The FTX Podcast #40 – John Wu President of AVA Labs

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The FTX Podcast #40 – John Wu President of AVA Labs

Ava Labs is the group behind Avalanche (AVAX) which is an open-source platform for launching decentralized applications, new financial primitives, and new interoperable blockchains.

Transcript:

00:03
[Music]
00:08
hello everyone
00:09
welcome to ftx podcast i’m really glad
00:11
to have here with me today john woo
00:13
president of avilabs the creators of
00:15
avalanche protocol welcome man
00:18
hey thank you tristan it’s a pleasure
00:20
yeah it’s great to have you on
00:21
i’ve been seeing a lot about your
00:22
project on twitter and other places so
00:25
glad to get to chat and get a little
00:26
insight into your mind
00:28
to start this off would you mind
00:29
introducing yourself and giving some
00:30
background
00:32
sure so as you mentioned i’m john woo
00:34
president of
00:35
all the labs alva labs is a next
00:38
generation blockchain
00:39
we really focus on the i would call
00:41
finance side defy and
00:43
traditional finance our goal is really
00:45
to uh remove all the inefficiencies that
00:48
exist
00:48
in the investing infrastructure by
00:50
making it very
00:51
easy to issue digitize tokens digitize
00:56
assets
00:56
create assets and transfer and exchange
00:59
assets so that’s really our mission
01:02
and um you know a little bit about my
01:04
background because i think the subject
01:05
matter
01:06
will require this so my background is i
01:09
started
01:09
in traditional finance i was a
01:12
technology investor
01:14
at various hedge funds like tiger
01:16
management kingdom capital
01:18
and then i started my own hedge fund uh
01:20
seated by the blackstone group
01:22
so those are great experiences and i got
01:26
into crypto when i realized how great an
01:29
opportunity an
01:30
investment basically bitcoin was in
01:32
about 2014 and 2015.
01:35
happy to get into that later but um
01:37
that’s my quick
01:38
background yeah absolutely i’d love to
01:40
hear a little bit more about that and
01:41
how
01:41
you were going from you know doing tech
01:43
investing in all of this and then
01:44
what caught your interest in crypto and
01:46
bitcoin and and made you
01:48
want to join this space because 2014
01:50
that’s early you know i i know the
01:51
promise wasn’t as evident back then
01:54
so i started following it in 2013
01:58
when um frankly everything was open to
02:00
the right
02:01
and then i uh i didn’t have like
02:04
the uh understanding of what this is all
02:07
about and i started
02:08
meeting a lot of people in the space and
02:10
then when 2014 happened
02:11
mount gox and the crash of it i really
02:13
accelerated my
02:15
call it research or study of frankly
02:17
just bitcoin
02:18
at that time and at first i’ll be honest
02:20
i kind of didn’t understand it i
02:22
couldn’t figure it out
02:23
i was trying to value it like i do any
02:26
security with you know cash flows et
02:28
cetera et cetera
02:29
and it was really kind of hard um but
02:33
though what got me really over the hump
02:35
was when i realized i should be looking
02:37
at this more like a currency or a
02:39
commodity
02:40
so when i started looking at that
02:42
framework more about supply and demand
02:45
what i did was like at that time i think
02:46
there was about 15 million
02:49
units already mined and the price of it
02:52
you know back then
02:53
was around in the hundreds like you know
02:55
two three
02:56
four hundred dollars so if i did the
02:58
math at the time the incremental daily
03:01
supply
03:02
was you know basically one million
03:04
dollars of bitcoin were being
03:06
mined or unearthed a single day and
03:09
i was also tracking the growth and
03:12
wallets and
03:12
addresses and the volume on exchanges
03:15
and you have to make some
03:16
assumption but even the most
03:18
conservative assumptions you realize
03:20
that
03:20
the demand the incremental demand for
03:22
bitcoin at the time
03:24
was far more than a million dollars and
03:27
so supply and demand was completely
03:30
imbalanced towards demand
03:32
i had no idea you can’t do a dcf but i
03:34
do know one thing when demand overwhelms
03:36
supply
03:37
it’s going higher and that was my first
03:39
uh
03:40
call it light bulb moment in the space
03:43
and from there did you sort of allocate
03:45
funds on a personal level did you start
03:47
doing it
03:48
with your whatever fund you were working
03:49
with at the moment how how was your
03:52
experience as an investor getting
03:53
involved with that yeah that’s a great
03:55
question because
03:56
i was running my own fund at the time
03:58
and um
04:00
the thing first thing i realized was
04:02
that there was
04:03
no way i can actually do it for my fund
04:06
and maintain my fiduciary responsibility
04:08
to my investors
04:09
basically uh there was no qualified
04:11
custodian so my fund was you know a
04:13
decent enough size
04:15
if you have a 150 million dollar final
04:17
plus you have to have a qualified
04:18
custodian
04:19
to house all your securities so there
04:22
was the first problems like is this a
04:23
security what is this like irs is
04:25
defining a one-way
04:26
scc no one was clear especially back
04:28
then and on top of that
04:30
i couldn’t house it anywhere you needed
04:31
a qualified custodian that wasn’t around
04:33
back then of you
04:34
and um it was not like today where the
04:37
occ has come out and said banks can
04:39
can actually custody this stuff so that
04:41
wasn’t possible then there was a um
04:44
how do you record this stuff it was and
04:45
how do you trade it in an
04:47
efficient way and normal trading desk
04:49
you have in what they call an oms system
04:51
and you can order and route your trades
04:54
and it automatically feeds into your
04:55
accounting system
04:56
everything’s captured you can do your
04:58
taxes easily none of this
05:00
was available it would be like i would
05:02
have to go like
05:03
write down on a paper ledger every
05:05
single trade
05:06
and then go back and calculate it so it
05:08
would have been just a nightmare
05:10
and you know but i did fall in love with
05:12
it based on that premise of demand just
05:15
overwhelming supply so i said i’ll just
05:17
invest for it myself and not trade it
05:19
and hodl it basically so
05:23
that’s what i did and that
05:26
experience trying to like invest in this
05:29
for the fund
05:30
is what really made me realize how much
05:34
needed to be done from an operational
05:36
infrastructure
05:38
in this space to make it possible for
05:40
what we’re seeing today
05:41
where the institutions and wall street
05:44
titans are all saying we need to buy
05:46
big bitcoin yeah i think that gives a
05:49
great example of how much the space has
05:51
changed already in the last
05:53
only five six years now i guess you know
05:56
it’s pretty incredible how
05:57
much the technology has advanced to tie
06:01
into this cryptocurrency world with
06:03
institutional legacy systems
06:05
and before we go into that i want to ask
06:07
you a little bit more about how your
06:09
relationship with bitcoin cryptocurrency
06:11
evolved into you actually founding a
06:14
company that was
06:15
based on this and building on this
06:18
so the next aha moment was actually 2017
06:23
