John Wu - The Blockchain Is For Everyone: How Avalanche Is Winning The Race To Democratise Finance

Full transcript: John Wu on London Real

2:42 This is London Real. I am Brian Rose. My guest today is John Wu, the entrepreneur, technology investor, and president of Ava Labs, the creators of the Avalanche crypto platform. You have over 20 years of experience as an investment fund manager and financial technology executive, having started your career at Tiger Management, the world-renowned $20 billion hedge fund. At Ava Labs, your goal is to digitize all of the world’s assets and open up financial services and products to the masses.

3:08 You ultimately want to make it easy for everyone to create, launch, and trade digital assets. Since Avalanche launched in September 2020, it has quickly risen to become the 12th largest blockchain by market cap with over $20 billion and has been called the Internet of Finance. John, welcome to London Real. Brian, thank you for having me. Looking forward to this all week.

3:29 Fantastic. Me too. I’m so excited and just getting ready for this got me buzzed. You know, the thing, John, that really got my attention is you said, you know, in the crypto space in Miami, which I know you have offices, you said there’s like a buzz on the streets and it reminded you of New York City in the 90s. And, you know, we both spent time there in the financial markets. And I got to tell you a quick story.

3:50 I remember I was just graduating from MIT with a bachelor’s degree in mechanical engineering. I’d just been offered a job at Bankers Trust and I was about to start my career. And John, I remember they flew everybody in for dinner, just dinner at this restaurant Barolo on West Broadway. It was like the place back in the day. And I remember sitting around this table with like 60 or 80 people, the future class and the managing directors and the traders.

4:15 And I’m just thinking they flew us in for dinner. There wasn’t anything on on site. There was an orientation. And I was like, man, these people are Mac in it. You know, they’re they’re really gangster the way they were thinking, the way they were behaving.

4:27 And there really was this kind of vibe in the air, perhaps even as a 22 year old, I could tell John. And you say that maybe Miami feels like that with the people talking about it in the vibe. First of all, this space is super exciting to be in. I feel just honored and privileged to be here. But can you maybe speak on that as far as were those comparisons true?

4:46 And did did New York feel like that in the 90s? So it’s funny you say Barolo, I don’t know if it’s still there, but it’s not. I checked. Even overlap because I was in those things as well. I mean, back then when you graduated school and you want to go into finance, it was really investment banks.

5:03 And they recruited you like crazy because there was even though there was a seemingly endless supply of people, they wanted the best of the best. And unfortunately, I did not appreciate fine wine as I do today back then. But I remember those days and it’s not easy to fly someone in from Ithaca, by the way. So that was the thing. But it’s funny, though, like I was in Miami.

5:27 I’ve been there in Miami many times now and we have a satellite office there. So there are people at all the labs there. When you walk around South Beach or Windward or any of those places, it literally is that same feeling. If you go into a Starbucks, if you go into a restaurant, people are thinking and doing things that remind me back in the 90s. Remind me back in the day, how do I create a new financial derivative?

5:50 But how do I create a new business? How do I, you know, use the blockchain or other technology companies that, you know, Mayor Suawaz is inviting a lot of people into the city of Miami. So it’s one of those things where like all of a sudden this tech finance as well as a blockchain crypto community is all there together and really trying to like brainstorm with each other. That’s no different from back in the 90s. And they had the first version of 90s, had the first version of social media.

6:22 It was actually Bloomberg. If you remember, after those viral lunches and dinners, you didn’t have your friend from MIT’s email, but you would connect them through Bloomberg. Today, they connect themselves through, especially in the blockchain world, Telegram, Signal, these other mechanisms. But it’s very similar how people connect and amplify the connections. Yeah, it’s still important somehow, John, to get a bunch of humans in the same room, right, to create and get that electricity.

6:51 And, you know, London exists because this is where you had critical mass of people and you get that innovation. So it is kind of important to feel that energy. You can’t do it all on Zoom, right? No, no, you cannot. And, you know, I grew up loving sports.

7:07 And the sports that I loved usually were team, team oriented sports. I actually played a little bit in college as well, but like baseball, football, basketball. And to me, you know, sports is about a community, a smaller one. But people all are working together. We’re trying to get the best out of each other.

7:24 If I can get the best version of my teammates out, they get the best version of me out. And the best teams I was on usually were teams that frankly didn’t have the best players for some reason. So you have to still be together. I know the world has changed a lot. And kids there read this in a bank report.

7:40 They spend like five to six hours a day online. Put that in perspective. Gen Xers and late millennials spend about two, 2.5 hours on TV. So, you know, there’s a lot going on online. That’s why Mark Zuckerberg is moving towards the metaverse.

7:56 And ultimately, where you spend your time. Last week, it was in Miami for me. I was buying coffee and I was having dinner, spending money there. Today, I’m in New York. I’ll be buying coffee and spending money in New York.

8:10 But if I am a young Gen, you know, late millennial or a Gen Z, I’d be probably spending money in the metaverse because I was spending five to six hours a day online. Yeah. And I want to definitely get into the metaverse, you know, towards the middle of this episode. I’ve been schooled by, you know, Yahtzee of Animoca Brands. And he really brought me up to speed.

8:30 And I’d love to get your thoughts and to see how, you know, Avax and Novel Labs is going to plug into that. You said a couple things I just want to address. First of all, I remember being taken out to Sparks Restaurant by the bookies and getting these wine glasses that were the size of my head. And them saying, by the way, you know, somebody was shot out here a couple of years ago and being blown away by this craziness of New York. So I know what you mean.

8:52 I did go to Ithaca with my mom to go see. I went to MIT Cornell in the new pen. And I loved it out there. But Boston kind of got my heart. So I went there.

9:02 But respect to the Cornell grads, including Emin as well. And yeah, you make a lot of great references. You said about leadership. And I’d love to get into your style later. But I’ve had a couple Navy SEALs in here like Jaco Willink and David Goggins.

9:14 And they all tell you during Hell Week, you can take the boat captain and move him to the worst team and the good boat captains get the job done. And it’s always a great analogy. When you’re ever caught complaining about your team, it’s not the team. It’s the team captain. And I’d love to get some of your leadership thoughts from there.

9:31 But let’s jump in to Ava Labs and what Ava Lynch is. I’m going to try to pronounce it right because sometimes I go a little hard on the A. Let’s talk about what you guys offer because a lot of people are tuning in here that know a little bit about crypto. Some know more. Some are my students.

9:46 But maybe you can kind of explain why you guys exist, why there’s such a big demand. For 10 years, I’ve been having conversations like this. Last year, we kind of went head to head with some of the tech platforms on freedom of speech. About six months later, I decided to run to be the mayor of London to see if I could change things. On May 8th, I got taken to City Hall.

10:04 They read the results. I wasn’t successful. So I’ll let Mayor Suarez do all the good work there. And I went right into DeFi because I looked and I said, wow, this reminds me of what I was doing at Bankers Trust in the 90s, except it’s not a balance sheet with 20,000 employees that’s a barrier to entry. It’s 20 guys and a dog in Tel Aviv, or 15 girls and a cat in Singapore that are doing this innovation.

10:27 And I thought, wow, look at the DeFi summer. That’s no joke. So we went all in. I created the DeFi Academy. We graduated over to 500 students, having amazing people like you and Emin and all these people on the show.

10:38 But John, the biggest complaint I get from my students, and they range from 18 years old to 78 years old. My daughter is 17. She’s been on the show. She’s got a MetaMask wallet. My mom is 76.

10:48 She lives in San Diego, California. She’s got a MetaMask wallet. The biggest complaint is gas fees. And maybe we start there because that’s the ultimate barrier right now to a lot of people really getting into DeFi in this thing. And I think it’s kind of ultimately maybe what you guys are all about.

11:06 So what are your thoughts on gas fees? How would you explain that to someone? And how does Ava Labs solve that problem? Yeah, there’s so much good stuff in there. Well, yes, there is high gas fees in certain ecosystems right now, certain first layers.

11:23 What Avalanche really is, a matter of factly, it’s the fastest blockchain based on finality and it’s the fastest growing based on usage. Now, the underlying consensus protocol is such that it allows it to scale. So you can create a transaction for far cheaper than the current existing solutions. It is by far the fastest layer one and it’s super, super cheap. So if you have the same service, it’s fundamental business.

11:53 People and users are going to go to where the products are the same but cheaper. Now, Ava Labs is far more than just creating great technology. It is innovators. It innovates in technology and all around Ava Labs, all the line items, all the functionality, all the people. The mindset is innovation.

12:16 We try to innovate in marketing, innovate in how we do BD, innovate how we think about product. So at the core, it’s about innovation. And Gun, obviously founder and CEO, he’s got this great vision that he’s laid out, digitized the world’s assets. The objective is to create adoption on Avalanche. My job as president, one of the things my job is to do, and put this way, Gun is a one basis point guy, okay?

