana and other blockchains, especially in Solana and stuff like that. And community participation and select that the next five or so participant of the whitelist when we need to expand.The why we do that because we want to have good stake distribution that will be good for Solana and that's not the best, but it's easily achievable way to do that. Because that way we can guarantee that node operator are good because they're selected by the community of node operator essentially. And we can guarantee that they have enough stake to run the operations and have enough profit that say that. So they really want to keep this good business going. That's a good business for them. That's what they want to do. They are not arranged by scrap. They are paying their DevOps engineers handsome salary and stuff like that, so that they can afford to be honest.It's not great in the sense that it's a process that allows us to select the distribution folks, but it doesn't allow people to come in fresh and grow. And that's not great. But as a temporary thing, when there is a good community of node operator that are just like not selected yet, it works, I think very well.FP (24:36):I think part of the reason why Lido does it is from what Vasiliy said, it's meant to make sure that the node operator are reliable and performant. And I would put forward that there's a very easy way to look and to see if a node operator is performing, just look at their API. So in some sense, I mean, I don't want to make any implications, but I believe this peer review process is a bit nepotistic. It's like if you're in our secret cabal and if we know you and and we like your DevOps engineers and blah, blah, blah, then will onboard you. Of course, that's not the case, but it's what it seems like.Anatoly (25:15):This is the most controversial Solana podcast we've ever had.Vasiliy (25:21):I wouldn't say that's not true. It really does not allow newcomers to come in easily because there is a community of node operator that been through thick and thin via market, like Greeks through this days, when we all worked like in the red four years, that was what happened. We used make way less money than we earned, like with P2P, which was a pretty big one even this time. Like I said, it's not great, with this process, we can't get in people who didn't build this reputation and track record and stuff.What I don't agree with you that you can easily estimate how good is node operator, but looking at their performance, that's just not true. That's not how you estimate a node operator. You don't only evaluate performance. You also evaluate tailor risks. And tailor risks, you can't evaluate by performance. You should understand that these folks have bus factor of more than one. They don't have a single guy running all this stuff because if this guy gets sick, your validators get stuck.You should understand that they will stay up at night when there is an upgrade. You should understand that if there is a via market, they will stay to the blockchains they're running and they don't all run on Hetzner. So because that's, at least used to be the easiest way to get APR is to run the same data center as everyone. That's how skip rates they used to work in Solana.There is way more nuance in selecting a good set of node operator than just looking at performance. The geographical distribution, the jurisdiction distribution, the track record, other blockchains, which runs the reputation and community participation being in discord or running projects for Solana and stuff like that. There is way more stuff about node operator that is not easy to understand from just on chain metric. On chain metric is like the 20, 30% important stuff of choosing validator, because there are a lot of validators with good on chain metrics, but there are differentiated by stuff that is not seen by most people at all.Ella (27:44):I would say if somebody is staying up all night to make sure that their validator is running and they do restarts within the first five, 10 minutes, they're going to have better rewards. So I would say, it's more than 20%. I agree that being decentralized and being in data centers that are different from other people are doing community projects is super important. But I do think that rewards are a good proxy for how active the validator is actually running their node.Vasiliy (28:13):You can say that, that's a prerequisite. If you have good bad performance, you're not a good validator. That's true. That's not what makes your excellent node operator because excellent node operators run explorers, for example. And there are certs basically, for example. You can't say that this guy has the same performance cert, so they're as good. That's not true.Ella (28:35):But I mean, I would say there are maybe like 10 community members who run dashboards and different tooling. And I think there are way more than 10 stellar validators. So sometimes it's just not within their area of expertise. They could be excellent DevOps people and run validators across many blockchains, but they're not a web developer. That's just not their skillset, but I wouldn't say that they don't contribute to the community.Vasiliy (29:01):Yeah. What I'm saying just there is much more nuance, especially when you don't have 300 places for a node operator, you don't have enough money to pay them for 300 validators and you need to select 15 or 20 or 50.Ella (29:18):Unless a hundred million SOL gets stake to Stake Pools, then you can expand that list to 3,000 validators and everyone will be profitable.Anatoly (29:26):So this is the challenges. How do we grow the validator set? And it almost in my mind is like, you need both, you need people that are driving, we need higher quality. We need due to proof points that you know how to manage keys, but we also need people that are like, okay, just on board and figure it out and try it. Yeah. This is a tough problem. And I think part of the reason of not wanting the foundation to do it and push out this technology, a stake fulls is because we don't know. You guys are both sound very much validator operator focused, but these things like, I think are some form of financial, like DeFi application too. How much of your time are you thinking about like how these things actually work in DeFi?Vasiliy (30:22):I think I'd say a lot. That's what makes or breaks the liquid staking, the whole point of liquid staking is that it's liquid and usable in finance. I actually don't think a lot about a lot of time about node operator because I used to work here. I'm working as the staking provider since like 2020, early 2020. So I'm just have strong opinions because I do it right. But I have to think a lot about DeFi because that's uncharted, it's new.FP (30:58):So yeah. I mean, I think as Toly points out, I think the validator operator stuff is important, but really it really is just a baseline. And I think what we do with it next is the thing that's more important. So the question was, how do we think about how it's composed with DeFi? It's just the beginning. So right now what are the main things that you can do with your stake pool token? So you can put it in an AMM and provide liquidity that way, you can do lending and that's about it, I think.I mean, there's lots of stuff you can do and you want to use the stake pool stake SOL in any occasion where you can use regular SOL. So whether it's just buying from a marketplace or doing some more exotic stuff, like options trading, that sort of stuff and not just putting it in liquidity pool or borrowing or lending or leverage yield farming. So yeah. I basically want to expand the ways in which stake pool tokens can be used. And I think that's going to be a big draw for people to start staking with us.Anatoly (32:18):How much work is it to get that adoption or to have a specific stake pool token used in a DeFi?FP (32:27):I think integration takes time. I mean, it really depends on the partner which you're integrating with. And I think some things just haven't been built out yet actually. So Ella and I have been talking about how we can use these stake pool tokens in the NFT marketplaces, for example. But none of this stuff has been built out. So, yeah. So we'll get that, but it's not there yet, I would say. So we have to build it.Vasiliy (32:57):There is two parts to the answer. One is how long does it take to build. The other is how long does it take to convince people to build? The first is, faster than usual for financial products in traditional finances, but still long because we know that shipping is hard and convincing is also can be pretty, pretty complicated. For example, we started the integration process on MiCA, I think in February this year. And we only now getting an executive at least take things on MiCA, I think around next week or so. That's how long it cost with MiCA. And it's very similar amounts of time with a major protocols on Ethereum that are by now pretty conservative. Solana is not conservative yet. Most of the protocols on Solana make fast and break things, move fast and break things. So I don't think it'll take like this long stake Solana tokens to be a major participant of DeFi, but it's still time.Ella (34:12):Yeah. I would say the technical integrations, they're not technically challenging, you're integrating an SPL token. So that part is pretty easy or not as challenging as you would imagine. I think in the early days, when the TVL was very small, it was maybe hard to convince platforms that they should care about this weird stake pool token thing. Now that TVL is close to $2 billion US dollars. They maybe will now take those meetings and be like, "Oh, okay. Yeah, let's integrate all the stake pool tokens."And maybe whereas before they would have some liquidity requirements say, prove that users actually want this on our platform. Why should we spend the time integrating it? I think hopefully the script will flip and they'll be like, "Hey please, can we integrate your stake pool token?" But I think it just, realistically it takes a couple of months to get at that traction. And hopefully we have some momentum now and we can push forward more of those integrations.Anatoly (35:08):Is there kind of danger of liquidity being fractured between too many pools?FP (35:14):Hey, I seem to recall asking you this exact question on discord back in September, Toly. Yeah. I wondered this myself to be honest because I think there is a happy medium. You don't want one stake pool taking all of it because there are protocol risk there as it ends points out. Yeah. And if they fail it, that's dangerous. Well, on the other hand, it's going to be really difficult to integrate a hundred different stakes pools.Although that being said, there are things we can do to mitigate it. One of which is to enforce some sort of standardization. So one good step would be, for example, to use the Solana reference recommendation instead of... Maybe it's too late now for some of the existing Stake Pools. But that being said we were talking about adapters. I don't know if you recall some sort of adapter, some sort of layer that makes sure that the Stake Pools can all interoperate with one another. I think that would be really good.Vasiliy (36:14):I think it's inevitable that a single representation of staked Solana to be the major player here. So that's basically Lido thesis and I'm seeing it play out in the Ethereum and in the LUNA and in the entire ecosystem. So I think it's going to happen. It doesn't necessarily mean that it'll be one stake pool, but the alternative here is just another layer of aggregation. One thing for example, was proposed by Michael from Curve where like basically a stable pool of multiple liquid staking tokens was used and LP token from this pool was proposed as a basically unit of account. I'm not sure that it will happen, but I am pretty sure that there will be one aggregate stake Solana token, that will take the majority of the market.Anatoly (37:20):I actually think that these things are far more fluid because it's all people based at the end of the day. And people will do promotions and get communities together and have fun or get excited about a thing that some innovation and you will see liquidity move from one thing to the other simply because it's exciting. And it feels like it's just a little too static for there to be only one token. This is not how normally people operate, but we'll see.Yeah. It's at any given moment one winning token maybe is a better way to put it. So it doesn't mean there will be one token for eternity, but at any given moment, there will be a clear winner except maybe the moments of flipping that's how I see it.FP (38:14):So I worry a little bit about that actually. I worry because we talk about increasing decentralization. And that was the reason why Stake Pools were created in the first place. And it's true that if you have one stake pool controlling all the stake, that solves a particular kind of centralization, Nakamoto coefficient. But then it introduces a new kind of centralization. And maybe there are risks that can be mitigated that way, but still this worries me a little bit. So I'd rather have an ecosystem with a good number of different Stake Pools.Ella (38:51):That's where the education piece comes in. You got to let your delegators know the importance of censorship resistance and decentralization so if there is a sexy new aggregated stake pool token, they don't just gravitate towards it because it looks good without thinking about the consequences of that.Anatoly (39:09):But the yields are so high.Vasiliy (39:15):I don't like the dynamic at all, that there will be one lean stake token, but I think it's inevitable. And what we can do is not oppose it, but we can build protocols that will be a net good for the system anyway, even if this happens, hence the self depreciate of governance and in liquid stake and stuff like that, that's all flowing from there.Ella (39:40):I wouldn't say I'm oppose to it, I think in an instance where you have 10 really small stake pool operators, let's say universities decide, hey, we want to run the Yale stake pool and the UDab stake pool. And they have very fragmented liquidity. I think it makes total sense for there to be an aggregated university stake pool token, support university students help them get their pizza and ramen. Great. That's a fun way to do it. But that's a very specific use case where you're trying to make sure liquidity isn't fragmented.But I think every stake pool today has more than 600,000 sold deposited into it Solana. So I wouldn't say that's a huge fragmentation. It seems like people have chosen the pool that they like and they're happy with the performance, with the project. And that's the one that they picked. And so I don't know that they would be attracted to something that tries to average everything out and is just a generic token, but I could be wrong.Vasiliy (40:38):Yeah. It's so very interesting to see the play out.Anatoly (40:40):So are you guys worried about if these are used collateral, like liquidations rapidly moving stake from the lenders to the people collecting to the traders, is that going to change the dynamic of the makeup of who controls the network over the long-term?Vasiliy (41:05):Not reallY. How I've seen it work by, in liquidation that happened in Terra and similar ones that there were not exactly strictly liquidation, but more of fire sale events in Ethereum when the price of weather went down and people were going out of stake teeth as well. The dynamics here is that people who have low time preference are selling at low prices and people who have higher time preference, they are buying. So then they went of the liquidation, the price goes down and people with more foresight and more patience are getting the discounted stake token. So if anything, that looks like stake token getting in the hands that smarter and are in for a longer game, usually. So not always the case, but very much looks like this.FP (42:05):I don't know. I mean, that being said, when you have all these incentive programs and emissions coming out. That doesn't that see to incentivize people who jump around pools, trying to find the best ones. And they're getting rewarded by lots of governance tokens at the end of the day. So what do we think about that?Vasiliy (42:25):I don't think that it's something to really think about, I don't know. Jumping around and getting this governance tokens and it is a natural way to get some money for people who like money. I don't know. That's not a bad thing. If you like some juicer smart contract risks and rockeries in your life, that's a very exciting way to spend time.Anatoly (42:55):Yeah. There is I think a danger, but I don't know how big it is in that normally for like a validator to receive more stake, the best they can really do is offer 0% commission and then they can start bribing people. And it's hard to bribe people, but with liquid staking, it's a lot easier. You can just simply say, when you stake with this pool, you get so many more rewards than you do anywhere else, because you can min this new reward token. And is that a dangerous, scary thing that could result with a third or more of the stake, all moving towards this hot, shiny thing? I don't know.This is the part of where I think it's very critical for DeFi to mature and to have real analysts and people analyzing these things and looking deep and giving a ton of pushback on things that look a little fishy. It naturally happens, but only happens on crypto Twitter and still so much stuff sneaks through.Anatoly (44:06):So we'll see what happens, but thank you guys for joining. Super excited to have this actually being live now and making so much headway and growing so rapidly. Honestly, if we actually get to a point where DeFi is incentivizing censorship resistance, we're kind of done. We built it. We can actually take a break. So I'm looking forward to that.FP (44:41):Is that the biggest concern for you as a creator of the layer one, the increasing this decentralization, would you say that's the biggest concern?Anatoly (44:49):Yeah. This is the thing that I'm most worried about, because I think to do it in a sustainable way, it means that you need to have a use case which benefits from decentralization. You need to have external users that have a benefit that exceeds the cost of running the network. It can't just be self-sustaining tokens moving around. So to truly succeed there means that, we build something useful to the world. And that's the ultimate goal.What else are you an engineer if not to build something useful? If that's what you care about, then you should be an artist and that's a totally different thing. Yeah. Awesome to chat with you guys. Thank you for being on the show and thank you for all the hard work everyone is doing, Ella, Vasiliy, FP. Just thank you guys.FP (45:48):Thank you so much for having us today.Vasiliy (45:49):Thank you.Ella (45:49):Thank you.

Live from Breakpoint 2021, Ali Yahya (a16z) moderates a discussion about wallets, custody and the User Control Layer with Brandon Millman (Phantom), Filip Dragoslavic (Solrise) and Maria Phillips (Slope Finance). 00:10 - Intro02:32 - Custodial vs. Non-custodial models for keys holding07:11 - Education is key11:37 - Building on top of user-controlled layers16:48 - Unbundling Wallets20:04 - Mobile vs. DesktopDISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Ali (00:10):All right, welcome everyone. So today we have a great panel to talk about the user control layer. So everything that has to do with UX, interfaces, wallets, how people use their private keys to interact with blockchains, and how all of that plays into web 3.0, and the things that are being built in DeFi, NFTs, et cetera. And we've got only 20 minutes, unfortunately, which is an egregiously short period of time to cover such a meaty topic, but excited for it. It's going to be a great conversation. I'm going to start by letting our panelists, maybe introduce themselves. Maybe one minute kind of introduction, and then we can dive in. Does that sound good?Filip (00:50):That sounds good. I'm Filip from Solflare. We actually built the first wallet on solana. That was actually before magnet, July last year. And Solflare was the first taking wallet, and right now we have over 20% of solana circling supplies stake through Solflare, and we are expanding onto all platforms. We have a web browser, we have a browser extension. We just launched mobile on Friday. And we are just looking to give all our users the opportunity to access Solflare from whichever platform they want to. And that's what we're all about.Brandon (01:37):Hey, everyone, I'm, I'm Brandon Millman. I'm the CEO and co-founder of Phantom. Just got started back in May, and it's just been such an awesome journey. I just wanted to say thanks to everyone in the audience and listening back at home for helping support us on this journey, and to hit 1 million users recently. Each and one of you are one in a million to me, so really appreciate it.Maria (02:03):Hi everyone. I'm Maria Phillips with Slope Finance, I'm head of communications. Slope Finance was the first mobile wallet on solana and we have over 150,000 downloads and an MAU of 95%. We are mobile first. Yeah, fantastic. Delighted to be here today.Ali (02:23):Amazing. Well, thank you guys. Well, let's start with, I think one of the basic questions about how user interfaces should interact with a blockchain. And that is the question of whether the keys should be held by the user, or if those keys should be held, or might be held by a company in the middle, like say a company like Coinbase or a company like that, where that would be kind of a custodial model versus having things being non-custodial and sitting at the edges. And I think we all kind of know what the ethos of this space is, but of course there are many trade offs. And so I'm curious to talk through how you guys think about those trade offs, and what are the kinds of things that we can do to empower the user as much as we possibly can.Filip (03:04):There's two different approaches like custodial and noncustodial. Noncustodial is in a true spirit of crypto where you actually control the keys. You control their finances and no one can actually take it away from you. I talked to someone from Algeria and he told me how important that is for them.Ali (03:24):Yeah.Filip (03:25):Since I don't live in a country like that, I didn't know that's so important for them because at one point in time, someone can actually get something from the bank account, they lose everything. But on the other hand, all people are actually used to, don't have that responsibility of just holding all their finances with them. So we have bank accounts, we trust banks with our money and it's going to be a long road to educate old people, to get from the custodial to the non-custodial thing. And I don't think that it's ever going to happen in a big way, but as all crypto people here are, we are like early adopters and we want to try new things, but the vast majority will always stay non-custodial. And there's always going to be those two approaches.Ali (04:19):Yeah. Makes sense. What do you think, Brandon?Brandon (04:22):Yeah, I'll start off by saying that at Phantom, our goal is to make the decentralized web safe and easy to use for everyone. And you know, what that means is expanding past like the very small number of users we have now to tens of millions and billions in the future. But you know, the thing is that giving private keys directly to users, is sort of akin to giving them keys to like a super car Ferrari, it's like super powerful, but not everyone needs all that power. And I'll say, actually, I think there's actually more than just this dichotomy of like non-custodial and custodial. It is actually a bit of a range of different techniques that are kind of somewhat in the middle. So I think there's things like social recovery, multi-party computation, premier secret sharing, tourists, those sort of things. And I think all of those techniques have not really been given the chance to really been taken to their like full extent. So yeah, we're really excited to kind of explore a lot of those options and sort of bring more custodial flavor, to non custodial tools.Maria (05:32):When we look at our user base, okay, number one, India, number two, US and number three, Malaysia. Everyone of our customers really are accessing via mobile, and that onboarding, and that access is a huge concern to us to make it as easy as possible. So we are looking at different innovations in this space. And especially because we're looking at being the gateway from web 2.0 to web 3.0, and being able to link activities in decentralized identity is what we're calling it. Being able to identify people in specific ways, according to their activities. And hopefully we're going to use that to lower the access and entry barrier for our customers to make it as easy as possible. And a better experienceFilip (06:16):Just wanted to add that actually education is so important and just getting people to know how crypto actually works and why is it so good for them? That's actually one of the things that, what we actually launched our sulfur academy. So we have blogs and guides to capture the users and tell them, okay, this is how works. Because there's a lot of scams out there. I mean, we both know that because before we actually launched mobile, we have caught three fake wallets. We actually met one of the developers who made those fake wallets reached out to us. And told us, oh, I'm so happy that you're using our wallet at the wallet that I made. And he was actually commissioned by someone else to produce fake wallets for Solflare and Phantom. So that was mind blown to us. He felt so bad, but he didn't know that. And so education is key actually to preventing users, for getting scammed and actually get so burnt that they say, oh, okay, all crypto is a scam. So that's why...Ali (07:22):I think this point of education is really good because I think there are two philosophies in this space. One of them is crypto wants to be seen. This is a line from Cavan, who's a founder of foundation. And his view is over time, people should become aware of what crypto is. People should become aware of the way that private keys work. They should become aware of the fact that holding your own private key is very different than signing into a web 2.0 service. And that's one philosophy that these things will become front and center. And that education will be a big piece of this and that you actually, as an application developer, should not be trying to hide it away, right. That you should not be trying to fully abstract it such that the user actually does not know anymore that they're interacting with a blockchain.Ali (08:05):And then a different philosophy would be more like a product and a very pragmatic point of view, which is people have a very hard time understanding how all of this works. And so instead, what you should do is you should abstract it away. You should make it look as much like a web 2.0 thing as possible, so that you can get people on board. And then over time, maybe you shift towards a more kind of web 3.0 native user pattern. And those are two very different ways of building a product. And I'm curious how you guys think about that. I mean, your point about education, how do you think about education?Filip (08:38):Yeah, I think educating users is actually the key to it. I mean, they don't need to know like 90% of it.Ali (08:45):Yeah.Filip (08:45):It's totally fine if they do the very basics and if they interact with, for example, much more complicated protocols, they don't need to know what goes on in the background.Ali (08:55):Right.Filip (08:55):But they need to know when the app says, okay, you're now signing a transaction, what end means on the blockchain. And this is the only thing that they should know. And we should actually push as an industry, users to educate themselves just in those basics.Brandon (09:15):I feel like none of us here really know what the final conclusion of all of this web 3.0 tech is really going to look like. And I think we're just so early in the vast majority of people who are going to use these centralized technologies have not really used it yet.Ali (09:30):Yeah.Brandon (09:30):But I agree. User education is super important. Support is another thing that we've seen that's super important. Unfortunately, the status quo nowadays is to kind of throw everyone into this zoo of a discord and let whatever happen. And unfortunately, a lot of projects basically just turn a blind eye to what happens in there. All these scams happen, people get DMed and whatever. So yeah, I think we really all need to take a much more user focused approach, not just in the applications themselves, but in, around just all of the surrounding infrastructure, support, education, et cetera.Ali (10:06):Yeah.Maria (10:07):Financial literacy and traditional financial services isn't great either to be honest.Ali (10:11):Yeah.Maria (10:12):But I do see this whole e-commerce space that we're involved in and looking at, I think that is a way to bring people into the space to understand it better.Ali (10:20):Yeah.Maria (10:21):If they start using cryptocurrencies or if they start using this in their normal daily shopping or activities, this is a way for them to understand that it's safe. You know, I paid for something, I got it. Yay. This is good. That's a real great way for them to understand and onboard in a really low level way, but get there.Ali (10:41):Completely.Filip (10:42):I just wanted to touch on the topic that Brandon actually mentioned, with support. We both did in our discords, people get scammed and stuff like that. So we tried everything. So we take this try and see what works approach. So we tried with telegram, we tried with discord. Yep. But people always get scammed. So I think we're launching periods to our live chat support on the website, but it's always like this fine line of, okay, how do you actually provide the users the best experience, but that they also feel still completely anonymous. It all depends on that fine line, and we need to see what works best actually.Ali (11:22):Completely. Well I think this actually segues well into how a user control layer application like a wallet or other kind of applications at that layer enable developers to build on top of them. Right. And I think that there's another kind of spectrum of different schools of thought or different approaches in that world as well, where you can think of meta mask or the kind of wallet that is very un-opinionated about how developers build things on top, as being on one end of the spectrum where you can really just sign anything using meta mass, you can sign just a binary blob because it doesn't provide you with very much context as to what it is that you're doing. And it's really on the developer to inform you as to what you're signing actually is.Ali (12:18):And then on the other end of the spectrum, can be much more opinionated about how the wallet integrates with specific applications, such that the wallet itself, the team who builds the wallet itself might integrate directly with a protocol that does lending. One example on ethereum world would be compound, you integrate with compound directly. And then there's a whole spectrum in the middle where a wallet could provide the tools for developers to build applications for it that are standard. And that give a little bit more structure and context for what that integration should look like, but it's not done by the team itself. And it enables an ecosystem to kind of emerge, to improve what the user experience might look like by enabling them to do things in a way that's more structured. So I think we need certain standards that help us build these applications in a way that are intuitive. And I'm curious how you guys think about this factor, or if you agree with it and, and where you guys kind of land on it philosophically.Brandon (13:19):Sure. Yeah. I can lead. Again, I'll preface everything by saying that we're in this mass experimentation phase where a lot of things are still being figured out. That being said, I feel like some of the walls that you've alluded to that have done more plugin type architecture. So namely origin, I feel like have sort of been left in the past a little bit, just because they were not really able to keep up with the explosion of all of these permissionless daps.Ali (13:50):Yep.Brandon (13:51):And, therefore were not really able to sort of participate in the network effect that gets created between daps and the users of those wallets. And so our opinion right now is to keep it very permissionless. Keep the current model going, as it has a lot of momentum and all of that. But again, that being said, I feel like we still have yet to see the final conclusion of all this, so things are always changingFilip (14:19):There's different trade offs between both approaches because if you integrated directly into the wallet, so firstly, the UX is going to be way better. And you could actually provide safe haven for all those new users because the permissionless world is the wild west. So you have like five great applications, you have five applications that will actually scam your money, so you could actually protect them. But on the other hand, you actually are gate keeping with your wallet. So this is why the panel is called whole user control layer. So the wallet actually dictates to which application the user can actually connect. And this may not always be in the best interest of the user because maybe that wallet has, for example, a business model with the dap that they have. So this is one part of it, in a permissionless system, the other thing applies.Filip (15:22):So there's inherent risk. And if we're going that way, then we need to go back to the previous topic and that is education. So if we educate them, then it's completely fine to do as permissionless because they know what they're doing. But if there's a big influx of new users who are just coming into the space, wanting to experience something and they want to do it quickly without educating themselves, we're in a really tough spot with permissionless systems. But as Brandon pointed out, we're so early, we don't know which way is actually going to work best. So I think there will be wallets with different approaches and we'll see which one is going to be the most successful one, which the users will actually choose that perspective.Ali (16:10):Completely. Do you want to add something Maria?Maria (16:12):Yeah. We have integrated with over 80 daps, but we're very lucky, we have 35 engineers, and we've created a standardized way for them to come to us and work with us and partner. So that's been fantastic and it grows, our list is growing, we're meeting people here, so happy to connect.Ali (16:29):And Maria are those integrations integrations that the team has pushed forward, or are those collaborations with the teams, or I'm curious how they end up working.Maria (16:40):It's collaborative. Yeah. Yeah. We absolutely work with them and make sure that they integrate with us seamlessly.Ali (16:46):I think an interesting question that also duck tails with what we're talking about here, with respect to integrations, is whether it's possible to kind of unbundle what a wallet is. And I mean, there are kind of standards out there that are being pioneered to things like wallet connect and I'm curious how you guys think of what the actual kind of user controls layer looks like. What are the various different components? What are the roles of that piece of the stack and how you think about what you're doing plays with that?Brandon (17:20):The wallet is actually, in its current form, a very complicated multifaceted product. So there's so many different parts. So not only in the app and outside of it. So inside the app, there's things like key management, there's things that people expect, like being able to do everything that you expect from your tokens.Ali (17:39):Yeah.Brandon (17:40):And if view, NFTs, swap tokens, like interact with daps and all that. And so it is a very challenging thing to juggle all of those things at once, especially in such a fast moving environment. And I think we're already seeing those sort of things, getting unbundled with like NFT viewing specific daps and daps that are more geared towards very fine gain grain control of your token accounts and things like that. And so I could see a world where they get unbundled, but I could also see a world where someone's kind of able to solve all those things, and under one umbrella,Filip (18:26):That's an interesting question. So it's basically the WeChat and other things. So is it a super app that can do everything?Ali (18:34):Yeah.Filip (18:34):Or is it an app that does one specific thing and then lets you connect to others? I think a really interesting approach is actually to have that super app, but in a light version. So you, the let the users do very basic operations with NFTs, with SPL tokens, with whatever they want to, because the space is evolving so fast, user demand is shifting from one week to the other and if a wallet can end up fast enough, then they could provide them those basic functionalities. But if they want to do some really heavy, deep stuff, then it's almost certainly going to be unbundled because you can't have 50 different integrations, fully integrated into the app. This just becomes exploded at one point. Especially on mobile. Dap is doable.Ali (19:35):Yep.Filip (19:35):But mobile, when you're limited with space, it's going to be almost impossible.Ali (19:42):Completely.Maria (19:43):For us, it's the super app approach. We love to keep our customers internally within the app. And you know, we do everything from activities, news, ranking centrally in the app. That's what we're trying to do, and it keeps our open rate really high as well.Ali (19:59):Yeah. Well, in a related question, which you alluded to is the question of mobile versus desktop and how the patterns of usage of web 3.0 and crypto might evolve and what might become the dominant vector for using keys for interacting with web 3.0 apps. What are your thoughts? How do you guys think that this will evolve?Brandon (20:20):Yeah, it's interesting. Because I feel like web 3.0 on mobile in more recent memory has had a hard time sort of getting started.Ali (20:30):Yeah.Brandon (20:30):And I think it's actually a function of the user base that has been using blockchain apps for the past couple years, which it has been more of like this prosumer DeFi type of user that prefers using complex DeFi apps on desktop. But what we're seeing now, I think is a couple paradigm shifts that are really setting the stage up for mobile. So first is this kind of new cohort of users that is much more NFT focused, and therefore a lot more casual. And so I think those people actually expect a really polished mobile experience. So I think that's one paradigm shift that's happening. And the second one is why we're all here today, is scalable and cheap blockchains, which their nature actually lends themselves much, much better to a mobile environment. So I think those two things are actually setting us up for the sort of new age of like web 3.0 on mobile. Which I think was not as tenable as before.Maria (21:37):Well for us, it's definitely mobile. Okay. We do have a Chrome extension as well, but for our customers, they don't really have laptops. It's very much mobile and that's their experience and how they onboard and how they continue to access. So it's definitely mobile for Slope.Filip (21:53):I'll go back to the last point and I'd say, it's going to be mixed. So you're going to do complex operations on a desktop, most certainly because mobile won't have the ability to provide them, but I see actually mobile and mobile wallet as your signing device for everything. When you connect to your desktop application, you just sign it with mobile. So because it's much more secure on mobile. I can't imagine myself, I can't imagine a lot of people actually, I don't know, sitting on a couch with a laptop open and browsing NFTs, as opposed to just sitting on a couch and browsing NFTs from their mobile app.Ali (22:38):Yeah. Yeah.Filip (22:39):And buying, selling. I want to connect to radio and harvest my farm in the morning from mobile. I don't want to do it from a desktop, open the desktop, type in radio, something like that.Ali (22:51):Yeah, it does feel as like, as web 3.0 begins to intersect more with a consumer world, mobile becomes increasingly more important as a result.Filip (23:01):Completely. Especially with NFTs.Ali (23:03):Yeah.Filip (23:05):Because NFTs and games in particular, so all those web 3.0 games are going to provide a huge user base, actually that is younger, the opportunity to experience crypto. And then you need a mobile wallet because all those mobile games will need a wallet.Ali (23:20):Of course.Filip (23:21):Unless they integrate one themselves, but talking to a lot of them, they don't want that responsibility because it's actually hard to build a wallet and maintain a wallet for it to be safe and secure for all users.Ali (23:33):Completely agreed. All right. Well, I think this is a good point to wrap the conversation. Thank you very much for joining us. This was awesome. This was awesome.