when the ico boom happened and um
06:26
i was just astonished i think about
06:28
close in 2017 not including the 2018
06:32
i think about almost 10 billion us
06:34
dollars was raised
06:35
through the ico method and
06:39
having been an alternative investor and
06:42
my entire career i looked at that first
06:45
with
06:46
awe like wow how fast the speed
06:49
of um a crowd fund globally can be done
06:54
and how efficient it was
06:55
you know i have participated in my share
06:58
of traditional ipos and traditional
07:00
finance
07:01
and usually a bank like goldman or
07:03
morgan stanley has to set up
07:05
two three four week road shows the
07:07
company literally spends close to 10
07:09
million dollars
07:10
you know depending on the size of the
07:12
offering and they have to go run around
07:14
paperwork the you know filing
07:16
registration statements all of that
07:17
and all of a sudden these companies like
07:20
show up
07:20
within weeks they raise them a lot of
07:22
money and
07:24
more money than you can in the same
07:26
period of time more efficient
07:28
and more people participated so at first
07:32
i was
07:32
odd by it and then when i sat back and
07:34
thought about it
07:35
it was like wait a second every single
07:37
one of these
07:38
raises in the u.s are effectively
07:41
illegal
07:42
raises so each one of those things
07:45
skirted
07:46
the regulatory um rules of you know
07:50
sec acts of 34 35 they didn’t rely on
07:53
the reg d
07:54
or you know 144a transfer exemptions
07:57
that will require for these private
07:59
securities
08:00
so i was investing in this but i was
08:03
also
08:04
investing in private shares you know
08:06
traditional back then
08:08
airbnb uber they’re public companies now
08:10
but back then they weren’t
08:11
and i was in touch buying secondary
08:14
shares from myself
08:15
on a place uh called shares posts where
08:18
they have a marketplace for secondary
08:21
trading of these private shares so
08:24
one thing led to another and i realized
08:26
in order for
08:27
those icos in the u.s to be actually
08:30
compliant
08:31
and to really leverage the power of that
08:33
crowdfunding
08:34
mechanism you had to get exemptions
08:37
and treat them like they were private
08:39
securities like they were airbnb
08:42
so that was the first step of me going
08:45
on this
08:45
mission of basically tokenizing assets
08:48
in the proper way
08:50
i ultimately became the ceo of the
08:52
digital assets group at shares post
08:54
where we went and worked with the scc
08:58
finra we got our ats license
09:01
uh did a change of membership of that in
09:03
order to make it compliant
09:04
for digital securities and we affected
09:07
some
09:08
some trades of not just like individual
09:10
digital securities but also
09:12
um funds like you know the blockchain
09:15
capital fund was a well-known
09:17
digital security at that time so it was
09:19
a fantastic experience from
09:21
a first experience actually working with
09:24
the regulators and understanding how
09:25
they think about things
09:27
and also understanding how hard it was
09:30
to bridge
09:31
basically the mindset of traditional
09:33
finance person
09:34
with that of a crypto native person
09:38
back in 2017 2018. it was a really
09:41
fantastic experience we had a great team
09:43
we did a lot of work but ultimately it
09:46
was a little bit early
09:47
and i don’t think the market was there
09:50
even though
09:51
ultimately the product was there
09:54
and did you do you think the third aha
09:56
moment was when you realized that
09:57
through a decentralized system it may be
10:00
easier to set all of this up is that is
10:01
that why ava labs came to be
10:04
so what the aha moment was when i was
10:08
um at shares post the ceo of the group
10:11
and i was working my tech team
10:14
realizing that the technology of just
10:16
putting stuff
10:17
on a you know blockchain the
10:21
that whole process and then making sure
10:23
the technology was compliant
10:25
could be done at so many different
10:26
levels and
10:28
on one level it could be just done like
10:31
it was back then you
10:32
went to great um third-party people like
10:35
a securitized and they helped you
10:38
tokenize that issuance i’d be working
10:41
on the issuers and getting them into the
10:42
funnel so
10:44
but then when you did all this a lot of
10:46
that work was still
10:47
on paper and very manual it wasn’t very
10:50
efficient
10:51
my goal again was to make things my
10:53
mission was to make
10:54
things efficient take out the
10:56
inefficiencies
10:57
in the investing infrastructure so
10:59
although the distribution side
11:01
like in the ico was very efficient
11:04
tokenizing the assets
11:05
were not that efficient and that’s
11:07
ultimately how i got
11:09
and led myself to all the labs eamon
11:11
gunsir
11:12
the great you know distributed
11:14
assistance professor at cornell had been
11:15
working on various blockchains
11:17
and he was working on you know avalanche
11:20
which is the protocol for
11:22
that ava labs created his mission was
11:24
very simple
11:25
it’s also similar to mine like we all
11:27
think the killer app ultimately is to
11:29
make that
11:30
you know like email was for internet
11:33
issuing digitizing assets on the
11:36
blockchain
11:37
and allowing people to easily transact
11:40
and trade and exchange those assets
11:43
is ultimately the killer app so very
11:45
similar mission
11:46
he was coming at it from the technology
11:49
end
11:50
i was coming at it from a wall street
11:52
making a compliant end
11:54
and that’s why i’m here and having a lot
11:56
of fun
11:57
that makes a lot of sense and when did
11:59
this all start when when did this begin
12:01
so they started you know they all the
12:04
labs
12:05
and the avalanche protocol came out of
12:07
cornell university
12:08
him and some of his students there wrote
12:11
what i would think is the next consensus
12:14
protocol paradigm shift and capability
12:17
and they took it out of cornell to
12:20
commercialize it
12:22
the first step was to raise money and
12:23
and they raised money in a series a
12:25
through some well-known vcs like andrey
12:28
sanhara with a16
12:30
poly chain initialized capital and then
12:32
i
12:33
started shortly after that and um
12:36
i started when the place was 14 people
12:38
mostly uh
12:39
great brilliant computer scientists
12:41
today were 70 people
12:43
nice yeah that’s really sweet that you
12:45
got to get in there quite early and
12:47
because i’m assuming that were you
12:50
president
12:50
right away when you began or was that
12:52
what was the president
12:54
i was president right away you know um
12:56
gun and i have known each other
12:58
for some time we’re trying to figure out
13:00
ways to collaborate because what we’re
13:02
trying to do is very similar
13:03
and i was ceo of the digital access
13:05
group at share suppose when we first
13:07
talked it was just never the right
13:08
timing
13:09
and then finally the right timing
13:10
happened and um
13:12
you know i’m proud to say that you know
13:14
the team that’s gelled together
13:15
and really started making this all
13:19
happen
13:19
you know besides the number of people
13:21
you know we’ve got on the main net
13:23
we’ve got close to 700 uh
13:27
nodes up and running with validators and
13:29