12:44 He’s set a toward pace. He’s the best of the best. And it’s very, very difficult for any person to just come in and say, oh my God, it’s a daunting task to move as fast and as good as Gun can do. So my job as a leader and as president of this firm is to get people around the firm that can think correctly, innovate their minds, if you will, and let them operate as fast as possible. Help them coordinate, help them communicate, help them do things.

13:16 And the first thing it starts with is how we hire. So when I hire people, I’m looking at a couple of things. I call it a T structure. I want them to have some domain expertise. They can go deep into something.

13:30 That’s the vertical part of the T. The horizontal part of the T is, do they have a flexible mind? Can they actually take the deep frameworks and things they’ve learned but apply it in a creative or innovative way? So it’s kind of like a lot of Web 2 people and traditional finance people, when you ask them to do something that is hard or too quick, their first instinct and their words coming out of the mouth is can’t, can’t, can’t. I want to hear the guy who’s saying, why can’t we?

13:59 Now, there are certain things you just can’t do, like you can’t change gravitational forces, but at least let’s think about whether it’s possible. That’s innovation. So that’s everyone at Ava Labs. We’re about innovation. Yeah, that’s an interesting statement.

14:13 You know, as end users, we see the final product and we just say, oh, it’s the best tech. But that only gets created if you have the right mindset and I guess the right people innovating. You mentioned BD, which I guess is short for business development. It’s something about you guys that I’d love to highlight because I think one of the problems in this crypto space is that a lot of the creators think if you build it, they will come, right? That old Kevin Costner movie, right?

14:38 And, you know, it is probably naturally tended to come from coders and tech people who just think, hey, my job isn’t to sell you. My job isn’t to create businesses and partnerships. I just build a bad tech and I win. And that’s, you know, even where I graduated MIT, probably that was the mindset. But without business development and partnerships and selling people and finding ways to work with other platforms, you know, it doesn’t matter.

15:02 The tree falls in the woods and maybe it didn’t make a sound. Am I seeing that right or am I got that wrong? No, you are absolutely right. Even more so than in traditional tech, I think blockchain crypto companies have to work in conjunction, whether it be BD product or marketing or technology. So, you know, Avalanche has a giant community.

15:28 We listen to the community there. And I’ll give you an example. Like after AMMs were around in DeFi on Avalanche, the community needed and wanted lending and borrowing. How do you get lending and borrowing? And you want to do it quickly.

15:43 So literally, I tell BD, we got to go and partner or give incentives to Aave, a great partner. Stani, I think you had on. Yeah, he specifically talked about you guys. And then from the foundation, we’re seeking out great native DAFs, like Banky, a lending and borrowing DAF. And then internally, the team actually was building a lending and borrowing DAF as well, in case we couldn’t do the other things in BD quickly.

16:14 Luckily, because we prefer it be done by the community than by ourselves. But if the community wants something and the community can’t do it or partner with others to do it, then Aave Labs has to go build it. It’s the biggest service and software company on Avalanche. So that’s an example of how to integrate BD into the whole process. And the funny thing about how BD, besides doing partnering and doing this constant analysis of build by partner kind of analysis is that it’s so good that now the pyramid has kind of been inverted in how investments happen in the space.

16:52 So projects who want to build on Avalanche come to us first, as opposed to the traditional BC. It is like a, you know, the classic ways an entrepreneur wants to build something, they go raise money, then they spend money to hire to build things. All of a sudden, this is all happening in conjunction at the same time. And this is why we have the Avalanche Blizzard Ecosystem Fund partnered with our good partners, Polychain and Threeattles. They want to see the sourcing and the deals that we’re seeing.

17:22 Literally, we’ve probably seen over 2,500 projects come to us in the last 10 months. Now, how many VC firms can see that many deals come to us, to them that quickly? Wow. So you’re almost doing one-stop shop. They used to kind of go to the VC and then they would raise the money and then if they built the product, they could maybe integrate that with Avalanche.

17:46 Now you’re saying, come to us, we’ve got the funding, the understanding, the platform, and we can solve it all probably quickly. And the community. And the community. We can help you get going with customers from our community. We can help you build your community.

18:02 We can, it’s not just like transactional capital, it’s actually true relationship capital. We’ll help you get going with the community. We’ll help you introduce you as you get into big rounds, those partners I mentioned earlier, for more funding if you need. You want to integrate into the chain. We know the chain very well.

18:19 We’ll help you integrate into the chain. If you need business development partnerships in order to do other things, the ecosystem has over 500 functioning dApps on it right now and another 300 coming. And the BD team knows the principles of a lot of these players. We can make connections far better and far easier. So it’s like, why wouldn’t you go to the place that can be one full-stop shop, so to speak?

18:44 Is there an Amazon reference here? I just came up with this where I have an entrepreneur and I want to get some products out, and as opposed to go try and do it myself, I can call Amazon up. Who’s got the customers, the relationships, and plug right in. Is there an analogy there, or is there also a bad analogy there? I don’t know.

18:58 The analogy which I hope will happen in the long run is that you don’t even think about when you start a business and you’re going to just go into AWS. At some point, it’s going to be the same thing. It’s just blockchain is there. You don’t even think about it. And we don’t even have to talk about it.

19:13 Just, hey, I do it on AWS. I’m doing it on Avalanche. And does this make VCs nervous? I mean, five years from now, will it make a VC, not obsolete, but less important when they look at the layer ones and they say, I’m just going to go straight there because that’s where the opportunity is? So the best VCs, the answer is no.

19:32 They get a view of all the good ones. It’s no different from education. I mean, if you just want functional skills, you can go and learn it online. But there’s something about, and we talked about some physical presence and other things related to the top universities. You still get a lot out of it.

19:48 So I think they are adapting. They’re participating, and roles just slightly change. Very interesting. All right. Let’s talk about layer one solutions because I’m calling this the layer one wars.

20:02 Maybe I’m wrong in calling that out. But we basically got two proof of work systems out there. Bitcoin, digital asset play, as Michael Saylor told me, I like Bitcoin because it has low aspirations. It’s not trying to be anything. It does this one thing really well.

20:16 We got the Ethereum, which again, has done amazing things for decentralized finance, but it’s still on proof of work. And it’s not obvious to anyone out there in the know that it, A, will ever go to proof of stake. Even Stanley said, Brian, sometime in the next decade, and again, he definitely does a lot of business on Ethereum, but also it’s not obvious. Justin Sonnetran said earlier last week, he said, Brian, maybe we don’t want them to do that. We got plenty of proof of stake mechanisms.

20:41 Maybe they should stay proof of work, because we at least know it’s reliable. He hadn’t made a good point. Talked in his own book a little bit, but he made a good point. So we’re seeing the Cardanos, the Solanas, the Avacs, I have Mercali on here of Algorand, all trying to offer these better solutions for their customers, which is the beauty of capitalism. Everyone wins in that standpoint.

21:01 But we’re seeing these vie out, especially in the market caps and in what people are providing. So how does that kind of play out, and how should people understand it? You know, Emin Gunseer was here talking about your proof of consensus protocol, which sounded really groundbreaking, again, verified by third parties, which was really important to him. And again, that speed is a really important piece. How do you see all these things playing out together?

21:27 He’s absolutely right. And he also said, I think he said, it’s going to be a multi-chain world. That’s what we believe. It will be a multi-chain world. I think it will be a multi-chain world for two reasons.

21:38 One, we are now having communities build around different functionalities. So each chain naturally has things that they do better because of the technology. That instant finality, settlements equal payments on Avalanche is super important. Financial transactions, swapping of assets instantly will be important for gaining. Like you can’t go through level one killing all these monsters in a game and find out when you get to level two, you got to go back to level one because there was an instant finality.

22:07 So the communities that build around that core capabilities are naturally the type of products or projects that will launch on that. And the other ones are doing other things obviously. There’s NFT platforms there that are very focused or chains that are very focused on that area and they have domain expertise there. But I think the second reason there will be multi-chain and then people forget this. I was a tech investor for a long time and the law in tech investing was pretty much like an Internet 2.0 stage was like one guy ends up with 70 to 80% in the market share and then everyone else splits to 20% so to speak.

22:46 And that was primarily because you have monolithic siloed worlds and once you get to a level attraction and network effect, it’s almost impossible to break that and your customers are super sticky and they stay there. In my opinion to the worst right now, we can get into this later if you want, but now they’ve hijacked your PII, your digital fingerprint and then they manipulate you. Let’s not go into that from now. We’re kind of talking about the big ones, the Googles, the Amazons, the Apples and the Facebooks and they’ve won, like you said, grabbed most of the market share.