Live from Breakpoint 2021, Austin Federa (Solana Labs) moderates a discussion about the transfer layer and cross-chain bridges with Hendrik Hofstadt (Jump Crypto), Bryan Pellegrino (LayerZero), Alex Smirnov (deBridge) and Andriy Velykyy (Allbridge.io). 00:10 - Intro02:50 - The importance of bridges not relying on Trust04:28 - Moving wrapped assets12:00 - Capital Efficiency of Bridges14:02 -  Future of bridges16:28 - Integration of bridgesDISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Austin (00:10):All right. Welcome guys. We're here to talk today about the transfer layer, scalability, cross chain bridging, the technical problems, the operational problem, the UX problems. This is just a panel of problems today, but it's also a panel on opportunities. We've seen a huge amount bridge over between other protocols in solana between other protocols and other protocols. We think of bridges as something new, but bridges are how DeFi has used Bitcoin as collateral for quite a long time at this point. It's kind of funny to think about how this started as we're taking an asset that's considered quite stable and solid that has no smart contract ability and being able to use that in Ethereum and that early day work really set the stage for, I think, a lot of what we're seeing today.Austin (00:55):But bridges go far beyond just this idea of how do I move something from chain A to chain B. There's roles in them as being decentralized ways to pass messages between different chains. There's a role for them in making users feel safe about trading across chains, and there's a role about them, about creating an exit ramp too. So that if you do something like buy an NFT for $69 million, you're not dependent on one chain to hold that. There's an ability migrate in a decentralized and trustless way. So we're getting into a bunch of that today. I'd say, let's just go ahead down the line and give a quick introduce to yourself and your project.Hendrik (01:31):Sure. I'm Hendrick. I'm with Jump Crypto and as Jump Crypto we're core contributors to Wormhole, which is a cross chain messaging protocol, connecting high value chains. And message passing in this sense means anything can flow between these high value chains, meaning assets and data. So your coins, NFTs, but also governance decisions and more information like as a base layer for developers to build on top of.Bryan (01:54):Bryan from LayerZero. Our focus is purely generic messaging interop. High level is connect every contract on every chain to every contract on every other chain.Alex (02:05):Hi everyone. My name is Alex Smirnoff and I'm co-founder of the deBridge Protocol, which is cross chain interoperability and liquidity transfer protocol. So the protocol itself allows to breach any arbitrary assets or data between any blockchains including solana of course, down the road.Andriy (02:23):Hi I'm Andriy from Allbridge, I'm a co-founder there. We currently support seven blockchains, and I hope that this number would increase to 12 by the end of the year. We started in July and since July, we bridged to solana one point half billion worth of assets.Austin (02:44):It's great to see. So I want to start out with just a level set question and Andriy, we'll start with you. Why is it important for a bridge to not rely on trust?Andriy (02:54):You see, when we speak about trusted bridges and trustless bridges, and that is the question, I suppose?Austin (03:00):Yes.Andriy (03:01):We have to consider that while we all here are building decentralized future, which should be completely trustless, in my personal opinion, sometimes we may sacrifice some layer of some level of decentralization to provide faster and better user experience. Because we are, in the end of the day, we are limited by the technology. And I have been thinking a lot about that because in the very end, we are building for our users and we want to create the product that would be used and used easily. And when we, in some cases, add too much of decentralization, that can affect user experience in a bad way. And this is something that we should consider as the owners of the business. So it is not so simple. I mean, as I said in the very beginning, I'm like a hundred percent over decentralization. I'm just saying, let's not forget about users. They going to use other product in the end of the day.Austin (04:08):Sure. So Bryan, when you're looking at something like this, is it possible... We talk about bridges, but these are more than just bridges. It's not like you're just, you take a bridge on a car, you're over the bridge, you're done, if the bridge falls down next week, you're still fine. You've gone over the bridge. But there's a different relationship here when we're moving wrapped assets. Can you talk a little bit about how users manage that and how you're thinking about that?Bryan (04:33):Yeah, I mean, I think that is the case when you do use wrapped assets, but I think wrapped assets are... You're always going to need wrapped assets for the primary chains. Because it's not like Ethereum can deploy a contract to mint Eth anywhere. But when you're talking about projects, Aave, Curve, like MIM, all these things, you're getting as projects move more and more to multiple chains, they're starting to deploy their token more and more on multiple chains and you have the ability to actually use native assets. So you can swap a real MIM for a real MIM rather than having four different bridges, which have four different versions of wrapped MIM coming in. And so I do think it's important to realize that over time the expectation should be that we do move away from wrapped assets. I don't think wrapped assets have to be the future for every project.Bryan (05:14):We've done it because we have something that's interesting on one chain and we want to create a synthetic on another chain, but these projects are starting to deploy wider and you will see much more of their own native. And especially when you have something, whether it's rebalancing or something like xSUSHI or [inaudible 00:05:32] any of these things. It's very important when you're getting a wrapped asset, you're getting like a Vanilla ERC20 equivalent where there is none of that and it creates a lot of issues. So I do think it's important to realize that move moving forward we will likely see or want to see native assets much more than wrapped assets.Austin (05:46):Yep.Alex (05:48):[crosstalk 00:05:48] I can adhere that wrapped assets is only kind of a gateway to get into the asset that user wants to get in because eventually cross chain interoperability will be all about the user experience. As a user, I don't want to know what is bridged at all. I just want to open my wallet like Fantom or MetaMask, I want to swap from one asset to another. And I don't care whether it went through wrapped asset or through some liquidity pools. I just want to receive the desired asset in the target chain. So I truly believe that eventually bridges will be kind of TCP/IP. What TCP/IP did for internet. So that's what true cross chain interoperability protocol will do for the internet of blockchain. So it's all about delivering of the user experience and yeah, the only point of interaction between user and DeFi will be the wallet or like decentralized applications, like 1inch or ParaSwap.Austin (06:42):Yeah. Yeah. No, I'm going to push you a little bit on that because every step in the wrapping process is a point of either failure or a point of trust. You could have Bitcoin that was originally wrapped onto Ethereum that's moved to Polygon, that's moved to solana, that's moved to Binance Smart Chain, that's moved back to solana. How do you simplify that chain of custody experience for a user? And how much should users actually care about that?Alex (07:08):I believe that users do not care about that. I mean the regular user. And as a wrapped asset, for example, what we do at deBridge, we have a wrapped asset in different blockchains, but if you bridge from the secondary chain to the secondary chain, so you basically burn the wrapped asset in one blockchain and you mint it in another. And of course there's kind of a additional risk of the consensus algorithm of the specific blockchain, but that the risk that user takes, because he know that he's going to bridge this asset to this blockchain and in case something will happen, like with the consensus algorithm in this specific blockchain, it's just the kind of collateral in this specific blockchain will be drawn. And that's the risk that user takes.Bryan (07:49):Yeah, I think the user doesn't care until something goes horribly wrong. And then the user cares a lot generally, but definitely.Austin (07:56):Do you think wrapped assets should trade a discount?Bryan (07:59):That's a good question.Alex (08:00):Of course not, I think.Bryan (08:03):I mean, there's some inherent risk depending on the wrapping mechanism. And I think likely over time, you could see that. I think demand right now, the value of a wrapped Bitcoin is... Well, all right. I don't want to trigger a lot of people, but you can generate yield on a wrapped Bitcoin that you can't generate in an actual Bitcoin. So there's actually maybe the argument that the wrapped asset should trade at a premium rather than a discount, but... [crosstalk 00:08:24].Austin (08:24):I love it.Bryan (08:24):I'll leave it there.Austin (08:25):I love it.Hendrik (08:26):I think the core assumption below that is really that notion of trust because that's essentially what the bridge establishes. The bridge establishes trust between chains that can't verify each other, or can't [inaudible 00:08:37] yet like verifying and proof of work chain, verifying different consensus mechanisms, all of these. In order to verify or establish trust between these chains, there's complex mechanisms that differ between any kind of chain. And I think that's what we all essentially bridge in the beginning at the very base layer. We establish trust between these chains and of all bridges I think the most important aspect should be establishing that trust and making sure that the bridge is going to be alive and the bridge is going to be secure.Hendrik (09:06):So the notion of [inaudible 00:09:09] and safety as the core properties of the bridges and then applications being built on top, but relying on this core aspect. And the risk that sits at this core protocol then trickles down into the applications built on top of the bridge, eventually wrapped assets. And that's where you could apply risk discount to wrapped assets. But that would hopefully be as small as possible if we all do our jobs right.Andriy (09:32):There is one more thing to that, like combining trust to the bridges and what we discussed before about the wrapped assets. So let's say we have an asset coming from Ether to Polygon. So it's being wrapped issued on Polygon. From Polygon we take this asset and rewrap it on solana. Then on solana, this asset, I'm speaking from experience, it's get on Saber our partners converted to the native asset on solana. So for user it is one seamless flow. It is good. It is all under the hood. But for us, it is sometimes scary because ultimately that means that bridges should trust each other. Because a point of failure before the assets come to my bridge can essentially affect my performance as well.Andriy (10:19):And it would not be my security problem. It would be problem of other bridge, but I will end up with the wrapped asset that is locked on my bridge, which due to the [inaudible 00:10:30] or something, it costs zero. So what should I do? And this is, again, the question, how can bridge trust each other? What should be the protocol? What can be the thing to unite us and resolve this issue?Alex (10:42):But that there is that liquidity providers actually [inaudible 00:10:46]. So it's not about like cooperation between bridges, but more like whether users are able to swap from like wrapped asset to any other asset within these specific ecosystem or like solana or Polygon, whatever. So, yeah, basically when liquidity providers provide liquidity in pair of like wrapped asset pair with a, for example, most liquid asset of these specific blockchain, they trust to bridge and they should kind of believe that bridge is truly the decentralized and trustless.Alex (11:12):So users do not bear so much risk, in fact. The risk is mostly on liquidity providers, but the question interoperability is not only about the swaps. First of all, it's all about the delivering of arbitrary messagings or arbitrary call data. Because what I personally would like to see is when protocols on Ethereum could be kind of composable with the protocols on Polygon. So let's say algorithmic stable coin on Ethereum opens up position on the Mango Markets to maintain its [inaudible 00:11:45]. And that would be awesome. And in order to accomplish that, we need to have truly decentralized channels to deliver messages between cross chains.Austin (11:54):Yeah. So Hendrik, you guys have been doing a little bit of work on that. I want to ask you two questions. The first is on the capital efficiency of bridges. And the second is on use cases for bridges that are not just assets.Hendrik (12:04):Yeah. I mean, right now, if we just look at the wrapped assets, I would say, of course they are in a sense capital efficient, but there could be more. Like there have been people talking about increasing capital efficiency by using the capital on the one side where it's locked into the bridging contract and then also using the wrapped asset on the other side. So essentially double yielding and double earning. I think that is something that is interesting, but I think that should live, obviously, above the base trust layer of the bridge. But this is something that is certainly interesting. But then when you're talking about should wrapped assets trade at a discount, you involve even more smart contract risk. You layer risk, risk, risk on top of each other. And they're the point of view X comes in that we've approached a couple times here.Hendrik (12:50):How does a user understand who they need to trust when I use this wrapped asset, when I use this bridge, when I use cross chain lending. And I think right now the user experiences do not really do that well. I think we've got a lot of work to do in educating users, giving them a reliable risk score, and then we can tap into these pools. But before, and especially as everything's moving so quickly, I'm kind of afraid in tapping into that. But as long as users are getting educated that this is happening, I mean, the bridges already allow that in a sense. Like for example, the Wormhole has message passing and you can add new layers on top, as we said, it's kind of like the TCP/IP layer. You can build a protocol that is more capital efficient on top of it and launch it today.Austin (13:37):Yeah. So let's talk for a second about that component of both moving things like NFTs and enabling protocols that are now moving cross chain. Something like Lido, which now exists in multiple chains, multiple layer ones. How is that communication being managed for something like that? And as a broad concept, not Lido specifically. And then what is the role of a bridge? Is that the right analogy to think of for something passing messages back and forth?Bryan (14:01):I also just want to chime in real quick and say that one of the things everybody right now is... Because you said you wanted to kind of touch on future. And I feel like everybody right now is focused on an individual coming like one user coming and wanting to bridge their assets from chain A to chain B. But my very firm belief is that in the future, 12 months from now, whatever, 95% of bridging is going to be driven by applications and not by users. Users will come and they'll use a Uniswap or they'll use whatever it may be that they're going cross chain and they'll be completely abstracted away from the bridging process. So it's not going to be driven by an individual user coming and saying, "Oh yeah, I'm doing this bridge. I'm accepting this risk, et cetera." It's going to be, how can you integrate that into an actual UI that's functional and makes sense. And the application is comfortable with whatever the trust assumptions are, if there are any, and yeah.Austin (14:48):Yep. So you see that layer moving from something that's more user facing, like a Venmo style experience, to something that's more like an interbank transfer.Bryan (14:56):I mean, I think the user, whether it's lending or whether it's swapping right now, I think the process is not going to be that you do some action in a protocol on chain A. You leave, you grab a bridge, maybe you have to jump through another chain and then another bridge and then like you go do something on the other thing. It's taken an hour, you've paid seven fees and switched wallets and got native gas. Like that just can't be the way that's going to happen. The user's going to sit in an application, do a transfer, and something is going to happen on the other chain. I think, everybody's sort of talking about that process of triggering arbitrary messaging on the other chain, but I think that has to live at that application layer, not at the individual user walking through this entire process piecemeal.Hendrik (15:34):I think that's a really good point because actually when you ask us about future, we also can only make assumptions. It's like, if you had asked me one and a half years ago, "Will I be trading Degenerate Apes and like getting yield on NFTs?" I would've said you, "Austin, are you crazy?" But now we're in this world and proof there's I think none of us can predict what exactly is going to happen. What we can do is design the bridges in such a way that we enable developers. And I think that's the key goal to build these experiences, to build new applications that can do all these things.Austin (16:07):Yeah. I love that. So talking about enabling developers. So if we go over to Andriy, you've been talking about, like on solana, you guys have bridged a ton of assets.Andriy (16:18):Yes.Austin (16:19):And that's not just going into direct people's wallets, oftentimes it's going into different dApps across solana. Talk about that developer work, how that integration works between the bridge and the application that the user's trying to use.Andriy (16:31):We were speaking the future. And that is exactly the future way of thinking about. It is like, we are calling this concept bridge as a service. Bridge, it is just the tool for users and for developers. So we would be more and more moving from the UI itself to some APIs and some connection with projects and developers. And this is how, for example, we built our whole strategy. We're not just the bridging assets. We bridge the asset and then on the destination chain, we partner up with Saber. We partner up with Orca. We create a flow because for users, the bridge, it is just like, it's a tall road and people they don't want to think about the road, they want to drive with their wife and kids from point A to point B. They don't care about the road.Andriy (17:16):And this is what happening here. And those bridges that would provide more flexible functionality. So for developers, it would be easier to build on top of them. Those are the ones that would succeed in future. And by future, I mean like six to 12 months from now. It is not distant future. It is not years. It is soon. This future is coming in soon. But in this sense, bridges is more like B2B business. Because I believe that other protocols and projects should be integrated with bridges, not user themselves. And we provide decentralized infrastructure, decentralized framework so that other protocols and projects can build on top of it.Andriy (17:55):And yeah. So for example, I think eventually like many projects and protocols, you'll want to kind of scale up and tap into user bases of other blockchain ecosystems like solana, for example, for project from Ethereum. And the main challenge here is to let actually protocols to build on top of this infrastructure. And in this case we don't need to have kind of censorship wide listing, et cetera. So we just need to provide kind of tooling so that any protocol can bridge their asset and any protocol can pass an arbitrary data cross chain that we will be executed in the target chain. We can actually let like protocols to decide on how they can do partnerships like with Orca or other dexes in other blockchains as well.Austin (18:40):So in a way we're talking about a composability layer for bridges.Andriy (18:44):Yeah.Austin (18:45):Interesting.Hendrik (18:46):And I mean to a certain degree, we're already there with applications building that on top. You already said Lido. Lido has staked. So they've staked Eth and then they get bridged to a protocol like [inaudible 00:18:57] and suddenly you have like a savings product. And that is what the user then consumes. This is the end user goal. I just want to put my money in and get interest or get some kind of yield and everything else is abstracted in the background. And I mean, this is one of the first steps and then we go further and further and further. We bring protocols truly like multi chain. Like if I hold COMP on solana, maybe I want to be able to participate in governance. I shouldn't lose that right on another chain and enabling this, but these are next steps. And I think to a certain degree we're already there.Bryan (19:29):Yeah, I think unified governance is something that's going to be a very hot topic over the next period. Almost certainly.Austin (19:35):Yes. Well, we'll have to do another one on cross chain governance protocol sometime later. Thank you all for joining us today.Hendrik (19:41):Thanks Austin.Andriy (19:41):Thank you.

Live from Breakpoint 2021, Brendan Eich sits down with Anatoly Yakovenko to discuss integrating Solana into the Brave Browser, the huge potential for a decentralized search engine and NFTs as an entry point to the metaverse. 00:09 - Intro00:54 - Integrating Solana in Brave08:00 - Challenges with creating the browser09:23 - How to scale crypto to the general public11:57 - A Decentralized search engine14:46 - NFTs as entry point to the metaverse16:35 - Mobile vs. Desktop18:00 - Languages and smart contract development20:40 - How to grow crypto to mass adoption22:44 - Global Peer-to-Peer environment in Crypto DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Brendan (00:10):Great conference.Anatoly (00:11):I know. Thank you. I'm really excited to be on stage here with you. You're-Brendan (00:15):Same, [crosstalk 00:00:17].Anatoly (00:16):... One of my heroes. As a programmer, JavaScript is a language that really revolutionized how we do application development, how we build. It's the foundation of the web. And I often think of web 3.0 really just being the web, just part of the bigger web.Brendan (00:34):Yeah, me too. That's how the web grows, by evolution. So we think the web 3.0 browser should be the gateway to a billion crypto users. And we are therefore integrating Solana into Brave soon as we can. And here's the cool thing, this is an evolutionary path. We're going to make it so any dapp that is Solana enabled, wherever other chains, EVM compatible or Ethereum, whatever it supports, if it supports Solana as well, we'll make it use Solana by default. So dapp builders who build for Solana as well as other chains. In Brave it's going to use Solana. And that's going to just help, I think, pull all the dapps on the Solana.Anatoly (01:24):Super exciting.Brendan (01:25):You like?Anatoly (01:25):Yeah, it's wonderful. Yeah.Brendan (01:28):Let's see what else. What do we like about Solana? We like NFT games, we like DeFi a lot. We want to make it easy for users to earn and get yield without having to be super expert or do a lot of complex operations. So we're going to work on building that probably in the first half of next year into the wallet so that you can just robo-earn, robo-yield. And we want NFT galleries and NFT transactions to be super slick. I was inspired by the Jules Urbach talk earlier today, and the demo earlier here with NFTs, there were several of them actually, it's all good.Brendan (02:07):We want as many NFT marketplaces integrated as we can, so that's on the agenda. And yeah, [Radium 00:02:13] is there, of course. Radium's still earning, yielding good. The thing that we do now with basic attention token tends to have to settle on Ethereum and it's going to cost you gas. And our valued settlement partners like Gemini, Uphold bitFlyer in Japan, but once we're on Solana, I suspect that BAT, which is already reflected through Wormhole, proxied through Wormhole, might just find it's better to settle on Solana. What do you think?Anatoly (02:41):Yeah, for sure. Absolutely.Brendan (02:44):I'm giving you the softballs here. And we really do want to get this out to all users. We think, whether you're having a hard time in some part of the world where it's hard to get banks to let you save or borrow, or you're beyond banks like a lot of us are or want to be, Solana is the way to do it. And I mentioned auto earn already, got ahead of myself, but I think this is going to be huge. It takes some skill, you got to make sure if you get on the wrong side of yield farming, you go somewhere where the grass is greener, but we'll make it as automatic and easy as possible. And it's just so much better on Solana. I'm making you blush. And yeah, the dapp ecosystem is growing, but if we do this Solana default on multi chain dapps, I think we'll just pull every dapps that's really popular over that Brave users want, and I hope that's going to be every dapp.Brendan (03:37):So here's more NFT marketplaces. There are lots of cool projects in crypto, so we're not doing only Solana, we have obviously Ethereum, we're going to do Bitcoin in the new wallet. It's coming up fast, it's in the Brave nightly builds. And we might do other chains, but I think it's important to pick a chain as default. This is a lesson we learned the hard way with search engines, because when you make a search engine the default, first of all, you can get paid if you get a deal, not always true. And really the user expects to just type keywords into the address bar and search. We want the wallet to have a fast, good default and that's Solana. So enough said. And we're bringing it to mobile too. This is important. I think a lot of fragmentation has occurred due to how wallets are split across mobile and desktop. We're seeing some good mobile first or mobile also wallets. We want to do it mobile and desktop feature parody, evolve at the same time. And we're happy to do that with Solana's partner.Brendan (04:42):So the last bit of news is the BAT system is a triangular system that involves privacy preserving ads. And users opt into it to get 70% of the gross revenue. What we've built so far has a part of our BAT ad system requiring us to verify things, to be the trust third party, which is a security hole. And so we started a project called Themus and worked with several crypto projects to see if we could bring it to high speed chains that can do things, like you need smart contract systems for zero knowledge proofs, you need some part of it in the browser because you're measuring attention. You don't want to put your detailed attention log on any blockchain, however fast, because it'll fingerprint you. So we're using black box accumulators in the browser with Themus and we're then minting ZK proofs. And the cool thing about Solana is we can just put those on-chain, no aggregator, no trusted third party. So we're getting rid of ourselves, we're firing ourselves as a trusted third party. And that's something we're excited about.Anatoly (05:40):And that's awesome. That was, feels like two years of research. It took quite a while to get to that design.Brendan (05:47):And now it's going fast. I think now we've got good working relations with Solana and we can crank out the Rust Co, because we love Rust. Because I was executive sponsor of Rust at Mozilla, so I have a tear in my eye to see my little babies all grown up. And Amazon's hired a bunch of the Rust core team. It's okay, they need jobs. But yeah, we want BAT to be fast, low fee, DeFi base pair and for ads on Solana. So Brave and Solana are doing the new crypto and ad system and it's going to be awesome. Thanks.Anatoly (06:24):That's awesome. I'm a huge fan of the web, huge fan of all the work that you guys have done and Brave. And I remember pre-mobile days, I was working on Brew and I was trying to optimized the web and flip phones. And there was a brief moment where the iPhone came out, we had a browser, and it felt like the web has opened up. And then it just got away from us.Brendan (06:49):That's right. Jobs said when he did the iPhone one, he said, "The web finally works on a phone." And then the story I heard from somebody who would is that they had to port a bunch of games which were C++ or whatever, and they had to do native apps. And they never looked back after that. But I think the web can always catch up and should catch up. And web 3.0, if you have this evolutionary path with dapps and dapp triggers from webpages, then you just evolve into it.Anatoly (07:19):Yeah, that to me is the really exciting part, is there's now an opportunity to have cryptography power the next generation, how web is monetized. Whether it's through advertisement, like with zero knowledge proofs or through direct payments and micro payments. Do you feel like Apple's going to crush us?Brendan (07:41):People a few years ago were worried about this Facebook thing, Libra and now DM. And they got crushed because some politicians hate them. But Apple is very cautious, and if they're doing anything with blockchains, it's a ways out. And then when they arrive in, it's going to be the diva at the party at midnight, like, "Start the party now," and the booze has already run out. So we're going to drink all the booze first.Anatoly (08:06):All right. I'm down for that. What are some of the challenges with building a browser for general consumers, but also with cryptography?Brendan (08:17):This is the problem with browsers is they are universal apps. You spend a lot of your digital life or online life in them. And so if you make the crypto stuff be this expert only area, or it's scary. I use wallet apps, I use ledger hardware wallets, but it's a little bit scary because you feel like, "Did I forget my pin in or did I have to reset it and do the word list?" And there's some anxiety and fear of loss. We want to make crypto be a positive sum, that's why the robo-earn is important to us. Just like with BAT private ads, you could get 70% of the revenue.Brendan (08:53):So you're always building up your assets as well as spending or sending them. And it should be slick, it should be for e-commerce. You can even do things like dis intermediate Amazon. I won't give away all my secrets, but we think we can do that without having a bunch of JavaScript user scripts attack every merchant checkout flow. We think there's a way to get into the interchange charge and do it. And crypto everywhere. It should be slick, should be easy, should be comfortable, make you feel like you're going to win, not lose.Anatoly (09:23):What about custody and keys? How do I get my parents to understand this stuff?Brendan (09:28):Yeah, it's really a little different, but we're looking at Taurus, we're looking at various ideas for backing up your keys that don't just put it on paper and word list in the safe, which we've all been through. And in some ways, the old web went with username and password and had to add a second factor, which often had to be a temporary access number generator on your phone. So at that point you're almost as complex as self custody. I would say you just have this more conventional recovery path. You lose your phone, you know your email, you can try to prove that you're the same person to Coinbase or whatever. But I think self custody has a complimentary role and we want both. We want people to use self custody and be comfortable with it, so we're looking at all these usability challenges. And we think we can get it just almost as good. And then unfortunately the regulators insist, if you want to do Fiat on/off, you're going to go through a custodian.Anatoly (10:20):Of course. The challenges, that's the exciting part. No one has figured this out yet and we're going to dive right in and see, how can we actually scale crypto to the general public?Brendan (10:31):Make it easy for your parents.Anatoly (10:32):Yeah. Yeah, would love to see it. What do you guys see as the tension between the app store on the mobile device and the mobile web?Brendan (10:42):Discoverability is always a problem. And we don't want these brutal curators like Apple. So having lots of stores is good, but then you have the need for a search engine, which Brave now has, which is a private engine and also involve users opting into building the index incrementally, that's the web discovery project. So we're going to aim, because we're very crypto first and our ad sales teams, one of who's here, always looks at crypto options and NFT options, we're going to aim at making our search engine best for crypto. It already uses [inaudible 00:11:14] charting, and it's still in beta, but we're working out all the kinks, so I think search, the good old search we remember from 2004 when Google was great needs to come back and it needs to be the way you find stuff in marketplaces and crypto exchanges.Anatoly (11:29):That's awesome. What kind of information do you think users would want out of a crypto first search engine or curated environment that's different from the traditional web?Brendan (11:39):Search almost gets into, is somebody trying to SEO you and compete for keywords? We're aware of this problem and there's no silver bullet. But we think with crypto, you might actually have a better chance at mechanizing this and having a fair playing field, an automated system for finding the lowest fees and the best yields.Anatoly (11:57):Is there hope for a decentralized search engine?Brendan (12:01):Yeah. So I had a friend who was involved with pre-research, Rich Scrantom, and pre-research looks like it's running a bunch of nodes [inaudible 00:12:07] Google, which Google does not like. And if they're running on [inaudible 00:12:10] IPs, Google's going to shut them down or use their anti-bot team to take them out. We're building a legitimate search engine, but we can't decentralize the algorithm easily because search is sharing queries, looking for some kind of objective best results like page rank, the eigenvalues of the random walk. And decentralizing that is a research problem as far as I know. But we have an active team, we're evolving search and we need your help because we're trying to crowdsource the incremental indexing of the web, we're not trying to index everything from 1998 on. Only Google can do that. Hats off to them, but their time is passing.Anatoly (12:49):When I was growing up as an engineer, the web was just starting, I was really passionate about Linux. And I had this dream of a Microsoft-free personal computer. It feels like the web 3.0 is potentially a dream of ad exchange free, that parasitic Google free web. Is that possible?Brendan (13:13):If you don't collect the data you won't go wrong that way. There's still other ways that central powers can turn on their users and take advantage of them. But I think there is, and that means ultimately you might need hardware that's indie or that's user first. And Brave's not capitalized to do this yet, but I know people, including friends from Firefox OS, which actually after it folded at Mozilla, continued in [inaudible 00:13:37] OS. And there's an open source lineage that you can trace back. And people at Qualcomm, we both know-Anatoly (13:42):Of course, yeah.Brendan (13:42):... We are working on it at the time. So I think there's a chance for a new open source OS that has web 3.0 and none of this Java or swift native stuff. And JavaScript, web 3.0 All the way down.Anatoly (13:55):Are we going to end up building a phone?Brendan (13:57):Brave OS. I don't know, I'd have to raise some more capital.Anatoly (14:03):Yeah. Yeah, that's a way to nerd snipe me for a couple years.Brendan (14:07):But people need independent hardware that serves their interest first. Absolutely.Anatoly (14:10):For sure. It always feels like that's a really tough challenge. But every two it gets easier and easier, hardware gets cheaper and cheaper and the tools get better and better.Brendan (14:19):And then Apple has something new and shiny that the commodity hardware can't match for another year or two, but that's just the nature of the game. So I'm sure we'll have iPhones, but we can probably have BAT phones too. Solana phones.Anatoly (14:33):The BAT phone. I love that. The BAT phone sounds really cool. As you guys see the web 3.0 evolving, I think from your presentation, NFTs were such a huge focus as well. Do you think this is the entry point for the Metaverse as people call it or that really interactive rich environment with ownership of the stuff around you?Brendan (14:56):Yeah. I think you have to keep running at these problems. And usually if you're a startup and the timing isn't right, or something goes wrong, you run out of capital and then the investors reset, or maybe they try again. With crypto, we have this great ability to just keep leveling up. So we're seeing Bitcoin, now we're seeing smart contracts on Ethereum, now we're seeing Solana. And as you level up, you can start to do some of these things that seemed hard before. Like you want some kind of cryptographic proof of ownership.Brendan (15:26):I think one of the demos talked about this. You want to make sure that somebody doesn't copy the pixels. And if you get into VR, there's been interesting research on this. And my friends at [inaudible 00:15:36] have done some work on this. You can actually watermark in a way that's indelible. And if somebody copies your art and tries to remove the watermark, they degrade the quality, because it's been convolved with the luminance and the chrominance. So I have hopes for this being useful in games and connected verses. And to me, that's the Metaverse, it's not going to be something centrally planned at Menlo park by Lieutenant commander data.Anatoly (16:02):I hope not. What I see out of the gaming companies that we talk to is that, especially the ones that are crypto focused, is the one to build browser first games. Everyone that I talked to had this idea that as soon as you open the page, you jump right into the game. There's no sign up, there's no friction, your wallet is your identity. And you're just exactly where you left off.Brendan (16:24):That took a lot of work at Mozilla, by the way. We did [inaudible 00:16:27] JS and that led to web assembly. And you could show games, in the story, you can start playing them and then you just convert. I think it's a great model.Anatoly (16:34):Do you feel like mobile is expressive enough for that? Or is the difference between iOS and Android and desktop is too hard to actually make that work?Brendan (16:45):There's certainly a difference. Even with the latest chip sets, you're just not as fast, you have less bandwidth all around. But games can scale down because the view port's smaller, there's hope that you can use the kind of tricks that we see with the remote rendering, cloud rendering. So I think mobile is the future, but I heard this 12 years ago, people would say around Silicon valley, mobile's the future. And then they would say, "That means there's no desktop." And that is very false. Everybody with a laptop or any big enough screen and a keyboard is still very high value. And that means the economics there don't go away, it just doesn't grow as fast.Anatoly (17:19):That's true. If you look at the growth of the Solana ecosystem, a lot of the users are basically dust up only.Brendan (17:27):Yep.Anatoly (17:27):That to me says that a lot of folks, maybe there was a switch during COVID where we went from being so much immobile to where we're staring at screens again.Brendan (17:36):A bit of that. You go to India and a lot of people are mobile only, but you need both. And I think as mobile gets stronger, you're just going to see more parody, you won't see this need for apps, which is often artificial. It's like holding the browser back, sandbagging Safari a little bit. This is what my friends at Google, or one of them who went to Microsoft, always accuse Apple of, and it's not wrong. You got to give the browser it's due and then it can compete with native better.Anatoly (18:00):Got to ask you about languages.Brendan (18:03):Okay, [inaudible 00:18:04].Anatoly (18:03):How do you see smart contract development in the future as somebody that had incredible depth and understanding how application development happens on the web?Brendan (18:12):Yeah, I think the thing you're seeing with type script, especially with large teams, is more information that you need some kind of proof system or it could be just a warning system, but it's based on model checking. Often it could be based on higher level models than you can express in sound type system, which is something where there's just this timeless world of types that's potentially syntactically checked and prevents bad things from happening at runtime. You need dynamic systems, dynamic code, JavaScript, and the static checkers.Brendan (18:44):And you get the best of both worlds if you have really good ones. So I remember at Mozilla, we were investing in model checkers for C++ because it's memory unsafe. And you could build these higher level checks that knew about security properties you wanted to enforce. And I think this is what you're seeing with smart contracts. I was talking to somebody I met at the hotel bar about this, because it's still a very fruitful area that's had good research in computer science, programming language theory. And it hasn't always been brought to the programming masses like it should. There were companies like [inaudible 00:19:17] Covarity and others like that. The compilers themselves grew the ability to do plugins for static analysis. And now [LOVM 00:19:26] is there.Anatoly (19:27):Do you think that smart contract development needs to have a high level, easy to use language environment? Or can it be driver code?Brendan (19:37):Yeah, exactly. Driver code in the era of C was the worst code in the kernel.Anatoly (19:42):Driver code with Rust is a little bit less frightening.Brendan (19:45):In fact, a friend of mine who was at Microsoft at the time went to Mozilla and has his own startup now, did it at Microsoft, a checker for driver's C code. Which he could skirt the halting problem and kind of statically reason about it and say, "This is garbage driver code, send it back to the vendor." But yeah, I think you don't want to have happy, fun, JavaScript looseness if there's big money at stake. So I think it's important to have the right tools with the right static and dynamic checking.Anatoly (20:13):Do you think smart contract development is strictly financial or are we going to see things that are not financial that you can actually [crosstalk 00:20:21]?Brendan (20:20):You'll see things that are not obviously financial, but they'll turn into reputation in a game or gifting and those tend to matter too. So you still don't want too many dynamic errors.Anatoly (20:32):That's true.Brendan (20:33):So I talked about this in my chapter in coders org, I'm still a fan of static, even if it's unsound semi-static checking.Anatoly (20:40):What do you guys see as like the opportunity for us to grow crypto to a hundred million users, actual signers?Brendan (20:49):Yeah, I'd to get Brave to that scale in a year or two. It depends on everybody here and others. It also, I hate to say it, depends on the nation states of the world not doing something adversarial. But I think given the state of the world, not a great state, but there will always be options to do things with crypto. The internet routes around censorship, and that's true in the web 2.0 And the web 3.0 world. And it's true with blockchains. You still have concerns you have to fork to undo the censorship, but at least you have options. DoAnatoly (21:26):What kind of applications do you envision will actually drive that growth?Brendan (21:30):I think at first it's going to be people using crypto for payments and for DeFi. And some leading edge of that user base will be getting more sophisticated in doing other things. But just having things like gift cards, where we often find that they're useless points, even if we can use them or Congress passed the law to don't expire, we still just don't use them. We should have much more liquidity. We should have liquidity across all kinds of assets. And this is where you start talking about tokenized securities, and can you have primary and secondary liquidity for companies? I think if you're as old me, you all had a tiny piece of some startup that went sideways for 10 years and then sold. And you couldn't trade it easily. And you might have wanted to do that because you might have been squeezed out when it sold. So there's lots of room for blockchains to solve these problems. I think in general, connecting people more directly getting rid of these officious or censorious intermediaries. A lot of room for application.Anatoly (22:29):In this new evolution of the web, I often describe crypto as a fully connected network, as opposed to a social graph, like on Facebook.Brendan (22:40):Yes.Anatoly (22:40):Do you think that's true? Do you think we're going to enter a stage where I am effectively with my cryptographic signatures, I'm in this true global peer to peer environment?Brendan (22:50):I hope so. I showed at web summit last week, I showed the slide with the correct diagram, which is more like a mesh for decentralized, and the incorrect one, which sometimes is called decentralized, which is really distributed, but it's mostly tree structured. Or if it's a graph, it has a dominating spanning tree. That's Google, that's Amazon. So with projects like Helium, with web RTC making it so you can make connections into the endpoints instead of only out. In the old days in the nineties, we could only make TCP connections out from the browser. I think we're heading toward this world. We have to build it iteratively and collaboratively, we have to get around the concrete firewall problems that web RTC mostly got around, it's still a little dodgy. And I think that is the future. I think we should all have Helium nodes if we can. I'm a fan of the project.Anatoly (23:38):That's awesome. The idea of decentralized browsing on an open source phone connected via an open network.Brendan (23:49):Low raw radio.Anatoly (23:50):Yeah, run by the people. Accessing Solana, that would blow my mind.Brendan (23:55):It sounds too good to be true, but I think it could be true, especially if we build it carefully and quickly enough and get it out there and make it usable, which is why I've always wanted to make Brave be about crypto. Even when we started using Bitcoin for our prototype, it was clear once you shield the user by blocking all those trackers, you break all the economics that pays advertising money into the publishers after taking a big slice out for the middlemen like Google. And if you cut that out, how are you going to reconnect it? It's crypto, peer to peer.Anatoly (24:26):All right, let's do it.Brendan (24:28):Awesome.Anatoly (24:28):I'm excited. So thank you, Brendan. Thank you so much for doing here, for working with us.Brendan (24:34):Thanks.