we have you know well over a billion
13:30
dollars
13:31
staking so it’s been uh a great
13:34
great ride so far yeah from what i’ve
13:37
seen and just from when you guys
13:38
launched and what not till now
13:40
seems like there’s been a lot of growth
13:41
and interest in the ecosystem and
13:43
but before i go into a little bit more
13:45
of the specifics of avalanche protocol
13:46
and asking stuff like that
13:48
i want to tap in a bit more into your
13:49
institutional investor knowledge
13:51
and i’d like to get your insights into
13:53
what i am seeing as an institutional
13:55
driven rally
13:56
that we’re seeing right now in the
13:57
cryptocurrency markets and i’d love to
13:59
hear your thoughts of
14:01
was the pivotal moment actually the paul
14:03
tudor jones letter
14:04
when did all of this start shifting
14:06
what’s going on right now and like where
14:08
do you think this is going
14:10
so classic well taking a step back
14:14
i think this has been something that’s
14:16
been uh
14:18
building up over time i think there’s
14:21
just a fantastic
14:23
macro backdrop for bitcoin for now
14:27
and ultimately other other
14:29
cryptocurrencies
14:30
it was also a psychological thing where
14:33
people had to take
14:34
time to understand what this is all
14:36
about
14:37
so first the macro backdrop i mean
14:40
we’ve got now in our country you know
14:43
the fed’s balance sheet is like 7.7
14:46
trillion dollars
14:47
i mean the amount of money printing that
14:49
is that’s going on
14:50
is insane after 2008 the great financial
14:54
you know recession the fed’s balance
14:57
sheet ballooned from
14:58
you know less than one trillion to like
15:01
five
15:02
and then we were slowly working that
15:04
down from five to four
15:06
and all of a sudden unfortunately covid
15:08
happened in 2020
15:11
and instantly we just went from less
15:14
than
15:14
you know about four all the way to 7.7
15:17
instantly
15:18
so there’s a lot of money being put into
15:20
the system
15:21
and the the issue with that is
15:25
um it’s not just the us every central
15:28
bank has been practicing
15:30
the same policy so every single
15:33
recession
15:33
around the world now in order to have
15:36
less pain
15:37
for their to make the dips of the
15:39
recession
15:40
lower so that it’s become very political
15:42
i think even though central banks in
15:44
theory
15:44
should be out of the politics but
15:47
there’s we’ve trained ourselves to
15:49
really make the
15:50
pains and the cycles shorter and shorter
15:54
so when you do that you actually have
15:56
this reflexivity property take effect
15:59
and you have to like the next time
16:00
around
16:01
you have to like print even more money
16:03
and put more into the system
16:05
and because it’s kind of like drinking
16:06
coffee like you drink one or two cups a
16:09
day and all of a sudden like one or two
16:10
cups
16:11
doesn’t affect you anymore and then you
16:12
have to drink four or five cups
16:14
so so it’s like this process where all
16:17
of a sudden you have to print more and
16:18
more and more
16:19
and when you print that much money
16:22
you’re effectively what you’re doing is
16:23
you’re debasing your currency so with
16:26
that
16:27
happening you’re having this asset
16:30
inflation
16:31
while your currency is deflating and
16:33
then what do you do as an investor
16:35
you look for air with places where you
16:38
find a store of value historically the
16:41
store value has been just
16:43
gold and a few other hard assets that
16:45
you can actually touch
16:46
but in 2020 people looked around and
16:50
actually the funny thing is store value
16:51
became
16:52
not just um gold but
16:56
bitcoin the properties of bitcoin the
16:58
finite units that will come
17:00
out 26 million by 2140 that had similar
17:03
characteristics and people started
17:05
looking at it
17:06
even equities right so if you’re not i
17:09
mean i think 20
17:10
to 25 of the global debt out in the
17:13
world
17:13
is actually negative yield you’re losing
17:15
money basically by leaving it in the
17:17
bank
17:18
so a store of value is no longer your
17:20
local fiat currency it’s actually
17:23
everything else equities bitcoin even
17:26
gold
17:27
so i think it’s the confluence of those
17:29
two dynamics
17:31
on top of the psychology we’ve had now
17:34
uh 12 years i think close to 12 years
17:37
maybe 11
17:38
in of the history of bitcoin and
17:41
it’s been around it’s gone through a few
17:42
cycles people are now
17:44
aware that um this thing has been around
17:48
and it’s probably not
17:49
gonna go away so what is money i mean
17:51
money is basically
17:52
the collective faith of the population
17:54
and as things are around more and more
17:56
and more
17:57
bitcoin has achieved some of that
18:00
uh faith if you will and obviously
18:04
great titans like politico jones coming
18:06
out saying that
18:08
caused an inflection so because i know
18:10
you speak of paul tudor jones as one of
18:12
the inflection points i
18:13
i mentioned that earlier as well but i
18:15
kind of want to touch on the point of
18:16
you saying that when you started it
18:19
would have breached your fiduciary duty
18:21
to invest in this
18:22
what is some of the infrastructure that
18:24
has come into place that now makes it so
18:26
that these
18:27
titans can put enormous amounts of money
18:29
in while still
18:30
holding their fiduciary duties yeah so
18:34
if you remember we had that great rally
18:36
in 2017
18:37
and the two promises was that
18:40
institutional money is coming
18:42
and then that uh all these applications
18:45
other than
18:46
ico would be coming as well so we know
18:49
on the operating side the applications
18:52
came a little slower we’ll talk about d5
18:53
later
18:54
but on the institutional money coming
18:58
i realized this a little earlier so that
19:00
a lot of people trying to buy in 2017
19:03
what was not there were literally these
19:05
custodian solutions
19:07
back then you didn’t have a custody
19:10
readily for a qualified custodian that’s
19:12
what you needed for a
19:14
proper institution to invest on top of
19:17
that
19:17
the user experience was really really
19:19
difficult like
19:21
professional investors are used to
19:23
world-class systems
19:24
where they can just enter a trade
19:26
quickly and then boom
19:27
they get results and it’s integrated to
19:29
their back end for the accounting for
19:31
everything
19:32
that wasn’t there that is starting to
19:34
come through there are
19:35
service providers out providing this
19:37
coinbase is doing a lot they have a huge
19:39
institutional push
19:40
right now their assets are growing like
19:42
crazy and most of that comes from
19:43
institutions so the software
19:47
the infrastructure and frankly
19:50
the regulation has become a lot clearer
19:53
today
19:54
than it was in 2017 and when i was
19:57
killing an
19:58
inordinate amount of brain cells to
19:59
figure out how to get a compliant
20:01
tokenization
20:02
back in 2018 so i think those three
20:05
things
20:06
coupled again with psychology have
20:09
really allowed the whole institutional
20:12
crowd to actually
20:13
flow into the space well i was hoping
20:16
you touched on the regulatory aspect
20:17
because i think the other that’s the
20:18
third column there that’s
20:20
that’s holding this up well i mean just