23:21 Unfortunately, not always the best result for the end user. No, it’s almost like a feudal system and they have power, so much power. This is part of why there is this movement here. It’s because what blockchain and crypto about being decentralized and distributed is self-sovereign governance and your ability to take more control of your own life. But going back to the earlier question, I think what people forget, the benefits of this is the open permissionless world, distributed systems, more governance on your own, but it’s also a negative.

23:55 The negative is customers are freely flowing from one place to another. The switching costs are lower. So in an ecosystem, the greater ecosystem of blockchain, when switching costs are lower, it’s going to be a lot harder for any firm team, layer one, whatever, to actually get 70%, 80% and make it such a deep moat that it can never move around. So I think it’s going to be a multi-chain world for those two reasons. One, there’s specialty being developed and also because the switching costs for customers or users is a lot lower.

24:31 And that’s an excellent point. I think you’re probably right, which again, everyone benefits and it means you guys have to constantly innovate to keep market share, which I guess means everybody wins. How do you usually explain to most people, where the paradigm was stuck into like web 2.0 to 3.0? Do most people get it, the fact that most of their information and technology is controlled by a few players and this isn’t always good for them? Or I think one of my guests said that a lot of people, we’ve never had ownership of our data, John.

25:02 So we don’t even know we should have it. And when you start talking to people about owning data and NFTs and having your own stuff, people were not even used to that because we grew up in a world where someone else owned it, controlled it, censored it, monetized it. So are you able to have that conversation with people or do you think it’s almost something for the new generation to understand? Well, the new generation definitely understands and things usually change when there’s a mindset and cultural change.

25:27 But I think even the older generation is starting to understand that. They just can’t help themselves. So they stay in that world. It’s kind of like the burden is upon these innovators and this new web 3.0 to actually show the use cases and make it so it’s obvious to the web 2.0 people that this is just a better way to do things. And that’s slowly happening.

25:51 And usually when you get past 15% penetration, you have this kind of like skyrocketing new paradigm in terms of adoption that happens really quickly. That’s the benefit for everyone. And that’ll happen, I think, yeah, Stani’s right. It will happen within the next 10 years. I don’t know when it’s going to happen, but the conversation is starting for the older generation.

26:11 Yeah. And we spent some great time with Stanley Kulechev here in the studio. Go figure, actually. Real people, real in person. And it was great talking to him.

26:19 We actually didn’t spend as much time talking about lending and borrowing as we did. He’s got 2,000 NFTs. He was talking about all sorts of fascinating things. But strangely enough, John, the first time Avalanche was mentioned was on that show because they had just announced a partnership with you. And I said, why Avax?

26:34 And he said, Brian, he said it was a no-brainer. We look at the forums in the communities and people are using their tech and they love it. So we partnered with them. And it was just interesting that he saw that coming a while back and he just said it was a natural partnership. I’m also guessing that it meant your BED team was on point as well.

26:52 You know, oiling those wheels, which is, again, a compliment to you guys because, like you said, there’s no time to wait. The community doesn’t want to wait. They want it now. And if you don’t give it to them now, someone else will try. So you have to move really quick.

27:05 I want to ask you a question I asked Stanley because I said, you know, what are the plans for the future? And Stanley said, look, my job is to come in every day and make good code because that’s the reason people use it and my community uses it. So I’m not the Steve Jobs that’s telling the world what they want. I’m actually here to serve. And it was an interesting point as we go from Web 2.0 to 3.0 of where, you know, the community has decisions and drives these things.

27:31 But I’ve got a question for you, John, because there is still a role for leadership. And like you said, at Ava Labs, if you can’t buy it or partner it, then maybe you go build it. And if you guys don’t do that, then maybe it won’t necessarily happen within the community. So how do we straddle this change, this shift in humanity, where we’re going from, you know, Steve Jobs, Mark Zuckerberg, I see the way world, which obviously worked and brought us value, Jeff Bezos, right with that conviction, to a world where we still have great ideas in leadership, but we still listen to the community and there’s governance tokens because it’s not clear to me how that transition happens or if it ever does because the idea of a DAO sounds great, but I don’t know, I’m still not sold on it.

28:15 So what are your thoughts, John? So I think the first point, and Stani got it right, is in this Web 3.0, it’s not about me, it’s how we serve other people. I know at Ava Labs, we listen to the community like crazy. And what they want, we figure out a path to get. And hopefully it’s partnering or investing in some native DAO to come do it.

28:38 So it’s about serving. So that in itself sets the tone for how things are done. And it is hyper growth. You also mentioned how fast you got to go three lanes at the same time and hopefully one or two will serve. If not, the third one will come through at some point.

28:53 But I mean, how you think about that is if you take that to the most end level in terms of serving your community, it’s kind of like you look at how you do marketing. Marketing has changed completely. In the old world, this is a classic, I learned it. I was in Cambridge also at Harvard for Business School. You learn the marketing funnel.

29:15 You do the top of the funnel, the brand. But ultimately what you’re doing is you are trying to get a product in front of the face of someone and then you want that someone to actually buy that when that product’s in front of their face. It’s kind of like point to point. That’s because it was company to user. In this world, the stakeholders are unified by a common thread called a token.

29:42 That token helps not just the user, it helps the creator. It helps some people, it’s just investors. It helps governance. We talked a little about that. So it’s like the traditional equity company of four or five stakeholders, some shareholders, to the board, to the builders, to the users of the product.

29:59 And they may all be different. But suddenly, this is one unifying thing for all four or five stakeholders. So you’re no longer, you should not be thinking about marketing that top-down funnel only way. You should think about how do you unify all four or five different stakeholders. This is why the community bill has become so important.

30:21 Campaign management almost has become so important in this space. Because you’re unifying people because they have common beliefs, not necessarily because that product is so good. And when you can have that unifying mission, then you can build concentric circles. Everyone is helping everyone else. Aave comes, they definitely benefit from the avalanche community, but they just grew our community bigger with their community.

30:51 And they benefited, we benefited, we all benefited. So even marketing, how you market, you have to start thinking differently. And frankly, there is no such thing as performance marketing in blockchain and crypto because Google doesn’t even allow you to buy certain keywords and you’re kicked off of things. So how you market, how you do things, it’s already innovative in this space. John, it’s such a shift in mindset from the tagline in the dot-com startup era.

31:20 And I was there in New York, which was world domination. That’s what everyone, world domination, world domination. It was this very egotistic Web 2.0, VC wins, let’s go dominate the market. And now, listen to the way you’re talking, John. I mean, you know, the John from 20 years ago would be like, who is this guy? He’s like a guru somewhere.

31:39 You know, in India, talking about let’s all be one, which is strangely enough what we’ve been talking about on London Real for 10 years is that ultimately it’s about a being of service and that’s how we all win. But to see that being embraced by some of the highest-valued companies in the world, it’s definitely just strange that we’re even having this conversation. We’re still all human beings and we want to win. Right. I think I talked about this earlier, like some of the best teams I was on when I was a kid or in college, whatever, weren’t the ones with the best players.

32:09 So if we can figure it out to create value for everyone, and I kind of do that every single day. Obviously, goodness, it’s crazy rapid pace and he’s got this fantastic vision. I’ve got to figure out a way to communicate that, to imbue that spirit and get people to at least go for it. And then each single person at AvaLaz, by them being better, makes everyone else better. So again, it’s like it is somewhat self-serving in the end to make everyone else better because that makes me better.

32:43 Yeah, you want to win and then serve, but win, but then also then be of service. That’s how we hire. They could be very good, but there’s no altruistic bone or fiber in them. It’s kind of like, oh, okay, that’s great, but you may not be for us. Go back to Web 2.0.

33:03 That must be hard because the mentality on Wall Street and the City of London is quite the opposite. When I was trained at Bankers Trust, it was just kill or be killed and the ruthless and take as much piano as you can out of the clients. And it must be hard to find people that are willing to open their minds to a new way of thinking. It’s easier when the market and the TAM is growing. So you’re thinking about creating new value.

33:30 It’s harder in the traditional world where the TAM is kind of set. So then naturally, if you’re a smart guy, you realize the pie is fixed and it’s a fixed pie, it’s a knife fight, and I got to get my share. So I think there’s a lot of smart people coming here. There were smart people going to finance, but finance wasn’t growing like the hypergrowth world of crypto and blockchain. So when you’re growing this fast, it’s like a new products and new things and new methods and innovation at all levels is happening.

33:57 You’re thinking, how do I build off of other great things out there? How do I work with other people? I mean, again, like the composability of the space of open source technology forces people to actually think about working together. I mean, you talked about DAOs earlier, but one of the most fascinating things about Constitution DAO, it’s not just that they almost won the replica of the Constitution, was that how quickly that whole thing was created. And it was created in less than a week.