Daffy Durairaj is the co-founder of Mango Markets and is currently working full time as a developer in service of the Mango DAO.00:28 - Origin Story04:44 - Seeing the order book10:20 - The idea behind creating Mango Markets15:38 - Going from creating smart contracts to creating Mango17:32 - How big is the DAO?20:01 - The Launch29:15 - VCs and the launch32:43 - Decentralization and getting stuff done34:55 - Will DAOs ever compete with big tech companies?40:43 - What’s next for Mango Markets?DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Anatoly (00:09):Hey folks, this is Anatoly and you're listening to the Solana Podcast, and today I have with me Daffy Durairaj, who is the co-founder of Mango Markets, so awesome to have you.Daffy (00:20):It's great to be here.Anatoly (00:22):So origin story, how'd you get into crypto? What made you build Mango Markets?Daffy (00:30):How did I get into crypto? So, I started off really not wanting to get into crypto. I was really interested in algorithm training. I did that in college and did some competitions that I did well in, and I wanted to trade equities, but it turns out if you have not enough money, if you have a few thousand dollars it's just not allowed. You're not allowed to algorithmically trade. There's a patent day trader rule, and I was infuriated and I was just looking around and I found Poloniex where you can do anything you want. The thing that actually hooked me first to Poloniex was the lending market because immediately as soon as I saw an open lending market, I was like, "Oh wow, I have to buy some bitcoin, and I have to lend it out." And, Poloniex was all bitcoin, and then it gradually got into just the meat of it, which was algorithmic trading and everything about crypto seemed exciting, but I actually didn't want to hold bitcoin. Poloniex was all bitcoin, but again, I think the government sort of pushed me in the right direction.I was like, "Okay, I don't want to hold bitcoin, I'll hedge off my risk on BitMEX, but again, not open to US persons, and so I was kind of reluctantly holding bitcoin and thinking, all right, I have a few thousand dollars if things go bad in this whole bitcoin thing. I'll come out okay. I'll get a job or whatever, but just never got a job, just kept holding bitcoin and continue to trade crypto, and I did that for about five years. Then, I wanted to actually start trading on chain because I thought this was probably for a lot of the reasons that you built Solana, the censorship resistance, and the global liquidity of it, and the openness of it, the fact that you're not excluding people that have a few thousand dollars. I wanted to build on chain and I was just not very bullish on a lot of things, so I kept going back to trading, and then I saw Serum DEX, and I was just hooked. I placed a trade and it felt totally natural and normal. It wasn't like $40 and takes 20 seconds and you don't know if it... And, then MetaMask was jammed and you're like, "Oh, but how do I cancel this?" So, that was a long-winded way of saying I was a trader and then I saw Serum DEX and then I had to start building the tools that would make Serum DEX even more fun.Anatoly (02:59):That's awesome. I got into it by trading. Basically, I set up like an Interactive Brokers IRA account, and that let me kind of bypass the rules.Daffy (03:11):Really?Anatoly (03:13):With a very small amount of money. I think they probably closed these loopholes already. I wrote a bunch of stuff on top of their Java STK and started trading there.Daffy (03:22):I remember I actually got started that way too. I did a bunch of stuff for their Java, and we can tell you we're both programmers. We wanted to build this money machine. It's so fascinating, and it's a machine that-Anatoly (03:40):It prints money.Daffy (03:40):It does things and it prints money. What more could you want? So, I got started with Interactive Brokers, but I guess the whole IRA thing... Because I was a college student, and so even talking to an accountant would take a huge dent out of my net worth.Anatoly (04:01):Totally, it's all really not designed for... The whole financial system in trading in the US is designed to funnel retail towards an app like E-Trade or Robinhood, which takes a cut, and then sells that trade to somebody else, who will take a cut, and then 10 other people until it gets an exchange, and that's how everybody's protecting their neck. They're all taking a little slice, and I think what's cool about crypto is that even centralized exchange like FTX is 1,000 times better and less extractive of the users than anything in traditional finance, simply because they can guarantee settlement. Such a very simple thing.Daffy (04:49):You feel it right from the beginning. You go to Poloniex in 2016, and it's like, oh, you have an email, you have deposited bitcoin, and now you're just lending to people. So, just talk about not being extractive. To see the order book through Interactive Brokers or Ameritrade or whatever costs you a lot of money and it costs them a lot of money to provide it, and I don't think I'd ever seen an order book. This was my passion, this is what I love to do, and I've never actually seen it.There's that story of the blind men who are touching this elephant, and so I had kind of figured out maybe what the order book looks like, but then on Poloniex, you go there and you just see the order book and you see all the lights flashing and you're like, "Oh, this is it. This is where the trades are happening." And, that's free, and of course, a big part of Mango Markets as well is you can see the order book. That's it, that is it, there's nothing more, and it's all on chain and all this stuff. So, in terms of not being extractive, it's a really big piece of what motivates people to come in.Anatoly (06:02):I don't know if you ever tried to get data, real data. I wanted timing information when a bid comes in or when an ask comes in versus when it's filled. How do I get access to it? Because when you get data from any of these places, basically it's like a little better than Yahoo Finance, which is like every five minutes they give you a low and a high.Daffy (06:27):I don't know, did you ever succeed at doing that in Interactive Brokers?Anatoly (06:32):No, I recorded some of it, but it just never had that fidelity and it always felt like a gamble. I'll build some models and sometimes stuff would work locally against my simulations, but then whenever I would actually try to run it, I'd see that fills take a little longer than they should and all this stuff really feels like you're not interacting directly with the trading system, that somebody when they see your order they're like, "Well, maybe I'll put my order ahead of yours or do whatever or slow you down a bit." It just sucks.Daffy (07:16):It feels very opaque, it's like a black box, and of course, this is all for people like me who are kind of looking on the outside looking in. So, if I had gotten a job at Citadel or somewhere, then I could probably see what's actually happening, but the fact that the vast majority of people are going to look at it and not really know it's actually happening, not everyone wants to see an order book. That's an important fact, but there are a large number of people who need it to be a little bit transparent to be involved.Anatoly (07:49):What I hate about it is that there's a lot of people that make a lot of money from you not seeing, that they're in the business of information assymetry and fuck them.Daffy (07:58):So, it's not a family friendly podcast, so it's good. I was going to ask that. So, there's a funny story on RuneScape. I don't know if you've ever played RuneScape.Anatoly (08:17):I played Ultima Online, which is I think similar vibes in the early days.Daffy (08:22):Yeah, so on RuneScape, just like on the point of no one being able to see anything, on RuneScape, also they had an order book because that's the most natural thing to do, and I actually had to figure it out from first principles. I would place a trade and I would see that sometimes it would get executed and sometimes it would not get executed, then I realized, okay, if I place a trade for these water runes or something or oak logs or something, and I put the price really high it gets executed at some price that's not the price that I said, and then I was able to form this concept of that's the asking price. I didn't even have the terminology for this, and then I did the same for set the price to zero for a trade and now I found the bid, and now I can make a lot of money actually underbidding the best asker and overbidding the best bid.Anatoly (09:18):So, you're market making.Daffy (09:20):Yeah, so it's funny, I was reminded because you said there's a lot of people who make a lot of money in you not knowing, and I was just minting money. It took me years to accumulate like 1 million gold pieces in RuneScape and then I was able to just 30X it in a month.Anatoly (09:46):Too bad RuneScape is not a crypto currency. Whoever is running RuneScape, you're missing a huge opportunity right now to just go full crypto.Daffy (10:00):There was some talk about some NFT or something on Twitter. Somebody was trying to encourage Jagex, the company, to get involved in crypto, and of course, I tried to signal boost it, but eventually everyone falls in line.Anatoly (10:17):How did you end up with the idea for Mango Markets?Daffy (10:21):So, I have to give credit to dYdX. It was like 2019 and I hadn't really considered that this was possible. I was heads down writing, trading algorithms and trading crypto just kind of holding all of my wealth in bitcoin and I was borderline bitcoin maxi on that, and just seeing dYdX do it in those early days... Now of course, they're way more successful now. Those early days seemed that you could do leverage trading on chain, and they kind of showed it as a proof of concept, which I just kind of started pacing back and forth like, oh my God, this is changing our worldview completely.Ethereum was slow and whatever, so years went by. Actually, maybe just like a year, and then I saw Serum DEX where I felt finally, okay, all the pieces are in play and also I wanted to market make on Serum DEX, but I really need leverage. I don't really need leverage, it just makes market making dramatically more efficient and safer. Leverage is just this tool that people who are involved in the financial plumbing really need, and it wasn't there. I was like, "Okay, this is the time and I have to learn how to code smart contracts," which sounds like a very scary and daunting task, but it was not that bad.Anatoly (11:54):The scary part was that you guys were building on a platform that was really rough around the edges at the time.Daffy (12:02):Well, no one told me that shit was really rough around the edges at the time. That was actually maybe important. You come in and there was nothing to do, this was August of 2020, things were not locked down necessarily here in the United States, but people kind of scattered. No one was hanging out in the major cities, they had kind of went to go live with their families, as did I. I fled San Francisco and went to the rural part of North Carolina. So, there was nothing going on and you just have all the time in the world and bitcoin is doing well, so that's funding you in a way.Bitcoin is this big, or crypto in general, it's all the people who bought it or own some crypto, as long as it's going up, it's kind of funding whatever zany side projects you have in mind. So, this is just a side project. Wouldn't it be cool if I could access this part of the world or this technology? And so, that's why chewing glass... You probably coined that term, I don't know, that's why chewing glass wasn't so hard because that pressure to... You have all the time in the world basically.Anatoly (13:30):Basically, COVID and lockdowns were so boring that chewing glass to learn how to code smart contracts with Solana was like a reprieve from the boredom.Daffy (13:45):And, I've heard you kind of say, okay, a bear market is when everyone is coding. To give the opposite perspective, I feel like a bull market, unlike much more chill, oh yeah, nothing really matters. Crypto is going up, it doesn't matter what I do. The rent is going to be paid for, everything is going to be fine, might as well engage in high variance new ideas, new projects. In a bear market, I'm very I got to grind, I got to squeeze out a couple of more bips out of this trading algorithm because I got to pay rent. So, that's the bullish case on bull markets.Anatoly (14:30):That you can try something crazy. That is the point where people enter this space is in a bull market. It's that they kind of start coming in droves because they're like, "Everything is crazy and I can also be part of the party." But, it's hard as a founder to stay focused because you are in that high variance, high risk taking kind of mindset.Daffy (14:58):There's a trade off of during a bull market there's a lot of things looking for your attention, and a bear market is very calm, or it can be. If you built up a lot of liabilities during the bull market, now you have to stay afloat during the bear market. Maybe it's calm in the external world, but internally it's not calm. You're like, "I got to do X, Y, and Z today every day." There's that natural pressure.Anatoly (15:32):So, you decided to learn coding on smart contracts on Solana. How did you end up going from there into Mango?Daffy (15:39):Initially, it was called Leverum. Not it, there was just an idea and there was a command line tool where you could... The YouTube video might still be out there, and Max was out there somewhere on the internet and he saw it and he thought it was a great idea. And so, he reached out to me and we did some other things like speculative about a prediction market, and then we were like, "Okay, no one is going to build margin trading." A lot of people are saying it, but it doesn't look like if we just wait it's just going to happen in the next couple of weeks or something. It's probably we just have to build it.Not we just have to, but we totally should. This is clearly a very important piece of the Solana ecosystem. So, we started building it. Mango was just we were thinking alliteration is good. Everybody loves mangoes, it's a fruit that I have never heard of anybody who doesn't like mangoes. It's probably the high sugar content and Mango Margin was the idea, but then we got the domain Mango.Markets. It's kind of evolved now. When you're starting off with something, you have kind of a narrow scope. You're like, "I just want to be able to borrow money." And now, there's this Mango DAO and people are talking about NFTs and drones. I'm talking about drones. I don't know if anybody else is, but it's just gone way higher and now I'm like, "I'm a humble servant of the Mango DAO." And, that's totally a normal thing to say.Anatoly (17:27):How big is the DAO?Daffy (17:28):How big is the DAO? That's a good question.Anatoly (17:30):In humansDaffy (17:31):That's like a philosophical question. In human terms, wow, again, even still a philosophical question. So, I think if you go to MNGO token, if you go to the Solana explorer and just type in mango or MNG or something, you can probably... I don't know if they have a list of unique token addresses, so in some sense that's the DAO, but in terms of the number of people who actively post on the forums and make proposals, that's much smaller. I'm guessing there's thousands of people who have votes, but the number of people who make proposals and add meaningful commentary on the forums is maybe 20 people, and it's expanding pretty quickly.I always see new people coming in. There's also not just people, there's the wealth of the DAO and the cultural reach of the DAO, the spiritual significance of the DAO, all of those seem like size if you ask how big is the DAO. You interviewed Balaji Srinivasan, and there's this idea that he had on Twitter that was like a DAO should buy land in Wyoming and send a drone to circle it and this is kind of like a moon landing sort of kind of thing or some kind of significant breakthrough where the DAO is controlling physical objects in the real world. So, this is very exciting to me, but it has nothing to do with margin trading, it's just something exciting that maybe in a bear market, I don't know, I'll push to get this done.Anatoly (19:23):Do you want the control to happen on chain?Daffy (19:25):Yeah, I think that's necessary. Maybe not the total control, but some kind of signal that distance... So, you can kind of think of Congress authorizes a certain thing and then the executive branch does it. If we could make that link be as automated as possible, I think there's something useful there, at the very least something exciting and interesting, kind of like the moon landing where maybe there wasn't anything useful, but it was inspiring for sure.Anatoly (20:02):So, the DAO, if you guys decided you want to do something with leverage and lending, and how you guys launched was really unique. I don't even know if people did this in Ethereum. To me, this is the first time anyone's kind of done this style of launch. Can you talk about the design and how you guys thought of it and what let you make those choices?Daffy (20:25):So, people early to Solana may be familiar with the Mango market caps and how that went, which somewhat argues the first NFT on Solana, and that was done pretty much sort of like how NFTs are typically done where there's a mad rush to grab the caps as soon as possible and the price is swinging wildly and there's a lot of people. Now, I think we put that together as an April Fool's kind of thing, very quickly, and so it was great for what it did, but the experience from that was, okay, there's going to be a lot of angry people. If you do it in this way where the DAO is raising funds, and this is the inception of the DAO, the DAO is raising funds for insurance fund, you probably don't want it to just be distributed to the people who were the fastest to click.And, that was the idea. We probably don't want that. It doesn't seem useful, it seems like a lot of angry people, and a lot of frustrated people. So okay, so you take out the time component, you take out the luck component, and then you're left with you kind of have this sort of auction that lasts 24 hours, but then what if X somebody comes at the last moment and dumps in a huge amount of money and raises the price for everyone? Everyone gets the same price. So, our design was we'll have a withdrawal period or a grace period at the end, the remaining 24 hours where if you kind of don't like the price, you can bail out. It had some flaws and I think we knew about those flaws from the beginning. We were like, "Okay, we just pushed to this game of chicken to a later point where someone can put in a lot of money to scare other people away and then they pull out at the last second. And that did happen, but it's not clear if that was net positive or net negative.Anatoly (22:28):And kind of in summary, there's this 24 hour period where people deposit funds in for a fixed supply of tokens.Daffy (22:36):Correct.Anatoly (22:37):And, then the period is over, and now everybody knows what the total amount in the pot is for the token and there's kind of this price that's created and then if you don't like the price, you can withdraw the entire bid or as much as you want. You can only reduce your bid.Daffy (22:54):Correct.Anatoly (22:54):But, you don't need to withdraw the entire bid, you can just reduce it.Daffy (22:57):Correct, yep.Anatoly (22:58):So, then that pushes the average price down at the same time, so for every dollar you take out, you kind of get a better price per token.Daffy (23:07):And, you see the price ticking up during the first 24 hours as more and more people are putting money in and then the price ticking down over the next 24 hours.Anatoly (23:19):I'm a huge fan of this setup because it creates a lot of... There was news, you guys made the news because it was almost half of all of USDC that was minted on Solana ended up in that smart contract. It was like 45% of it.Daffy (23:43):I remember actually because we saw the USDC on Solana was 700 million the days before and then it had climbed up to like 1.1 billion or I don't know what the number was at the end, and there was 500 million in the contract at the end of the first 24 hours. That was not the intention.Anatoly (24:05):It's like it was minted.Daffy (24:05):And honestly, I think you could appreciate it better from the outside than from my point of view for sure, and of course, I also could appreciate it better from the time distance, but that was not expected. We kind of knew that there would be a lot of money placed in the beginning and then money would go down. That was in all the documentation that we wrote, and that was expected and we had all these dev calls where everyone was always talking about it, and I was like, "Okay, come on. Literally, there isn't that much USDC in Solana." So, it can't be that bad, but of course, I underrated the possibility that someone could just mint a whole bunch of new USDC and bring it in from somewhere else. It made the news and a couple of other projects did the same thing, and I wonder if maybe it's a one time kind of thing. The game only works once. You can't expect to scare people every time or use the tactic every time.Anatoly (25:10):Maybe, I think a lot to be said, but there was no other way to go. Mango took it all, so there was no private round, they were never listed anywhere. This was really the only way to get it, and the anticipation of a project that was awesome, and from every other perspective is... What I always tell founders is that you should always raise the least amount for the highest price. The VCs kind of have more power than you usually because they have more information, they look at many deals, people come to them, they have the money, but it's sometimes the founders have this asymmetry where they're the only ones without equity. They're the only ones without tokens and that moment is if you can get everybody at the same time to compete for that thing, then you've kind of created the symmetry there and you maximize the capital raise for the DAO, for the project, for the community, and therefore that actually is a good thing. You have more resources to build a vision.Daffy (26:16):Although, I'll clarify, I think the DAO is still handing out a lot of tokens, so there's still a lot of ways to acquire Mango tokens, and that was kind of the inception for the insurance fund. The DAO has been paying people out of the insurance fund, and so it's been useful, but there's still more tokens to be had. There is a slight private rounds and I totally understand why people do them, but like I said earlier, if you are in crypto for a while, and this the cool thing about bull markets, I don't actually need money, I just need to pay rent and bitcoin has gone up 50%, so I'm solid.And, no one was paid anything. There was just Mango tokens that were given to people and they were told the DAO values your contribution or this is the inception of the DAO, and everyone worked to build this thing. People worked without even the Mango tokens and sort of the tokens were given after the fact. I think it's a valuable way to build crypto projects actually.Anatoly (27:30):I want more teams to try to totally from genesis this DAO first approach, but it's really tough because you guys had such a principled view on how things should be done and there's a lot of people out there that are offering money for that one thing. How did you guys have the discipline to just go stick with this?Daffy (27:54):We had a lot of discussions about all these things. We talked to VCs and we still do and we like all VCs actually. So, I think Satoshi, I'm not trying to draw a comparison to us to Satoshi or anything, but there is this beauty in that story and I think there's a lot, maybe even the majority of bitcoin's value at least to me... To me, I just love the narrative. I love the story of Satoshi, the pseudonymous founder who is one of the richest people on the planet right now. Obviously, they're in a no VCs. This person wanted to not make a big fuss. It was kind of like this clockmaker prophetic person who just came and then left, built this thing and then left, and that's such an amazing story.There are these long, long payoffs. Maybe they take a while, but they definitely do pay off that if you're not hurting for rent, again, I was in a position, all the other Mango devs were in this position as well where it was a bull market, we're not getting eviction notices or something, we could kind of float the boat for a while. Just consider the longterm payoffs, consider the five year payoffs. Stories are amazing.Anatoly (29:17):The weirdest thing is that every good VC will tell you that you should maximize for the highest return. Don't worry about the middle exit, or don't compromise. Actually, imagine you're taking over the world, what are the steps to get there? And, the risk don't matter. Actually maximize for the high and this is the irony here is that I think this kind of fair launch, most distribution will probably result in overall longterm, better, and higher returns, but the risks that I always find is that humans are hard to organize and at the same time, cryptography is this new tool for organization.It is what allows us to massively scale agreement and complex problems, really, really complicated problems. We can just click a button and vote and agree on that one and you know. You know that the decision was made, but I'm curious, do you see tension between the decentralization, kind of the disorganization of the DAO and getting shit done? I've got to build stuff.Daffy (30:34):No, 100% actually, on a daily basis actually. There was a podcast with the guy on Twitter that goes by Austerity Sucks and this was back in April. We talked about this and he brought up a similar point and he was, "Yeah, this DAO thing, it's all a fine and dandy idea, but do you think this will work?" And I, to be honest with you, am skeptical, however it is always felt to me sort of a high variance idea, kind of like if you were in the 16th century Netherlands or the 17th century Netherlands and you were like, "Okay, we've got to get spices from India. How do we do it?"And, you come up with a joint stock corporation and then the join stock corporation is everywhere and I don't think anyone has really figured out how to do DAOs well or what's the right mix, how do we communicate, how do we coordinate, all those things. I don't think anyone's quite figured it out yet. No one had figured it out like six months ago. I still don't think we have figured it out, but if it works, the payoff is enormous. There is global coordination, there isn't a jurisdiction. I imagine the DAO is controlling drones one day. It could be wild. So, even taking into account all of my skepticism, I was still like, "Okay, we should do the DAO idea." Anyway, not just me, Max is totally on board with this and Tyler and all the other people who kind of built Mango Markets. But on a day to day basis, as of October 2021, now I'm thinking, okay, maybe what we need to do is have small teams that build things and then pitch it in front of the DAO and get compensation. So, the DAO is kind of the government and it subcontracts out to people. Maybe not like direct democracy rules everything and we'll try that out and if that doesn't work, we'll try something else out, but try new stuff out quickly.Anatoly (32:45):That's awesome. This is actually a really good strategy to incentivize product development. Building an MVP, which means you're the PM, and the implementer, the dev, and you go do all the work and here's your management. It's all done, just give me money.Daffy (33:09):And, there's some maintenance tasks, so it's not purely new products, so I'm thinking Mango V4, but also in the meantime, there are all these nodes that need to be paid for.Anatoly (33:24):I think you guys will need to split. We called it KTLO, keeping the lights on work. You for six months, you're on KTLO duty, and you get paid a salary effectively, and you just got to keep the lights on, but then some other folks are like, "Go build something that you can propose to the DAO and the DAO will fund it."Daffy (33:49):I think that's basically what we have coalesced on is that, well, some people should be doing KTLO and other people should be doing new things, building the new product, and it takes kind of the risk out. The DAO doesn't have to pay for whatever stuff that I produce for Mango V4, but we both have some kind of incentive to be honest about it. If it's clearly a huge improvement or even a very substantial improvement, DAO should pay me something because if the DAO doesn't, then you can expect future builders to not go for it. And, we have these discussions on the forums.People make good arguments like this. I think the average IQ in the Mango Markets forums is very high. I think probably higher than most legislative bodies. I'm just going to go out on a limb and just say that. Not ours of course, ours is obviously very high IQ, smart people in our government, but you know.Anatoly (34:55):Do you believe five years there's going to be a 30,000 person DAO. Imagine a tech company, 30,000 engineers, or 30,000 people, they got product managers, teams, layers of bullshit. Is there going to be a DAO that's competing with a big tech company?Daffy (35:16):It's legitimately really hard to figure out how this might look. The reason why I hesitate so much with the question of a 30,000 person DAO is I'm not sure it'll look exactly like a corporation that we can say, okay, these are these 30,000 people. You might never be able to figure out who is part of the DAO and maybe that's one of the benefits of the DAO. If I asked you, how many people are part of Solana, not Solana Labs, but Solana the community? It's a little bit difficult to even answer, lots of people, various levels of involvement, and financial. Some people have a lot of financial stake until you don't, but some people have a lot of financial stake and no involvement at all. It's wild all over the place. Does Bitcoin look like a country or a corporation? I can even point my finger on what it is.Anatoly (36:20):So, even LINE had a battle that had 8,000 people all coordinating over something and I think they have corporations within that game that are maybe probably span up to 1,000 I'd imagine. So, that's people organizing using tech for a common goal without a job, without a structure that you normally have at a company. Linux was built by people organizing online. I think as soon as you have something to lose and in Linux and even LINE you start building up a virtual token, your reputation is a contributor to this thing and becomes a thing that we don't normally think of as valuable in a monetary way, but it's valuable to that person, but I definitely care about my ability to continue contributing to an open source project. So, where tokens I think can get there is if there is something of value being created by the community, some common goal that everyone is working on and that token is in the middle of it and is uniting and organizing it. I think that could scale as large as a corporation.Daffy (37:45):No, I agree with you. I just think it'll always be a little bit hard to figure out how many or who is involved, just by the nature of it. I just think it'll be always a little bit hard to figure out, but will 30,000 people be building on Mango or some DAO? You already know the numbers better, but we might even be approaching that with Solana. So, I'm not part of Solana Labs or affiliated with Solana in any way, but building on Solana, and also I have a financial incentive too, but also I have a reputation incentive and it feel like I'm part of the Solana corps or whatever it is, but I don't know what it is. It doesn't even exist. It's not even a DAO. There isn't even a DAO there.Anatoly (38:39):Oddly enough, I feel the same way about Eth and bitcoin even is that we're competing with them.Daffy (38:50):But, it all feels like we're actually kind of a part of the same team and-Anatoly (38:54):This is the weird part that I think is going to be really interesting how it plays out because I don't think it's obvious to anybody what is crypto. Is it the token? Is it the coin? Is it the network? Is it the cryptography itself?Daffy (39:10):It's not the cryptography itself, so we can strike that one out.Anatoly (39:14):Are you so sure? I think it's honestly the power that a person has to be able to make these very concrete statements that are unbreakable no matter how... That's the math. The math behind it is what allows them to do them.Daffy (39:36):I don't totally know the cryptography itself. I know basic 101 number theory stuff, but I remember going through my first programming class and coming up feeling just very powerful. I'd write stuff down and then it happens. Kind of like a king, actually, more powerful than a king in a lot of ways because I was writing these training algorithms and it was happening around the world in ways that probably a medieval king couldn't imagine and crypto brings that to finance where things of actual value can be moved.Mango Markets exists and you can go there and place a trade right now, but it was just somebody who wrote it. I was involved based on you can see the GitHub contributions, but it was just people who wrote it and that's probably... We can maybe chalk that up to the cryptography.Anatoly (40:43):So, what's next for you guys?Daffy (40:46):There's drones on the horizon. Yes, sometime in the future, but we have to do a lot of the nitty-gritty, roll up your sleeves kind of work. On Solana so far, there isn't... Maybe a lot of projects are struggling with this, indexing all the data and providing it for people in a usable way because there's just so many transactions. It turns out if transaction fees are really low, people just make a lot of transactions and they don't think about it.And so, gathering it up and displaying it in a useful format to people, that's a very immediate term and then slightly medium term is sort of becoming the place where everyone does leverage trading and does borrow and lending, all the crypto natives. And then of course in the longterm, I would say it's somebody like my mom should be able to store her money in Mango Markets and not think twice about it. It's not a good idea right now I wouldn't say, but that's the goal. That involves a lot more social things than just technological things. That's get it to a level where she can do it safely and feel comfortable and manage her keys, or even if she's not managing her keys, have a solution for how the keys might be managed, that she's not falling for scams, and that's I would say my longterm goal.Anatoly (42:09):That's awesome, man. On that note, man, really awesome to have you on the podcast. Great conversation. I'm always excited about what you guys are doing and how the community is building this ecosystem of its own, so really amazing. It's serendipity that you guys started going on Solana, just really lucky to have folks like you in the ecosystem.Daffy (42:35):Thanks a lot. It means a lot. This was really fun.