20:22
the last
20:23
year or so um actually occ
20:26
last year allowed the banks to basically
20:30
um custody crypto so you know
20:33
and then just recently i think about a
20:35
week ago and i actually tweeted about
20:37
the shitty reader
20:38
they they’re allowing for banks to
20:40
actually use stable coins to transact
20:41
and take payments
20:43
uh and and move assets around that way
20:46
or currency around that way so
20:48
again it’s not still it’s definitely not
20:50
perfect and there are still things that
20:52
are vague
20:53
but the clarity is growing from the
20:56
regulatory side
20:58
it’s exciting to see all this growth all
20:59
the confluence of these factors as
21:01
you’re saying coming together finally
21:02
especially for
21:03
people that have been in the space for a
21:05
little bit too it’s really interesting
21:06
to get
21:07
feedback from you know from your
21:08
experience 2014 or i was speaking to
21:10
amir
21:11
in another episode he was one of the
21:13
developers in 2010 of bitcoin it’s like
21:16
what what bitcoin was and what it is now
21:18
is just taking this transformational
21:20
journey of all these years and
21:22
now all these investors seem to be
21:24
putting the funds into bitcoin and
21:26
that’s where all the attention is
21:27
but you know as an institutional
21:29
investor yourself and as someone that’s
21:30
building in d5 and creating other
21:32
solutions
21:33
do you think they may be missing
21:34
something are there parts to this that
21:36
are outside of the bitcoin land
21:38
yeah so this is funny because in
21:42
2014-15 when i told
21:45
my colleagues in the hedge fund tech
21:47
investing
21:48
vc world that i was doing this they
21:51
literally thought i was crazy
21:53
um they thought you know when they
21:55
looked at me when i told them this
21:56
they thought i was as if i had a third
21:58
eye or something when they looked at me
22:00
and then in 2017 when things were
22:03
uh you know going crazy in terms of the
22:06
prices
22:07
what they were doing was they were
22:08
getting on coinbase and then they were
22:11
creating an account they still didn’t
22:13
really believe in this stuff
22:14
they just kind of liked the fact that
22:16
there was this kind of like this cool
22:17
pinball machine where they can gamble
22:19
and make money
22:20
didn’t have to write up to their bank or
22:22
private equity or hedge fund
22:24
that they were buying securities because
22:25
there’s no rules around it for that so
22:27
they get to like speculate
22:28
buy stuff but it was more fun it wasn’t
22:31
really like i’m taking this seriously
22:33
and they were doing it
22:34
individual not they were they were not
22:36
doing it for their firm
22:39
then somewhere about last year it got
22:42
kind of more serious
22:43
um you know the they were starting to
22:47
ask like okay
22:48
given this macro backdrop that we talked
22:50
about earlier
22:51
how does my firm and that in the for and
22:54
the infrastructure being built
22:55
you know the confluence of these
22:56
different things how does my firm now
22:59
participate
23:00
and that’s what really was happening in
23:02
somewhere in 2020.
23:04
now those same people right now in the
23:07
beginning of 2021
23:08
the number one question i am being asked
23:11
by
23:11
my former uh peers in the hedge fund
23:14
and in the vc world is how do i buy and
23:19
what do i buy
23:20
on coin market cap from number six down
23:23
to number
23:24
200 because they don’t know
23:28
anything about anything underneath
23:30
number five basically
23:32
and there’s two problems one
23:36
they don’t know how to assess and and
23:40
research any of those currencies coins
23:43
whatever you want to call it
23:44
the second problem so therefore they
23:46
don’t know how to assess
23:47
reward and risk and then the second
23:50
problem they have with this
23:51
is those are not
23:55
properly allowed to be custody because
23:58
you know the ruling is still
23:59
you know uh you can custody bitcoin at
24:01
these banks but you can’t
24:02
and the solutions are for qualified
24:05
because custody is for
24:06
bitcoin and maybe they’re working on
24:08
ethereum but like for anything
24:10
else it’s not a proper thing that they
24:13
can just custody at the
24:14
custodians yet so what they’re doing now
24:17
is
24:18
they are looking what they can do is
24:20
invest in
24:21
funds and be an lp in a manager that can
24:24
invest in those things
24:26
so they’re basically doing an indirect
24:28
into how to invest
24:29
in in numbers six call it to 200
24:33
if you will so what they are missing out
24:36
or missing
24:37
is the framework to how to properly
24:40
analyze
24:41
everything under the fold for you know
24:43
the first page of coin market cap
24:45
and a direct vehicle for investing like
24:48
they found
24:48
in bitcoin it makes sense to me
24:52
and going on a little deeper then since
24:54
we’re going you know from six down to
24:56
200 2 000 wherever we want to fall a lot
24:59
of these new tokens are defy tokens
25:00
because we’ve had a defy summer and
25:02
there’s been a big boom
25:03
and i want to know what your thoughts
25:06
are on defy
25:07
since now you are basically the
25:09
president of a company that’s creating a
25:11
decentralized protocol so
25:13
i’d love to hear kind of what this
25:15
resonates within you
25:17
i mean d5 being close to 20 billion
25:19
trapped capital is unbelievable uh
25:21
beginning this year is about
25:23
one right so we’ve gone from one to
25:24
twenty with insane
25:26
and you know we’re so happy because the
25:29
whole purpose
25:30
of our you know mission was to create
25:33
financial assets and make it easy and
25:34
efficient
25:35
and to digitize it so some of the
25:37
problems we see
25:38
in d5 such as the usage fees on the
25:41
theorem and the
25:43
slowness when things are congested
25:46
that’s what we’re
25:47
solving so obviously we’re very excited
25:49
to see this explosion
25:50
in d5 now on d5 itself i think it’s just
25:54
the most fantastic
25:56
experiment slash pichu dish of
25:59
brilliance
26:01
of fraud scam but at the same time
26:05
what they’re doing is really showing the
26:07
world what can happen
26:09
in a decentralized permissionless way
26:11
and how you can
26:13
a recreate certain financial functions
26:16
and products and services
26:17
in a peer-to-peer manual and i actually
26:20
create new ones
26:21
because a lot of the people that are
26:22
creating this stuff they don’t have
26:24
the bias of history to say hey this is
26:28
the way the world is done so i’m just
26:30
going to copy that and create it in a
26:32
period of pure matter they’re actually
26:33
thinking of like
26:35
crazy stuff that actually doesn’t exist
26:37
in traditional
26:38
finance so it’s a super exciting time
26:41
i think if i think back back to the
26:44
investor
26:44
hat and you look at who’s investing in
26:47
bitcoin and who’s
26:48
investing in d5 the investors are
26:50
absolutely missing out on d5
26:52
that you know d5 right now is crypto
26:56
products for crypto people
26:58
the the only in traditional
27:00
institutional
27:01
investors are capturing any of the g5
27:03
boom
27:04
are people who have invested in funds as
27:07
lp
27:08
into the d5 so they are really missing
27:11
out on
27:12
call it you know for lack of a better