34:29 And part of the reason why it was created so quickly was because they leveraged off of other existing products. So they weren’t even like builders. They were curators of existing projects. I mean, they used one project to be the legal construct for them. They used another project to do KYC AML, and therefore they can do everything and build the whole gizmo, if you will, in less than a week.

34:54 There’s no way in a traditional web2 world you can build the entire gizmo from ground zero because you have to literally build the entire stack and someone else in another monolithic area is building the entire stack. Oh, you did that. Can I borrow it? Great. And they’re like, well, you’re doing that. Can I borrow that?

35:10 And you both are moving faster. And they almost bought the Constitution of the United States of America. Almost, almost. Was it hundreds of millions? Something like that.

35:19 No, no, no. I think that it was bought for 40-something million. And at that time, their token and their raise was about that much. But since then, it’s taken a life of its own. It’s actually worth more.

35:32 So had they waited or started a little earlier, maybe they could have done it, but that there’s another point there. It’s like there’s no other place where you can get access to customers and users as fast as you can in this space. That goes back to why Stani is talking to us. It goes back to how wide apps or other projects are coming to first layers, like Avalanche, because it’s actually more important that you have access to customers and users than it is to get money.

35:59 Money is actually very cheap, you know, you know, where interest rates are around the world. There’s a lot of money out there. It’s a scarce of resources to get access to our community. Yeah, that’s a really great point. Probably going to be one of our highlight clips.

36:13 And you’re right, money is nothing special right now, especially in this space, you know, where, you know, everyone is throwing money, but can you get the customers and can you start showing value locked, et cetera, because other people are rapidly. And you guys have had some geometric growth and that’s going to decide your fate very quickly. Let’s talk about community, John, because you said we listen to our community, we engage with our community. Can you tell me, how does that actually work on the ground?

36:42 You know, the weird thing about community, it’s just such this weird nebulous term that it’s humans. For one person, it can be one thing, one the other, and now you’ve got this community you connect with online or on Discord or whatever. How do you actually listen to them? You know, how big are they? How do you do these?

36:59 Because you’re not doing town hall meetings, I guess. So how do you do it? Well, I mean, you mentioned a couple of methods already. You know, obviously there are different mechanisms, whether it be a telegram group channel or Discord. You do have physical hackathons where you meet new developers as well.

37:16 So you have to have people in all those different distribution mechanisms. And most of the community members all have a, if they don’t, they do later on, a passion for Avalanche and building or using Avalanche. And it all comes back down to the benefits you talked about, the speed, the low cost, and then the features and the ease of use and the infrastructure that Avalanche has built on top of Avalanche for the community to work on. So the answer is, and I think you mentioned this all the time, is let’s just make it easy for them and these different marketing silos or distribution areas, you have to have good people who are willing to listen and to aggregate the information.

37:59 And then, so the difference is, instead of the old marketing funnel, which is that you tell them that they love Coca-Cola and you beat it down in their head so they see it everywhere, you are actually asking them what they want and having a dialogue. It’s not a monologue anymore. It’s a dialogue and it’s not a funnel. It’s a circle and everyone is talking to everyone else and you’re sharing information back and forth. Now, Steve Jobs famously said, my customers know what they’ll want when I tell them, what do you think about that?

38:30 Because he made my iPad here. What about that mentality? Is it flawed? That’s not going to happen. That does not, it’s not going to work today.

38:39 That’s the old world. They worked back then, and it worked back then because technology, the concept and the benefits of technology was so new to everyone. Today, everyone understands how their world can be more efficient by adopting technology. We talked about banks. Are they going to be slow?

38:59 Are they going to be part of this movement? Are they not going to be part of the movement? Well, the retail guys didn’t understand this movement and they got Amazon. The banks, I don’t think they’ll get Amazon. Now, they may not win because of the David and Goliath issue.

39:15 They have other restraints, but they are building war chests and you know what they’re doing? They’re starting to partner with Ava Labs and Ava Lynch. We just had a great announcement with Deloitte. We’re part of the Start Path program and MasterCard. So they’re doing what they can, and one of the things they’re doing is partnering with the most innovative and permissionless blockchains like Ava Lynch.

39:40 Yeah, I saw your announcement with Deloitte, which was big. I had to rub my eyes a little when I saw Deloitte next to Ava Labs, and it happened so fast. Can you talk to me about how significant it is for one of these massive management consulting firms or massive financial institutions to partner with you and why are they doing it and what are you helping them do? And are you surprised it happened this fast? So it’s like those success stories.

40:06 It seems like it happens overnight, but it was actually a long grind to get them comfortable. It was a one-year process. Ultimately, the objective is to create adoption on Ava Lynch, and it’s a testament to the fact that they want to build an application for their thousands of customers on top of a permissionless blockchain. Really what they were saying was, wait, we can go and continue to create applications off of traditional SaaS products out there where there’s collaboration tools, workflow automation, all of that.

40:45 But you know what? On a blockchain that’s permissionless out there, the collaboration and the workflow automation, the data management is so much easier when everyone’s working with a common data set just replicate it many, many times. Instead of having middleware company plugging in APIs to different data sets, all of that. Now, they estimate they can save a lot of money for their end customers, and what it says about Ava Lynch is that, oh my God, this is a chain that is secure enough, and we believe that it can have the scale and speed that they need at an institutional level.

41:25 Now, that is great that they save money, and the government agencies and disaster recovery scenarios are able to have instant value and messaging at the same time, information and value transfer at the same time. But what it really means, and this is super important, is that a poor victim in a disaster zone can get their grants immediately, and the right person gets it. So the end result is everyone is better from the user to the provider and adoption on Ava Lynch.

41:57 And you said something with MasterCard or are there any other kind of big moments like that? So a StartPath program with MasterCard, which is basically their entree into they want to work with Ava Lynch to build their solutions for themselves or for other clients. That’s exciting. And this maybe goes into what you guys do, and this is a perfect opportunity. Again, I’ve been playing with your platform.

42:21 I’ve been getting my students in the DeFi Academy to use it because, again, they complain about cash fees. So I’m saying, all right, well, why not onboard your assets straight into the AvaX wallet? You’ve got the X chain, the C chain, the P chain. I’ve used the X chain and the C chain to transact my AvaX. But the P chain is one thing I know a little less about, and then I know you’ve got these subnets, which I believe, but I think you’re about to school me, John, is a way where companies can have this incredible power of these blockchains, these transparent systems, and yet also have them private, maybe like an intranet in your old company.

42:56 First of all, have I got that right? How would you explain that to corporates? You have that right. It’s a subnet on top of AvaLange. So it takes advantage of the speed of the AvaLange consensus protocol, but they can now create the governance around the validators.

43:14 And therefore, if it’s a financial services company, they can set rules that are complying for their jurisdiction. Or if it’s a tech company and they want only certain types of users to have certain processing power, they can use that as a restricting thing. But the point is, you’re no longer just creating at the smart contract level the barriers for who uses it, but you can actually now provide it at the network layer as well. So creating a subnet is kind of like creating a private blockchain but allowing a company to be future-proof and to seamlessly plug into the permissionless side when they’re ready for it.

43:54 And also, obviously, AvaLange is Ethereum compatible, so wherever it happens in the world, it can also plug into all of the blockchain world and the multi-chain world. But another thing that’s very important here I need to mention is there’s a technological advantage by doing it this way. I think ultimately all blockchains have some sort of state issue. Obviously, in the third generation of blockchains, like in AvaLange, the capacity is greater. But most blockchains handle the state issue, capacity issues in a very vertical fashion.

44:24 This is kind of like having a horizontal way to handle scale because you have these subnets that can operate very independently quickly, but yet they could be interoperable with each other and with the underlying AvaLange blockchain. I think the way Gun said it was, like in the IoT world, there’s no reason why you should wait for your garage door to go up just because someone else is doing an ICO or something somewhere else and taxing the network. So suddenly you can have that garage door go up instantaneously like you should, even if the rest of the activity on the chain is gigantic.

45:02 So it’s also a method for better scaling in a horizontal manner. Right, okay, got it. So yeah, that whole kind of parallel processing, you can take advantage of the speed, you cannot be worried that someone else is going to slow down your network speed, still have the privacy and have all the innovation that you’re doing because again, if a Deloitte or an Anderson or a Barclays had to do it themselves, they’re not ever going to be able to keep up with the tech curve.

45:27 So they say, okay, we’re going to partner with you. We’re still going to run all these different systems that the world’s not going to necessarily be privy to, but we can use all of this technology that’s clearly working. I guess that’s your value prop to get most of that right? Well, the value prop is that developers love using it. Everything just works better on Avalanche.