Live from Breakpoint 2021, Alexis Ohanian sits down with Raj Gokal to discuss web3 and the $100 million fund to support decentralized social media projects on Solana. 00:10 -  Intro2:20 -  Announcement of Seven Seven Six and Solana Foundation collaboration9:53 - GM, Twitter, #FreeRaj14:31 - Discussing Web 3.0 and the future of decentralized social media18:04 - User experience and building on Solana22:48 - New types of governance and delegation25:59 -  How crypto can change the way we see the world DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Raj (00:10):(silence). Ooh, beautiful.Alexis (00:11):This is fun. Hey everybody.Raj (00:13):It's electric.Alexis (00:13):All right. All right. Nice to see you all too. Oh, there we go. Okay. This is big. This is just the building of a new internet. Probably nothing.Raj (00:26):Probably nothing. It's such an honor, Alexis, really, to be on stage with you. It's like a dream. I've been a power user of Reddit, and I saw the way that you created that and the intention that you brought into it, and the intention you've brought into how we build technology that connects people together, and the conviction you have about how you want it to connect them for good. Not pull them apart but pull them together. Three things that connect them, their interests, their common grounds, and give them the tools to do that.Alexis (00:59):Thank you, man.Raj (00:59):Yeah, it's been really awesome.Alexis (01:00):I feel grateful. I was a dumb college kid in 2005, starting Reddit. The inspiration were like message boards. And I ran a PHPBB forum. Shout out PHPBB. I think those bulletin boards are still cranking somewhere in parts of the internet, but it was a hope for a more connected internet. But I really had no idea what would come from it. I'm obviously grateful. Hopefully a few of you all are Redditors. Any? Couple, one or two? Thank you. Thank you for all of your upvotes and thank you for also admitting you're the least productive people here. So thank you for your candor. I got so excited as crypto started taking off because Reddit is where I dove in. R/Bitcoin is the community that inspired me to first invest in Coinbase back in 2012. R/Ethereum was the community that got me really excited about what could actually be done with programmable money and this concept of building an internet that was decentralized and truly in the hands of all the people creating content. And now what I am seeing here, especially within the Solana community, is nothing short of awesome.And we can just cut to chase and one of the reasons why I'm here is to announce a collaboration that we're doing. I have a venture fund called Seven Seven Six. We're earmarking with the Solana Foundation $50 million to invest in the next wave of social built on Solana. Because I think this new world... We were debating whether to do the announcement at the start or at the end, I'm happy we did at the start. It's good vibes. But my job these days is with our team to look for the next big thing, put our money into it, give our support, our advice, our feedback, and help build businesses that'll be even bigger than any of the ones I've created. And it's exciting because this actually fulfills ambitions that I remember having 16 years ago but that we just couldn't execute on because the technology did not exist. And so I'm going to take you down memory lane a little bit. We'll fire up some slides.This is actually the very first version of Reddit that went live in 2005. I was not a great web designer. I was not. I'm really proud of Snoo, our mascot. I created that while I was bored in marketing class. But this was the first version, and a couple of things to notice, karma score, absolutely stole that from Slashdot. But I realized, okay, if we can get people to be incentivized to post good stuff, we can get more people to post more good stuff. And we'll just use internet points. It'll just be made up. And so if you got an upvote, you would gain a karma point. If obviously you were downvoted, you'd lose one. As you can see here, I posted the first link to Reddit, the Downing Street memo, and I was promptly downvoted because my co-founder is a dick. I knew exactly who it was, because it was just the two of us in an apartment. I knew who did that, and I have -1 karma. But internet points were the way we got people to come together and produce high-quality content.If you could believe me, in 2005, no one believed me when I said that people would spend all this time on the internet creating content, sharing content, commenting on content, but clearly it worked. And as we saw more and more progress, I obsessed over even designing the up and down arrows. I probably did like 10 iterations. I'm embarrassed by how many different versions of up and down arrows I designed. But this was all with the idea that we could reward people and get them feeling like their contributions mattered and encourage the best behavior. You'll notice the leaderboard there, the stats. That little janky link was one of the most important part to the website back in 2005 because the top submitters cared so much where they were on the leaderboard that when the stats thing went down, we would get a flurry of emails from people saying, something's wrong. Fix the stats leaderboard. I grew up playing video games, probably like a lot of you, and this seemed like a pretty obvious mechanism to just motivate people to keep posting content.But again, we're talking about internet points that outside of the community don't really amount to much, even awards. So once karma points exceeded their value, because once people got far enough along on Reddit, a new user would come on and feel demoralized because the idea of one day getting a million karma points seemed impossible. So I had to create new games. These awards, I was inspired by GoldenEye on the N64 because the end of Deathmatch, even my friends who were terrible at the game and never won would still get a little fun award at the end, like most cowardly. And we would ridicule them for that. It turned out that's like you spend the least amount of time on the screen of other players during the match. And it was these novel awards that inspired the Reddit awards today. I literally have people who introduce themselves, not by their government name, not by their username, but by the fact that they are a 12-year Redditor or a 14-year Redditor.These badges, these awards that were just a game mechanic that I created 16 years ago without much thought have become a sense of pride. But I look at all these things and I think, damn, if only there was value beyond this world of this ecosystem, because there's clearly value there. And everything I've seen in the last few years, the reason I'm so excited about Web 3.0 is this is all the same mechanisms, except with real ownership. With real value gained by the people who did all the amazing work to make these platforms function. And then I can't not talk about swag. This was Reddit's original business model, and it was actually the first fight we had. So the first two months of Reddit, we got into a big fight because I really wanted sell merch. I knew that even though we had this burgeoning user base, that random strangers on the internet would want to buy t-shirts with our logo on it as a way to show solidarity with our tribe. It was a huge fight, finally won it, and I built a store. And this was before Shopify, before Stripe. This was like a janky PayPal. It was really hard to take money from strangers on the internet back in 2005, okay? But I get this janky storefront up. I filled the bedroom with probably like 300, 400 t-shirts and put it online, and within 24 hours, sold out. And then I spent the next day stuffing envelopes and taking garbage bags full of these t-shirts to the post office. And with every one of them I sent out, I felt a little bit validated because random people on the internet wanted to show their pride by making their torso into a billboard for us, and give us money for that privilege. Today, just seeing someone change their profile pic is an even bigger statement of that tribal solidarity. And again, maybe if you have one of these original 400 Reddit shirts, you could probably fence it on eBay for a few bucks, but you didn't actually capture the real value. There was tremendous value in being one of those early adopters and signing up to say, yes, I am a part of this. I want you to believe.And everything I see play out, even the most basic profile pic project, is a reminder that this is like the core atomic unit of building community online. And I just can't help but get even more excited because the rate at which this will grow is... it is hard to overstate. And even just thinking about where you all were, we were reminiscing backstage a year ago or two years ago with how far the Solana ecosystem has gone, I'm just very excited. So I'm thrilled to be announcing this fund with you. I hope we can do some amazing stuff together and fund the next generation of the social web.Raj (09:45):I think we totally will. It's totally going to happen.Alexis (09:47):Are you going to do that? Are you down with that?Raj (09:53):It's going to be incredible. I don't know if anyone was paying attention yesterday. Something interesting happens, right before Alexis and I went onto a... I think it was Fortune interview to talk about this... or Forbes, one or the other, to talk about this fund, I had gone on Twitter... GM everyone, by the way. GM.Alexis (10:20):Yes. Good morning.Raj (10:22):So someone who happens to be a good friend of mine, Sam Lessin, he used to run product at Facebook. I've known him for 10 years. He's the first person I've seen negatively respond to the idea of us all saying GM in crypto. And we all love GM. It's just good vibes, right? And so I went on Twitter and I said, "I'll kill you." But this wasn't me threatening Sam. I've known him for 10 years. We trust each other. Sam talks a lot about how... he was in the room when Venmo made the trust feature. I should be able to trust Alexis to be able to take as much money from me as he wants. We have a relationship. We should be able to flag that, right?All these little features, the nuances of how we connect with one another and how we trust each other and how we have relationships should be reflected in social. But right now there's only little pieces and it's the pieces that happened because one platform that becomes monolithic decides which features it's going to differentiate on. And so, yeah, I guess I should have expected this, and my comms people tell me that I should have expected it, but I got suspended on the first day of Breakpoint. And it was actually amazing because I'm super addicted to Twitter. This is the first time I've spent 24 hours not on Twitter in probably years.Alexis (11:44):Jack just wanted you to have a respite from [crosstalk 00:11:47].Raj (11:46):Jack's a meditator. He wanted me to just meditate on my feelings and beliefs and my actions, and I did. Just another point on this, it was a joke. It was a reference to this Costco founder who, when the CEO talked about increasing the cost of hot dogs, he said, "I will kill you." So this was sort of two ideas to get other in one tweet. There's a lot of nuance, like I said, in social. Sam and I know each other, so of course I would never kill him. And also if you know this joke, it's the idea that there are some things that are sacred, that are positive, that are inherently good. Like a chief hot dog for everyone that comes into Costco is like part of their belief system. GM is like part of our belief system. We should wake up every morning and talk to each other with good intentions. And if you're going to threaten that, I will kill you, right? And that joke...Alexis (12:47):Like a Costco hot dog.Raj (12:49):Like a Costco hot dog. And that joke, Twitter doesn't get it. The rules don't get it. It's going to be hard to regulate these things and moderate these things. But when all of it comes from one place, we just see that nobody's happy. Jack's not happy with the rules that he's been forced to put in place, which is why he's deciding to turn Twitter into a decentralized protocol. I think my fear, and I don't know if you agree, but Facebook's going to do the same thing. And Reddit's going to do the same thing. Everyone's going to do the same thing, but these things happen pretty slow, and there's opportunity to build from all directions. It doesn't have to be the old social platforms converting. We can build new ones and it doesn't have to be competition and it doesn't have to be winner take all.There will be hundreds of successful social media companies that are protocols and clients to those protocols, and choices will be made in programmable, modular ways between communities, just like Subreddits do that in certain ways. But it'll be much more fluid and we'll be able to govern these rules. I kind of see this pretty clearly, but I only see like maybe five or 10 companies trying it and building it. There should be 100. There should be 100 like tomorrow. So as we were talking with this reporter yesterday, it was a flurry of thesis. And even backstage, we just couldn't stop talking about all the ways that this future is going to happen. And I think it's going to happen quickly. And I realized $50 million is not that much for the number of teams and stabs at this problem that I think can happen in the next 12 months. So we're going to increase it to a $100 million.Alexis (14:31):That's right. See that, we lured you in with the 50. Surprised you with the hundo. And look, this is real. Normally, incumbents have had, and Zack has taken full advantage of this, incumbents have had a huge unfair advantage with the distribution. As social evolved, Facebook can gobble up, Instagram can gobble up, WhatsApp can get the economies to scale that distribution. But I would argue in Web 3.0 it's actually a liability because the intention with which you're building these new protocols and these new communities starts from the very beginning. It seeds the foundation of how people think about the platform. And the baggage of Web 2.0 infrastructure and the Web 2.0 precedent is that you're ultimately just harvested for an advertiser. And that factors into product decisions. That factors into design decisions.And what's really exciting is that there's a whole new slew of founders who have a chance to jump into a very energized community and actually start building something with a very different business model in mind and very different product instincts and very different design focus, and that's compelling. And I think we could see new platforms emerge very fast. We talked about Discord backstage and how... 2015, I think, I first started noticing them on the sidebars of gaming communities on Reddit and I thought, damn, they're onto something here. And as someone who's suffered through TeamSpeak, it was like, okay, clearly there's got to be a better way. But that was five years now, six years now Discord is the dominant platform for all the real-time conversation around NFTs and a lot of things in crypto. But that window for a new platform to emerge keeps getting smaller and smaller. It keeps moving faster and faster, and we haven't even seen what happens when people build this way first.Raj (16:33):Totally. Yeah, the cycles are getting faster. And we don't have to wait. And I think even just the rise of Solana and the cycles in the blockchain industry have been getting faster. And a lot of folks are surprised by how much and how fast so Solana has grown. I think this next wave of companies are going to get to a billion... we set it at the top of this whole conference, a billion users. And we didn't set a timeline. We set as fast as possible. I think it could happen in 12 months, 18 months. It's very feasible if we build that future. And I think it'll happen in waves. Applications protocols will be quickly saturating to a billion, 4 billion users in rapid succession because it doesn't have to be a competition of a monolith against another. It's just ideas and changes and protocol shifts and forks that can propagate very quickly.So I think this future's going to be happen very quickly and it's all connected. This is why we wanted to have Solana be one giant global state machine. A lot of people call it monolithic. Yeah, it's monolithic. That's the point. It's all one computer that we can build all of this together on because if you saw... I realized a lot of people miss some of the best talks here, but Jules Urbach from Render is making a photorealistic metaverse. We will be able to connect these social protocols to that rendering engine and we will be living in the metaverse faster than anyone thinks. It's going to happen.Alexis (18:04):And when that user experience hits, it will hit. In 16 years of designing product, of investing in product, I keep coming back to great user experiences, almost always end up winning. And that's broadly defined. That's the literal user experience as well as the figurative. How does it make customers or users feel? And what's exciting is we can do things on Solana that... and I'm not a maximalist in any regard. You'll see me, I'm very pragmatic on this stuff, but we can do things on Solana that just make so much more sense to create that amazing user experience that people have come to expect. And that's it at the end of the day. That's what wins. And you tie that in to being able to actually own the content you create and actually get rewarded for things like community building. It's going to be exhilarating.The second wave, Web 2.0, whatever we're calling it, I really believe it's going to look like this transition period, almost a bleep in the internet where we first got online, everyone's on the World Wide Web and we were making our geo cities' websites and just trying to build for what was largely a pretty read-only internet. And it's so obvious to me, even in these last few years now coming out of the crypto winter, that this era we're in now is going to define, really define the internet as we know it. And when I'm explaining to my daughter about these phases of the internet, she's going to look at me and be like, "Wow, dad. You played all those video games without being rewarded for any of your time or effort." And she'll be shocked. She'll be shocked that I bought things on the internet that I didn't really own. She'll be shocked that so many of the things that are really some of the most valuable work online, whether it's content creation or curation or community building weren't rewarded in any way, shape, or form.Alexis (20:07):It will seem like this weird, dismal, brief period of the internet. And I think we'll all be better off for it, ultimately, but I'm just excited to see what people build because we're all still in the very early days where we're actually just trying to take better versions of what we've known for Web 2.0, and I think things level up once we get out of that mindset and then eventually start building the things with a first principled look at what Web 3.0 really can unlock. But I'm already excited for this stuff that's coming, which is why we're going to put $100 million towards funding it.Raj (20:43):You know what else we should do is make sure the app stores allow NFTs and tokens. Are we really going to hold this back at the...Alexis (20:54):The good news is, look, Epic on the one hand has been fighting the good fight and on the other, not so much, but momentum here is on our side in a world where I know most of you all are probably default skeptical of regulators, which is a fine thing to be. I really do think though that the principles of what is getting built now are so aligned with the average person, with the consumer. And I still do believe that those people are represented by people in government who are at the end of the day beholden to the voters.I do think the more that we can tie the relevance and the value of crypto to the average American, especially beyond our initial early adopter community, the more we can make crypto a big part of people's lives, the better, because that ultimately is going to put leverage on the couple of monopolist or duopolist with their app stores. And I think it's still one of the strongest leverage points we have, which is it's just not good for consumers to have one of two app stores to choose from, and both that are pretty egregious in what they charge and the control they have.Raj (22:05):It's clear that social media affects government. It affects political movements. It's just very clear all of us. And I think one of the things that I always have tried to do, building products where people are taking on social behaviors, connecting is replicate what they're already doing, but do it in a positive way. I think you did that really well with Reddit. Focusing on upvotes, focusing on content creation and elevating each other and our creations and our content. And I'm curious, do you have any ideas about how the types of forces that have coalesced political movements in social media might be reflected in this next Web 3.0 Version of social media?Alexis (22:48):I really do think we're seeing some really interesting types of governance emerge. Look, for those of us, whether we're in European democracies, American democracies, these are global democracies, we ostensibly like these ideas of everyone gets a vote. And what's interesting now is you're even seeing what some of the recent ENS stuff and some of this... Just even the concept of vote delegation, being something that is getting more normalized. What I love about Web 3.0 broadly is we get a chance to think about, from first principles, how we can architect better and more representative systems. And so on the one hand I'm like, would I ever delegate my vote for a president of the United States? Would I ever delegate my vote for some company I'm a shareholder of? Maybe not, probably not, definitely not. There's a spectrum of answers to that. But what we get to build is whatever we think is the best tool for the job and then the broad market basically decides, okay, this is what wins.And this kind of experimentation, I think, tends to be among the most, or will ultimately reward the most egalitarian way possible because it's not controlled as basically every institution has been from the top down for so long. So I do think there is this pretty strong streak throughout the crypto community that almost by definition is built in opposition to institutions that have had top-down authority and plenty of times abused it. So I think when you combine community and capital, which we're seeing play out right now, really surreal things happen. And WallStreetBets is probably the most visceral example that I get asked about all the time back in the states. But that's one example of many where you are seeing a power shift from the traditional top-down structures to the bottom-up, where it's people who are connected online able to communicate in real time, at scale, for free, essentially, and now able to also move dollars. And even though those dollars individually may not be that much, in aggregate, especially when coordinated, can move markets, can shift all kinds of things. This is the experimental phase of it so I'm excited to see what's to come.Raj (25:16):The word delegation, I think, that I heard there is so important because delegation is happening, like you said, every day in crypto. We delegate to validators. In Solana there are stake pools and there's nested delegation that can happen. And our representative democracy is a delegation of responsibility and decision-making authority. But there are really only a few ways that you can do it and a few bodies that you delegate to and a few people. And then you mentioned this idea of would I delegate my presidential vote? Maybe not that one, but there's probably 100 offices that we're voting for. Right now we just go one side of the ticket. That's a pretty dumb way to do it. Not everyone's doing their research.Alexis (25:59):This is the opening of a lot of doors for a lot of people because with all the progress that we have made so far, we are still a pretty insular community. We are all still early. Just being here means you are in a very, very select group. Congratulations, you're going to make it. You're among the earliest adopters. Yes. It's true. And so you're among the earliest adopters of something that I... I've been on record. I was on Rogan CNBC 2014 saying that I was cautiously optimistic about crypto because it just felt like, no, this is too good to be true. Somehow it's going to get screwed up, someone's going to mess it up. But I've gone from that to pretty irrationally exuberant now in the last year. It now feels inevitable. And so everyone who is here, you are among the earliest adopters for this. You all have a mindset shaped by being immersed in this space for a little while now.There is a whole world, the vast majority of people still have not even started to think about the world the way that we do now by default. And that is going to unlock even more creativity and even more motivation and even more energy. And I'm excited to see that. And I encourage you, please, go out of your way to find people in your immediate community. Your friend group's an easy place to start. Don't be that person who just at every dinner just keeps talking about crypto, but please create this to be as welcoming and open as possible, because that is actually the long-term greedy move to make, because the faster that this adoption spreads beyond the early adopters in tech, especially the dudes who tend to look like me, the faster that this actually comes to fruition, and the more powerful it actually is.Alexis (27:54):And I'm excited because we get to rethink so many systems. And because finance is tied intrinsically into this, it means rewarding people for work, for effort, for creativity that historically have not been. And I get excited about that because selfishly, I just want better stuff. And so whether it is better democracy, whether it is better art, whether it's better social networking, we will get to see a flourishing, a literal Renaissance happening because of what is getting built here. And that is an amazing thing to be a part of because there will not be another time like this.Raj (28:31):There won't be. That's awesome, man. This is so cool. Look, I just want to close on one note. The one thing that came out of yesterday was this idea of #freeraj, which I love, but I'm back now. And so I don't need to be freed, but I do need to be freed from centralized social media. I want to get off Twitter. I want to get off. Help me do that. Build the next Twitter, build the next Facebook, build the next Instagram. I'm going to have a special prize for whoever helps me get off and delete my accounts from those centralized services.Alexis (29:16):Oh, the bounty is out there. I love it. Right on.Raj (29:20):You can come hang out with me and Alexis. Dude, thank you so much for coming, Alexis. This has been phenomenal.Alexis (29:25):Thank you.Raj (29:25):And I think we have many more great conversations to come and so many teams are going to form. It's going to be truly wonderful. I can't wait to do this with you. And thank you for committing capital and your time to these builders. It just means the world. Thank you.Alexis (29:37):I'm excited. Very grateful. Very grateful you all.