27:14
purpose of you know numbers
27:16
six to 200. and you know i think what
27:20
defy people are missing out or crypto
27:23
people
27:24
miss out and they can learn from from
27:26
more institutional people
27:27
is institutional traditional finance
27:29
people
27:30
they really think in the risk reward
27:33
matter they’re look always looking at
27:35
things from okay
27:37
they probably spend if they have a
27:39
hundred hours they probably spend
27:41
70 on the risk and 30
27:44
on the reward side so i think
27:48
people who invest in these crypto d5
27:51
products or services they actually the
27:55
crypto natives probably spent
27:56
95 on the reward and almost nothing
28:00
on the wrist the only person
28:03
that i’ve seen repeatedly in the crypto
28:06
world that actually
28:07
mentions risk is andre he’s the only one
28:10
and he’s you know done it on your
28:11
podcast where he talks about
28:13
risk so i mean it’s funny right because
28:16
if you are just looking at things from a
28:19
risk reward
28:20
profile um you were real if you’re just
28:23
looking from a
28:24
reward profile you know the um
28:28
the traditional finance guys really
28:29
missing out yes in 2020
28:32
i think bitcoin was up 300 ethereum was
28:36
up you know
28:37
uh similar to that and d5
28:40
you know trap value went up like you
28:42
know 20x but
28:44
like um the if you look at a basket
28:47
on deep uh you know d5 pulse
28:50
the value of that basket probably went
28:52
up less than 20 x but still
28:53
went up far more than than uh bitcoin
28:57
or ethereum so you those guys are
29:00
missing out on the returns
29:02
but if you do it on a shark ratio basis
29:05
which is the you know the shorthand
29:06
uh rule of thumb that traditional
29:09
finance people look at
29:10
from you know whether this company or
29:13
this security or this
29:15
you know uh investment is worthy
29:18
based on how much risk and how much
29:20
return you get
29:22
tesla was actually as good if not better
29:25
return than a lot of these um
29:27
crypto companies i mean tesla last year
29:29
was up like 800 percent
29:31
and the annualized ball on tesla is
29:33
about the same as bitcoin
29:34
so um on a risk reward basis
29:38
the d5 people are missing out on tesla
29:40
and on a pure absolute return basis
29:42
the traditional people are missing out
29:44
on d5 so i think
29:46
both sides can learn a lot from each
29:47
other at some point in the future
29:50
um i think both sides will look at risk
29:53
and reward in the space
29:54
closer to the middle as opposed to 95
29:57
and
29:57
70 30. well i think you touched on a few
30:00
really interesting things there john
30:01
one of them being as you were saying
30:03
that we’re seeing a lot of experimental
30:05
financial products coming out and
30:07
primitives because these people haven’t
30:09
been constrained by
30:10
what a prime brokerage is and what the
30:12
functionalities are and what different
30:13
offerings are and that’s what you have
30:15
these guys are actually creating new
30:17
things that allow people to have new
30:19
interactions
30:20
from their web3 wallet or whatever but i
30:22
also think that
30:23
what allows this to happen and to expand
30:26
and to grow and to get adoption and at
30:27
least enough adoption
30:29
that they can iterate and build a team
30:31
and keep building
30:32
is that you have these apes who will
30:34
come in and like throw
30:36
money at whatever thing without really
30:38
understanding it
30:40
but and yeah there’s rug pulls people
30:42
are definitely losing money
30:44
but i also think like it’s a very
30:45
crucial component
30:47
of what’s allowing all of this to move
30:48
so quickly is that these very
30:51
risk open people are willing to you know
30:54
put their money where their mouths are
30:55
to see what happens so i think it kind
30:57
of needs that to keep growing at the
30:59
rate it has been up till now
31:01
oh yeah absolutely i mean just like any
31:03
other system
31:04
you’ve got a bunch of compounding loops
31:06
helping each other grow
31:07
faster so the more money that comes in
31:10
the more development happens the more
31:12
interest comes in
31:13
the more money comes back in and then
31:15
the more development happens and all of
31:16
a sudden
31:17
you end up someplace maybe there was a
31:19
zigzag there but you end up someplace
31:21
that is really a wonderful place and if
31:24
you can see
31:25
the uh end here it’s never going to be
31:28
an
31:28
end so to speak but if you can see down
31:30
further the road it is fantastic
31:33
what you know deconstructing of the
31:35
financial services supply chain is
31:37
happening right now
31:38
in in the d5 world and the irony here
31:41
again is we’re talking about
31:42
who’s missing what what do you know so
31:44
yes the financial
31:46
traditional people are missing out on a
31:47
lot of g5 but the d5 people
31:50
actually need those uh traditional
31:53
finance people
31:54
even now so a lot of those guys when
31:57
they invest
31:58
they do go through coinbase and what
31:59
happens is you know because that’s
32:01
still the best in the u.s fiat to to
32:04
crypto
32:05
and they have all the regulatory
32:06
compliance stuff there so they go
32:08
through coinbase
32:09
and then from coinbase they go into usdc
32:12
and then from usdc they go into the
32:14
world of d5 somewhere
32:16
so ironically to your point
32:19
yes you have these very open um
32:22
investors in the crypto world
32:24
but some of that money is being supplied
32:27
by the traditional investors coming into
32:29
the channel
32:30
and the gatekeeper paul coinbase um
32:33
that’s what’s fascinating and then on
32:34
the other side
32:35
i think what d5 is actually showing the
32:38
traditional
32:39
investor is that as they invest
32:43
they are actually helping completely
32:46
change
32:46
their own industry and taking out all
32:49
the intermediaries
32:51
that have been there to like for
32:54
protection but also slow things down
32:56
and lower returns yeah absolutely and
33:00
then and that also touches upon like the
33:01
governance aspect of this where like
33:03
these investors are actually seeing
33:05
that when they buy some shares quote
33:08
unquote shares of these different
33:09
protocols and stuff
33:11
it isn’t so much now that they have some
33:13
stocks and you know kind of
33:14
good luck they don’t really can do they
33:16
can’t really do much with that now
33:18
you know the systems aren’t completely
33:19
worked out yet there’s a lot to be done
33:21
there
33:22
but in some sense we now have a direct
33:24
voting effect
33:26
on a financial platform that we can
33:28
guide in the sense or direction that we
33:30
want
33:31
and i think that sense of ownership is
33:33
pretty important and
33:34
hopefully these systems keep becoming
33:35
more sophisticated because then we’ll
33:38
really see what dfi is or decentralized
33:40
finance where the user gets to
33:42
select the parameters that make it a
33:44
better platform for everyone
33:45
that’s something i’m really excited to
33:46
see again that’s a
33:48
that’s a great point there because you
33:51
know the crypto native
33:52
uh defy investor
33:56
loves the world of permissionless and
33:59
you take the
34:00
trust component out of the hands of
34:02
intermediaries and put it into the
34:04