45:48 So that’s a better feature, I would say. That’s one of the features. But the real value proposition is everything works better on Avalanche. And let’s talk about this because I had a reporter in here yesterday. I was checking his name.

46:00 His name is Brian McLean and he works for Yahoo Finance and the Daily Express and The Independent here. And we were talking and he was doing a short documentary on how long he could live on Bitcoin in London. All right, John. And he’s like, Brian, I just came from the optometrist and the coffee place and the taxi. And he said, my Bitcoin trades are still processing.

46:26 And he said, Brian, what’s going on here? And I said, look, Bitcoin is an amazing digital asset, but it’s not a currency. And it made me think about what, you know, Emin Gunseer said is the big elephant in the room that nobody talks about, even though it’s the only thing we’re talking about. And that’s speed, right? No one’s talking about speed.

46:47 And again, I know Vitalik’s a good friend and we really appreciate Ethereum and it’s amazing. But it doesn’t have the speed or the frictionless part of it. And so it’s not working. And like you said, nobody wants to wait on the video game to know if they can get to the level two. They want to know now.

47:04 If you’re at a bank, the reason I got the direct lines down to the Mercantile Exchange is because I want to know now. And that’s something that I don’t know if it gets enough airtime. I don’t know if it gets enough airtime either. That’s super important. I mean, you know, listen, Bitcoin was the gateway.

47:21 Everyone loves Bitcoin. It’s a huge improvement. Its utility right now is, I think, store value. And that’s very important in this world of potentially hyperinflation. If it does happen, I’m not sure it will happen.

47:32 But that’s, you know, there’s a thought out there. Ethereum improved upon that with programmability. But, you know, the way I look at it was, okay, introduction of money was what was crypto 1.0, which was Bitcoin, store value. You know, crypto 2.0 was programmability, smart contracts, utility, ecosystems started building. That was Ethereum.

47:58 3.0 crypto is about building economies. You cannot have an economy if that transaction doesn’t happen quickly. So with these 3.0 layer 1s, especially Avalanche, where instant finality, suddenly money can be, or value can be instantly moved around. A real economy can start. And if you can take this, the way the real world does this so that money can be moved is someone assumes risk to the lag of money.

48:29 So in a credit card situation, you know, merchants sometimes don’t collect their payment till 30 to 45 days later, and banks charge them, you know, the system charges them 2.5% for getting their money late. And then when there’s fraud, they have to eat it themselves. People forget they think, oh, the consumer doesn’t pay for this, but embedded in the pricing, there is that 2.5% that you’re not seeing. So, you know, we both came from traditional finance. I think about this, like for the longest time, people say technology is killing inflation and everything.

49:01 But like, if you unleash trap money all over the world, suddenly, you know, your velocity of money is going to increase like crazy. And maybe that will solve inflation and help wages go up appropriately. So there’s so much to think about here. And none of us, as smart as we all are, can actually predict everything. But we all know that incrementally, this is definitely better.

49:27 And going to your point, how about we unlock some trap money in the real world and let the velocity of money work for all of us? A fund’s IRR would be a lot better if you can constantly redeploy well your money too. It just works better for everyone. Yeah, speed. That’s something I want everyone really to think about.

49:45 I’ll ask you a question. Maybe it’s a loaded question. Do you agree with Justin Son of Tron that maybe Ethereum should just focus on keeping its proof of work system going and let the proof of stake happen with the layer one guys and let them go ahead and do the innovation and keep Ethereum to where at least something that we know will continue to work? I don’t think Justin or anyone else should tell what the Ethereum community to do. The community of Ethereum should tell them what to do.

50:14 That’s a good way of looking at it. Are we seeing proof of stake anytime soon on Ethereum? Well, I mean, E2.0 is always two to six months away every six months. I don’t know. The answer is I don’t know.

50:29 I think it’s been slower. I do think people don’t realize that E2.0 is actually a fork. So even if it does happen, the community may not move over as quickly as you expect. I mean, the funny thing, I think you and Gwen talked about certain chains that are kind of like where the technology is not anywhere, but yet they are still a top whatever, seven or 10 in price or something. And when I heard that, I was like, well, it’s funny because in this world, technology can be easily forked and recreated.

51:08 Customers are definitely, they can easily move around. However, a community which are the customers is harder to move around than just replicating the tech. So all of those call it dead projects, chains that still have price in them. It’s probably because a community is hard to move. So tie that back to Ethereum.

51:30 When E2.0 actually does happen from a tech perspective, it’s not going to be as easy to move all that community over to E2.0. And I don’t think people think about that. Yeah, look, this whole community discussion is fascinating because I spent six months running to be mayor of London. I’d never been in politics before, but that’s ultimately about messaging and I guess a little bit of marketing and politics and community. And that’s a whole strange beast to try to get your head around and trying to communicate with communities and value communities is what this does.

51:59 One of the questions this reporter asked me yesterday was, what do you think of the mean coins? And what do you think of Shiba? And I said, well, first of all, I think in general there’s better things you can invest in in the crypto asset space than a mean coin. But also when it’s worth $20 billion, maybe it tells you that there’s real value in community. And Mike Novogratz was beamed into a conference it took in 2049.

52:22 I think Edmund was there in London. And Mike said, oh, Mike’s old school, kind of old school Wall Street guy and hedge fund guy. I’m very big in the digital space as well. But he said, I used to just ignore those things until I just stopped one day and said, well, clearly there’s something there and there’s value there. So maybe we should understand that community and the value of and try to unpack it.

52:46 What are your thoughts when it comes to value in community? I’m glad you asked that because I’ve struggled with this myself. And so again, I’m listening to the community and there’s a whole bunch of NFTs and we don’t mention the names here, but like that’s also on. So I talked to the younger generation that actually is part of these, call it communities of these mean coins or whatever. And I asked them like, why do you do this?

53:12 And then I related to my own personal experience. And the answer that really resonates to me was, well, it’s just a lot of fun. And I’m like, well, we’re thinking about why is this an investment? Are we throwing money away? Are we playing a Ponzi scheme?

53:28 They think it’s fun. And in some respect here, it’s no different from when you and I used to go with rolls and quarters into the arcade to the carnival. And we play either pinball machines or space invaders or whatever it is you’re playing. And then you get tickets that come out when you win and you go to the gentleman behind the barrier and you get a big bear for your girlfriend or something. It’s just fun.

53:52 So is it spending money? Is it investing? I don’t know, but it’s a lot of fun. And they get to do it together, which is actually a lot more fun. Like my best times at all those carnivals was when I went with the entire team and we had a lot of fun together as opposed to I go by myself and try to win a bear for myself.

54:10 I rather win a bear for someone else than myself. So the answer is it’s a lot of fun. And the power of the blockchain and crypto allows them to actually work together and build a huge community. And now a byproduct of that. There’s a lot of things in crypto and blockchain that you don’t go out setting to do something, but then the byproduct is like, wow, now you have something of value.

54:33 So the byproduct is you have a giant community and maybe one of these communities can point that community in the right direction and create specific utility and then bootstrap an entire business. I don’t know, but I know it’s a lot of fun when I ask these kids, why do you do this? And they don’t look at it as an investment. Yeah, it’s really well said. And because of blockchain and transparency, we just put a market cap on fun, right?

54:55 Which you couldn’t do before. You can kind of describe it. I went to the Knicks game last night and it was amazing because everybody was there cheering and it was fun. You know, clearly you do it, but no one ever hung a market cap on it or put it all on the blockchain to where it was transparent. So we never…

55:10 They’re probably asking you, why do you spend $200 on a ticket to watch other people do things? At least on this, I’m interacting and I’m actually trading. I’m not a spectator. I’m spending money to participate. And that’s another big thing here.

55:25 It’s kind of like this new mentality is I don’t want to just be a user. I want to be a creator. And I want to build things that other people like because I get satisfaction when other people come to my storefront or whatever. Yeah. It’s clearly telling us something about humans and what they want and they need.

55:43 And to ignore it would be ridiculous. So if you can learn from it and try to channel those powers into what you’re offering or work with them, that’s the way forward, isn’t it? And… That’s right. Yeah.

55:57 It’s so important that you can even think that way because, again, that old Web 2.0 mentality is, I’m right, you’re wrong, I’m going to dominate. So, yeah, that’s a great answer. But Brian, I do want to bring one point out here. It’s like you and I cannot bring enough quarters to affect our lives in a bad way by spending all of those quarters at the carnival. I do think that there should be some responsibility here and people should realize that there is risk reward in everything they do in life and not to get over their skis and affect the long-term life by having too much fun.

56:34 Yeah, and this was an argument I had with him as well. I mean, I’m a big fan of financial education. It’s what we do in the DeFi Academy. And so the big thing here recently was kids trading crypto and how irresponsible it is. And it’s this fine line because my daughter, she’s 17 and she owns an asset for the first time in her life.