Tommy and Taylor are the founders of PsyOptions, a DAO developing the leading options primitives on Solana. 00:09 - Introduction and Origin Story04:04 - What are the challenges / improvements in Solana?11:49 - Integration of Serum v314:32 - ​​Adoption of PsyOptions17:19 - Architecting the system22:11 - Liquidity mining vs. options trading26:27 - Background in trading options28:05 - DeFi vs. Traditional finance products30:56 - Gaming as a market32:56 - Exciting things out of the hackathon34:09 - Announcements for PsyOptions37:53 - If Solana could change one thing? DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.Anatoly (00:09):Hey folks, this is Anatoly and you're listening to The Solana Podcast. And today I have with me Tommy and Taylor, co-founders of the PsyOptions protocol. Awesome to have you guys.Tommy (00:18):Thanks for having us.Taylor (00:19):Thanks for having us.Anatoly (00:21):Cool. So what's the origin story? How did you guys get into crypto and what made you build PsyOptions?Tommy (00:27):Crypto, it goes back to... I remember watching the Ethereum ICO, just being a broke college student, but felt we were too broke to actually throw anything into and that's a big regret, but that shaped up how we got into Solana later on. Really dove deep into everything back in 2017, right before the summer hype. And then in the summer hype, tried developing a little bit on Ethereum, doing some solidity development in the spare time, but I never jumped full time into it until PsyOptions. Taylor has a little bit of a different history with crypto.Taylor (01:03):Yeah. I've actually been full-time in crypto since late 2017, after Tommy and I shut down a previous business we started in school. We were looking for different things to do and I knew crypto had a lot of hype in 2017. I was like, "All right, this is definitely an industry I could see myself being a part of." I eventually took a job at Blockfolio and then as well as doing some freelance solidity development and then been full-time ever since.Anatoly (01:27):How did you guys meet? What was the genesis for you guys to go build PsyOptions?Tommy (01:32):Well, Taylor and I are twins, so we met a long, long time ago. We've always been hacking on ideas and stuff. And I guess, Taylor had his eye on Solana from 2018, right Taylor?Taylor (01:47):Yeah, pretty early on. I remember Multicoin writing about it. I was like, "Oh, this is actually a really sweet architecture, solves a lot of problems that we saw in Ethereum." And kept following before Mainnet beta was launched.Tommy (01:59):Yeah. And so we had been tinkering around, created a GitHub organization last summer, like the same one we're using now and just started reading the documentation. And then had a few projects we tried in the fall that never really took off. And then in October we were surfing with Tristan from FTX and he was just talking about Serum and everything that they were working on. So we knew what was in the pipeline and had that in the back of our mind. We did the first hackathon, did in place, built a trusted third party Oracle. And then after that had an issue with TradFi, trying to get API access to automate a options trading strategy, and that was what kicked it off. We were for fresh off that first hackathon, wanted a fresh idea, had our feet wet in Solana. And it was like, "Taylor, what if we just built options into the blockchain? We can get this API access built in. We have the order book already there, there's some basic infrastructure." And that was the genesis.Anatoly (02:59):That's awesome. Limited access to data was one of the reasons I started building this thing. Because I used to try to build stupid deep learning models on interactive brokers and you never have access to data. It's always even the quality is really suspects. It's like, "Do I really know that this is where things got executed? Or did they just copy and paste stuff from a database with a bunch of errors?"Tommy (03:26):Yep.Taylor (03:26):That's terrible. Yeah. If you want good data quality, you have to pay up for it. That's why Bloomberg Terminal is what 20, 25K a month. And if you're just the hobbyist or just trying stuff out, it's just not feasible to pay that much.Anatoly (03:41):Yeah. This is to me I think part of the beauty of the space right now, is that you can build up a lot of what finance is with just a bunch of hobbyist. It's like Linux. Linux in the '90s, you're competing with Microsoft, billions of dollars of engineers buildings stuff, but it's just a bunch of people over the weekend can compete. It's crazy.Tommy (04:03):Yeah. It's wild.Taylor (04:04):I think that's one of the best parts, all that coordination.Anatoly (04:07):So what are the challenges? You guys are one of the earliest I would say teams working on Solana. What have you guys seen, or what were the real painful points? What got better? What still sucks?Tommy (04:18):Oh man. All right. This first Solana season hackathon, the one that we won, we wrote everything in Solana native. I remember pinging [Armani 00:04:29] back in February saying, "Hey, I hear you're working on some framework, can I poke around? And checking out the repository." But it wasn't anywhere near complete or, I didn't dive in enough to use it for the hackathon. So now I rewrote the entire American option protocol in Anchor and it took me very little time to actually write that. So the development life cycle and just ease of getting up to speed, has improved ridiculously.Taylor (05:07):Yeah. And documentation has improved too.Anatoly (05:07):That's awesome. What is Anchor doing for you guys that Native, Rust isn't?Taylor (05:13):It's helped simplify our integration tests. So that's one thing that we try to do when we first started was, we wrote our own integration testing framework in Rust. I guess I wouldn't even call it a framework, it was pretty rough. But Anchor takes care of that. You're just writing your test in JavaScript, it's pretty easy to get up and running. And then also handling a lot of different edge cases that you wouldn't have to think about, checking account addresses and other things just to bring safety in. And it removes a lot of those headaches that, if you're just getting started and trying to hack something together, you're not really going to be thinking about.Tommy (05:48):Yeah. I think the account, de-serializing accounts, token accounts and things like that. You just have your accounts structure, passing that into the context and it de-serializes all that. The amount of little issues we had just because oh, we mis-ordered one thing in the array when we were refactoring, the accounts array, and it's like, "What the hell is going on?" And then you're trying to debug and add messages and stuff, because you're just like, "Oh man. And what is..." And then it all turns out to be a typo or you fat fingered moving one line up or, and it was... So the account structure and dealing with that is just incredibly easy. You don't have to de-serialize anything yourself.Well, anything that has a token, SPL token program or even some of the DEX infrastructure. And it makes cross program invocations a lot easier. I've been working with some teams for this hackathon, and wrote a bunch of cross program invocation examples for these teams to get up and running with PsyOptions pretty quickly. And it was just seamless for them to use our data structures and serialize it, de-serialize, because as long as we're all using the same framework, it works.Anatoly (06:56):Yeah. This was is my decision, so you can blame me, but I really didn't want to build a shitty framework. And until people started building on Solana, it was really hard to know, what do they need? I think it would've been worse if we built a bunch of code that nobody could build with, because it would've been incomplete. I'm going to say, it takes a lot of discipline to do that, versus laziness.Tommy (07:22):It makes sense to offload it on to the actual DAP developers. It's a different beast when you're programming the underlying system versus the actual just Solana runtime program. So it makes a lot of sense how Anchor came out and who really is leading it.Anatoly (07:40):Can you guys tell me what worked really well? Or what features or anything for any other Devs that when they're coming into building on Solana, what stuff actually feels like a superpower?Taylor (07:52):Well, one thing that's improved a ton is the SPL token program and how you manage the token accounts and whatnot. That's definitely something that a lot of the new developers on Solana don't have to deal with. But back then we were building into our UI the ability to have multiple accounts for the same SPL token and it was super frustrating and whatnot. So using those associated token accounts and other kind of, I guess you could call them rapper programs or things like that, that just improve the UX significantly. Understanding those and why they're there is pretty important when someone's getting started.Tommy (08:30):I think taking it a step further too, how does the associated token program work? And what's really under the hood is the program derived address. I put together some documentation for people starting to onboard to PsyOptions or related protocols. And I'm like, you need to read up all these Twitter threads, these documentations on PDAs, because there's just so many things you can do with a PDA that's very unique. You can get a mapping just to accounts, you can create a unique constraint. So for PsyOptions, there should never be... Right now, there's no reason to have more than one of the same option and the fungibility of those options are based on the expiration date, the strike price, the asset pair. And so we just have a PDA that is seated with those parameters and it creates this unique constraint.Anatoly (09:24):Oh, that's cool. So you encode the constraints as, basically hash it into the address.Tommy (09:30):Exactly.Taylor (09:30):Exactly.Anatoly (09:31):And the taker then has to satisfy those constraints to be able to take that trade.Tommy (09:36):No, not on the trade level, just on the general structure for creating the option. It's like, okay, if you want to spin up a BTC 70,000, USDC strike for the October 29th expiration, just that structure that creates that... because that's structure is the core structure of PsyOptions, the Psy American program. And that's what then controls the option TokenMint and writer TokenMint and how you dull out those option tokens. And so it's just there can never be more than one of those specific to those constraints. So it's separated from the trading concerns.Anatoly (10:14):Got it.Taylor (10:15):Yeah. I think you thinking of your stateless escrow. I thought that was a pretty cool proof of concept.Anatoly (10:21):Yeah. I wasn't sure that you guys already built... I think this idea has been around in crypto for a while, so I wouldn't be surprised if you guys use it too. But I like that idea that, because you don't want to generate infinite number of these markets, if everybody enters the same data, then it's going to spit out the same BTC month increment whatever, like May 2021 option or whatever you want.Tommy (10:47):Yeah. And we've seen it too. It's really useful to have these deterministic ways to look up an account address. So it's like, "Look, I can just check if this option market already exists by using these parameters, the PsyOptions market exists." And we also ran into some issues that we had to hack together, on the client side, because Serum doesn't have these kinds of constraints. And an adversary could come in and spin up multiple Serum markets for the same asset pair. And then when you're pulling that data from the chain on the client, it's like, "Well, which one is your UI using? Which one are these automated traders using? All that kind of stuff. How do you sync them up?"And so that was a pain point, and we had to whip together a package. But now with Serum's permission markets and some other stuff, we can now use PDAs to say, "This is deterministically how the UI is going to determine the market. Here's how everyone else should do it. These are the seeds." And then it keeps everyone in line in a more decentralized way, rather than having to have some NPM package with metadata and it's painful to maintain.Anatoly (11:54):Got it. That's cool. What actually runs the market? Is it a Serum Q, a Serum V2 or V3 Q?Tommy (12:03):Serum V3 right now, for the Americans. Yeah.Anatoly (12:05):Awesome. Man, that's super cool. How was that integration? Is that blood, sweat and tears still, or are the tooling itself around Serum getting better?Taylor (12:15):It's getting better.Tommy (12:16):Blood, sweat and tears.Taylor (12:17):Yeah, but it was definitely blood, sweat and tears. I think that's what took us the longest part in the original hackathon that we won, was doing the Serum integration. And we weren't even doing any cross program invocations to Serum at that point, it was literally just client site integration. And that was really difficult. No documentation, got to read through the source code. I think we even found some bugs in their type script package and had to patch it ourselves. So yeah, definitely blood, sweat, and tears there.Tommy (12:48):There's still room for improvement. I'm like drop in list every time as hackathon participants start asking, or users are complaining about settling funds. I'm just at a constant stream of, "Hey, we should document this and add a flow chart for that." Because all the customer surface is offloaded to the people using the Serum stuff, so we get that inflow of feedback from users and other developers building on top.Anatoly (13:12):Yeah. People don't realize how strapped every team is.Tommy (13:16):I agree.Anatoly (13:17):It's literally like three, four engineers at best to, no customer service, no nothing, just pure software, open source software. It's not like when you look at a market cap of something, you think there's a equivalent to market cap S&P 500 company with 30,000 engineers just all cranking away. Thank God it's not, honestly.Tommy (13:41):Yeah.Taylor (13:42):Yeah. It's got its ups and downs. At least you can move fast, it's not a bureaucratic process. But at the same time, customer support definitely dwindles and I think 70% of people are probably testing in production. So the end users are just going to have to deal with that and understand that's just the way things are done in crypto right now.Anatoly (14:03):I guess, how close are you guys to launch and what are the next blockers?Tommy (14:07):So we actually are on Mainnet trading with BTC and ETH markets right now. We have been live since the end of August, just with BTC and ETH for the September strike. Then we upgraded to a V2 of our American protocol with Serum permission markets, so we can eventually close those markets. And so that gives us the ability to open a bunch more. And so we're live with those, we're working with a couple other partners to get some SOL markets up pretty soon. So we'll probably announce that here.Anatoly (14:40):Awesome. What have you guys seen in terms of adoption, and how are people using it and has anyone surprised you with what they're doing?Tommy (14:49):It's tough right now from the retail side using our user interface. I think what the biggest thing that I'm excited... There's been a lot of great feedback. Options are not an easy instrument to use, managing your own positions is tough. And so we've gotten a lot of great feedback from the community and it's shaping what some of these projects that are work thing on during this hackathon. I think that's what's most interesting and surprising is these teams that are building on top and they're not user interfaces. These are protocols that are going to be managing certain strategies and rolling positions for users, and so you can have this more passive product. It's like a ribbon finance to the basic ones, where it's just selling covered calls and secured puts or things that.But there's a lot of plans, I don't want to leak their Alpha. But a lot of plans for additional products where it's more just, set it and forget it. And it has certain properties detailed out to hedge for various things, give you certain direction on volatility. And it'll make these... all these products, some more user friendly for retail, but also big institutions that are looking to hedge existing exposure.Anatoly (16:00):That sounds like you guys are building more of info level for options.Tommy (16:04):Yep.Anatoly (16:05):That's awesome.Taylor (16:06):Yeah. We chalk up the V1 American that we built as just a primitive, and as decentralize as possible. It doesn't rely on Oracles, it doesn't need pricing information. So the only dependency is the Solana runtime and SPL token program, I guess now Serum with the permission markets. But the original one had only SPL token as dependency.Tommy (16:29):Yeah. So there's capital inefficiency with the American style, because you can exercise at any time up until the expiration. So we're about to hopefully announce pretty soon, we have a European that we've architected and we're going to break ground on that and we'll crank it out pretty quickly. That will have a little bit more dependencies, but it'll be more capital efficient because it'll be auto exercised and we'll have a margining system built into it. And the American will continue on because we're going to build, I like to call it Carta for DeFi, but just a place where people... We whipped out a vesting contract the other week. And we'll be able to show people their tokens that are vesting, their options that are vesting, the ones that have currently vested and the options all in their portfolio and whether they should exercise them or not. It'd be less like trading based and more of just an interface for managing your portfolio of vesting stuff and options, so.Anatoly (17:33):That's awesome. How many engineers do you guys have?Tommy (17:38):We actually just hired another front-end guy today. So we're two full-time front-ends, and we hired another protocol developer, so we're two full-time protocol developers. Then we have a community guy and a marketing guy, and then couple of part-time and open source contributors.Anatoly (17:52):That's so small, I mean that's awesome. I feel this is the biggest thing in crypto, is how fast small teams can ship really sophisticated products.Tommy (18:04):Yeah. I think, as I've learned, the hardest thing nowadays or right now is, it's not the programming, it's the architecting the system to fit the runtime and developing the instruction set. And once you wrap your head around how that whole system works and you have your instruction set, writing the actual code is not that hard. If you actually take the time to just think and focus, and you have to have the knowledge and experience to understand that, it's pretty easy to start architecting a bunch of stuff and delegating and managing a little bit more.Taylor (18:35):The thing I will say on that though is that, the runtime changes here and there, but the changes aren't that drastic. But when you're using dependencies like Serum, Pyth, whatnot, those change a ton. And so you're seeing a ton of changes on Serum, so one week you might have architected something for Serum B3, sounds great. All of a sudden Serum updates to some new thing and that might change the optimal architecture for it. So you have to be nimble in order to just go with the flow as different protocols update, and as new versions come out and new architectures are viable.Anatoly (19:14):It's weird to think of immutable code still having dependencies. But something with Serum, you're so dependent on liquidity in those markets that if they move to V4, you have to update because you can't point to a empty market.Tommy (19:29):Yeah. We bring a lot the liquidity ourselves. Well, these are brand new markets that we spin up. It's not as much of a pain point, it's more just announcing and coordinating. But it's more of the European protocol and architecture, it depends on a lot of the stuff like... it doesn't depend heavily on the SPL token, contracts aren't represented as SPLs. And so it depends on this new architecture that they just announced, that Bonfida has been working on. So it's just interesting, you have to keep up to speed with what exists in the ecosystem, so you can constantly be like, "Is there an improvement? Can we squeeze something out of this is?"Anatoly (20:03):Is the European option, are you also planning for it to be Oracle free, or no Oracle?Tommy (20:08):No. We'll rely on an Oracle just for the exercise. We're wrapping up the architecture and probably just, we're going to develop this one totally open source from the scratch. I just put up the boiler plate repository and its open source. We're going to open source, or at least make public the architecture, so everyone can read and comment on it while we're just cranking it out in the next week and a half. So there's a Oracle dependency just on one instruction, just to actually lock in the index price, that would be for the expiration. But we don't see it being too risky of a dependency, considering it's not an instruction that has a lot going on so we can do a lot of checks. We could pull two different Oracles and reduce the potential pitfalls there.Anatoly (20:53):Yeah. This is a hard problem too. When an option is exercise it's still going to hit the Serum market to actually exercise the price?Tommy (21:03):No. So on the base layer, the European, it's just going to... essentially the architecture is locking in the price, and then users basically have to settle up the positions and collateral themselves.Anatoly (21:14):Got it.Tommy (21:14):The best way to describe this one is Deribit on chain. It's really just like P&L, not the full underlying.Anatoly (21:22):Okay. So you can actually settle in any collateral. You could have an option on SOL, but settle in wrapped ETH or whatever?Tommy (21:29):Well this one, it's actually going to be... well, it's going to settle in the currency that it's trading. So BTC, it's going to have this siloed market and account that holds all the BTC and manages the entire portfolio, margining for someone's BTC options. And so it has it's own realm of just, this is the BTC world. And everything settles in BTC, everything's traded in BTC and premiums are even in BTC, but then it just uses the USD index price to actually settle up on the strike. And then SOL would have its own world, with its own portfolio margins system. So they're not cross margined between all those at the moment.Anatoly (22:10):Got it. Is cross margining something you guys are also thinking about?Tommy (22:15):Yeah. It's one of those things where we want to just crank this out and ship fast, because it's improved from the existing architecture, for when it comes to a trading perspective. And then we'll discuss a more improved cross margining system.Anatoly (22:27):Do you think that there's a gap still in this idea that I think, what's popular on DeFi Ethereum is liquidity mining, and I just want to put my tokens and get yield? And is there a gap between that and options trading and central limit order books?Taylor (22:46):I think there's a knowledge gap. The closer you are to dealing with the primitives, the more knowledge you need to have, the more hands on you have to be in managing your positions and whatnot. So I think that reduces the addressable market or the end users that are willing to participate. And so that's why you have people building programs and tooling on up to manage the position, so it can be more passive. Because I think that's one of the biggest things that drove a ton of people to DeFi, is the passive yield, all the token incentive programs and whatnot. So I do think that there's a bit of a gap, but it's slowly being closed. And the more passive it can be, the more non crypto people or even crypto native people, but the less financially sophisticated you could say will come in and utilize DeFi.Anatoly (23:39):So you guys imagine that... or there's probably somebody already building this, where I have my token, I'm an LP, which is under the actual thing behind that position is a covered call or some other fancy strategy, iron condors or whatever, right?Tommy (23:58):Yeah. So there's a couple teams from the hackathon building that right now, actually.Anatoly (24:03):That's awesome.Tommy (24:04):That's what I'm really excited about. Because that's what we've seen is, there's decent order flow, I haven't looked at the volumes because we're just very focused on product. We know what the low hanging fruit is, so we're not focusing on the vanity metrics at the moment and not really talking about the TVL and whatnot. But it'll just increase order flow because these people can just get passive yield from covered call products, or they can hedge certain positions just by depositing tokens. And it's all going to be managing these underlying options and straddles and things like that.Anatoly (24:38):How long does it take to go from, let's say I wanted to build an iron condor or something that as a strategy, can I do that? Do you guys have examples already, reference implementations for things like that?Tommy (24:53):Are you talking as a protocol or as just a user, using the... like a client?Anatoly (24:58):As a, here's my DAP, I'll take tokens from LPs and then automatically generate the position on PsyOptions.Tommy (25:07):The hard part actually isn't to the generating the initial positions, the hard part is handling how they want to roll, if you're trying to do it over time, where they just can keep that open. So the generating the positions is super easy, placing the orders. We have examples, CPI examples in the repository for minting options, exercising, placing an order, opening a Serums open orders account, all that kind of stuff. Just been cranking out examples as people ask for them. And then, it's onto those teams to handle that really tough part of, how should we roll? There's certain concerns in there for manipulation. There's certain concerns for front running, there's certain concerns for eating through the order book and having to build your own TWAP into it and stuff like that, so.Anatoly (25:59):Yeah. Man, you guys are taking on some really tough challenges, that's cool. This is something that I wanted to get good at, trading. Trading options and deep learning into these things, but I got it to work.Taylor (26:15):Yeah. It's a full time job. That's why we try to focus on the primitive and lower layers and try to get that right. So then other teams can focus, if they're much more financially savvy or have of better trading backgrounds, can handle that. It's a full-time job to be a trader, to come up with those models, to build those positions and roll them, it takes a long time. And you constantly have to be updating them too.Anatoly (26:44):How long did you guys trade options before?Taylor (26:47):Not much. We're just retail traders. I interned at an investment bank once a while back, but to the extent of my full-time finance career, that was about it. And then we would trade options here and there, but nothing serious. And then, when we wanted to automate that option trading strategy, that would've been probably the first automated system we would've built. I don't think we built an automated option trading strategy before that.Tommy (27:15):Yeah. I would say we relate best with the retail, speculative, YOLO option users, rather than very sophisticated options traders. But it's been nice building this and winning that hackathon and getting some attention, because then those people show up. And we have some really smart TradFi people who have been around crypto, some really smart TradFi people who have never been around crypto, contributing to the thought leadership of where we should go, what's needed to get to certain structured products and things like that. And that's been super helpful because we've been early in Solana and have the engineering capabilities and knowledge to work with them of a translating their vision into a Solana architecture. And so we've just been helping as many teams as possible that have that background and can bring that knowledge. And then, that's why we're just like, "Look, we'll help you as much as we can because you're going to help us answer some of these questions that we don't know." So it's been good to fill out the team and the surrounding circles with that.Anatoly (28:23):Do you think that DeFi is something that... I always think of it as growing faster than TradFi versus replacing it. Do you think these products are good enough to compete with traditional finance, or are we just going to see more stuff being built on open finance because it's easier? I don't have to go talk to a CME to launch an option for my in-game bullets for my shooter game or something like that.Tommy (28:52):I think it will be just the fact that it's open and anyone can do it. Looking at the architecture here and designing an ideal architecture for the most capital efficiency system, it's just not really... You could do it in CeFi so much easier than you can do it in DeFi. I don't even know if it's truly possible. We're still just on the back burner trying to figure out how you could portfolio margin everything. I think a lot of teams that we've talked to are all thinking about that in the back burners. It's like, how do we margin against everything? So I think it's definitely moving faster. I think they will rival CeFi, a lot of these products, but I think they're still going to be both working hand-in-hand.Taylor (29:42):Yeah. I think both have their ups and downs. The speed that DeFi innovates because of the open source nature and things can be represented and it's all digitally native, it just makes the pace of innovation faster, also makes what you can build much faster. Like CeFi you're beholden to, not that you're not beholden to regulation in DeFi, but CeFi there's a lot more red tape. You got to jump through hoops in order to be able to launch a market or... You can't just launch your own equities exchange, it's takes tons of money and resources and whatnot. So it stifles innovation in that respect. So I think even if DeFi can't become as capital efficient as CeFi, you're still going to have more innovative products, more flexibility in what you can do with your assets, that at the end of the day, you might not need that capital efficient, high, super fast, low latency systems to do what you want to do with your assets. So I think there's a place for both. And I think DeFi is just going to continue to innovate and outpace growth in terms of TradFi.Anatoly (31:00):Well, our goal is to get that latency to be as low as physics allow, and then we're competitive.Tommy (31:10):That's why we're here.Taylor (31:10):Let's do it, man.Anatoly (31:11):Won't rest until we're building neutrino emitter detector. I just think with gaming especially, the first massive multiplayer games instantly within six months had a market for the digital items there. As soon as you get something like Star Atlas or equivalent, like World of Warcraft that's decentralized with all these assets on chain, I think the idea of options as a service, people are just going to, "Well, I got whatever... I got more gold that people want to use because this game is hot right now." People are going to definitely spin up those markets, it's just going to happen.Tommy (31:48):100%. We've been talking about game... we're gamers ourselves, and I haven't played a game since I really dove into Solana development 11, 12 months ago. But I'm hoping to get back to it once Star Atlas and Aurory and all those other... Kaiju cards, everyone starts actually launching the game play, I'll jump back to gaming. But we've been thinking about it a lot and what could be done with this American primitive, and that got us into talking to other teams and other games, just to see what's out there. And then I actually got connected with Metaplex and built out a contract that they just announced that's focused on gaming. And it all stemmed from trying to think about, these games, everyone's so early and not really thinking about how these game assets are going to plug and play into DeFi protocols and things like that. And there's still just so much work and research that needs to be done, and some infrastructure needs to be built for it all to work perfectly together.Taylor (32:42):Yeah. I think the interoperability for gaming is still... there's still going to be some rough edges there, because it's harder to build standards across games. But I think you'll have a few games come out and maybe they'll have transferability between games and whatnot, but it's going to take some time and some trial and error before we get to this on chain metaverse where you can transfer assets between different game worlds and whatnot. But I do think that is going to be one of the ultimate killer applications on blockchain.Anatoly (33:19):What are you guys excited about out of this hackathon?Tommy (33:22):Oh, for me, it's really just the stuff we've mentioned with the structured products, passive yield products, all that kind of stuff, being built on top of PysOptions. I'm very heads down on product and everything at the moment. So aside from the people that are ping me, asking me for help, I don't really know what else is being built.Anatoly (33:42):Yeah, likewise. I see NFTs being launched and then I'm deep in the trenches and optimizations. I guess that's good. It means that there's more stuff to do than you have time, so you started actually going heads down and working.Tommy (34:00):But there's a lot. The roadmap with just these teams alone, is ridiculous. We have so many products that we want to whip out on top, and hoping to launch the first few in the next week or two. And then the framework's there, it'll be a little bit easier.Taylor (34:14):Well, it's just fun to see people building on software that you've built. I'm sure you and the rest of the Solana team get excited as new projects come out and new people innovate. And I think that's one of the more fun things to do, is just sit and watch what people come up with because you can't come up with every idea yourself, so might as well open source stuff and have community run with it.Anatoly (34:33):For sure. What should we be looking out for? Do you guys have any announcements you want to leak?Tommy (34:40):Oh man. SOL options coming soon. Passive yield products that will make it extremely easy for people to get volatility exposure or generate yield. And this is yield that's not going to go away. A lot of these pools are based on rewards, and API is based on rewards and things that will dry up and aren't sustainable. But the volatility is a little bit more sustainable in a sense. Sure volatility will decrease over time, but.Anatoly (35:09):So these are like covered call strategies, basically?Tommy (35:12):The first few are the most simple covered call and secured put strategies. But then there's going to be a few other vaults coming out once these are launched, then it'll be focus on a few other vaults that have different strategies. Eventually, we started talking to some other teams like Symmetry, because we want to get a good crypto index, because then if we get liquid index options, we can create a nice volatility index for certain baskets. So that's all on the horizon. And so, you need that rolling and rebalancing and infrastructure, and that's what we've been working on the past few weeks, or other teams have been working on. And then it's formulas for just managing array of positions.Anatoly (35:57):What is your development process like? How do you guys go to build test and ship?Taylor (36:03):In terms of roadmap and how we determine what to work on, it's pretty ad hoc, things change up weekly, biweekly. But we try to run in two week sprints, at least just pick like, "Okay, what... base on user feedback, check GitHub for issues." Obviously anything that's blocking usage is number one priority. And then it's, "All right. What do we want to see built? What do our partner teams need, and how can we get them going?" I don't know Tommy, you have anything to add to that?Tommy (36:35):Yeah. Protocol development too. I'd sit and focus and start drafting up a full architecture doc with the instruction sets and potential functions that are needed, black box some stuff, just to make it a little bit easier and then put a to-do to dive in later. And then you have this whole instruction set and a general outline and framework, and you know it fits into the Solana runtime because you've made sure that the constraints are handled. And then I'll dive into running a test driven development process with Anchor, just doing full integration test. You end up writing a lot more test code, but I just find that the confidence level is so much higher. You can refactor and upgrade versions and you're just so of confident in your code when you have all those tests, so. And then, it cuts down the time from DevNet testing, where everyone just puts up a contract and then just relies on interacting it to test it. Especially when you're building a primitive, you want to have all those cases handled.Anatoly (37:36):In your use case specifically with options, what bug are the most worrisome? Is it overflow or actual logic and economic?Tommy (37:45):Probably logic and economics. The American protocol, overflow is not an issue, not really. We do all the check map of course, but it's not an issue. Maybe if we get some weird [Altcoins 00:37:58] eventually trading, then we'll have some weird issues. But I'd really just say logic, economic attacks, things like that, when we get into the capital efficient Europeans that has the margining system built into the base layer, and liquidation built in the base layer. And just always thinking about account management. You have that limitation of number of accounts you can pass in, and how to architect around that.Anatoly (38:19):So if Solana could change one thing, what would it be? Or anything, and things-Taylor (38:24):Two things.Anatoly (38:29):... two things. Finite numberTaylor (38:29):Fixed account length. If we could make it-Tommy (38:32):Oh, sure yeah.Taylor (38:33):... dynamic sized, I think that would be great.Anatoly (38:36):The length of the data.Taylor (38:37):Yeah.Anatoly (38:37):Okay.Taylor (38:38):The account data.Anatoly (38:39):That's actually... I don't know if you guys saw, but believe-re growing reallocation from the program itself or the account that it owns, I think it might be live already in 1.8.Tommy (38:49):Yeah. I saw ...Taylor (38:51):I think I saw the PR for that.Anatoly (38:52):Okay.Taylor (38:53):But that's one thing that... Sorry, but when people jump over from ETH to Solana, that's probably the biggest gotcha, that we're like, "Oh crap. I can't readjust or create a larger array, more mapping data, whatever." So that's one thing. And then also the number of accounts you can pass to an instruction [crosstalk 00:39:14].Anatoly (39:13):In a transaction. Yeah.Taylor (39:15):... open up more. Yeah.Tommy (39:17):And I think 1.8 handles a lot of these headaches, but you still, when you're trying to think, for the long term, just the limitations in general. I'm assuming they're always going to be there, the number of accounts you can pass in, can't be-Anatoly (39:32):109, the goal is to double the transaction size basically. So the number of bytes that a transaction can maximum size. That means you can double the user data or encode more, put more accounts in there. So there's always a limit because of the real time nature of the system. You're not submitting an arbitrary large transaction that then the block producer decides, "Okay, I'm going to pick this one." You're really like, "How do I write to the block right now?" And making sure that doesn't slow everything down, is a challenge. But really cool, man, you guys are shipping like crazy. It's awesome. It blows my mind that you guys were hackathon team that is now... there's teams in the hackathon building on top of PsyOptions.Tommy (40:23):I love it.Anatoly (40:24):Yeah.Tommy (40:24):I've been doing office hours, every Tuesday and Thursday, just letting people come in and ask questions because it's just nice to see people building on top. And we're going to do whatever we can to help them out and keep them there.Anatoly (40:36):That's super cool. Man, really good to catch up with you. Thank you for coming on the podcast. Is there anything you want to add for the listeners in the final bit?Tommy (40:46):Yeah. I would say, check out PsyOptions to trade your BTC and ETH right now, SOL coming soon. And then we'll be announcing an under collateralized European protocol pretty shortly, going to try and crank that out as quickly as possible.Taylor (41:00):Yeah. And get in touch. There's no shortage of projects that we can dream of and I'm sure others are too, but happy to help any team out that we can.Tommy (41:08):Yeah. And if you're a protocol too, looking to do option liquidity mining with American PsyOptions, reward contributors with options, or use the PsyOptions vesting contract, we're trying to get that. The vesting contract's a unique one, where you can delay your vest. The recipient has the option to delay their vest if the issuer grants it. So that way they can keep pumping the vesting and the potential taxable event. Not an accountant, so don't take that tax advice. Not financial advice.Anatoly (41:39):Not accounting advice, not financial advice. That's awesome.Tommy (41:42):Yeah.Taylor (41:42):No advice.Anatoly (41:44):That's super cool. Well, thank you guys.Tommy (41:46):Thank you.Taylor (41:47):Thanks for having us