individual so it becomes a trustless
34:06
community
34:07
the entire mindset of traditional
34:09
finance is that those
34:10
intermediaries because of regulation
34:13
because of other things
34:14
are put there in order for trust
34:18
to happen this is why things are named
34:20
like northern trust
34:21
bank or this trust that trust you you
34:24
know
34:24
you never it’s almost like you tell
34:27
a traditional finance person that this
34:30
system is trustless
34:32
and this is literally what happened like
34:33
you know back in 2016-17 i was talking
34:37
to my peers in traditional finance and
34:39
i was like yeah this is a trustless
34:41
peer-to-peer system
34:42
and instantly they’re like trustless why
34:44
do we want to go into something that’s
34:46
trustless they didn’t understand what i
34:47
meant
34:48
was that when you remove these
34:50
intimaries that are
34:51
there to provide trust and then you take
34:54
that trust you’re kind of extracting it
34:56
from those people
34:57
and then you give it to the individuals
34:59
participating
35:00
and it’s through rules and algorithms or
35:03
governance tokens whatever
35:05
and you allow them no matter who they
35:07
are whether
35:08
you know and in some and with anonymity
35:12
the the incentive system and the algos
35:14
are set up
35:15
so that they actually do the right thing
35:17
or hopefully they do the right thing
35:20
if they don’t do the right thing they’re
35:21
booted out of the system that is the
35:23
ultimate like again obviously there are
35:25
scams and stuff like that but
35:27
that is the concept that every person
35:31
in you know hardcore crypto is shooting
35:33
for
35:34
and that’s a foreign concept to the
35:36
traditional finance person
35:38
absolutely and i think one of the most
35:39
important things we’re doing in d5 is
35:41
just removing overhead we’re moving
35:42
overhead removing overhead
35:44
so that at the end the end user just
35:46
pays way less in whatever application
35:48
that they’re doing
35:49
and and that and the speed with which
35:51
this is happening
35:52
is kind of insane i mean even within
35:56
crypto think about this uh coinbase
35:58
started probably like
36:00
almost nine ten years ago now right they
36:02
have about 2 000 people
36:04
16 or 1700 people they had a last equity
36:08
they’re going ipo but the last
36:09
equity round in the private round was
36:11
about 8 billion valuation
36:13
um you know they’ve got close to if not
36:15
more than 100 million of assets under
36:17
custody they’ve got like 35 million
36:20
clients so
36:21
our wallets so unbelievable but then
36:24
you look at a thing like uniswap
36:27
literally
36:28
it’s i think it’s like less than 20
36:29
people created just a few years ago
36:32
and not apples to apples but the network
36:35
market cap of it is already five
36:37
six billion so not quite apples to
36:39
apples but almost there
36:41
and the volumes on certain days are just
36:44
almost close to the coinbase level so
36:47
you’re talking about removing
36:48
intermediaries you’re talking about
36:50
programming business logic into and and
36:54
putting it into the smart contract or
36:56
putting it into code
36:57
this all helps you remove intermediaries
36:59
and allows business formation
37:01
and business products at a incredible
37:04
rate
37:05
so i mean if i told you you had a chance
37:08
to build this
37:09
big business over here with 2 000 people
37:11
or this
37:12
20 person business and it’ll take two
37:15
years to get to
37:16
70 of what that big one is i don’t you
37:19
may
37:20
go for the the the defy solution as
37:22
opposed to a bigger solution now i’m
37:24
exaggerating obviously there are things
37:26
at coinbase that you know the deep
37:28
traditional order books
37:29
the the compliance the custody they
37:32
serve a certain audience a different
37:34
audience
37:34
and right now the way uniswap works and
37:37
then the fees and the gas
37:39
and all that it’s not a realistic thing
37:42
for a traditional finance
37:44
firm and the fiat rails i think are like
37:47
the fiat rails are really important the
37:49
rails are terrible but
37:51
just the even be you know just the speed
37:53
and scale and the latency
37:55
uh and you know that’s again what we’re
37:59
trying to do is
38:00
the differences between unit swap and
38:02
coinbase need someone who
38:04
can bridge those speed scale and latency
38:06
issues and hopefully
38:07
we can be a platform to help that and
38:10
accelerate that
38:11
perfect so grabbing all of this sort of
38:13
macro generalized conversation we’ve had
38:16
i’d love to hear how
38:17
avalanche ties into this and what the
38:19
vision is for avalanche where you guys
38:21
want to take this going forward
38:23
yeah so you know avalanche wants the bv
38:27
platform a platform of platforms almost
38:29
where all these great innovations
38:32
especially in the d5 will will come over
38:35
to us and start experimenting on our
38:38
platform
38:39
you know we think of ourselves as
38:41
friends of ethereum
38:42
but it’s almost like an alternative to
38:45
the
38:45
ethereum alternative you know we we’re
38:48
about to
38:48
have a bridge that’s ready to go we’ll
38:50
have functionality
38:52
we’ll have different features different
38:53
applications so
38:55
if you think of like your phone you have
38:57
an ios and android
38:59
there’s no reason why two or three
39:00
different systems out there
39:02
cannot all exist and as we grow our
39:05
ecosystem
39:06
we will have more and more applications
39:08
um we’re gonna have a lot of stable
39:10
coins already launching in the near
39:11
future i can’t
39:12
pre-announce a lot of these things but
39:14
basically we’re going to have the
39:15
functionality
39:17
and much lower cost of transaction
39:20
and solve some of the current pains that
39:23
exist
39:23
in the d5 world because of a slower
39:26
chain
39:27
and you’re saying that a big part of
39:28
this is tokenization of assets as well
39:31
so
39:31
when you say that do you mean do you
39:34
have
39:34
certain objectives or you say that in a
39:36
general sense where you know hopefully
39:38
you can have a market for
39:39
tokenized mortgages at some point or
39:41
tokenize commodities or yeah or do you
39:43
so
39:43
do you want to go with it so this you
39:46
know is a little bit outside of
39:48
the context of just you know d5 versus
39:50
traditional investing but
39:52
one of the great things about in the in
39:54
the vision of ava labs and avalanche is
39:57
that
39:58
we have a network of networks kind of
40:00
thing
40:01
where the goal is that you people
40:04
enterprises can spin up a sub network
40:07
it’s almost like a private blockchain
40:10
and then the advantages of what we’re
40:12
doing
40:13
is if you go to a traditional financial
40:15
organization that wants to spin
40:17
up a wants to raise a fund and they want
40:19
to do it on the blockchain
40:21
and they want to create it in their own
40:23
private manner where all the lps are in
40:25
this private blockchain
40:27
they can do a very it’s easier to do
40:30
with us
40:31
and also that we built in with this in
40:34
mind
40:35
that that compliance was a big issue so
40:38
the first generation of digitized assets
40:41
and
40:41
security tokens back in 1718 a lot of
40:44
the restrictions were embedded into the
40:46