56:51 I mean, John, you and I, the first asset we would dream to own in our life is maybe to get a small apartment when we were in our 30s after we saved up. And we never understood asset ownership, which meant we really didn’t have a great relationship with money. We worked for a paycheck. But now, you know, these kids have an opportunity to own an asset. Yes, it’s potentially dangerous if they do the wrong thing with it, but it’s potentially an incredible way to educate them on money.

57:14 I mean, I’ve had Robert Kiyosaki in the studio many times and he says poor people work for money, rich people make money work for them. And it’s a hard thing to hear, but at least it shows that financial education can allow you to master your money. So I do see this as good. I see it a little bit like sex education. You know, John, when you and I grew up, it was probably a newish thing to have your 10-year-old taught how the body works and where babies come from.

57:40 And your mom and dad were probably thinking, we didn’t talk about this when I was a kid. And it was hard for them to allow their children to do this. But ultimately, it was a really smart thing to get these kids to understand how their bodies work. And now I think we kind of assume it’s normal. I feel like we’re somewhere like that with financial education where we’re like, oh, no, no, no, no, don’t do it.

57:59 But as soon as we empower these kids to show them what these things are and educate them, I think they’ll be more responsible. What do you think of my analogy? I think you’re right. The upside is far greater than the downside. And education is good in all forms.

58:16 Knowledge is good. And that’s one thing good from Web 2.0 and even better from Web 3.0. All right, while we’re talking about risks, let’s talk about regulation. We both know Gary Gensler. I’m actually about 20 hours into his course he taught at MIT Sloan School of Management in 2018.

58:33 It’s out there on YouTube. If anybody wants to watch it, I must say I’m in danger of really getting to like Gary after watching him on that course. He’s very knowledgeable. He’s very smart. He doesn’t sound like the kind of guy that would say, stable coins are the poker chips of the wild west, although he did say that.

58:47 But I do understand Gary has a tough role. He’s a bit part politician, part not. He’s also trying to keep people like my mom, 76 years old, from buying the wrong mean coins. So I’m with you. I understand CoinMarketCap says it’s over 15,000 coins right now.

59:01 I mean, I can’t even look at all the crazy things going on. So I understand we do need to protect the public to a certain extent and protect people that think app is a bank one. It’s not a bank. But we’re also going into a currency war, maybe a digital currency war. Alex Masinski from Celsius says World War III will be a currency war between digital yuan and digital dollar.

59:23 And do you want the entrepreneurs creating that dollar or the governments? What are your thoughts on regulation, how it happens, and how we need to at least understand that conversation? So just a couple of days, obvious days ago, there were a whole bunch of crypto entrepreneurs who went down and testified to the United States House of Representatives. I actually thought that was a very positive dialogue, and the operative word is dialogue. I expect a grandstanding.

59:54 I expect a brow meeting. But it seemed like genuinely good questions and people listening and hearing each other out. I thought we were back with like Gingrich-Clinton days or something. It was just like people were actually talking and listening. It’s great for the politicians and rule makers to actually listen to the practitioners, and the practitioners listened to the concerns of the rule makers.

1:00:15 That was very healthy. I don’t know what the ultimate answer is. That’s not my job. But I do know that the current rules were set close to 100 years ago, Securities Act of 1933-34, in an analog world where the choke point was the entity and the intermediaries. What we have now is this intermediation P2P.

1:00:43 How do you regulate if the entity, the classic place where you did it, is no longer there? That’s what they have to think about, and I think that is the sticking point. If they can figure that out, then everyone could be better. But I do know what I want and what I’m rooting for. Healthy regulation, and I’m also hoping that we don’t – or the U.S., I know you’re in London, but we don’t regulate out all the great innovation that’s happening in this space right now.

1:01:15 I’m American. I want the U.S. to be the leading place of development. Sam said it in that testimonial. He wants this to be the place where there’s the most liquidity.

1:01:26 Part of the reason why our capital market’s so good is our markets are the deepest. Our equity public markets are 125 trillion. That’s still the deepest. The rest of the world is the same amount, the rest of the world. So let’s have the capital markets be the deepest or crypto capital markets.

1:01:44 Let’s let the innovation stay. I mean, we definitely have the best innovation. And hopefully, that’s where we end up. That’s what I’m rooting for. And having that beginning healthy dialogue was very encouraging for an operator to see.

1:01:59 Yeah, I saw some of those testimonials. I think it was a subcommittee, and that’s why it was a little bit more of a dialogue. You get the more people involved, and then sometimes you get more of that grandstanding, like, let’s get everybody up and beat them up in public, and then nothing changes. We’ve seen that happen with big tech companies, obviously. Yeah, I was really encouraged to see some of the members listening.

1:02:19 They clearly had been communicated by their constituencies and their voters beforehand, I think. Maybe so they know they have to listen, because they have a lot of people out there that, you know, I was in politics for six months, and I know politics care about votes and the budget. Those are the things they really care about. So I agree, I was surprised to see… That’s actually very insightful, Brian, because unlike other assets, people forget that if they over-regulate and do crazy things, the people they will hurt the most are the people that they think they are protecting.

1:02:56 This movement is the only movement I’ve ever seen where the individual, the retail, front-ran the institutions. Like, this institutional adoption we’re talking about happened way after individuals started getting involved in this thing. Yeah, and back to the power of the voters, I mean, again, you see Florida and Mayor Suarez, and you see how in Texas, you know, they made decisions, and you could see people vote, you know, with their locations. They would literally move from California or New York to these places of innovation, the places of open ideas, or certain laws and regulations.

1:03:31 And we haven’t really seen that happen in America to that scale that I remember that fast. So it feels like politicians are understanding that their job is not to, you know, just regulate or just make a decision, like they really need to listen to the voters. And like you said, it sounded like a dialogue. So every now and then, I get a little ray of hope that perhaps they will allow the greatest capital markets on the planet. And again, Dan Tapiaro from Tenty Holdings made that very explicit at the end.

1:04:01 He said, let’s be honest, we like to beat up on the U.S. sometimes, but it’s got the best legal system, the deepest capital markets, the most advanced capital markets, and that’s why we continue to innovate and win in these technology wars. He said, but this one, we might not, unless we really make sure we make the smart views on regulation. And again, even the stable coin itself, a tremendous innovation. One of my students raised his hand and said, he said, Brian, I don’t know what to do with these stable coins.

1:04:28 I’m making money on Bitcoin, I’m making money on Ethereum, but my tether just won’t move. And everybody laughed and I explained to him that, you know, this is actually incredibly boring, but an incredible innovation. And I said, I like my stable coins like I like my nannies. I got boys that are four and five years old. I like the nanny that’s boring.

1:04:47 You know, I like the one that doesn’t have a social life, that’s super quiet. I don’t need to come home and see the nanny with the bottle of tequila and six friends over. So I like boring and I pay for boring. And I said, that’s the way to look at stable coins and amazing innovation that came from entrepreneurs in America. So I really hope the government allows them to do what they do best and not to over regulate.

1:05:06 But again, if anyone’s listening, contact your officials, your congressmen and let them know that this is important to you, that you care about crypto. I think that’s really important. John, I got to ask you about Metaverse and NFTs as well. It’s your choice on which one you want to talk about. You know, you did mention Metaverse earlier as far as, you know, real solutions for speed in gaming.

1:05:28 I did have an amazing conversation with Yatsu of Anamuka Brands who’s been in the space for a long time. I mean, you know, he was, you know, doing Angry Birds on iPhones back in the day, really understands the space, early investor of Axie Infinity and Sandbox, et cetera. And he really made me understand it for the first time. Also, Yat said, and I almost fell off my leather chair. He said, if it wasn’t for the DeFi Summer of 2020, we wouldn’t be having the success in gaming.

1:05:51 And he really gave credit and homage to the borrowing and lending markets for empowering other aspects of this space. And for the first time, I realized that everything’s connected. You know, the Bitcoin asset play is connected to the layer one solutions, to the layer two solutions, to the NFTs, to the Metaverse. And when you pull one, they all move. And the gaming people might bring us a whole new crowd that comes in.

1:06:12 And the NFTs might do it as well in the DeFi space. So your thoughts on Metaverse, how you guys are going to play a role there going forward. You cannot talk about Metaverse without talking about NFT. And what you said about intersections, interoperability is so true. You know, on the front lines, what I see right now is the interconnection between these digital worlds in the game format with NFTs with DeFi.

1:06:42 And what I mean by that is normally, again, go back to the old arcade games. You just choose a character and you play it. Suddenly, you can create your own unique avatar that’s just yours. You can use that and represent yourself and collect points to many different games. So that’s always you, and you can be prideful of your winnings.