Larry Cermak joined The Block as one of the first employees with the mission to provide professionals with accurate information about crypto. He now leads a 30-person research team that delivers insights to institutional customers.00:09 - Intro00:20 - Larry Cermak’s origin story / His work at The Block08:25 - The fundamentals of Bitcoin16:03 - The value of SushiSwap19:35 - Investing based on Memes23:42 - Market Value for future gains in Crypto26:12 - Will NFTs be backing internet money?28:44 - Thoughts on Algorithmic Stablecoins31:00 - Regulation in the US34:47 - Decentralization and tokens in the context of regulation39:45 - Volume of users / social networksDISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.Anatoly (00:09):Hey folks, this is Anatoly, and you're listening to The Solana Podcast. And today I have Larry Cermak, who's the VP of Research at The Block. Awesome to have you, man.Larry Cermak (00:18):Nice to be on, it's a pleasure.Anatoly (00:20):Yeah, so tell me your origin story. How'd you get into crypto?Larry Cermak (00:24):Yeah, it's probably slightly longer. But really high-level, I got involved in late 2016, I was in college in the US and was thinking about what to do my thesis on and Bitcoin seemed like one of the more obvious options, to not make it incredibly boring, so I just decided to go with that. And throughout the research process, I just kind of found that there isn't good research about Bitcoin, just in general crypto. There was either the super bullish people that were like all in on Bitcoin, or super bearish academics, and there nothing in between, and I felt like I can fill the gap a little bit.So after I published that research, I shared it publicly as well with a few people, and based on that I got my first job offer to work at Diar which is a research company, focusing only on crypto. So I worked there for a couple of years, and really just tried to focus on data driven research, which now it sounds kind of obvious, but back then it just wasn't very common. Most people were just looking at the really simple metrics and munging data, but mostly it was just price discussion, price predictions, all that stuff. And we were really looking at just analyzing the market a little bit more fundamentally, that sounds even more silly now looking back.And I got lucky that in 2017 when I joined full time, like early 2017 I joined full time, and that's when everything popped off massively, and it was just a bunch of shit ICOs, like a lot of sketchy stuff. I consciously started looking more into these projects, so I was one of the people that were kind of cautioning against some of the ICO stuff, and it was a lot of fun but I was quite skeptical back then still. So actually, a lot of people who have followed me for a while, they know initially I was a no-coiner, I had no crypto, and I was convinced that initially actually that a lot of this is just kind of hype mania, it's just all like overblown massively. But something really drew me into it, and it was mostly the permissionless nature, ability for anyone to participate, but what really I didn't like was just the hype around it, the marketing, the emptiness, and all that stuff.So I over-focused on that I think initially, but after some time, I realized that that's probably not what this is all about. Initially, I didn't think that it was necessarily important for most projects to have tokens and I was very skeptical that most tokens need a project, and I started massively changing my mind on this with the DeFi beginnings. So early 2020 my mind started completely changing on most of the space and I stared allocating a little bit more, and now I also do seed investing privately. And obviously, I lead the research department at The Block which is now 25 researches, probably the largest research team in crypto.Anatoly (03:33):So you went from Bitcoin skeptic to full shit-coiner.Larry Cermak (03:38):Kind of, yeah. It's a little bit concerning honestly.Anatoly (03:42):In four years.Larry Cermak (03:44):Yeah, I don't think I was really a massive Bitcoin skeptic, I was just skeptical of everyone is just so positive, and Bitcoin maximalists, I just could not handle that. When you just start using really bad arguments, just kind of shit-post and being really negative about everything other than Bitcoin and not being open-minded, that really pissed me off and I wasn't open to it.Then I was like relatively active in the Ethereum community early on and DeFi. We had Teo on the team initially who was one of the people the most involved in DeFi early on, he's now the Director of Strategy at Uniswap, and he definitely showed us all on the research team why this makes sense. And when I really started understanding that these tokens are not just useless, they can actually be used for real things, and they do get closer to almost equity in some ways, even though obviously a lot of them try not to, but when you have some sort of a claim and some sort of cashflows, that's when it gets interesting to me. And governance obviously as well, but that's when I really completely started flipping.Larry Cermak (04:57):But yeah, you're kind of right, I went from a skeptical no-coiner to then kind of a shit-coiner now, like spreading seed investments that I like.Anatoly (05:06):Do you still believe in this idea of sound money, or?Larry Cermak (05:10):So a lot of Ethereum community members think that Bitcoin is just a meme, it's going to go away, I actually don't believe that myself. I do believe that what's really powerful about Bitcoin is that it's been around for the longest time and it's very hard to compete against what it has, which is basically just the belief of a lot of people, and it's difficult to break that. And then you also have a lot of buy-in recently from, not only hedge funds, but also larger institutional investors, and that counts for a lot more than just blockchain, even though it sounds silly, something that's established as internet money and a lot of people pushing for it is really powerful.So yeah, I still kind of believe in that and I don't think that Bitcoin is going to be surpassed by Ethereum anytime soon, I actually have a bet going with Kyle from Multicoin about that. But yeah, generally I believe there is some merit to it, but I definitely also believe that people should be more open-minded, and because a lot of people are close-minded, they are missing on a lot of really obvious opportunities. Really my bread and butter is exploiting these things, when people underestimate something, and when there is actual merit to it that they don't see because of some reason or another, that's when I usually perform really well.Anatoly (06:35):Yeah, that's digging for alpha man, that's real work.Larry Cermak (06:40):Yeah. But yeah, The Block's research team, when I started obviously it was just two people, and now we have 25 full time researchers that a lot of them digged that up for me now thankfully. It is a lot of hard work like doing a lot of that myself, but now there's a massive team behind me. It's going really well, like we're reaching a lot of institutional customers as well, and the market just exploded massively this year for institutional access.Anatoly (07:08):That's amazing. So 25 researchers at The Block, how many people total?Larry Cermak (07:15):Around 70 or something, 75 maybe. But The Block initially, even when we started, I joined one of the first employees like 2018, and the vision was always to go through all the noise and bullshit and price predictions, and SEO plays and all the click bait nonsense, and try to go through that and have more data driven, research oriented coverage on the news side. We started with that and then eventually turned into actually a research product that just mainly focused towards institutional customers. But obviously, the news part is still a really important part of the business, it's what most people know, the institutional product is not really accessible for regular retail customers.And it's been a really, really fun ride, just going through this in the last three years. I don't think people realize how really difficult it is to go from nothing to building a media company that's recognized by people and somewhat respected. It's something that took a lot of hard work, and it's a very thankless business, like media, it doesn't usually make too much money, it's something that's really undermonetized in a lot of ways. So that's why we're going more into research, more into data, and just going after the institutional customers because they just have deeper pockets and they're more sophisticated, which is easier.Anatoly (08:44):What are the fundamentals with something like Bitcoin, something like money? It's just such a dumb idea for somebody that's like a value equity investor that's looking at the Amazon.Larry Cermak (08:56):It's a really good question, a lot of it is just a common belief that this is worth something. If you ask the same question about a lot of other things, you're going to arrive at the same answer, it's basically like the value is because a lot of people believe in it. Similarly with gold, like who's using gold for stuff, very little people for jewelry and chips and all that. Most people don't care about that, most people use it because they believe it will retain value and because they believe there is some sort of a scarce supply that's somehow protecting their investment.And it's Bitcoin, it's something similar, where you have a lot of really, really religious supporters who are the holders of the last resort who are just never going to sell, that creates a pretty powerful price for a lot of these things. And then on top of that, you also have guaranteed fixed supply, which obviously I think there are going to be some issues about in the future, but it is a meme that people buy, it is a meme that people believe in, and I think that in itself is more powerful than-Anatoly (09:58):But people don't write research reports on gold, or fundamentals of gold, or how gold is going to get more gold.Larry Cermak (10:06):... Yeah, no, I agree. And I think it's like funny, we started the research firm three years ago, and since then what can you really research about Bitcoin? We've done obviously a few research pieces about mining, and few like micro looks basically on how Bitcoin is performing, but ultimately there really isn't much you can research. It's more so about just like enough people believing, and the better the buy-in is and the longer Bitcoin survives, I think the better the likelihood that it will continue surviving, is kind of my thesis. But there are a lot of issues obviously, like it's still not exactly figured out how everything is going to incentivized when there is not many subsidies anymore, and a lot of people just don't want to answer these things right now, because they just put it off.But generally, yeah, there isn't much to research, we don't research much. What we also do from time to time is just explain what Bitcoin is, explain how it works, to just institutional customers that want to learn just fundamentally what it is. But generally yeah, if you want to dig a little bit deeper, really like Bitcoin mining is the only thing where look at a lot of data and analyze how that's going, everything else not much honestly.Anatoly (11:19):Part of this research right is to give you some ability to predict price I would imagine, like why would I care about Bitcoin, is because I hope that it doesn't crash or it goes up, something. So where does that come from?Larry Cermak (11:36):It just comes from people that... and I think that this is somewhat justified, let's see what's going on around us for the last two years and see that inflation is spiking while a lot of people have been denying that this is going to happen. It's just like this belief of finally having control over something, something like being programmed before, is a powerful concept that a lot of just hedge fund investors and institutional investors just buy into.Anatoly (12:02):Is it like a fundamental though? Are we going to have accounting standards for how much of a religious belief is spread?Larry Cermak (12:15):I think that by itself is somewhat fundamental, like why are people investing in gold, you can be asking the same questions. Central banks have some gold, but ultimately it's just because enough people believe that it will retain value, and it has done that relatively well historically. And as we are moving, everything as you know is now moving to the digital world, everything that used to be physical is somehow transforming into the digital world, and there's probably no reason why that shouldn't happen to money either.And I think fundamentally, there also is some value to Bitcoin not changing that much. A lot of people make fun of it and I think it is kind of funny as well, there is not much innovation in Bitcoin, but also that it's one of the benefits, where you have something that's totally predictable, you have something that you know what to expect from. I kind of buy that as well, I think Bitcoin is one of the most boring things that you can invest in, but it's also the thing that usually gets people in the door, and it's always when friends come to me and when they say what they invested in, it's almost always Bitcoin first, just because it's talked about the most.It's kind of like also the most safe, if you think about it. Everything else is kind of still unclear, even Ethereum, even Solana, it's not totally clear if all this is going to end up working out and if there's ever going to be some larger issues. Whereas with Bitcoin, it's a lot of more guaranteed that if people keep having this belief and if something is digitally scarce, it will probably retain the value in the future. So yeah, it is kind of ridiculous, but almost everything is a meme recently, so why not Bitcoin as well.Anatoly (14:02):Well, I mean it's weird, again, we're not looking at a company even like Google or Facebook, which has people and memes, or Twitter, but they still have like cashflow.Larry Cermak (14:14):Yeah, but Bitcoin was the first as well, which in itself has a lot of value. For every project, if you look at everyone who was always the first, even in crypto, there is always a big premium to that. And I don't think it matters too much if there are cashflows and if there are real people, it just matters if enough people believe that this will retain the value in the future and if enough people do.I think like Tesla was a massive fundamental shift, like we saw that with our customers on the research side, it absolutely exploded after the announcement, just institutional interest, more companies inquiring into what Bitcoin is, more companies thinking about treasury management. Those things really matter, and it's hard to go back from them.Anatoly (14:59):Can you like measure that? Can you measure how many people believe that Bitcoin is safe or like an inflation fund? You're literally just testing how many people are part of the religion basically.Larry Cermak (15:20):I think you can say something similar about Ethereum, probably about Solana as well, you always need some sort of a belief. Of course, there is some backdrop of some sort of cashflow, some fee generating, but it's the same shit as people saying oh, I'm only investing in cashflow generating DeFi projects, but ultimately who cares. Ultimately, if the price goes down generally over the market, it doesn't matter if you have cashflows or not, everything is going to crash. It's just like a general belief in the market overall.Anatoly (15:48):Especially if they're marked in the token itself, then if the price goes down, so do the cashflows.Larry Cermak (15:58):Exactly, yeah. So a lot of TVL metrics and all the revenue metrics, and not only that, but we've talked about this before as well, but a lot of the revenue or what people call revenue is basically just going to the participants, like LPs, it's not even distributed in any way. So a lot of this thing, I think it just doesn't matter too much, what's important is social belief. It really is, it does sound ridiculous, even to people on the outside, but when more people are buying into it, it is basically a Ponzi but it's really like a well working Ponzi.Anatoly (16:32):You said it. What about something like SushiSwap? What is the value there?Larry Cermak (16:42):I think SushiSwap is interesting, and the value is your belief that this will continue existing in the future, that the people involved in SushiSwap, the developers will figure out ways how to get some value out of the ecosystem. And even though I said it's kind of bullshit, it is, but it does have some claim to cashflows, unlike Uniswap at the moment.But yeah, the value is just you believing that the currently associated developers and the community will just build something that will end up sticking around. So right now, a lot of people are betting on the fact that they're developing an NFT platform to compete with OpenSea, they also have a token launching platform, it's always just going to be a bet on the people involved with the protocol and on the community.I think that's one theme that I see constantly, time and time again, crypto is very much about the community, it's very much about engaging with the community, listening to what they want. I think what SushiSwap has shown even though it was really, really cold early on, for some really good reasons as well, is that it does listen to what people actually want, because if they listen to what people want, they will get more support, they will get more public support, price usually is pretty reflective of that. So that value is just like betting on this being around for a longer period of time, adjusting to the market, so if people figure out that AMM is not the right way to go and it's [inaudible 00:18:17] based exchange, they're betting on the fact that they'll be able to pivot to something that is meaningful. I think that's a relatively reasonable bet, but SushiSwap is still giving out, or was giving out a lot of incentives. What a lot of people don't realize or maybe don't want to realize is that if you look at how much they're giving out in incentives and how much they're actually generating in revenue or cashflows or whatever, it's usually negative, even for the most successful protocols, because it's still right now-Anatoly (18:50):Like Bitcoin even.Larry Cermak (18:51):... Yeah. Bitcoin is slightly different, where you're ultimately burning energy to prove something. But yeah, it is similar.Anatoly (19:00):So why couldn't Sushi become the meme for internet money or a store of value?Larry Cermak (19:07):I just think because Bitcoin was the first, it's the most established, it has probably closest properties to something like gold which is also a meme that people believe in. I think it potentially could, it's just unlikely. Ethereum could potentially replace Bitcoin at some point if enough people believe that that will happen, but I don't think that's going to happen anytime soon. If I was betting someone, and I think I bet Kyle that this is not going to happen by the end of this year which is ridiculous, I don't know why he made that bet, but even in the next three or five years, I don't think that's going to happen.Anatoly (19:47):I'm a logical person, I'm an engineer, this stuff doesn't make sense to me, so I try to break it down into things. The pieces that I see is that there's the technology to coordinate shared state, Makimoto, BFT, whatever, and then there's the people participating in that shared state, and the size of the people is that super connected social network and the technology is the piece of tech that does it.Larry Cermak (20:13):I mean, look at equities right now, no one fucking cares about the fundamental value, no one is investing based on that. People are investing based on meme, based on what they believe the future will be. So even something as dumb as Tesla, no one is looking at the cashflows, everyone is looking at the potential to become something larger in the future, and I think that's the same in crypto. People are looking at Bitcoin as being able to capture a lot of that. If you have someone that's right now, institutional investor or a big hedge fund, and they're looking for instruments to hedge the inevitable inflation that's coming in the market as central banks kind of went nuts in the last two years, what are your options right now? You're probably not buying Ethereum, you're probably not buying Solana. Maybe you're buying some gold, but probably you're already overexposed to gold in some way, and then also the upside in gold is probably relatively small, it hasn't really moved, it's not volatile, the opportunity isn't that great.So if you're looking at it from like a really pragmatic approach, and I talk to these people so I know how they're thinking and this is how they're thinking, I mean it just works that way, it doesn't matter if there's no logic to it, what matters is enough people just buying into this meme and buying it because they believe that the price in the future will appreciate.Anatoly (21:40):Because the meme will get stronger so you get more people into that?Larry Cermak (21:44):Yeah.Anatoly (21:44):So if these are like memes, these are basically social networks.Larry Cermak (21:49):How much of the recent price appreciation in Solana do you think it's because of strong memes and because of strong community buy-in? Maybe you think differently.Anatoly (21:59):I can be totally honest, I think it's purely people comparing us to Ethereum. And they're like, well Ethereum is more and this [crosstalk 00:22:07] good.Larry Cermak (22:07):Exactly. And then if you make this comparison to Bitcoin and gold, it's exactly the same stuff. People are like, oh shit, what if this goes up to the gold's market cap, the upside is still 5 to 10x, or whatever it is. It's just like, that's how people think, and I think that's exactly right, you're totally right, it's because people in Solana or a lot of investors in Solana, they're like all of a sudden, what if there is 5% chance that Solana takes Ethereum's users and replaces Ethereum in some way?Anatoly (22:39):They're not doing the fundamental valuation comparison of what is the actual value of this thing to the world? What is the benefit derived from it even?Larry Cermak (22:51):Again, we can go back to this in almost everything, what's the benefit of any company, it's to satisfy shareholders, and people don't really care about cashflows anymore lately.Anatoly (23:05):Sure, but we can remove the cashflow component, maybe in a fully super connected peer to peer system, that doesn't make any sense. Maybe there is no cashflow because you don't have like a centralized coordinator that's doing it, it is purely peer to peer, then how do you measure what is the fundamental value that this thing is providing to the world? Like if this didn't exist, is the world poor? Can we even say that?Larry Cermak (23:34):Yeah, probably not, but again, you can this about everything. A lot of things don't need to exist.Anatoly (23:40):I can say that about Tesla, I can say if Tesla didn't exist the world would be poorer, because there would be fewer electric cards, high quality electric cars. I can clearly say that.Larry Cermak (23:54):I guess so. But the utility is always a small aspect of why people are buying into it, it's more so just your bet that in the future, this will become more important. And as people are grasping with how much inflation is hitting right now, there just aren't many other options, and I think that's really the main reason.Anatoly (24:14):So I can see price being inflated due to... there's so much money available, so much capital that is seeking future gains, that anything with potential for upside is now overvalued. But maybe not overvalued, maybe it's just market value, it's just the market value for future gains is so large right now. But I can still kind of look back at the dot.com era and look at like okay, Amazon was overvalued, Microsoft was overvalued, because there was a huge crash, but I could see that if I remove this thing from the world, the world is poor. Are we there yet with crypto, 10 years in?Larry Cermak (24:58):I think honestly we're getting there. I think crypto now, in the last two years, showed us there's potential to do good, which is basically giving access to something that they didn't have before, and tangibly making their life better for one reason or another, and also just giving people access to this new asset class. I think those are really powerful concepts by itself. And on top of that, you add like composability of all these different protocols working together.I think yeah, I would say if crypto wasn't here, the world would probably be worse of, and I also think that the longer crypto is around, the higher the chance that it's not going to go away. I'm very sure, I can't imagine a world where in like three years, we bump into each other on the street and we say, holly fuck, this crypto thing was dumb and it's not around anymore, I just can't see that.Anatoly (26:04):We're all infected with the same virus.Larry Cermak (26:06):The concept of crypto makes a ton of sense to me, and it is definitely empowering people, even in jurisdictions that normally don't have that much access to the financial system. For example, we have a researcher from Kenya on the team, and we only pay her in stablecoins I believe, or it might be crypto, and we initially tried to pay her through the regular banking system and it was almost not possible. She's just one example, but there's tens of thousands of examples like this, where you have people all of a sudden getting access to something that they couldn't access before, and even if crypto just helped with that, that by itself, I love that, I love giving people more equal access to stuff.Anatoly (27:01):Okay, I'll throw some theories out and see if they stick. I think NFTs are a clear good to the world because any luxury spending that we move away from, like fast cars that burn fuel or penthouses into digital goods, is good for the world. Let people waste their money on digital things, because it costs nothing to create, that's great. So that's one theory.Anatoly (27:35):The other one is, if we are moving into post-capitalist society totally where everything is plentiful, what would people be doing? They would just be messing around in the digital metaverse, this is all just part of it.Larry Cermak (27:56):No, I think those are pretty good theories. I think it is kind of fascinating how you had this shift from NFTs basically being in like a digital flux, the most luxurious NFTs only owned by the elite, that's really, really interesting to me. I remember 2017, I was looking at CryptoKitties, and none of that made sense to me, and even with CryptoPunks, I was probably one of the biggest CryptoPunks skeptics as well, even earlier this year. The price is probably like 100x or 1000x since then, it makes almost no sense to me fundamentally as well, but it's what it is.I think NFTs are quite similar to Bitcoin, Bitcoin is basically one of the original NFTs. It's the same thing, you're trying to collect as many of them as you can, and because you believe it's something that will have some value, and similar things are happening with NFTs. And yeah, maybe it is removing some luxury overspending on dumb cars and watches and all that, but who knows, I don't know if this is going to stick, but it seems sticky so far.Anatoly (29:08):My theory is that we're going to see internet money be a perpetual basis trade of a NFT floor market, that's going to be the asset that's backing internet money. It's not going to be Bitcoin, it's not going to be ETH, it's going to be entirely backed by culture, [crosstalk 00:29:32].Larry Cermak (29:36):Yeah, maybe. But I think that you kind of hit it on the head, a lot of this is just literally backed by culture, backed by communities, backed by culture, and that's what matters.Anatoly (29:45):Do you think algorithmic stablecoins can make it?Larry Cermak (29:48):Oh, no. Again, there are going to be people that are going to say, I'm super dumb and not looking at it from the right perspective, maybe I am, but I think algorithmic stablecoins are fundamentally broken. You're always relying on some sort of demand to be the backdrop of stabilizing these things, and I'm just not skeptical that that's going to hold up in really maybe not as favorable market conditions long term, and I have not seen a single evidence to show that these things will be resistant to some sort of scrutiny in the future. That being said, stablecoins are probably going to be regulated by the US government, and maybe if you create enough demand for these, it can sustain for some time. A lot of the algorithmic stablecoins have performed incredibly well, because they're really like, what happens if stablecoins are called securities in the US now, it severely impacts the rest of the crypto space. And when you look at something like DAI, it's backed massively by centralized stablecoins as well, and then all of a sudden what's the alternative. If none of the centralized stablecoins are allowed to be used by investors in the US, even on Solana, a lot of the DeFi apps still use USDC and on Ethereum as well.I think that's why there's a lot of interest, is because people are realizing that centralized stablecoins are obviously prone to be regulated, and if they are, it's going to affect how the rest of the space operates. DAI hasn't shown that it's actually really decentralized, especially now that it's backed massively by centralized stable coins, and you don't really have any other options at the moment if you want to just transact value in some sort of stable instrument. But generally I think the idea of algorithmic stablecoins is never going to work. It's much better to just use Ethereum, or Solana, or Bitcoin as [inaudible 00:32:06] value and just [inaudible 00:32:07] if stablecoins are regulated, at least that's my belief.Anatoly (32:11):How much do you guys spend researching regulation in the US specifically?Larry Cermak (32:17):Not much on the research side, mostly on the news side, we have people in Washington that talk to these guys. But I guess the problem with researching regulation generally is that it's super opaque, like you don't see into it. Unless you talk to people and actually ask them what they're thinking, you don't really know. We know some people who are talking to the SEC, we know some people that are talking to CFTC and some regulators, and we have a directional idea of what will happen, but ultimately none of us can know until this is actually going to go into effect. We sometimes talk to the lobbying firms as well and they also don't know, it's a black box completely.But I think what most people that we talk to that actually are in the know or some sort of insiders, they agree that some sort of regulation is coming. The SEC obviously, there have been tons of indications already, but the SEC will do something, the question is how severe this will be. And it is very likely to me right now that within the next year or a year and a half, there will be some sort of a framework for crypto assets from the SEC, so they can actually with some sort of certainty know if it could be a security, or if it just a utility coin, or a governance coin.And there are also some serious indications that stablecoins are going to be in some way regulated. I've heard rumors that there are a lot of people who are trying to label it as securities, but none of that is final, and I don't think we're going to find out until actually that gets released in some way.Anatoly (34:00):Yeah, there is this like a lot of big uncertainty. You don't think there's any hope of US actually just creating clear, simple rules that just open the space up to innovation? Are you both bearish on regulation and bullish on crypto at the same time?Larry Cermak (34:22):I think the US is likely going to release some guidelines, the SEC will likely release some clear guidelines for what is and what isn't a security, I think that's going to be coming. That could be positive in some way, it's probably going to label a lot of the governance coins as securities, it could be negative short term as well.Generally, yeah, I'm pretty bearish on US regulation. What I've seen anecdotally is a lot of people just getting out of there. I frankly don't understand why DeFi teams are based in the US, why Uniswap team is based in Brooklyn, it makes no sense to me. I think if you're trying to build a really censorship resistant DeFi protocol you should get out of the US, because there is uncertainly for you right now and also for people to invest in your protocols, there's just too much uncertainty. And I think a lot of the future in crypto will be anonymous developers developing these protocols, I'm pretty convinced about that as well, that this eventually will shift into pseudo-anonymous developers that are not doxed. I don't think this will happen to like L1s, so the networks that will be securing these protocols, but I do believe that those that are really trying to empower people without being limited by sometimes nonsensical regulations, I believe those will have to be build by pseudo-anonymous developers, in some way or another, and then just decentralize early. I think that that's going to solve some of the issues. There are obviously some doubts about people trusting these projects, but there have already been some hints at this potentially happening. So I'm pretty optimistic that this will happen.Anatoly (36:12):What is decentralization mean in that context for these projects?Larry Cermak (36:16):For me, it means just inability to shut something down. So if you're the SEC and if you're looking at Uniswap, maybe you can call the UNI token a security, but ultimately what are you going to accomplish if you go after the project? You're not going to able to shut it down, you're probably just going to look like a fool afterwards, so you don't have that many options. So to me, decentralization means if someone really wants, if a regulator really wants, or if some third party really wants, it's possible to shut you down. So just having unchangeable [inaudible 00:36:50] is a point on Ethereum or on Solana, that's decentralized to me, and I think a lot of that will go towards that direction.We've seen examples of this with 1inch for example in the last two weeks, 1inch started limiting US customers or at least letting them sign a message. And that's partially because they're doing a lot of [inaudible 00:37:15] computing and they can be targeted in some way by these regulators, they can be threatened, whereas some other protocols really can't be. And I do also think that in the future, like in the next couple of years, there's going to be a lot of front end basically blocking or geo blocking, and restricting uses, blocking assets. So there's going to be a shift into alternative front ends for example, or making people interact with the protocols more directly that what they do now, which is they google Uniswap, go on the Uniswap's website, and then swap an asset, like that's not going to be sustainable, I'm already pretty certain about that.Anatoly (38:00):I'm just annoyed that like, if this is pure code, what is there to regulate? The token right, or the UNI token. So to speak to your original point that you've become a believer of every project needs a token, but if the contract itself doesn't need a token doesn't do anything, besides run this mathematical function, there's nothing to regulate.Larry Cermak (38:22):That is true, that is all true. I think why projects need a token is pretty simple, it's because it builds communities and it builds engagement, and it helps you incentivize some sort of usage or bootstraps these protocols. So I don't think that if Compound didn't do the initial liquidity mining last year, I don't think DeFi would be where it is right now, and the same goes for Airdrops. It just helps to engage people, it helps to get them invested in some way, and that's why I think they're important. But you're totally right, they are opening up a possibility for regulators to go after these tokens and regulate it in some way.But tokens are also opening up opportunities for not only people to invest, but also institutional investors and more capital to be draw in. A lot of the VC firms right now, they're completely stacked in cash, there's billions of dollars on the sidelines right now waiting to be deployed, they're only investing because they know there's some sort of an exit strategy, which to them is selling the tokens at some point in the future to enough people that think it's going to be more valuable. And I don't think this would happen if there were no tokens, I used to believe this myself as well. It's like Uniswap doesn't need a token, it's a perfect protocol, it's totally fine the way it is, but because it does have a token, it just attracted more usage and it's trending more people to actually use these things. And I think that by itself is something that probably overweighs the negative consequences which is more regulatory capture.Anatoly (39:56):Do you think we could separate the devs from the community? Could you have the Shiba token adopt the best developers in the space? They built the distribution and the community and they're like, we're going bribe Vitalik to work on some more contracts for us.Larry Cermak (40:26):I don't think that can happen or will happen. We've seen this before as well, a lot of projects raised a lot of money, like Tezos or EOS, and they haven't been able to do much with it, they haven't been able to accomplish much. And I think a part of it is just because communities are built by people actually believing in the project, in the future, and I just think that communities rule everything in crypto, and that's how I think it's going to stay.Anatoly (40:55):This is like both utopia and dystopia at the same time.Larry Cermak (40:59):Yeah. I think it's just a pragmatic approach. You look at how everything has worked in the last three years, and the conclusion is like it makes sense for people to interact with these protocols early because you believe that in the future there's going to be some sort of an Airdrop. And then there are like loops to this, if enough people believe that there are going to be Airdrops for all the protocols on Ethereum and on Solana, they're going to use these protocols more. So even if you look at the number of transactions on Solana or just generally how many people are using these things and for what reason, a lot of it is just speculators, a lot of it is literally completely useless activity, and people just hoping that they're going to make money out of it. And that's fine, like if you're bootstrapping usage, if you bootstrap attention with purely capitalistic intent, I think that totally works. If Compound didn't do the incentives, I don't think we would be here right now talking to each other, I don't think Solana would be worth as much. And it's just a way to get more of that interest, and almost like abuse the speculators to get more attention for this, to get more mainstream media to cover this, to get more investors interested in this.Larry Cermak (42:11):I think it's much deeper than you think, where yeah, a lot of these are probably useless to some extent, but a lot of these are just social experiments, social tokens, and a way for people to get exposure to some of these things.Anatoly (42:25):If we use that as like the fundamental thing, then you really should be looking at these as social networks, how many people, how connected they are, what are they doing?Larry Cermak (42:35):Yeah, you should be, and then also utility on top. If I can get a stablecoin swap for cheaper than I can get it on [inaudible 00:42:43] exchange, that's probably worth something. Similarly for Uniswap, if some of these players have more liquidity and it's cheaper for me to go there instead of on Binance, if I want to sell $1 million of something, that's also worth something. But generally yes, it's absolutely a function of how many people are using these things, how many people are interacting with this. That's why I think for crypto, the most powerful indicators are really social indicators, it's like looking at how many people are using these things, how many people are actually transacting. What's more difficult sometimes is to remove all the either fake activity or non-essential activity, and that's the hard part. But generally yeah, it's just a function of attention, function of which people are involved, and eventually you hope that this will turn into a mainstream thing.When I look at DeFi right now on Ethereum, and even on Solana, it's a relatively meaningless number of people using these things. Even Uniswap, maybe 150000 users maximum, it's a joke. None of us think that this is why we're here, all of us think that this will eventually go to tens of millions of people using these protocols, and that's really the end game. And I think even obviously for Solana, one of the premises for why it's designed this way is to support a lot of these new people.Anatoly (44:06):Yeah, I've said this a bunch of times, that trying to predict how this stuff is going to be used is like trying to predict Facebook in '94, zero chance I would've believed you that sharing pictures of your cats is going to be worth a trillion dollars, it's ridiculous.Larry Cermak (44:24):I totally agree, and no one knows. I think that's kind of the fun part, that it's like enabling people to really do whatever they want, it's really cool. Even just me talking to some small teams about seed investing, it's like you're talking to people in Pakistan and India, those guys normally would be somewhere closed up in their office, not really having these opportunities, and now all of a sudden they can develop these protocols, they can arbitrage them, they can make money. Like we have a guy in Russia, a genius coder, he's exploiting these arbitrage opportunities and making a ton of money, that's awesome. That's really powerful.Anatoly (45:07):Awesome man, really good to go deep down the rabbit hole with you.Larry Cermak (45:13):Yeah. Honestly, I didn't expect I would be the one convincing you of crypto's potential, I thought it would be the other way.Anatoly (45:21):I'm an engineer, so I look at a system and then I try to like, where does it break down? What does all this stuff not seem backed by strong arguments and real physics? Why is it all bullshit?All right man, really awesome to have you. Thank you so much for being in the Solana Podcast, and always enjoy your work at The Block.Larry Cermak:Thanks a lot.