smart contract you know kyc
40:48
aml all accreditation all of that was
40:50
better into the code
40:52
itself we’ve kept that but we also
40:54
introduced more governance
40:56
at a different layer than network layer
40:58
so in these sub
41:00
networks these private blockchains if
41:02
you will
41:03
these enterprises can actually choose
41:05
their own validators
41:07
and create the rules that these
41:08
validators can
41:10
um can operate under
41:13
so in other words all of a sudden if you
41:15
want to control the entire life cycle of
41:16
an asset
41:17
you can do that a lot easier and be
41:19
compliant because
41:20
securities are different roles in
41:22
different jurisdictions
41:24
different securities have different
41:26
rules and the rules actually change with
41:28
vintaging
41:29
of of the actual securities so
41:32
you know after a year they can trade
41:35
more easily or after certain
41:37
or or when they go from one you know
41:40
uh jurisdiction to another they have
41:42
different rules as well so
41:44
if you have your own private blockchain
41:45
you can tweak
41:47
the validating rules the governance
41:49
yourself
41:50
to what fits to the geographic
41:53
or the vintage of that security so you
41:55
can see the entire life cycle of it so
41:58
we’ve created in summary a way in these
42:01
sub
42:01
networks for an enterprise permission
42:04
blockchain if you will and what’s cool
42:07
about it is
42:08
this permission blockchain is a sub
42:10
network
42:12
that when they are ready and they want
42:14
to can tie into the permissionless psi
42:16
and hopefully as the worlds converge
42:18
take advantage of the liquidity and
42:20
demand
42:20
from a whole new universe of of
42:23
investors
42:24
that makes perfect sense so potentially
42:26
you can provide liquidity to these
42:27
different funds
42:28
that didn’t happen new participants
42:31
because right now
42:33
the uh the interesting thing i see from
42:36
the uh call it permission or the
42:38
enterprise side
42:40
is that uh unlike in 2017 and 18
42:44
when the issuers were adversely selected
42:47
because the world
42:48
adventure was so good a lot of these
42:50
issuers went straight to
42:51
sand hill road just raised money very
42:53
easily so you had literally the
42:55
leftovers try to raise money um
42:58
on on the blockchain if they weren’t a
43:00
native blockchain type company if they
43:01
were just a normal venture company
43:04
but in 2020 and 2021 what we’re seeing
43:08
is these issuers whether they’re funds
43:10
or individual companies
43:12
they’re looking at the blockchain as a
43:13
solution to actually
43:15
have automated and better workflow and
43:18
more efficiency not necessarily just for
43:21
pure
43:22
distribution of money so the people who
43:24
are adopting right now private
43:26
blockchains from the financial services
43:28
side
43:28
they’re looking at it as a technological
43:30
improvement efficiency
43:32
and savings of money versus 2017-18
43:36
which is basically well i can’t raise
43:38
money on sand hill road so i’m gonna go
43:40
try to raise money in the crypto world
43:42
and then yeah the crypto people looked
43:43
at it like well i don’t understand what
43:46
exactly you’re doing
43:47
so they went back to the whole um i’ll
43:50
just invest in my own crypto world and
43:52
then that’s what i was saying
43:53
in 2018 we worked really hard to create
43:56
the system
43:57
but the demand wasn’t ready yet yeah i
43:59
think that’s that’s an overlooked
44:01
often overlooked fact that a lot of
44:02
these networks
44:04
blockchains are in fact in permission
44:06
systems also a lot more
44:08
efficient than data servers and other
44:09
things that people are using
44:11
and and and also removes intermediaries
44:13
for them i did an internship at this
44:16
shipping company in chile and there was
44:18
right by the harbour in valparaiso which
44:20
is one of the bigger ones there
44:22
and i was speaking with the i don’t know
44:25
if it’s dock master but the kind of the
44:27
guy that runs the
44:28
whole harbor and he was saying that
44:30
maersk in partnership with them
44:32
and several other shipping companies
44:33
have a permission blockchain now
44:35
and that’s what they’re doing for all
44:36
their container tracking and stuff it’s
44:38
still in beta testing but it’s just
44:39
really cool to see how
44:40
this technology which means so much for
44:42
me i love it from the decentralized
44:44
perspective like i’m a believer from
44:45
that sense i like
44:46
anonymity of our private data or at
44:49
least the choice to do with it as we
44:50
will and whatnot
44:51
but i also think it’s great that people
44:54
see that these technologies can be used
44:56
regardless if those people want to
44:58
participate in the decentralized aspect
45:00
or not
45:01
yeah i think um those use cases that you
45:05
just highlighted
45:06
where there are multiple parties in one
45:09
network a sub network or a smaller
45:11
network
45:12
instead of having seven eight different
45:15
tech stacks and you have to write apis
45:18
to get in and permission the right
45:19
person
45:20
um a form and then along with that is a
45:24
lot of paperwork in between that
45:25
and all of a sudden you can put it on
45:27
one distributed ledger and it’s
45:29
almost coded into who can see what and
45:31
how c1
45:32
and and it’s almost in real time really
45:35
again just eliminates
45:36
bodies no different from what we just
45:38
talked about you have 2000 people in
45:40
coinbase and you have 20 at uniswa
45:41
it’s like all of a sudden you have a lot
45:43
of bodies that are gone i mean
45:45
the other analog to this would be cloud
45:48
i mean
45:49
back in the day you had your own service
45:51
and your your company had servers in
45:53
some case in your basement
45:54
and then you had a higher staff to take
45:56
care of that hardware and then
45:58
another guy that literally went down to
45:59
the basement all the time to make sure
46:01
you know that or sat in the knockroom
46:04
just to make sure everything was
46:05
perfect and at first people were like
46:09
okay i don’t trust this aws thing but
46:12
now that’s kind of like
46:13
an afterthought like there is no more of
46:15
that basement where there’s a guy down
46:17
there
46:18
trying to monitor the the servers that’s
46:20
it’s all in aws now so
46:23
just like how the cloud has become
46:26
just part of the way you do things and
46:28
making things more efficient
46:29
i think blockchain and the dream for
46:31
that one day will be it’s just
46:33
in the background you won’t even be
46:34
asking people are you using the
46:36
blockchain
46:36
just kind of you know they do
46:39
isn’t that wild how fast even just the
46:42
shift to the cloud has happened
46:44
i mean you know i’m only 25 but from
46:47
from
46:48
my young age till now the paradigm has
46:51
is moving so fast it’s incredible
46:54
i mean again like these cycles are
46:56
getting shorter and shorter
46:58
and um it’s it’s scary i think you know
47:02
your generation
47:03
you think about like a little bit older
47:05
than you 10 15 years older you went to
47:08
college and you kind of assume you’re
47:09
going to go into one industry
47:10
you’ll be almost like you know maybe
47:12
three job jumps or whatever
47:14
like i can almost tell you like
47:17
whatever you learn now i hope you know