1:07:00 And then you’re doing it because you’re actually enjoying the play to earn kind of concept. That’s no different from DeFi, and a lot of the DeFi principles were borrowed. And the great thing about it is, you’re doing it in this virtual world. And the reason why you’re doing this virtual world is it goes back to what I said earlier. Like, I spend time physically somewhere in a golf course, on a tennis court in Miami or New York or Connecticut.

1:07:25 They spend their time online digitally. You’re going to spend your money where you are digitally or physically. And for them, it’s digitally. So I think Mark Zuckerberg sees those numbers. His greatest fear is that the metaverse wins.

1:07:42 So he’s trying to create what I consider AOL, a siloed wall garden version of the metaverse, whereas you have this other version. So it’s almost like Sony Betamax versus VHS. You have an open system where everyone gets to be part of it or you can be Sony with a production house, the distribution and the maker of the machine. It’s one person. Typically, when it’s one person with the resources of Facebook in the beginning, that’s probably better, better graphics, more games or whatever.

1:08:16 In the long run, I think it’s going to be the open system. And we’ve had this example play out already. I mean, everyone uses Wikipedia, which is crowdsource information. Microsoft had a Wikipedia. I don’t remember the name of it, but when we were young, guys looking at the internet, Brian, that was way more resourceful and better for information, the online encyclopedia for Microsoft, which I remember the name of it.

1:08:43 But that ultimately died because Microsoft didn’t want a funded entity that was basically not generating any revenue or profit. And somehow this crowdsource version of Wikipedia has survived and become the standard for information in the virtual encyclopedia. So there are going to be this two worlds, the closed one and the open one. And I think the ingenuity, the composability and the community built on the open world is going to win the long run. Do you think it’s a danger?

1:09:13 I mean, yeah, it was like, look, Brian, we better really watch out because a closed metaverse goes right inside your brain and we need to fight, fight, fight for this open metaverse. I mean, is it that dire in your opinion? Yes, they are. It goes back to what we were talking about before. Like, I’m sure you and I as investors, and me definitely as a tech investor, benefited from the early days of Google, Facebook, all of these places.

1:09:39 Back then, they made our lives more efficient, more fun, and basically they served us. Somewhere when they got past $500 billion market cap and on their way to a trillion market cap, it became, well, in order to continue to grow, let’s take their digital fingerprint, hijack it and then manipulate them or make them buy things that they actually don’t really need, but let’s just keep the engine going. And so I think it’s dangerous, especially when they have a closed system and they’re trying to create their own private token all at the same time because when they put payments and they have your information together, that just accelerates the danger of what can happen.

1:10:25 Yeah, it’s scary. They just quietly retired their face ID system as well. And if you read into that, you realize just how much information they have and how powerful it is. Was that the greatest piece of press, though, that the whole crypto market ever got, was the changing of the name of Facebook to meta? I mean, did it not just put tons of eyeballs into everything we’re talking about?

1:10:47 Well, not only was it, I think it was genius. I mean, Mark is a genius. It’s clearly like it actually killed two birds with one song. I know they didn’t just overnight decide to name it that way, but literally a week, days before that, you had people testifying that they manipulate people and they’re fully aware of it. It’s like nicotine, et cetera, et cetera.

1:11:10 I haven’t heard one story since they named it meta. So either the timing was genius and the idea was obviously genius. There’s a reason why, you know, Mark is Mark, I guess, and Facebook is Facebook. Yeah, and I think it kind of confirms to everybody in this space, not that we needed it, that we’re in the right direction. I mean, if a company that massive is changing its name to a word no one’s ever heard of before, you know, and clearly focusing all their energy, this is clear the future.

1:11:39 You know, Mark is no dummy, and he’s still willing to take this whole company with the legacy issue and point it in that direction. You know, it’s pretty impressive. Yeah, the metaverse itself is fascinating. NFTs, do you have thoughts on those? Do you own NFTs?

1:11:56 I will say one thing, John. I have a 17-year-old daughter who’s very hard to impress, and when I got my first NFT, she was impressed. When I gave her an NFT, I became the coolest dad in the world. I’m telling you, John, I could have given her a Porsche, and I wouldn’t have been as cool as giving her the NFT. And again, back to what you said, there is some aspect of fun here, or other aspects that the NFT almost shows us that’s important to humanity because I’ve got such crazy reactions from these things.

1:12:25 It’s clearly a huge part of our future. What are your thoughts? Oh, it’s definitely a part of our future. There are two types of NFTs. There is the digitization of a traditional type of collectible, and then there are these apes and party animals that exist, which is a different type of NFT.

1:12:44 And the thing that all of us in blockchain and crypto have to thank NFTs for is it’s greater, far more adoption. Literally, when the NFT craze went nuts, MetaMask went from a few hundred thousand or a million, so wallets to 21 million. So we have DeFi to thank for the value that’s come into the system, but we have NFTs to thank for adoption for traditional people. And I am personally attracted to NFTs, not necessarily for just the digital collectible aspect of it, but the potential business model ramifications that it can lead to.

1:13:22 So Avalanche was just partnering, well less partnering with a company called Particle. And I was in Miami to basically unleash the fractionalization of NFTs of a Banksy painting. It’s like a print, I would say, it’s not owning a piece of the painting just to be clear, but it’s like a membership into a touring gallery and you get access to see this and future paintings that Particle actually put together. Different from Masterworks. Masterworks, you actually own a piece of it, but it’s locked up, you have no use.

1:14:02 This is a membership utility card, so to speak. So this is an example where like creative, innovative thinking at the intersection of technology, art, culture all come together, and now you’re providing access to a whole group of people who think Banksy and the whole type of genre of painting is cool, but can never actually see it in person. And now they know that they have access to this membership, this club, and when this gallery tours and museums, they will have a fact that their members should take it in to go check it out and future paintings as well.

1:14:37 That’s a new use case, NFT being used in a positive way to create access for people to see unbelievable art that otherwise they have to pay $15 million in order to see. Yeah, you had some really good points, and congratulations on that, by the way. I did watch the video of you in Miami. You’re sporting a pretty good-looking suit down there, John, and talking to the people at Particle. Again, Banksy’s ours, thank you very much.

1:15:01 We’ll take credit for Banksy the Artist. But it was a $12.9 million piece, I think, that traded on Sotheby’s, and Particle is fractionalizing into 10,000 pieces. But like you said, the real hidden value is access to that group of people, that community, that touring piece, where we’ve never been able to really quantify something like that before or value it. And people clearly want to belong. It’s fun.

1:15:26 It’s of real value. And I guess that’s what Particle is doing, like you said, that’s slightly different than just another asset. It’s like it turns it into an experience, into an exclusive group, right? And crazy enough, the launch party, it was like, you know, it brought three communities together. All of a sudden, if you look around the, it was an outdoor environment, but if you look around that room, so to speak, you had, it was clear about what they were wearing.

1:15:52 You had Wall Street types, then you have what they call IRLs, in real life art people, wanted to come check it out. And then you have the hoodies and the sneakers and the t-shirts from the crypto crowd. They all got along together and they all were having a lot of fun. That was actually a byproduct of this whole thing and it was actually quite pleasurable to see people from different communities all bonding over one thing. Isn’t that amazing? I love it.

1:16:21 And I know those avatars that you’re talking about because standing, he rocks a mean pair of sneakers. He’s got like a shirt with his own branded URL and yeah, I know what you mean by these kind of different people and it’s nice to bring them together. And you mentioned the board apes. The crazy thing is the board ape parties sound really, really cool. So it’s like, you know, the board ape, I mean, you know, they’re pretty cool.

1:16:42 You know, is it worth $50 million for a board ape, Justin Sun? I don’t know. But I heard the parties are really cool. And again, you kind of jump into a group of people who almost by definition are kind of thinking the way you are, right? And it creates these crazy experiences that you really couldn’t have.

1:16:58 Like, you know, like when we were in New York, what could you could go to a club here, you could go to a bar here, you could go to this, but you could never really kind of custom tailor your community like that, could you? So cool. So cool. It’s really fascinating. And like you said, it’s going to be interesting to see how we innovate in this space and how it evolves from more than just a JPEG and it evolves into all these like multidimensional, you know, pieces going forward.

1:17:22 A couple final pieces, John, if you look back at 2021, as far as a year, and look at all the things that happened, what’s the one that makes you want to talk about most? Like, if you’re having Christmas dinner and, you know, Grandma would come over, you’d be like, this is the weirdest thing that happened. You know, maybe that we haven’t talked about, or one of the realizations that happened that makes you think, wow, what is that thing that sticks out, you know?

1:17:48 Or what is the thing that impresses you most about this space? Can I bring it back to 2020? Yeah. Yeah, please. Just 2021.