Packy McCormick is the author of the tech/web3 newsletter Not Boring and runs Not Boring Capital.00:09 - Intro01:34 - What are people building in the world of crypto / What does ‘Not Boring’ invest in09:36 - Ownership in Crypto16:00 - Conversation around Play-to-earn19:06 - The regulatory aspect22:14- How does Anatoly balance his time23:54 - Thoughts on DAOs29:33 - Network Effect and defensibility in Crypto32:18 - Centralizing in Crypto35:20 - Solana in relation to DeFi, the cultural and the metaverse side of things.39:13 - The internet is Silicon Valley41:12 - NFTsDISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. Anatoly (00:09):Hey, folks. This is Anatoly and you're listening to The Solana Podcast, and today, I have with me, Packy McCormick, author of Not Boring. Hey, man. Good to have you.Packy McCormick (17:27):Good to be here. Thanks for having me on.Anatoly (00:21):So, You're an author and you're also an investor. How did you get into crypto?Packy McCormick (00:26):Yeah. So, I got into crypto back in 2013. I read Fred Wilson's blog post on investing in Coinbase, bought a bunch of Bitcoin, I think 38 Bitcoin, and then I went on a trip to Oktoberfest, and I felt bad about it, I had just quit my job, so I was like, "You know what, instead of spending money when I'm unemployed, let me just sell this stupid Bitcoin and I will pay for the trip."So, because of that, because of the pain of selling then, I avoided it until earlier this year, later last year, and really, really got back into it as I was talking to a couple companies that I was thinking about investing in and thinking about the intersection of crypto and the metaverse and how an open economy just fits so much better with that vision, since then, I've just gotten deeper, and deeper, and deeper down the rabbit hole.Anatoly (01:18):So, you held Bitcoin because you can sell it? That's just too big of a pain in the ass.Packy McCormick (01:24):I felt so bad about selling it and missing out. I think at the peak, it was like a two million dollar plus mistake, and so I was like, "You know what? I'm out of this for a little while."Anatoly (01:34):That's funny. What do you guys invest in?Packy McCormick (01:39):Yeah. So, I run a small 10 million dollar fund called Not Boring Capital, and we really invest across stages, across geographies, across verticals. For the first, I'd say, half of the fund, it was really traditional investments, I'd say for the second five million in the fund, it's been pushing up against the 20% non qualifying limit. I'm actually investing in my first Solana based project this week, which is yet to be announced, so can't talk about it, but something in the real estate space and something I'm super excited about. But doing as much crypto as I can in there, but I still think some use cases are perfectly well suited to crypto and some are really not. There's plenty of things in Web 2.0 that I'm super excited about as well, so really trying to balance investing across both.Anatoly (02:27):So, by traditional businesses, you mean like software internet based ones?Packy McCormick (02:32):Exactly.Anatoly (02:33):Cool. I mean, I've been in crypto for like the last... I can't remember... it feels like a decade, and I can't imagine what the world is like. So, what are people building?Packy McCormick (02:48):It's a good question. So, today, I talked to a company, for example, that is making it a lot easier for a restaurant to order the food that they need. So, right now, if you're a restaurant and you're ordering food, you're getting a bunch of PDFs from suppliers every week that aren't even searchable, and then you're going through the 6,000 items on there and picking something. So, there are still a bunch of these huge unsexy categories that are completely ripe.There's some security stuff that bridges into crypto, but there's one, again, stealth right now, but is also dealing with some Solana projects on the security side that I'm really, really excited in, but they're also securing Web 2.0 projects. There's some FinTech stuff I wrote about a company called Uni, yesterday. There's definitely a little bit of mental gymnastics that I have to do to be super bullish on FinTech and super bullish on crypto, but I really think adoption cycles are going to be super long and there are some really huge opportunities on that side too. I think everybody is trying to make the existing system that doesn't work, make it work better for people, and so I'm all for things, on either the Web 2.0 Side or in crypto, that make finance better for people.Anatoly (04:01):The mental gymnastics are curious about. I always thought that crypto is just part of this general story of software eating the world. Is that your take on it too?Packy McCormick (04:12):Totally. I mean, I wrote about Solana and I wrote this in the piece, but then I'm a maximalist-minimalist, and that's cross chain, but that's also I don't think crypto is going to eat everything yet or maybe ever. Just like on the internet, Web 3.0 is really about the dynamic interfaces where you could interact with each other. While there are companies like Facebook and Twitter and all of this social media companies that were more interactive, there were a ton of huge companies built during the Web 2.0 Era that weren't social media, that weren't real-time interactive at all, and I think the same thing will play out. I think you need to pick the best stack for whatever you're building at the time. And so I think we'll see a world where a lot of stuff moves to Web 3.0, And hopefully, even things that don't incorporate crypto become a little bit more liquid, a little bit more decentralized, a little bit better for people, but I don't think that crypto is the answer to every problem that the world has.Anatoly (05:05):So, when you look at a company that is building out the basic, "Let's convert PDFs to a searchable interface," that feels like something that should have happened 10 years ago, right, in your mind, at least?Packy McCormick (05:23):Totally. I mean, I think there have been attempts in that space actually, and some of them haven't worked. There have been different approaches. People have tried to do marketplaces and different things like that. I think what changed in that particular case is that over the past year, one, restaurants are super cognizant of cutting costs and getting profitability to the best possible spot, and so they're more willing to try new things. These people are taking an interesting approach without actually changing the interface that the restaurants interact with at all, they're just making everything behind it more powerful. So, things have been tried... there's people that are trying new approaches every day. I mean, I'd say 80%, because that is the literal max that I'm allowed to do is 20% crypto out of my fund, so 80% of my investments are non-crypto, and there's a bunch of stuff that's growing fast and is really exciting.I think the other interesting thing is that there are a bunch of companies that aren't going fully decentralized but are incorporating maybe a DAO in one aspect, where they have members who might be running something and want to vote on what that thing is coming up, or will incorporate NFTs in a particular part of the business where it makes sense. So, I think we'll see that blur a little bit more, but even within companies, they'll be doing some Web 2.0 Stuff and some Web 3.0 Stuff.Anatoly (06:32):So, I guess, in a way, you're bullish on non-crypto on the rest of the world as an investor?Packy McCormick (06:41):Yeah, my worldview is bullish tech and innovation, and I think if you're talking on the... I have a medical device company in the portfolio and a machine learning company that helps make sense of medical documents, and all that kind of stuff, I don't see a need yet for crypto, and maybe there's better decentralized storage of that information in the future, so it's not a centralized entity. And so over time, I think more, and more, and more of it will potentially become decentralized as the tools catch up, but for right now, that's just stuff that needs to improve.There's a company called NexHealth that I invested in that has really complex long term plan to first, sell SAAS into doctor's offices, use that to connect the EHRs, use that to build out APIs, use that to build out a platform, to ultimately try to make it easier for people to just hack on medical products, because right now it's such a pain in the ass to do anything in the medical space. I am super bullish on that kind of innovation because if you ask me what doctor I went to two years ago, I'd have no idea, if you asked me what my stats were, I'd have no idea. So, anybody fixing any of those kinds of things, I'm super bullish on.Anatoly (07:52):Man, I mean, the internet is basically 30 years old, right, at this point, and it's wild to think that we're still connecting just data...Packy McCormick (08:00):Totally.Anatoly (08:02):... data to format.Packy McCormick (08:03):It's why I'm going to be bullish on all of this. The internet is still early in terms of penetration, and then crypto is a tiny, tiny, tiny percentage of that, so there's just a lot of room for all of this to run.Anatoly (08:13):It feels then like everything is happening at the same time, we're still onboarding the world to the internet or now, part of the internet is being on boarded to crypto. Is that something that you first saw? What do you think about that?Packy McCormick (08:29):Yeah. I mean, I think most of the world... I think well over 50% nowadays is internet connected. I think it's just more and more things that were not internet connected are being tackled. I think a lot of the big obvious opportunities get taken and then people realize like, "Oh, shoot." I think I've seen, in the past week, a couple of companies that are making it easier for truckers to pay for gas and track those expenses. There's just all these big things that touch the physical world, where primitives needed to be built first, you needed banking as a service type things to make it really easy for companies to issue cards, to build it for specific use cases, so I think it's all just a matter of what primitives have been built and then what you can do on top of that. That's one of the reasons I'm so excited about crypto is because you and other folks in the space are building such interesting things for other people to build on top of.Anatoly (09:15):Since you have, I think, a more maybe practical or realistic view, since you're dealing with non-crypto projects that are trying to get revenue, right? That's generally the pitch to an investor.Packy McCormick (09:33):Yes. Over a long enough time horizon, some of them need to get revenue.Anatoly (09:36):What do you see in crypto itself as promising to use crypto in a way that actually increases revenue for that business? What are those things?Packy McCormick (09:48):Yeah. I don't know. One of the fun things about exploring both sides is that I really try, when I look at any crypto project, to understand what business physics laws it's enhancing. Businesses are businesses because people buy things the same way all over the place or people like to make money. People are the same, and I think all of this comes down to people, obviously. Solana comes down to how many developers build on top of it and how many people use that. And so obviously, I think one of the big important things is the ability to build network effects by giving people ownership. And I think the idea of using ownership in crypto to even have negative customer acquisition costs, to be able to essentially make the price of something negative to be able to get adoption, to use crypto tools for retention and network effects I think is one of the big things that excites me.I think it's also just moving way, way, way faster. I mean, look at Ethereum and Solana, right? Ethereum, strong network effects, people building on top of it, and then Solana comes in and looks like the same chart but faster. And so you can get these network effects, but then somebody else will come in with network effects that are even faster, and I think it's going to be interesting to see how those types of things play out.Anatoly (11:05):Negative acquisition cost is a really interesting topic because that's basically yield farming, right, like DeFi? The foundation of DeFi, how I get users is, a lot of these projects give away their coin. Do you think those patterns is something that you're going to start seeing in traditional businesses, like AMC popcorn, if you buy AMC stock is some form of liquidity mining, right?Packy McCormick (11:39):I think the challenging part, right, is that people want either money pretty immediately or they want ownership in something, and it's really hard for Web 2.0 Companies to give away ownership, there's a ton of paperwork involved. There are platforms that are trying to make that a little bit easier, but it's still really hard for them to give away ownership the way that, if you're a DeFi protocol, you can give away your token to attract users in the beginning.So, maybe there will be some things that Web 2.0 Companies steal and bring over from crypto, but I do think that's one of the uniquely beautiful things about it, is that it's this... I mean, we'll see. It's still so early, right? But that it's this beautiful thing where because you're early, you're able to earn more, and then because you were there, you actually support the network and make the network more secure and all that. So, there's actual justification for it, but it's just that shift in who gets the ownership of things, which I think is kind of beautiful.Anatoly (12:35):Do you think that the Web 2.0 properties, or like Facebook, Twitter, that those are at risk for being disintermediated by crypto?Packy McCormick (12:44):Yes. On a long enough time horizon, absolutely. I don't know what it looks like, and I think the early attempts to do it have been a bit skeuomorphic, and that's one of the things that interest me here is that BitClout was, I guess, interesting, but it was Twitter with coins, and I don't think that the next social network will look like Twitter with coins, I think it will look like something that is maybe wallet first, or maybe in the 3D world, or something that looks different but then achieves a very similar end. And so I think, yes, 100% they're at risk, but I don't think that they're at risk from something that looks like a clone but adds a token.Anatoly (13:23):Man, I love that word, skeuomorphic, because that's how I started thinking about it as I'm talking to a bunch of projects that are trying to shove crypto into what is a Web 2.0 thing, a Web 2.0 product. Do you as an investor see that as a red flag or like, "Okay, maybe this might work and you should try it, but clearly, you're going to have to iterate away from it"?Packy McCormick (13:46):I think it comes down to what you're trying to do. I talked to an investor who is way smarter than I am about this the other day, and she was like, "You know what, actually for me, because I invested in the series A and beyond, if one of my portfolio companies came to me and said that they're going to incorporate crypto at this point, that would be a red flag because that means that they don't have product-market fit and they're trying to figure out how to get product-market fit by doing something else shiny." There are other projects, like there was something that I was talking to her that was totally Web 2.0 Based but that asked people for feedback, they were having challenges with retention, they were asking users to submit information, they were thinking about how to reward them, and for something like that, particularly when it's so early, I do think that adding crypto into the project makes a ton of sense.If you're trying to incentivize contribution and improve retention, crypto is an amazing tool for that for the right type of community. So, I really think it depends on what type of product it is, and some things I think skeuomorphic might work in some cases where you're ripping out an internal reward point and replacing it with crypto, I think that can make sense, but when you're trying to just shove money into something to see if you can attract more users, that's when I feel like there's a bit of a problem.Anatoly (14:59):So, Reddit Coins, do you think that's going to work?Packy McCormick (15:02):I mean, they're at least early and I feel like they're such an interesting community of people, and the idea of karma has existed in Reddit for a while, so maybe making that a little bit more fungible and exchangeable is interesting. I mean, there's a bunch of behavioral economics on the idea that if you just pay people for stuff, you actually fuck up incentives in a bunch of different ways that are hard to predict, so it could be tough. When you actually assign a dollar value to something, you make people think about it in terms of the dollar value, and they're like, "Wait, I just spent a day moderating the subreddit for $1? Are you kidding me?" So, I think you need to get that part right, right? Where you can give them a million karma points and it doesn't matter, but then it becomes $1 then there's an issue? So, I think people need to be wary of that, but certainly where there are internal scoreboards, giving people a way to actually monetize that I think is interesting.Anatoly (15:56):Have you looked into play-to-earn stuff?Packy McCormick (16:00):Yeah.Anatoly (20:39):Okay.Packy McCormick (16 :02):I wrote a piece on Axie. I think it's so fascinating.Anatoly (16:05):I'm terrified of a world where everything we do is like, "You got to do this to get your 20 extra cents on your dollar." Right? It just sounds like a nightmare.Packy McCormick (16:15):I know. I mean, I am of the mind that dystopia is probably overstated because people have to opt in at every gate, and so I've had conversations with people where they're like, "Isn't it wild that we'd be spending time in the metaverse? Isn't that dystopian?" And then you think about how we spend a lot of our time right now, we're in a two dimensional screen. Wouldn't it be more fun if there was an immersive environment that we were interacting with here, and would we just continue to choose to do the 2D version until the 3D version got realistic and fun enough that we made the shift? And so there's going to be those gates at all times where people can opt in or not.A lot of the people playing Axie right now are in the Philippines, were unemployed, thanks in large part due to COVID, and so their options were, "Don't do this and figure out some other way to make money or start playing this game, that you might be playing anyway, and actually make money while doing it." So, that's an incredible option that people have, but you also don't see a ton of people in the West flocking to Axie to make a couple of bucks because the trade-off doesn't make sense for them. And so I think the trade-offs have to make sense for people but everybody has agency, to some extent, and will opt in to the things that make sense for them.Anatoly (17:29):When I played Ultima Online, I bought digital items in that game on eBay with a cashier's check. So, I get this idea that you can get really into a game.Packy McCormick (17:41):Totally. And then you stop playing Ultima Online and that money is just wasted, right? And so the idea that you could easily transfer that item to the next generation or person that wants to go all in on the game is nice, it means that you're accumulating something while you play. I think, over time, those experiences will fade more and more into the background and it will feel less like play-to-earn and will probably just be play-and-earn, but there's going to be a transition period where you have to just be bold about it and the play-to-earn piece has to be front and center, but I don't know.We can go to deep down the philosophical rabbit hole on all of this, but there is a point at which, at some point in the future... and I know this is debatable... but at some point in the future, we're not going to have to actually work to eat, to shelter ourselves, to have clothes, all of that, and so what do you do that provides meaning, right? I don't think we're going to evolve into a world where we feel comfortable not having to work for anything, and so people will find new ways to make meaning.Anatoly (18:47):We're going to be NPCs in each other's games.Packy McCormick (18:51):Seriously.Anatoly (18:53):How much do you pay attention to the regulatory side of it? Do you think World of Warcraft is going to have to file W-2s?Packy McCormick (19:06):Man, I do not envy the IRS or the SEC trying to keep up with... I do this all day, every day. I'm fascinated by it and I can't keep up with everything. There's going to, obviously, need to be a total paradigm shift in the way that this stuff is tracked and managed, even taxes. I am going to figure out, at the end of the year, whatever the best tax software that I should use to make sense of everything that I've done all across Web 3.0 This year, but if I didn't, the chances that somebody sitting in the IRS for my small potatoes amount of money is actually going to be able to go and figure out what I did is minuscule. So, I don't know how they're going to do it, but there needs to be a common sense way that doesn't end up in just this constant clash.Anatoly (19:54):Yeah. All my Degen Ape trades.Packy McCormick (24:36):Seriously. I mean, there's a thread that went viral on Twitter a couple weeks ago that was someone being like, "Hey, by the way, did you know essentially that when you buy an NFT, you're also selling your coins at a game and you're going to have to pay taxes on that?" There's going to be a lot of people who get hit pretty hard at the end of the year.Anatoly (20:15):Yeah. I'm curious how that's going to play out. That's wild. I mean, like one of the investments should be like, "Here's tax software for all your crypto shit." That seems obvious one.Packy McCormick (20:28):Yeah, there are a few people working on that. I mean, the other one that I really want to see... I had mentioned this 20% limit. So, if you're not an RAA, if you're not a registered investment advisor and you manage over X dollars, you can only buy 20% non qualifying, and crypto is included in that. I really want to see someone build RAA in a box, and RAA means that you need a chief compliance officer and you need all this stuff. And so somebody who makes that easier to do and easier to set up crypto funds I think is going to make a killing as well.Anatoly (20:58):I mean, that seems like something that the smart contracts should be doing, right? If you're investing purely... Most of that compliance is just transparency, right? It's like, "Am I doing the thing that I said I was going to do?"Packy McCormick (21:10):Totally. But some of it is, "Is there a person here looking over what I'm doing?" The rules are written for a world in which it makes sense for a person to look over something instead of computers talking to each other. So, there's going to be a transition period there, but over time, yes, it makes a lot more sense as a smart contract, and I'm interested to see.Are you familiar with Syndicate protocol?Anatoly (21:33):I'm not.Packy McCormick (21:34):So, Syndicate protocol is I think mostly on Ethereum at this point, but it makes it easy to set up investment clubs, SPVs, a bunch of other things, and so brings a lot of the group investing activities on chain. Is there anything similar on the Solana side?Anatoly (21:50):I don't know yet. The network exploded in terms of people building on it to the point that I can't track.Packy McCormick (21:57):That's awesome. That's a milestone.Anatoly (22:00):Yeah, that's a milestone. It's just like, "Pooh," so now I'm like, "Okay, go back into the weeds, back into optimizations."Packy McCormick (22:08):Yeah. Sorry to turn the mic on you, but I'm very curious. How do you balance your time right now?Anatoly (22:14):Poorly, I would say. I think there was an effort to get the word out to as many developers out there that this is how you build stuff and these are the reference implementations, and now that that's moving on its own, I almost feel like me putting energy there is going to have such a small amount of gain. So, I think of it in value against replacement terms, which is a very dumb engineer perspective, or maybe that's a pretty good one. I don't know.Packy McCormick (22:48):No. I mean, if you can view yourself from a remove like that. I mean, that's the goal of running a company or an organization or a protocol is, "How can I replace myself in as many different spots as possible?" But are you in the Discords? Are you getting Degen on some of these projects and stuff?Anatoly (23:07):I used to be more Discord just telling devs, "This is where the doc started, this is how you unblock that compiler error or whatever." I was in there, and now there's enough people doing that, I'm like, "Okay, I'm useless here." So, in the early days of Metaplex, helping out people set up their Heroku servers or whatever, I spent a little bit of time doing that, but then all of a sudden, our engineers took off with it.I'm curious how you think about DAOs? Are these truly amorphous blobs where nobody knows anyone else and there's some voting mechanism that you trust, or as normal people actually that do this stuff, it feels to me that they are humans that are all know each other and they're coordinating with software?Packy McCormick (23:54):Yeah. There's been a meme going around, I feel like this week, again, on Twitter, where people have been talking about like, "Oh, it's impossible to get fired by a DAO. Why not just get hired by a DAO and then don't do anything because who's going to fire you?" I love the idea, and I love the fact that crypto makes it possible to organize and incentivize huge groups of people across the world and get them to work in the same direction, I also think there's going to be a ton of challenges.People are very used, for the past at least couple 100 years since the dawn of the corporation, people are very used to working in hierarchical structures where there's somebody making a decision. And so I think there will be a balance that gets struck in a lot of cases, like delegation I think will get more, and more, and more popular. And ideally, there's some projects being worked on that I'm excited about where people's on-chain contribution and activity and resume is almost tracked, and maybe you give more power to the people who've contributed the most and proven expertise in a certain area, and all of that. So, I think a lot of things need to be worked out there.I think that we're in the stage now, frankly, where a lot of DAOs will not do as well as a centralized thing would have done, but then some DAOs will just do this crazy emergent stuff that never would have been possible in a normal structure that was a little bit more hierarchical. So, I think we're in the, let 1,000 flowers bloom, phase of DAOs right now where emergence will produce some really interesting stuff, and then emergence will also produce some total failures, and we'll see where it all shakes out.Anatoly (25:25):Corporations have politics, right? There's definitely politics in large corpse, and I feel like small DAOs have politics, and that's typically not true of a startup.Packy McCormick (25:39):Yeah, I think that's true. Although it can happen faster to startup, but the interesting thing that happens at a startup is, if the CEO allows it to be political, it can get political really quickly. And so it's interesting, in the DAO structure, when you don't have a "CEO," that either the community ethos will be away from politics and you'll get shunned and banned or whatever for politicking, or there's no one to say, "Don't do that," in which case, it can get out of hand really quickly. So, if you have a bad CEO, it's probably better to be a DAO, and if you have a really good CEO, there are advantages to having somebody making the decisions.I'm also fascinated to see... and I don't know if you've seen anything on this side yet... but can a DAO build products that are as good as something with a little bit more centralized control? Like products are traditionally made by a visionary, and then a team, who has a clear roadmap and all of those types of things, and is it possible to do that in a more decentralized way?I mean, even Solana itself, one of the things that attracts me about the project, and again, not a decentralization maxi by any stretch of the imagination, is that you were involved, right? And when there were code errors, you were getting in there, you were telling people how to fix them and all of that. And I've talked to a bunch of people, since I read that piece, who were building things on Solana, who site that as one of the reasons that they like building on Solana, is that the team is there to help when there are errors and help direct them towards best practices. So, I don't know. I think something like that model is probably going to succeed.Anatoly (27:18):I can only get blamed myself.Packy McCormick (27:21):Exactly.Anatoly (27:23):At the end of the day, yeah. Balaji had this quote that I've used it a bunch of times, that decentralization is not the absence of leadership but it's the abundance of leadership, and I love it. I also feel like that because of Bitcoin and it's like history. People started assuming that disorganization also was required for decentralization, which I think is bullshit too.Packy McCormick (27:52):Yeah. How do you view DAO versus social token, or I guess more just governance versus upside sharing?Anatoly (27:59):I think tokens are social networks, almost first, and then anything else later, because any community, it's all contracts. All this open source software is reusable. I can take Uniswap, fork it, and then stick some random token on it, and it's as good as Uniswap. You cannot tell me that it's worse in any way, right? It's the same thing, right?Packy McCormick (28:27):Someone should do that.Anatoly (28:29):Yeah. And then that community takes it in a different product direction, right, for whatever reason. I think that really fast fail is probably the most important part of decentralization. Anybody can fork you and then just take it in a different direction and form a community around it.Packy McCormick (28:50):I agree. Which project was it that Justin Sun tried to take over and then everybody just stopped using it?Anatoly (28:50):Steem.Packy McCormick (28:55):Yeah.Anatoly (28:57):And that is, I think, part of the beauty of the space, right, is you can only be a benevolent dictator. As soon as you lose the benevolent part, they're like, "Well, everything's open. F off."Packy McCormick (29:12):It's amazing.Anatoly (29:13):Yeah. Did you follow the SUSHI saga?Packy McCormick (29:19):I didn't follow in real-time. I went back and looked at it after the fact, but I would not consider myself a SUSHI expert.Anatoly (29:26):Do you think that we're going to see these communities stick around for the long haul, like Uniswap, etc?Packy McCormick (29:33):I think that is the billion dollar, trillion dollar, whatever number you want to put on it, question. I mean, I was alluding to it before with these network effects being replaced by things that pick up network effects even faster and faster. I think that's the blessing and the curse that I was talking about. You could remove every single person working on Facebook except for the person who made sure that the servers were up, and people would keep using it for a long, long time. If the people disappeared from Sushiswap or Uniswap or wherever, it just fades away and they move on to the next thing, and that takes off. So, I think virality in crypto has been proven. You can get viral really, really quick. Defensibility over a very long time horizon I think is still TBD.Anatoly (30:19):Where does defensibility come from in Facebook, in your mind?Packy McCormick (30:24):In Facebook, Facebook has a clear network effects, one where I guess if the people on the network decided to stop using it, it would go away, but there's not a clear place that you would all go when you have... Maybe there's switching costs too because you have your whole network mapped, and they won't actually let it be portable. To your point, you can fork anything... you should be able to fork the relationship graph and all of that over time as people build new mechanics to make that happen, and when you can just bring your whole relationship graph with you across Web3, then maybe you just all go to the next place, or maybe there's not even a place, and it is just that your wallet, at some point, keeps track of all the connections that you have, so maybe the wallet is the central point where a lot of the value accrues and the thing that makes everything portable, but I'm not exactly sure. What do you think?Anatoly (31:22):When I first saw Facebook, I thought, "This is a shitty news group. I can run my own mail server and ask my friends." And then you realize that normal people don't want to run their own mail servers or news groups, but you centralize around convenience. Where things centralize around convenience in crypto has, for me, been really tough to pin down. NFTs especially are a really good example of people jumping from one set to another but still maintaining both, right? They're able to be in multiple places at the same time.Anatoly (36:44):I can be a Degen Ape and like a Monkey MBS member at the same time.Packy McCormick (32:12):Where do you think that ends up? Where do you think people end up centralizing, or do they not?Anatoly (32:18):I'm not sure. This is like, again, a trillion dollar question. I feel like if we get to, three, 400 million people self custody with wallets that are doing stuff, we'll start seeing those patterns of like, "Okay, this is like the Facebook, it's a social graph or the... I don't know... the super connected now," something.Packy McCormick (32:42):Yeah. I wrote about this a couple weeks ago, I wrote a piece called the Interface Phase, and it was a little bit like a high kid post where I was like, "What are the interfaces going to be?" But just the fact that the first internet needed Netscape and needed a graphical interface, Web 2.0 needed things like Digg and Facebook that were interactive for that kind of capability, the read-write interface to really be there, and I don't think Web3 has gotten there yet. I do think that either a wallet based thing, and I don't know what that looks like, and I'm not smart enough to figure out what that looks like, or the kind of metaverse. And I think it's such an interesting mistake of history or just a coincidence of history that the tech for the metaverse and Web 3.0 Are peaking at the same time, but a world in which...One of the things I think crypto does well is give physical-ish characteristics to digital things, and so I think a interface that makes that clear will have a lot of value in just making a lot of the stuff that feels a little more ethereal feel more real and tangible, and actually, there will be physical places that people meet up and all that.Anatoly (38:28):So, I think what's interesting about crypto is that it's more like Ultima Online. When I was playing the game, I got a mental model of the map and the ownership of those items because it was persistent. I would go to the thing and I would change something and then come back and it was still there, and your brain, I think, just rapidly just plugs it into the rest of the stuff that it interacts with. If you got a lot of humans all doing this together, I think they'll start forgetting that it's nothing more than a bunch of computers.Packy McCormick (34:23):Totally. I mean it's interesting. I forget the name of the book, but there's a book about the memory competitions and the world memory championships, and the way that they memorize things is by putting different objects throughout a house and then walking through that house, So, we are, I think, a lot better at memorizing things and grokking things spatially than we are... and maybe this is just me talking as a non technical person, but just picturing computer networks without some physical reference point.Anatoly (34:54):I don't have as good of a mental model of space crypto Twitter or like social networks. It's not a map to me in my mind. But with something like experiments like DeFi land and stuff, I think that actually might bridge that because of this ownership thing. And I don't still think it's the fact that I can modify stuff and come back and see it and feel that I'm doing it.Packy McCormick (35:20):Totally. Yeah, people like building, and showing progress, and all of that. I'm going to turn the mic again. How do you view Solana at this point in terms of DeFi versus the cultural side of things or the metaverse side of things?Anatoly (35:37):We don't. I think, to us, DeFi was always I thought was an important part because you look at any kind of markets, NASDAQ, those are the obvious ones, "Oh, yeah, that's probably going to be on some blockchain," but advertisement, right? It's like Google Search shows you a page, they take your data, sell it on an Ad Exchange, and that to market, that's centralized right now, how do you disintermediate it? Oh, you can do that with cryptography, right? And a replicated censorship resistant database. That's it.You can break those things down into marketplaces and remove the middleman. And that, I think, is how we think about it, is like, where does that make sense? And culture NFTs are I feel like that non skeuomorphic social networks. It's not somebody that stuck Twitter with coins, these organically sprung up, right? It's like lodges in the whatever, 1700s, like I'm part of this Masonic Lodge or this club or whatever, right? Now, I'm Degen Ape or whatever.Packy McCormick (36:57):Totally. And right now, I guess, that often manifests itself in Discord where people are hanging out. I've had this conversation with people before in this debate. Do you think there needs to be a decentralized Discord where this lives or where do you think all of this ends up living?Anatoly (37:12):I don't think so. Like a year ago, I thought somebody needs to build a decentralized Twitter, a decentralized Instant Messaging, and the working mechanics of it, being decentralized or on chain, don't change the social impact of it. You're still talking to people. Why does it matter where you talk to them, right? Who cares?Packy McCormick (37:34):Totally.Anatoly (37:37):It's like, I think, stuff where you can start making connected modifications of the same state, that mental model of like, "Hey, we're all doing this thing over here." That becomes a place and that's where people actually do things, but here's where they talk about it.Packy McCormick (37:56):Yeah. And I don't think you can find a more minimally extractive corporation than Discord, and they make less dollars per user than anybody.Anatoly (38:06):Yeah, they're pretty awesome. Also, yeah, the high fidelity audio and stuff like that I think is pretty cool. I think they built it for gamers.Packy McCormick (38:19):Yeah. It's so interesting, and I'm probably going to write about Discord at some point here too, but I've written something called The Great Online Game before, which is essentially we're all just playing this big video game across the internet. And so it's really funny that Discord, which was built for gamers, is where all of this activity is... If you're playing a big video game and the chat app designed for video games, it makes sense as the place that people go.Anatoly (38:43):Yeah. Crypto and the internet is... at least the internet part of crypto is very much a big video game.Packy McCormick (38:49):Exactly.Anatoly (38:50):Are you investing mostly in the US, US companies or all over the place?Packy McCormick (38:54):I'm investing mostly in the US but have done a few in India, I've done Sweden, I've done Canada, very open to doing anywhere on the world.Anatoly (39:06):Do you feel like there's been a shift towards everything becoming Silicon Valley, that it doesn't really matter anymore at this point?Packy McCormick (39:13):The internet is Silicon Valley. A more amorphous idea is Silicon Valley at this point, but I'm in New York, I'm probably 30 minutes away. I'm in Park Slope and the crypto hub has become Williamsburg, and I talk to all those people all the time, and I never take the 30 minute trip over to Williamsburg because I have Twitter, and I have Discord, and I'm pretty much right there with them. So, I don't think physical place matters nearly as much. Gathering in physical places is awesome. I think the idea of conferences, and quarterly team meetups, and all of that kind of stuff is absolutely going to explode. There's a really fun thing about only knowing somebody on the internet and then meeting them in person and feeling like you've known each other for a long time, but I don't think the physical place where you all live all the time matters that much.Anatoly (40:03):Yeah. I think what's weird is like I have a sneaking suspicion that the remote work worlds, everybody's working remote is actually going to mean more people travel and get together.Packy McCormick (40:17):And it's not just going to be like FaceTime and waiting around the office and sitting. When you're together, you're together, and then when you're working, you're heads down working, and I kind of like that.Anatoly (40:26):Do you think people are more efficient that way or is that the natural state?Packy McCormick (40:30):It depends how many Discords. Before this call, I was supposed to be writing and I've gotten obsessed with the Wanderers NFT projects, so I just bought another Wanderer and then was trying to figure out how to display it in my cyber gallery. So, I think there's not somebody looking over my shoulder, so in that sense, maybe it allows you to get a little bit more distracted. But I also think a lot of things coming together at the same time, more and more people are responsible for themselves, and so if I don't work now, then I'm working all weekend, and I have to get the same stuff done anyway. And so I do think that's, hopefully, the natural state of things, is that people are allowed to get their shit done when they want to.Anatoly (41:12):Are NFTs what you're looking at mostly in crypto? Is that the most exciting part?Packy McCormick (41:16):NFTs are, I think, very exciting to me. My first internship was on an energy trading desk. I should want to get into DeFi and I feel like I'm going to get wrecked unless I can spend all of my time getting into DeFi, so I've largely steered clear. I do think that NFTs are super interesting for the reasons that you suggested, and I think that they are a little bit like a social network. I think it's going to be really fascinating to see how these things evolve and the worlds that get built around them. And they're the most tangible crypto thing out there, right? You have an item. I like these Wanderers because there's audio, and they're these eight second clips, and so the richer that you can make them, I think the better, and over time, more, and more, and more things will just be ownable digitally, and I think that's very cool.Anatoly (42:09):I love the trend of like 2DR first, like really low res, because it's like a forcing function in creativity, right? It's actually hard to make something look good with that low fidelity.Packy McCormick (42:22):Totally.Anatoly (42:25):So, I'm a fan of watching the space self, almost evolve, right? This is definitely going to get better, right? You're going to have full scale renders with 3D models and high production stuff in a few years, but it's exciting to see what it is now, right?Packy McCormick (42:42):Totally. I have another portfolio company called Arco that's doing... essentially, it's trying to replace the design software that companies use. So, Autodesk has Revit to do 3D modeling, they're doing the Figma version of that, but then could you just take this physical building that somebody's designed for the real world, turn it into an NFT and let somebody bring it into the digital world? I would love to own the Chrysler Building and then bring it into my world.Anatoly (43:10):Skeuomorphism.Packy McCormick (43:14):I thought about that too when I was trying to write about the interfaces, I was like, "Why are we even thinking about buildings and worlds at all? If you don't have to follow the rules of physics, then why do you?" But I do think, through our conversation earlier about maps, reference points are also important, so you need to, one step at a time, go away from things that people are familiar with.Anatoly (43:34):Yeah. Cool, man. So, this is a really awesome conversation. Thank you so much for being on the show and really getting into it.Packy McCormick (43:43):100%. This was fun. Thank you.