47:19
how to learn
47:20
as opposed to take what you just learned
47:22
and apply it because
47:24
your generation is going to have like
47:26
three four different hops as the world
47:28
changes so quickly
47:30
and then what you did for the first five
47:32
seven years becomes irrelevant but
47:34
because you’re good at learning
47:35
your next five seven years you’re doing
47:37
something really cool again until that’s
47:38
another
47:39
goal then you gotta go on to the next
47:40
thing so um the number of jobs on
47:43
people’s resumes and the number of
47:45
industries they go into
47:46
are gonna flow a lot more than people
47:49
from an older vintage
47:51
oh yeah i mean just look at japan it’s
47:53
pretty wild like a lot of these
47:55
companies are having trouble finding
47:57
because they only want to hire people
47:58
that want to work there for life and a
47:59
lot of the young people don’t want to do
48:00
that so
48:01
yeah that’s what we do now mindset yeah
48:04
psychology and the mindset
48:06
has to change and you know if you bring
48:08
this back to
48:09
institutional people investing in in
48:12
crypto
48:13
i think um and then we talked about how
48:15
the psychology has changed but i think
48:16
there’s nothing
48:17
better than the following stat when i
48:19
talk to people how their eyes just start
48:20
getting
48:21
wide and say oh my god i mean basically
48:23
in the u.s
48:24
you know in the next 10 years or so
48:26
there’s about 69 trillion dollars worth
48:29
of wealth
48:30
that’s going to go from the boomers to
48:33
the millennials
48:34
and those boomers who used to love gold
48:37
as a store value
48:39
are going to be millennials who love
48:41
bitcoin as a store value
48:43
unless there’s a new thing that comes
48:45
that uh
48:47
gen z is working on right now um some
48:50
tick-tock tick-tock star value dancers
48:54
no i mean that’s so if that
48:58
paradigm holds the adoption for bitcoin
49:02
is going to be just like absolutely
49:05
insane
49:05
i think you know if you look at the
49:07
numbers i’ve read recently and how
49:09
people
49:09
try to like figure out price target for
49:11
bitcoin in the institutional world
49:13
they’re always using gold as an example
49:16
and i think there’s just under three
49:18
trillion
49:19
gold bullions that’s held outside of
49:22
central banks
49:23
i think with central banks like seven to
49:24
eight or whatever but if you just look
49:26
at that
49:27
2.7 2.8 trillion that’s held in private
49:30
hands
49:32
what is the evaluation of bitcoin right
49:34
now the market cap is i think still
49:35
under a trillion right
49:36
it’s yeah still yeah so you can do 800
49:39
something right now
49:41
yeah i mean that so like you can do
49:43
whatever assumption you want
49:44
x percent of that just that 2.7 trillion
49:47
before you even the central bank
49:48
and the your price target for bitcoin is
49:51
significantly higher
49:52
than where it is even at 37 38 39
49:56
000 right now yeah and i think that’s
49:58
what more and more people are realizing
50:00
and why the price keeps going up
50:02
which is pretty wild i mean you know
50:05
i don’t think anyone expected us to pass
50:07
20k and then a month
50:08
and a half later what not to be double
50:11
that already it’s
50:13
it’s intense honestly to be a market
50:15
participant but
50:16
also it feels very i feel very blessed
50:18
because you see
50:19
a lot of the things happening in the
50:20
rest of the world right now with covet
50:22
and whether it’s happening for most
50:23
people in other industries and it’s like
50:25
wow there’s a very large break from
50:28
reality going on here
50:30
yeah i mean i’m actually a little i
50:33
think the long-term prospects are just
50:35
incredible
50:35
but my natural instincts when you see
50:37
anything just you know go vertical
50:39
you have to like step back and say well
50:41
i expect something
50:42
just math like the volatility at some
50:45
point will lead to a pretty heavy drop
50:47
in in the thing it doesn’t mean the long
50:48
term prospects are not there but
50:50
we do have to worry about these super
50:52
spikes or that we’re seeing right now
50:55
from a short-term trader’s perspective
50:57
but from a
50:59
investor’s perspective i think um
51:02
the psychology the infrastructure and
51:05
the
51:05
rails that have been built for more
51:07
institutional investors
51:08
it’s only you know going to get better
51:10
and better and going back to my
51:12
how i got into this space and how i did
51:14
a supply and demand analysis i still do
51:16
that on a regular basis i think
51:18
you know on a daily basis it’s only
51:20
still like 970
51:22
bitcoin that gets you know uh unearthed
51:25
or
51:26
mined a single day and then if you look
51:28
at the
51:29
uh the amount of inflow into grayscale
51:32
the amount of growth you’re seeing in
51:34
the au
51:35
um assets under custody at coinbase and
51:38
you just track wallets around the world
51:40
again the demand supply is still just
51:43
overwhelmed by demand
51:45
so in the long run this thing has a lot
51:47
of upside
51:48
and um in the short run you know
51:51
volatility’s volatility and you’re going
51:52
to have some pretty good downdrafts at
51:54
some point and
51:56
we’ll see what happens when all those
51:57
guys who are uh saying they love it they
51:59
love it and also and they’re the ones
52:01
that bought at
52:02
50 and it goes to 30 what happens
52:05
if but i have one last question for you
52:08
john so what’s a message you could leave
52:10
with people that want to enter the space
52:12
be it as builders be it
52:13
in any capacity honestly but that have
52:16
hesitancy what are some words of advice
52:17
you could leave with them
52:19
so as a builder and when you say enter
52:21
the space do you mean like
52:23
a younger person entering or just like a
52:25
traditional person wanting to come into
52:27
this
52:27
i think anyone anyone coming in to grow
52:29
this space with us okay so
52:32
for the the younger person um my
52:35
recommendation
52:36
is that go into a place a firm
52:40
not start something right away and be
52:43
with great people
52:44
and be in a great firm you’ll learn
52:47
great
52:48
ways of thinking you’ll learn great
52:50
coding you’ll learn best of breed
52:52
practices
52:52
and then you get to really figure things
52:55
out
52:56
at a nicer pace so it’s almost like
52:58
you’re measuring up
53:00
and understanding the space making
53:02
connections and then figuring out what
53:03
you really would love to be part of
53:05
because there’s sub-sectors within
53:06
maybe it’s nfts it’s not really d5 that
53:08
you want to do or other things
53:11
and then for a traditional finance
53:14
person
53:14
i think what you do is you take your
53:19
skill set whatever it was in traditional
53:21
finance and then you find that young
53:23
person that i just talked about who’s
53:24
probably if you’re a finance person find
53:27
someone who’s a
53:28
more dev oriented type person and
53:30
understands technology better
53:31
then two of you should lock yourself in
53:33
a room and come up with the next d5
53:35
application
53:37
cool well thank you so much for coming
53:38
on john i appreciate your time
53:40
well thank you i enjoyed it
53:56
[Music]
54:05
you
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