Jonathan "Moshe" Schemoul is the founder of aleph.im, a cross-chain p2p storage, computing network and first decentralized indexing provider for Solana.00:36 – Intro & how did Jonathan Schemoul got in crypto02:09 – What is Aleph and how does it work?06:48 – Is Aleph database a blockchain?09:20 – Understanding core nodes and Aleph’s economics11:22 – How does Aleph interact with DNS?15:29 – How does Aleph get verification of certificates?  21:44 – How does Aleph check integrity of computation?25:06 – What is Aleph’s vision?30:32 – Will Aleph always be project facing or will it one day be user facing?32:28 – What load can Aleph currently handle?39:00 – How do the economics work for people providing hardware and bandwidth?DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.Anatoly Yakovenko (00:12):Hey folks, this is Anatoly, and you're listening to The Solana Podcast. And today I have Jonathan Schemoul with me, who's the founder of the Aleph.im project. Really awesome to have you.Jonathan Schemoul (00:22):Thank you very much. I'm really happy to be here today.Anatoly Yakovenko (00:25):Cool. We usually start these with a simple question, how did you get into crypto? What's your story? What's the origin story?Jonathan Schemoul (00:36):Well, into crypto it's a long story. I started way back in time, a bit on Bitcoin then I stopped because it was only money back then. And that wasn't the end game for me. Then I came back into crypto in 2015, 2016, and I started doing a bit of development because I saw that I really wanted to be part of Web 3, to do nice things with it. I started developing as an open-source developer for a few projects. One of these is the newest project which is Chinese blockchain layer one. I'm not really involved with it anymore.Jonathan Schemoul (01:16):But working with them as a community open source developer, I saw that there was some missing links somewhere that you couldn't decentralize all the stack with just layer one, it is not the one that they were building back then. So that's how the Aleph.im project is born. For me, besides that, I've been developing for a lot of companies before in the IOT space and also for big banks sometime ago. I've been a developer for a lot of years.Anatoly Yakovenko (01:48):That's great. I mean, that's a great background. The thing that you're focusing on with Aleph is this idea that Web 3 is just a small part of the piece, but you still need UI front-ends, business logic and things sitting on top of the blockchain. How does that work?Jonathan Schemoul (02:09):The idea is that, okay, now you can have smart contracts on Solana, that's great. You can even do way much more on like just money on smart contracts, that's great. Now, you need to have a front-end. So you need to have storage for that front-end. That's not all because a smart contract, a program doesn't have all the data that you need. So you will need some kind of indexing to get history. You will need a back-end for that.Jonathan Schemoul (02:37):Most of the DeFi application that we see have some centralized back-end behind them. They're running on AWS, sometimes on dedicated servers or stuff like that that is still centralized. If a government, and we just saw something about it today, wants to shut down the DeFi protocol that is organized like that, they can. With Aleph.im what we are trying to do is decentralize the last mile, because for that last mile most projects are using AWS, so we need to decentralize AWS.Jonathan Schemoul (03:11):So we provide storage, as in file storage for the front-end files, database storage, because most applications are just databases and also an equivalent to Amazon Lambda, where you start small functions that will be launched on a decentralized cloud, where there is place for them and will get you a return value, and these can be written in any language and connects the web and also a PC from blockchains here at Solana obviously.Anatoly Yakovenko (03:42):Got it. Super Cool. So this is a storage mechanism. Does it guarantee consistency? How's it decentralized? What happens if you nuke it? Yellowstone flows up, the current set of servers from Aleph get destroyed in the volcano. How do I move, switch, what state do I lose? Those are the hard distributed systems question.Jonathan Schemoul (04:08):Yeah. It's a really good question. Aleph.im is not a blockchain at all. We don't have a blockchain. There are enough already. We just accept messages from blockchains. All the supported blockchains are accepted on the network, that means that that message that is signed by a material address is accepted on network, a message that is signed by a certain address is accepted on the network. All our network, hence the name .im, dot instant messaging, the whole system works with messages on the network.Jonathan Schemoul (04:45):Those messages are organized by channels, just like you would go on telegram channels and get the history of them. The network keeps track of those messages and when you start a new node, you get the history of messages, not directly from the other nodes, you will connect two blockchains to specific smart contracts on blockchain. Look at past events, for example, on the Ethereum or on Solana. You look at past events for the synchronization of the network and you look, okay, there has been all these events, okay, let me ask the whole network what those messages were. Then you resync, when there are missing parts you leave them apart and then you get a view on the channels on the messages.Anatoly Yakovenko (05:31):So you write your software, your Lambda hook as if it's a re-entrant, right? So you're kind of recording your progress potentially on Solana as you're processing it.Jonathan Schemoul (05:43):For the Lambda it's a bit different. Here I was explaining how the network works for the messaging on the global state. For the state of pure application, you could either get your state from a blockchain here at Solana. For example, all the indexing effort that we are doing is using Solana as a source of synchronization for these Lambda. But then you can have multiple kind of volumes because since it's Linux Micro VM machine, everything is a volume.Jonathan Schemoul (06:18):So we have local storage volume that is local to the running host. And then the Lambda kind of issue messages on a decentralized database of data and project or under storage, and then raising to the local file system and then issue messaging, et cetera. And we are also working on another kind of phase system that is distributed, where any of them that can write in it on the overall receive the changes, which is kind of tricky.Anatoly Yakovenko (06:48):Is the database, the Aleph database, distributed database? Is that a Byzantine fault-tolerant database? Is it designed with that in mind?Jonathan Schemoul (06:58):Yeah. The idea is that when you send a message on the network, it gets stored by all the over nodes that are interested in your channel. And then there are synchronization node that go and write hashes of the data and signatures inside messages that they push on blockchains. So that when overcome, they can synchronize it and replicate all the data. So that even if one part of the network gets totally disconnected, you can have one part that gets reconnected to the other therefore the peer to peer network for blockchain, for APFS. We have multiple kind of different connectivity solutions so that they can reconnect on resync.Anatoly Yakovenko (07:42):So the Aleph database, if it's Byzantine fault tolerant, I mean, doesn't that make it a blockchain? Is there a token? Is crypto economically like fault tolerant?Jonathan Schemoul (07:56):Yeah. So we have a token, but the token is living on multiple blockchain, Ethereum, Solana, and a few others, but those are the most used today. We have a token, you need a token for your data to stay there. If you don't have any more your data gets garbage collected. But we don't have a blockchain because we go and write on over layer ones. We are technically a layer two database which is computing pre storage.Anatoly Yakovenko (08:23):But the data storage, like the Aleph distributed database, what is that backed by? Or can I pick my own blockchain to use it as a common interface or something like that?Jonathan Schemoul (08:34):Well, currently it writes on Ethereum, we're working on making it write on Solana. For this we need our indexer to be super powerful. So we'll get it writing on Solana very soon. Basically you can write on multiple blockchains and use it as a source of proof.Anatoly Yakovenko (08:53):Got it. That's pretty interesting. So it really doesn't have its own blockchain and you're just using the fault tolerance of the chains you're connected to.Jonathan Schemoul (09:04):Exactly.Anatoly Yakovenko (09:06):Awesome. Yeah, that's really cool. So the other challenge I think is like how do you deal with domains and the web? Where do you run these executed nodes? How do you connect all those pieces?Jonathan Schemoul (09:20):It's a really good question. To connect all the pieces together, we didn't develop some really fancy stuff like proof of space and time and things like that to verify that the data is really stored. We are using something much more low-tech, which is just a quality control. We have core channel nodes, which are the controllers of the network, which needs to keep some Aleph have stakers on such economics. They are verifying that other core channel nodes are behaving well. And that also the resource nodes are behaving well. Then the resource nodes are really doing the work of storing data, providing computing, et cetera. And they're continuously controlled by the core channel nodes.Anatoly Yakovenko (10:09):That's great. So they're basically like a tokenized health check, right?Jonathan Schemoul (10:14):Yeah.Anatoly Yakovenko (10:14):I can spin this up and they can continuously monitor whether this computation is making progress, right?Jonathan Schemoul (10:21):Exactly.Anatoly Yakovenko (10:21):Is that verification, is that programmable? Can me as an app developer, can I kind of code up my own apps, specific health checks or an interface or something like that?Jonathan Schemoul (10:35):It's a really good question. That's what we are working on exactly right now.Anatoly Yakovenko (10:40):I'm leaking all the features. My imagination is going.Jonathan Schemoul (10:44):No, no worry. Well, it's really interesting because to understand if an application behaves well on one host, you need to understand what the application is doing. So yes, we will give some kind of health check, which is kind of a unit test of how the app should work. So you will be able to provide unit tests for your app basically.Anatoly Yakovenko (11:11):That's really Cool. What about domains? Like actual DNS?Jonathan Schemoul (11:17):Yeah.Anatoly Yakovenko (11:20):I'm asking all the hard questions.Jonathan Schemoul (11:22):Yeah. These questions will be answered if I explain how we handle access to this virtual machine. Because for DNS, for just IPFS, there is already quite a few solution, that's not an issue. But then if you want to make a domain point to one micro VM, you want your micro VM to be able to serve your data. How we do first the load balancing because that's the important question. For load balancing we have two ways, one, which is a regular cloud load balancing, which could be blocked by government, could be censored, because that's what can happen when you have centralized point of control.Jonathan Schemoul (12:07):We will run it ourselves and a few of our partners might run some of the cloud load balancers that basically you can just point your domain to the cloud load balancer. And then the cloud load balancer will create certificates and stuff like that. It will work. We will run one instance. Ubisoft will likely run another. And like many of our partners. Well, for Ubisoft it's not sure, just some talks about it. But perhaps over partners could run cloud load balancers that we'd go on point on specific micro VM host to see where your app is running and point it to them, that might work.Jonathan Schemoul (12:48):Now What happens if a government says, "This app shouldn't work, this domain shouldn't work." Then you have two solutions, you either put the front-end inside IPFS, use some IPFS gateways, et cetera. And then the back-end is on the VM network. But then what happens if a government blocks the specific DNS inside the micro VM global.aleph.sh .aleph.cloud Whatever. Then we have a decentralized load balancing that comes into play.Jonathan Schemoul (13:24):The idea of the decentralized load balancing is that your browser will connect to the IPFS network using leap peer to peer, just leap peer to peer, find Pi Aleph nodes running, contact them directly then ask Pi Aleph node, "What micro VM host are running this software?" And then you can contact them directly. We are working on the JavaScript library that will do all this work on the client side so that you can have your front-end in IPFS that will then go and find all the back-end hosts that could answer your request.Anatoly Yakovenko (13:58):That's super cool. You guys are working on some really hard problems. I think it should be fairly easy to kind of have basically a resolver that points to ENS in the system, right. That's fairly straightforward. And basically you should be able to use any kind of like name, system, command any blockchain.Jonathan Schemoul (14:25):Yeah, clearly.Anatoly Yakovenko (14:26):Do you think that this is something that browsers are starting to recognize as standardizable? Is there a future where you think this technology could start percolating to the UI level where the end user can pick like blockchain based DNS resolver that kind of like connects all the pieces, right? From the human to this decentralized one.Jonathan Schemoul (14:51):I think that something that could come, I think that those that could really help in this is Mozilla foundation, I think that they would be the one to talk with. We aren't in talk with them because we don't really take that step right now. We have a lot on our plate. But in the future I'm pretty sure it's the way to go. We will connect to any effort in that area and we will recognize it. I know that for IPFS for example, IPFS, IPNS, there are some efforts on some browser extension that you can install to have it, et cetera.Anatoly Yakovenko (15:29):How does like certificate chaining play with us? What happens if I need to have a cert on my service and things like that.Jonathan Schemoul (15:38):A certificate on your service? Yeah.Anatoly Yakovenko (15:41):Like their sign or whatever.Jonathan Schemoul (15:43):Well, we use the one that everyone uses, which is-Anatoly Yakovenko (15:48):Let's Encrypt. The EFF one.Jonathan Schemoul (15:49):Yeah, exactly. We're using this one, we used the discovery with the content, so that we switch to a specific content when Let's Encrypt connects, then we serve this content, then we get a valid certificate, we can serve the good content.Anatoly Yakovenko (16:07):Can you unpack that a little bit?Jonathan Schemoul (16:10):Yeah. Well, Let's Encrypt has multiple ways to certify that you have a certain domain, for sub domains of .aleph.sh and .aleph.cloud, It's easy, we are using wildcard certificates. For custom domains that you could make point to your content directly, what we do is that you put a key inside your DNS to say, this is the virtual machine that should be mapped to that domain. Then you do a CNAME to our cloud load balancer and then the VM host when they get a request for this one, they go and check the DNS to see what VM they should serve on the generator certificate using Let's Encrypt for that domain and they start serving it.Anatoly Yakovenko (16:59):Oh man, this would be really cool. But if we could have like an ENS where in my ENS registry I set my Let's Encrypt domain, and then I run a local DNS server on my home machine where I run my browser and point that as a resolver, you could kind of tie these knots together and get-Jonathan Schemoul (17:23):Yeah, it could work.Anatoly Yakovenko (17:24):That's really cool. What happens if these instances die, where do you guys get more hardware? How does that process work?Jonathan Schemoul (17:36):Well, an instance can just stop, then the load balancing system will find another instance to run your code. Then what happens when an instance get a request for a code that doesn't have for the micro VM network. I mean, it goes on the network, checks, okay, what is the database entry that is in front? It takes the database entries. Has there been any upgrades to it? Okay. I get the upgrades. I subscribe using web socket to the upgrades of this database entry basically because it's a document about database entry.Jonathan Schemoul (18:14):And then it looks, okay, so this is the root FS that I should load. Do I have it? I have it, could I use it? If not, I download it from the network. I applied that root FS, where is the code? Okay. What volume does it needs and it builds and retransits and gets you the answer. For a cold start with no root FS or whatever, it can take a few seconds. But in general you use the same root FS as others. So you can get the code start. If you don't have the code, it's less than a second. If you already have the code of the application is like 150 millisecond for a cold start.Anatoly Yakovenko (18:53):Got It. And is the coordination to decide where to start this particular instance? Does that occur over the underlying chain, like Solana or Ethereum or whatever?Jonathan Schemoul (19:08):Again, that's something that we're working on. At start it's on the cloud load balancer. So the cloud load balancer are semi centralized for that. The idea is that each micro VM running node that starts running one will register a message, which is a database entry with a reference to say, "I am running this one." And then the cloud load balancer looks at the uptimes of the available micro VMs and say, "Okay, this micro VM has it ready." I'm forwarding it to it.Jonathan Schemoul (19:40):And then if there is none, then it could just route it to like a random one that has a good uptime. And then this one, the next time kind of like be choosing automatically because it is already serving it. If there is a lot of requests, it will provision multiple ones.Anatoly Yakovenko (19:59):Interesting. Got it. And you anticipate that you'll basically be able to move if the underlying chain is cheap and fast enough you should be able to move the coordination and kind of like start this instance, pull this volume. This would be really cool with like Arweave backed storage volumes. Because you could almost then see the lifetime, the life cycle of the application as its business logic is evolving, right? That state is very useful to developers who are being able to go back to a checkpoint effectively at any given time too.Jonathan Schemoul (20:38):Well, right now we are using our own storage engine, which is APFS compatible. But in the future we will allow to choose other storage engine and we will also develop gateways with like Arweave, Filecoin and other.Anatoly Yakovenko (20:53):Super cool. I used to work at Mesosphere so I don't know if you've heard of them, like D2iQ, this was kind of Kubernetes competitor, trying to build this decentralized operating system using Mesos as the jobs kind of Q-engine. There's a lot of similar challenges there, and this is really cool that you guys are building this in a decentralized web application that's kind of hosted in the real cloud, the mythical cloud.Jonathan Schemoul (21:28):Yeah. Well, there's a saying, there is no cloud, it's just other people computers. Here it's really other people computer. So it's pretty good because then you don't trust those computers because you know it's other people computers.Anatoly Yakovenko (21:44):How do you guys ensure the integrity of the computation itself? How do I know that the virtual machine, the execution environment that's running isn't malicious.Jonathan Schemoul (21:54):It's a really good question. There is multiple questions there. How can I ensure that this computation isn't returning a bad result because it knows who is on the other end. The load balancing system ensures that you don't really see who is in the other end, so you don't know who is making the request. So you don't know if it's a quality control call or if it's a real call. It goes back to your question of the testing of the application. And there is another one there which is the question of the secrets, because you might need secrets. If you want to do push notification based on a smart contract event on Solana, let's say, because that's something that we are working on right now, thinking about it.Anatoly Yakovenko (22:48):That's super cool.Jonathan Schemoul (22:48):So you would need secrets. You will need to story a secret to being able to go back to this device and send these device and notification. So you either store secrets in the local storage of the instance, but then if the instance dies, you can get it back or you try to get shared secrets between multiple hosts. We are working on it. We don't have a total answer on that. What we are working on is using free shirt cryptography, so that multiple host defined by the developer come under these secrets. And then you go back to a question of trust, which is problematic.Anatoly Yakovenko (23:30):By the threshold cryptography, is this like an MPC to compute, or are you guys thinking like BLS or like Schnorr aggregation?Jonathan Schemoul (23:42):More like you encrypt something that can be decrypted by multiple private keys.Anatoly Yakovenko (23:47):Got it.Jonathan Schemoul (23:48):And then if they want to send a message, it needs to be signed by at least x of y.Anatoly Yakovenko (23:54):Right. Got it.Jonathan Schemoul (23:57):Because this micro VM I mentioned can also send messages on the network. These messages on the network will be database entries that in the end might end up also on-chain using all records or whatever. Because these micro VM can read from on chain data and the idea is that we are working so that they can also write on chain as well. So then you might need some kind of trust somewhere. So one developer could say, I trust this host this host this host, but they need at least to do that calculation three times, let's say. But it's a bit problematic and we are still working on it. It's not finished yet, so yeah.Anatoly Yakovenko (24:40):That's what I mean, that's a really hard problem.Jonathan Schemoul (24:41):Yeah.Anatoly Yakovenko (24:43):Really cool. Yeah, the secrets thing is really challenging. I guess, what's your vision for this? You guys are tackling on some really hard problems, you get all of them done in the next year.Jonathan Schemoul (25:01):I hope so.Anatoly Yakovenko (25:06):What happens then? What is the vision for Aleph?Jonathan Schemoul (25:08):Well, here we are only speaking about a few crypto issues. We aim at bigger than just the crypto ecosystem. What we really want to do is decentralize the web, so getting bigger, way, way bigger, that's the goal. We are working with a few bigger partners who are part of the Ubisoft entrepreneurial labs, for example. We want to have a lot of hosting partners in the game that start providing resources so that I want it to be as easy as spinning up AWS server or whatever, you would just spin up VMs under the .im network. I want it to be as easy as using Firebase, using Amazon Lambda, et cetera.Jonathan Schemoul (25:51):And we have another big project going on, which is the indexing on Solana, where we are indexing data for a few protocols, currently Raydium, we might have another already soon. Well, I can say the name. We are working a lot on Orca, on port finance right now, and a lot of others actually that I can't really talk yet. But the idea is to have all these data available, have all these data feed coming up so that you can have events based on them, also do off-chain computation and things like that.Jonathan Schemoul (26:29):I really want DeFi to be totally resilient because until it's totally decentralized, you can stop DeFi. When it's totally decentralized, you can't. And if there is only the smart contracts that are decentralized, you can still stop it.Anatoly Yakovenko (26:48):Yeah. That's definitely a fair point. I think the UX issues around building also just like push notifications and all these other things for projects are really hard to overcome if it's a decentralized project, because who's going to host those servers, right, to connect to mobile and everything else. Yeah. You guys have a lot of work set out and it's pretty exciting. What do you think is missing? If you guys had like another, somebody else was building this other piece that you think is missing in the Web 3, what would it be?Jonathan Schemoul (27:26):What is missing today in the Web 3 ease of use for all this. We are trying to tackle this, but we have so much on our end. So this is a big issue, ease of use for developers, ease of use for users. Well, Phantom is already doing a great work on that end on Solana. But yeah, this and also I think that there is some kind of breaks between the ... In DeFi, if you want to move money into the real world, it gets hard really fast because there has been some kind of complications that have been put in place by regulators, by banks, by whatever. If we could just get all these parts simpler, it could be great. Some kind of link between FinTech and crypto that would work everywhere in the world, including Europe, USA, et cetera. It would be great. There are a lot of people working on it, but that's something that is missing as well.Anatoly Yakovenko (28:28):Yeah. Identity and like having those easy ramps is still hard. What about DNS? Just straight up resolving, do you think that's tackleable from a Web 3 perspective.Jonathan Schemoul (28:45):The issue is the way DNS is done. DNS protocol is great, but it implies centralization points, a lot of centralization points, which are problematic. Then you will need another standard on DNS. But if you have another standard on DNS, then you have the issue that the network right now is done, is not done for it and the browser don't understand it, et cetera, and operating system don't understand it. We would need gateways for that. I think it's doable. It's definitely doable, but it's a lot of work. And you would need multiple root servers, even virtual root servers, like what you said, local DNS server that would resolve your request, it could work.Jonathan Schemoul (29:38):If Let's Encrypt could understand it in the same way, it would work. Or we could even have something different than the root certificate that we have today, because with blockchain, we already have private keys. We already have signature. So if you sign your content with your private key, then you can verify it on the other end. And you don't really need all these chains of certificates that are here today. So that could also be another solution, but it would need another way, because right now we have roots certificate, children's certificate, et cetera. And it all goes back to central authority. The whole DNS on certificate system today goes with authority. With blockchain we are trained to remove authorities.Anatoly Yakovenko (30:33):Yeah. Do you guys see this as becoming developer facing, or maybe someday eventually kind of like client facing and want these decentralized applications running for me, kind of my own instances. Or is this always going to be here I am, team Orca, go to this domain as a user.Jonathan Schemoul (30:56):It's a good question as well. It's always the issue between hosted components, locally run components and kind of pragmatic on that. At start I would really like to, everything runs inside my browser, everything works. That's great. In reality, you have mobile phones, you have tablets, you have computers, you have a lot range of devices that can be running all the time. So real peer to peer application can't really work that well, unless you go and say, "Okay. While you are waiting for me, please send it to my friend, that will forward the data for me, et cetera.Jonathan Schemoul (31:40):Blockchains are really helping there is that we have a centralized authority, which is the blockchain that you can trust and that can hold data for you and can even encrypt it for you or store it on aleph.im, whatever, and only you can decrypt it. I think that the mix between the two would be good, like self hosted data and remotely hosted data on the decentralized cloud, a good mix of the two could be good. And the efforts by the leap peer to peer team, with the javascript leap peer to peer. And there are a few of us like that helps, because once you have access to a peer-to-peer network directly from your browser, you can cut middlemen. You can cut central authorities, et cetera, if you're the blockchain that serves as a central authority.Anatoly Yakovenko (32:28):What kind of loads have you guys seen or been able to test this out, in terms of like users request per second, kind of WebSocket connections per second.Jonathan Schemoul (32:39):It depends because when it's per server, that's not that much of an issue because the micro VM supervisor just forwards the request to the underlying software. If you don't choose local persistent volume, the supervisor can run as many instances of your program as needed, then you can spawn multiple one even inside the same supervised cluster. And then the network, if it sees that this one has issues adding the request load you can load new ones.Jonathan Schemoul (33:18):I don't think that there is really a limit on the request per second for that. So it's not really the issue that we have. And then on the database part, same, if you access one API server and you give it 500,000 requests per second, it would go down, because it's a server. If you target multiple API server, you are good. So that's also where the decentralized load balancing helps because if you use a cloud load balancer obviously even this cloud can go down. But if you contact a peer to peer network to know what host can answer, then you can contact multiple host. And all our core channel nodes, we are currently 54 of them are also API servers that users can connect to to get the data, which will be certified by our core channel node.Anatoly Yakovenko (34:10):Cool. As a whole, how many, I guess, do you have an idea of how many users per second or humans per second have you guys served in some peak times?Jonathan Schemoul (34:21):We don't, because we don't store metrics currently, we should. We don't have it because we didn't want to have any kind of log or whatever on the users, but we should add it, that's actually a good point, we will.Anatoly Yakovenko (34:37):Yeah. I mean, I think you got to be really aware of privacy and how that impacts some applications. But really interesting to see how this works. Caching is another one of those things, basically having a distributed cache around the world for often queried data. And this is an issue that I think doesn't have a good solution in Web 3 right now. You do all this work, set up a purely thin client, that's like loads from code, only talks to the chain and then you got to go fetch assets. And if you're using centralized ... Yeah, they can basically inject whatever they want.Jonathan Schemoul (35:25):Yeah, that's the main issue. And the good part is that if you also randomize where the request of the users go, if there is one bad actor, it will only inject bad data once in a while you don't even know where. Once there is a quality control it will detect it, so that can also be a solution. It's not a silver bullet either, but it can definitely help. So like for Solana what we are doing right now, for Raydium for example, is that we have an indexer that talks to multiple RPC of Solana then get the transaction history, store it inside the level DB, inside the micro VM, and then index the data.Jonathan Schemoul (36:09):Then we can get data on the pool's latest trades and stuff like that. The idea is that if there is too much request on one index, it will start another index or another index or another index, or et cetera, so that when you do a request, it reroutes you randomly to multiple hosts that have the same index.Anatoly Yakovenko (36:28):How fast is that?Jonathan Schemoul (36:31):Not fast enough currently. Well, it's fast enough for Raydium.Anatoly Yakovenko (36:35):Okay.Jonathan Schemoul (36:36):It works really well.Anatoly Yakovenko (36:40):Raydium gets a ton of hits. I mean, some of their IDOs have seen half a million requests per second-Jonathan Schemoul (36:48):Yeah. So for the Raydium data, it handles it well, like all the trades, whatever, it handles it pretty well. We don't get behind blocks in the indexing, so it works well. For Serum it's a bit more problematic because you need to watch, event cue all the time. I really hope they will have some kind of flux in the future. I think that they are working on it. So that would really help us either to get history even when we aren't watching their event cue.Anatoly Yakovenko (37:23):Yeah. So not half a million per second, half a million total, which is quite different, but yeah, they see some really good traffic.Jonathan Schemoul (37:30):Yeah.Anatoly Yakovenko (37:32):Cool. I mean, that's really cool. I think really hard part I think in designing these systems, one, is the problem is difficult, but then once you build the first version of it and you start hitting real traffic, there's a lot of parts that fit together that break under load. So what is your debugging like? How do you guys actually monitor like debug, like PagerDuty, what do you guys use as a team?Jonathan Schemoul (38:01):Right now our team is still small. We are growing a lot. Right now we are like 10 developers. A few months ago we were only three. A year ago I was alone. So we are growing really fast and we are putting all these things into place. Right now everyone monitors and checks what happens and it helps. There is Hugo who is on the micro VM side, Ali was mostly on the indexer side, myself we can get everything. But we are putting really real stuff in place right now to have it, because we are a growing startup so it takes time to get everything in place.Anatoly Yakovenko (38:43):Yeah, for sure. Do you envision a PagerDuty team for this?Jonathan Schemoul (38:48):Yes. I think that we will need one. Once we have more application that are using it, we will need one. So yes, if you have advices on that day, I'm really happy to get them.Anatoly Yakovenko (39:00):I mean, it's just part of life. It's not complicated. It's just work. This is I think that like response team I think is a difficult thing to set up in a decentralized community. If you guys are building a decentralized network with providers that are supplying hardware and all this other stuff, those are the folks that we found to be really responsive and have a lot of stake in growing this. How do the economics work for all the people actually supplying the hardware and bandwidth, et cetera?Jonathan Schemoul (39:36):Again, the research and economics aren't live yet. We are working on them. The core channel nodes economics is already there for like a year, now it works well. For the core channel node you need to have 200,000 Aleph to start a node and 500,000 Aleph, staked on a node, so that it can start to run. And then all the node operator get a share of a global envelope daily for all the nodes. All the stakers get a part of the envelope for stakers. The more nodes active, the bigger the envelope for staker is. But then for each node, they will earn a bit less if there are more nodes because it's a global envelope. So it helps stakers grow the number of nodes that are active, so that's for the core channel nodes.Jonathan Schemoul (40:25):For the resource nodes, to get storage or computing on network, there is two ways to get it. One that is already live, which is hold X amount of Aleph and get that amount of storage, hold X amount of Aleph and have the ability to start one VM with X megabyte of RAM, X virtual CPU, et cetera. And then the multiplier, and all that gives you the total count of micro VM I mentioned that can be running on your network based on your balance. The good part with that is that partner project could use a lending protocol to borrow Aleph where depositing their own token to get service. They would get the service for free just paying interest in their token, inside the borrowing protocol.Anatoly Yakovenko (41:14):Got it.Jonathan Schemoul (41:15):So that's a way for protocols to get it, but it's quite expensive because they don't directly pay for it. So for this way of using it, Aleph.im network is paying for them from the incentive pool, which right now it's one fifth of the supply, and we are changing it in the next few months, we'll change a bit of economics. It will be nearly half of the supply that would be dedicated to pay for that. Because since you lock a part of the supply, then you can release a bit inside circulating because of this new use. So that's for the hold X Aleph tokens.Jonathan Schemoul (41:51):And then there is another way that isn't developed yet that we will likely use Solana for, because it's fast enough for micro-payments in that area. It's like pay per action, pay X Aleph per gigabyte per month. You as a provider, you can say, "I am okay to be paid at least that much." And then users will say, "I want my data to be replicated at least four time. And I'm okay to pay at most that much for this." Then you get divided by those who provide service and the payment is done as micro payments. And same for the micro VM you pay per CPU per hour, et cetera.Anatoly Yakovenko (42:32):Got it. That's really cool. Well, this has been awesome to have you on the show. I mean, we got into I think the really deep, deep tells of how Aleph works, so I had a blast because it really reminds me of the spending, working on the stuff for centralized systems. It's really cool to see this kind of built ground up for decentralized ones as well. So appreciate the work you're doing. Thank you, Jonathan.Jonathan Schemoul (43:00):Thank you very much for having that call. It was really great talking with you.Anatoly Yakovenko (43:04):Awesome. And good luck to you guys. I mean, startups are blood, sweat and tears, so just keep working on the vision. You'll get there.Jonathan Schemoul (43:11):Thank you very much.Anatoly Yakovenko (43:13):Cool. Take care.

Jeff "Jiho" Zirlin is the Co-Founder of Axie Infinity, an NFT-based play-to-earn online video game. 00:23 – How it started through CryptoKitties?02:41 – What is Axie Infinity?04:13 – Game design and constant iteration05:52 – What is a blockchain game? A mix of social network, gaming and the start of a new economy13:15 – Why is crypto important to Axie?17:24 – Building and relying on your community  20:47 – Is the future of gaming the metaverse and user-owned assets?22:22 – The feasibility of crossover between games with NFT ownership27:35 – Where are Axies user from and what kind of players are they?30:45 – What's Axie's endgame?37:16 – Thoughts on competitors41:18 – Generative art and creating an Axie DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

Yutaro Mori & Grace Kwan are the Co-Founders of Orca, a user-friendly cryptocurrency exchange built on Solana. 01:15 – About Orca and its vision09:48 – What’s the future of DeFi?20:48 – A little bit about Orca’s roadmap25:50 – What does Orca’s team look like?32:11 – The internet hasn’t changed much, people grew into it. How will crypto grow more present in our life?36:22 – Solana and zero knowledge proof40:02 – Orca’s next features planned for Q2 and Q343:46 – How does Orca plan on growing their worldwide community? DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

George Harrap is the co-founder of Step Finance, a platform for Solana DeFi users to track their portfolio performance. Before Step, George was the CEO of Bitspark. 00:29 About George Harrap and mining05:03 From Bitcoin to DeFi, how can crypto solve currency issues in the world18:27 STEP Finance’s vision for the next five years21:20 Censorship resistance and layer 1s27:11 Hackathon: what would you like to see created?30:30 Thoughts on Rust and why it was the better choice for Solana38:08 Why you can’t innovate in the traditional financial system DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

Kevin Rose is a partner at True and a serial entrepreneur best known for founding Digg and Revision3. Most recently, he founded Oak, a guided meditation app, and Zero, an app for tracking intermittent fasting. 00:08 – Introduction of Kevin Rose, Modern Finance and the story of Reddit vs. DIGG06:04 – From DOS to Windows, where are we in the evolution of crypto07:50 – Crypto is here to stay. Could we see countries getting into it in the future?14:47 – The NFT craze19:58 – NFT: dynamic art and encrypting mystery over time23:08 – Blockchain is persistent and permanent; how will this impact NFTs in art and games?32:49 – From investing into educating people on crypto39:35 – Discussing the repercussion of Christie’s endorsement of NFTs43:22 – Kevin Rose’s investing philosophy49:34 – Kevin’s advice: test features DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

Jason Choi is a General Partner at Spartan Capital, one of Asia’s first crypto funds. As Spartan Capital’s first employee, Jason helped scale the fund from $9M to $200M within 3 years, and supported the launch of Spartan’s $50M DeFi-only venture fund to back world-class teams shaping the future of finance. 00:23 – Getting into crypto and about Spartan Capital04:33 – How does Spartan Capital invests?11:47 – Next wave: building for current users vs future adopters?19:47 – DeFi and the yield farming phenomenon30:36 – From CeFi to DeFi for the mainstream adopters43:33 – The NFT craze and where it could lead us51:37 – Thoughts on the next wave? DAOs? Social Networking? DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

We are excited to have Dan Gunsberg, Co-Founder of Hxro, sitting down with us for Episode 41. During this discussion, Dan talks about his history in traditional finance, how this experience guided him to building out Hxro, the importance of community, and the powerful disruptions he believes are going to happen over the next few years. 00:25 – Dan’s crypto story and what’s Hxro?05:38 – Centralized crypto exchanges vs legacy exchanges15:07 – Community capitalism24:11 – Community building around projects35:23 – Closing thoughts and what’s next for Hxro DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

In this episode, AlphaRay discusses the origin of Raydium, working with Solana and FTX, fusion Pools, the importance of communities, and the future of decentralized governance. 00:25 - The story behind Alpha and Raydium10:26 - What are Fusion Pools?15:07 - Teaming up with FTX/Serum and being among the first to build on the Solana blockchain19:29 - Solana communities25:52 - Thoughts on future governance features29:57 - Closing thoughts, what’s next? DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

Anatoly and Santiago sit down to cover the stages of crypto, the major benefits of decentralized finance, on-chain transparency, the future of decentralized collaboration, and plenty more. ☀️ 00:31: Who is Santiago Santos, and why crypto? 09:07: At what stage are we in crypto? Are finance applications the equivalent of the internet in the 90s? 14:32: DeFi benefits: crypto lending, automatic investor profiles, transparency, and more 31:43: Is decentralization the future of collaboration? 38:45: Closing thoughts: porting vs. innovating. Stay open-minded DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

Michael Wagner and Anatoly Yakovenko sit down to talk all things Star Atlas. Star Atlas is a grand strategy game of space exploration, territorial conquest, and political domination being built on Solana. 00:48: Who is Michael Wagner and What is Star Atlas? 18:34: ATLAS and POLIS: Development of game economy 23:12: Developer ecosystem 25:40: Roadmap 34:19: Metaverse and VR 38:11: Decentralization of Star Atlas 43:29: Future Concerns DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

Audius is a music streaming and sharing platform that puts the power back into the hands of content creators. In this episode, Roneil talks about the creation of Audius, the need for empowering artists, how blockchain technology and cryptocurrency can completely disrupt the music industry, and more. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

For this exciting and technical episode we welcome, Eli-Shaoul Khedouri, CEO of Intuition Machines and designer of HUMAN Protocol. HUMAN Protocol specializes in providing the infrastructure for launching decentralized work pools that allow humans to contribute to data labeling and training ML/AI algorithms. hCaptcha is a user of the HUMAN Protocol and currently covers over 14% of the internet. In this episode, Eli and Anatoly talk about what Intuition Machines does, why the company embraced blockchain technology, how hCaptcha managed to capture such a large market share of the internet, what the future looks like for HUMAN Protocol, and much more. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

For this exciting and technical episode we welcome, Eli-Shaoul Khedouri, CEO of Intuition Machines and designer of HUMAN Protocol. HUMAN Protocol specializes in providing the infrastructure for launching decentralized work pools that allow humans to contribute to data labeling and training ML/AI algorithms. hCaptcha is a user of the HUMAN Protocol and currently covers over 14% of the internet. In this episode, Eli and Anatoly talk about what Intuition Machines does, why the company embraced blockchain technology, how hCaptcha managed to capture such a large market share of the internet, what the future looks like for HUMAN Protocol, and much more. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

In this episode, Sergey talks about how he originally got into crypto, the origin story of Chainlink, the critical importance of smart contracts in growing the blockchain ecosystem, and more. Tune in for this very special episode with the Co-Founder of Chainlink, Sergey Nazarov. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

André Allen Anjos, better known by his stage name RAC, is a Portland-based Portuguese-American musician and record producer. RAC has created more than 200 remixes in the rock, electronica, and dance music genres for various musical artists, with his work featured in ads from Citigroup and Hulu, among others. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

This is a special episode of The Solana Podcast - we took a recent panel for the Solana Wormhole Hackathon and converted into audio format for you! Enjoy this deep dive into all things DeFi with industry leaders. Sam Bankman-FriedSam Bankman-Fried is the CEO of crypto derivatives exchange FTX and Alameda Research. He majored in Physics at the Massachusetts Institute of Technology and graduated in 2014. Stani KulechovStani is the founder and CEO of Aave and ETHLend. He is a seasoned entrepreneur with extensive experience developing technology in the crypto, blockchain, and fintech space. Michael EgorovMichael is the CEO of Curve and a physicist and scientist from the Moscow Institute of Physics and Technology. Anatoly YakovenkoAnatoly is the creator of Proof of History and co-founder of Solana. He led development of operating systems at Qualcomm, distributed systems at Mesosphere, and compression at Dropbox. Jeremy MusighiHead of Growth at Balaner Tarun ChitraFounder and CEO of Gauntlet Networks, a research company aiming to make crypto networks and their governance interpretable and statistically sound. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

In this episode, Aaron takes a deep dive into all things Bison Trails. For anyone curious about how Bison Trails operates, what it's like operating a Solana Validator, or is curious into the various business models of node operators, this podcast is for you. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

This is a special episode of The Solana Podcast. Things take a different route - Balaji and Anatoly cover Covid-19, the current state of the world, smart contracts and the future of decentralization, computation diligence, blockchain-based elections, Yale Law being replaced by code, math vs. science, Snow Crash, and location-independent work. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

KRNC is a new blockchain protocol. Like Bitcoin, it uses cryptography to create a form of scarce "digital gold." The difference is what that digital gold is used for. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

With over 924 million in value locked, Synthetix is a popular platform for derivatives trading in decentralized finance (DeFi). Kain Warwick and Anatoly discuss the early days of DeFi along with the pros and cons of the plethora of products hitting the decentralized finance market. This episode is for anyone looking to get a better understanding of how decentralized finance works-  Kain and Anatoly abstract away the complexity riddled in DeFi and cover the fundamentals. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

This episode is all about Layer 1 architecture and innovation. Justin studied mathematics at Cambridge University. He was a Bitcoin entrepreneur from 2014 to 2017 and is now an Ethereum 2.0 researcher. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

A day after Project Serum was officially announced, Anatoly and Sam sat down to discuss the current trading environment in crypto, the future of DeFi, and to provide additional details around the high-speed, non-custodial decentralized derivatives exchange built on Solana, Serum. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

From developing flow to leading the engineering team who designed Crypto Kitties, Dieter has extensive experience in both L1 and L2 development. Dieter discusses why he feels that sharding is not the best approach for scalability, along with how his experience developing creating crypto kitties molded this mindset. This episode is perfect for anyone interested in learning more about L1 development and games on the blockchain. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

This episode is all about venture capital. Rodolfo Gonzales is a partner at Foundation Capital, a venture capital firm that backs individuals who want to nudge the world ahead in some way, using a transformative business as their fulcrum. Founded in 1995, Foundation Capital has invested in companies such as Uber, Mode, Netflix, Genies, Brave, Solana, and many others. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

Tarun and Anatoly discuss macro and micro theories on blockchain progress, making it through 'Black Thursday', and much more. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

In this episode, Zaki discusses the slow adoption of complex VDFs, Anatoly lays out his theory that we are in a simulation, and both speakers take a deep dive into layer 1 architecture. Zaki briefly covers why he decided to leave Tendremint and all the exciting projects he is currently working on. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

In this episode, Kyle and Anatoly talk about the effects of COVID-19 on the cryptocurrency market, Black Thursday, and how they each see the next few months playing out in both the crypto and traditional markets. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

For this episode, Anatoly sits down with the CEO of Helium, Amir Haleem. Helium was founded in 2013 by Shawn Fanning, Amir Haleem, and Sean Carey, with a mission to make it easier to build connected devices. Helium is creating a decentralized internet network through its product the Helium Hotspot. With a Helium Hotspot, anyone can earn cryptocurrency by building a wireless network in their city and creating a more connected future. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

coinlist.co/solanaFor this special episode of The Solana Podcast, we answer all your questions around our Coinlist auction that is happening right now! Pre-bidding starts on March 17th at 12pm PT and and the auction happens at 10pm PT on March 24th.- Anatoly breaks down how our 90% buy back guarantee works- Andy & Anatoly talk about how a dutch auction works DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

Vinny Lingham is the founder and CEO of Civic as well as a GP at Multicoin Capital. In this episode, Vinny and Anatoly go deep into early bitcoin adoption and how it shaped the entire ecosystem. They discuss the practical use cases for crypto and how we have just started to tap its full potential. Lastly, they touch on early success stories in the industry and Vinny talks about how Civic is reshaping the landscape for crypto wallets. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

We had a blast hosting Jill Carlson for episode #15 the Solana Podcast. For this episode we took a different approach; instead of doing a deep technical dive on a specific project Anatoly and Jill discuss the history of Bitcoin, practical uses for blockchain technology, ways to stay authentic and true to your vision in the crypto space, and so much more! This was one of the most fun episodes we have done to date. Enjoy. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

Chorus One is operating infrastructure to help you securely increase your crypto holdings. Meher & Reisen go into the founding history of Chorus One, the high availability validation project StrongGate and its implications for Solana, as well as the future of Proof-of-Stake and validation in general. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

This episode is all about Validators. Are you interested in learning more about how to run a node and become a validator? Sunny and Anatoly go deep into the current models and how validation within the blockchain ecosystem is evolving. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

This is a special episode. Brendan Eich stopped by our recording studio in San Francisco a few weeks ago. During his visit, he and Anatoly sat down for over an hour to cover a broad range of topics. We start off the recording with a highlight of Brendans many accolades and achievements - creator of Javascript, co-founder of Mozilla/Firefox and most recent the CEO of Brave Software. Through Brave, Brendan and team are working to reinvent the way online advertising is handled. Opting to gave the power to the everyday user, you, instead of the advertisers.  Evan and Anatoly go into a deep discussion around the future of SNARKs and real-life use cases. Are SNARKs still a research problem or have they evolved into an engineering problem? DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

Evan and Anatoly go into a deep discussion around the future of SNARKs and real-life use cases. Are SNARKs still a research problem or have they evolved into an engineering problem? DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

In this episode, Gün discusses how he originally got into operating systems and the importance of figuring out this tech before moving on to other aspects of the stack. This episode is great for anyone looking to get an interesting and unique perspective of how operating systems and blockchain are intertwined. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

Listen to SKALE CEO and Co-Founder Jack O'Holleran discuss with Solana CEO Anatoly Yakovenko how we can grow crypto communities. Recorded in Solana's San Francisco office live during SFBW. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

Why is Sharding that hard? What is NEAR Protocol? Anatoly Yakovenko of Solana interviews Alexander Skidanov for a discussion on the two protocols. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor. 

DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

We are back with Episode 5 of The Solana Podcast. We are joined this wee by Ryón Nixon who is the head council for Solana. He discusses what makes a good lawyer in the crypto space. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

Dominic Tsang chats with Andrew Hyde on how he got involved in open-source projects. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

In this episode, Andrew interviews the Chief Scientist of Solana, Eric Williams. About Solana: We are a lightning-fast distributed ledger technology for mission-critical decentralized apps. This podcast is a discussion between our staff, community developers, and industry leaders. You can follow us on Twitter @solana or GitHub @solana-labs. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

In this episode, Andrew interviews the CEO of Solana, Anatoly Yakovenko. We are a lightning-fast distributed ledger technology for mission-critical decentralized apps. This podcast is a discussion between our staff, community developers, and industry leaders. You can follow us on Twitter @solana or GitHub @solana-labs. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose.The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice.The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.

On Episode 1 of #NoSharding, Andrew interviews the CTO of Solana, Greg Fitzgerald. We are a lightning-fast distributed ledger technology for mission-critical decentralized apps. This podcast is a discussion between our staff, community developers, and industry leaders. You can follow us on Twitter @solana or GitHub @solana-labs. DISCLAIMERThe information on this podcast is provided for educational, informational, and entertainment purposes only, without any express or implied warranty of any kind, including warranties of accuracy, completeness, or fitness for any particular purpose. The information contained in or provided from or through this podcast is not intended to be and does not constitute financial advice, investment advice, trading advice, or any other advice. The information on this podcast is general in nature and is not specific to you, the user or anyone else. You should not make any decision, financial, investment, trading or otherwise, based on any of the information presented on this podcast without undertaking independent due diligence and consultation with a professional broker or financial advisor.