1:17:58 The thing that sticks out to me most, in 2020, it was literally 10 of us, obviously, good, and like eight other computer scientists and myself and one other beauty person. And we were in a room and then COVID breaks out in March. Now, we had great funding from great, you know, investors, and what we were on the road to create other funding round in order to continue to grow, because we need to be more than 10 people. We’re 130 now, and we knew that we’re going to be bigger.

1:18:31 The great thing was, unlike the way we would have been on Wall Street, shot, staring at a screen and worrying about everything, you know, everyone in that room, our mission, our vision was to basically, very simple, it was to digitize the world’s assets in order to create more access to the financial instruments and other things. I think we all looked at it very quickly, and then we just went back to work and continued building. That was an unbelievable feeling.

1:18:57 We didn’t even think when we were not lying to the whole thing. There was just that one moment, and then we just said, okay, well, it happens. And we just kept doing what we needed to do. On a trading floor, you know very well, as you would have been going home and complaining to your wife or a significant other or whatever for days on end and thinking your career was over. It was kind of like, hey, okay, not great, but we’re still doing what we want to do, and we had this goal to get to, this objective.

1:19:28 Everyone kept going. That stuck out more than anything. 2021 has been a great year, where a lot of the work in 2020 led to this explosion, TDL 300 to 13 billion, a monthly act of wallets going from the thousands to 600,000 plus, et cetera. Zero dApps to 500 dApps and 300 in integration. But I think more, in my mind, was that one moment in March of 2020.

1:20:02 We said, okay, let’s get going. Let’s keep going. And same thing. Like now, you’re going to see in 2022 what we’ve been doing in 2021. What happened in 2021 was because of that moment in 2020.

1:20:13 Let’s keep going. Let’s keep building. And that’s a testament to the space and also a testament to the team that you’re doing. His vision is, you know, my job is to execute his vision. That’s one of my jobs.

1:20:28 And to make sure the team has, again, to hire the right people to have that same spirit, the people who can adapt, be flexible. People understand that Winston Churchill said is the best, I think. You know, perfection is the enemy of progress. So let’s not worry about being perfect. Let’s worry about good and keep moving forward.

1:20:48 So many good Winston quotes over here. And the Church of War Rooms are really impressive. When you come to London, I’ll take you around there if you haven’t been. Leadership, John, tell me just some of your basics because that’s your job every day to come in and lead and obviously recruit. You know, things that you always fall back to or rules of thumb.

1:21:08 You just quoted Winston Churchill there. But, you know, things that you could pass on to others or maybe things that you just remind yourself on a daily basis because, you know, everyone’s watching you. Everyone vibes off your energy and, you know, your ideas and your vision and you and them. And what are some of your lessons in leadership? For a business, for a team, for anything, leadership doesn’t start once someone joins the firm.

1:21:34 It starts with who you recruit and how you select those people to join. That’s where it starts. And then once they’re there, it’s the job of the leadership to create that environment where they can be imbued with the vision and the mission of what and how you do things. They become an extension of yourself. You know, I literally, it’s kind of like watching somewhere after 100 people.

1:22:01 It was impossible for me to be point to point with everyone and to communicate, coordinate, and make sure we all are on the same page. But luckily, there’s been great people that joined, you know, who want to be part of the mission and the vision that Gunn set out. And luckily, we hired correctly so that they have created their own pods. And these pods are acting as one with the same views and the same process and the same speed that everyone else in the firm, in the very beginning, those 10 people in the very beginning, were like.

1:22:36 Now, the question is how many pods you have. And it’s not a surprise when you talk about Navy SEALs. There’s something about six, seven people, and that’s why Navy SEAL teams are six people. The trust starts like breaking down somehow, if it’s greater, if it’s like double digits. And the N-square problem for me is when there’s over 100 people, it just cannot help Gunn and execute for him as well.

1:22:59 So, you kind of have to create structure and you have to have the right people to be there. So, I think it’s just a lot of fun for me to execute while Gunn, you know, being the one basis point guy, he is, continues to meet us. And explain that one basis point, because I didn’t know you meant it first. What does that mean, the one basis point guy? I mean, he’s extraordinary.

1:23:24 I’ve known Gunn for five years. My undergrad was Cornell. And I met him because we were both advisors. We were the only two advisors to the Cornell Blockchain Club in 2016 and 17. And the reason why he’s the one basis point guy is because of his capability.

1:23:42 But his effect on everyone was incredible. So, I was obviously outside of Cornell at that point. I was an alumni. But every student I spoke to that Gunn touched. Well, the only thing they can say was, I would not be thinking this way if Gunn didn’t, wasn’t inspiring me or teaching me or doing something.

1:24:04 I mean, a one basis point guy is not just will someone was great at himself, but can effect change in everyone else. That’s good. And one basis point is the top one one-hundredth of one percent. That’s what you mean by that one basis point. One divided by ten thousand.

1:24:18 Yeah, gotcha. And you’re right. It’s not because they’ve figured it out. They somehow inspire other people to go forward too. And he has, I call him in the Conor McGregor of the Blockchain.

1:24:28 You know, he doesn’t mind calling people out. And I appreciate that. And I’ll let him do the calling out, which he did really well on the episode. But I thought it was really healthy actually for this ecosystem. And he does it with a lot of love as well, which I thought was fantastic.

1:24:42 Well, I don’t think he calls him out. I think he’s a scientist. And as a scientist, it’s very hard for him to remain quiet when he sees something that’s inaccurate. And the same with you. When someone tries to convince you one plus one is five, you kind of have to just step up and say, no, let me explain to you.

1:25:01 So I think being hard on the facts sometimes confuses people that he’s being hard on the person. And I hope the world understands that it’s really hard on the facts, not the person. Yeah, and I think people do understand it because the energy comes across from him as not a complainer or a hater. But you’re right. He literally is criticizing the technology and calling it out for exactly what it is and not letting it slide if they have a good spokesperson or they have a loyal community.

1:25:28 He’s like, well, actually, this isn’t working very well. And this is why ours works really well. And yeah, it was, like I said, refreshing. And again, I spoke to a lot of humans and I got a lot of humans watching me. And they know good energy.

1:25:42 And M&M has good energy because, like you said, it comes from, I mean, ultimately, a place of love because, you know, the accuracy, the right tech, the best tech is going to create the best value for this race. I had Jeff Booth on this show who wrote a whole book about deflation. And he’s a mild American-Canadian guy. And he said, Brian, Bitcoin can save humanity. And his point more was that perhaps this whole blockchain space and everything we’re doing here, John, could solve all of our age-old problems that we have where we corrupt ourselves and we ruin our monetary systems and we go to war and all that.

1:26:21 What do you think about that thought? Is that possible? Do you believe that? What’s your take on it? So is that related to the inflation?

1:26:30 No, it was more just that this itself might save humanity or this public blockchain, these decentralized ideas might ultimately help us bring best versions of ourselves maybe to this world. Actually, I believe that’s why I’m part of it. I mean, I think what’s happened now is you have a feudal system with seven tech companies in San Fran and Seattle and no one wants that. So having more distributed governance and having a voice in who you are is super important.

1:26:59 And hopefully we reverse the dialogue so that everyone listens again. Yeah. 2022, what are we expecting from Ava Labs and what do you guys got cooking up in the kitchen for us? So I think there’s a lot being cooked up. So much, you know, I don’t know where to begin.

1:27:17 But 2022 is going to be a year where continued adoption and adoption reflects a whole other level. Based on my visibility in terms of the potential applications joining, the quality of the people that want to join, and the partners that we are signing up, just be ready. And the new assets that we’re creating, just so much. I don’t even know where to begin. Be ready for another explosion.

1:27:44 And again, I was already impressed before I spoke to Gun speaking to him. I started talking about you guys in the chain. And again, you guys keep just dropping all these great news, great partners. If someone’s listening now from a user perspective, from a developer, a creative perspective, and obviously these roles change rapidly. You know, the user today might be the DAP developer of tomorrow.

1:28:09 How should they think about Ava Labs going forward? How should they contact you, think about your protocol and how it integrates into their business? What’s the basically next step they should take or advice you give to them if they’re building something on the blockchain? Well, I mean, especially for people in DeFi Academy, they want to get in touch with us, obviously Ava Labs. AvaLabs.org is a website that you can figure out way.

1:28:33 We personally follow my views on Twitter, John, the number one Woo. But I think what’s important for anyone that wants to get in touch with us is that I want them, if they’re a user or developer, just try Ava Lynch out. Try out, if you’re a user, try out the different DeFi apps. No other system out there with a few hundred dollars, you can have access to so many things. You can’t do that in traditional finance.

1:28:57 If you’re a developer, try to do something on top of Ava Lynch. And then I actually encourage you to try to do it elsewhere as well. And then make your decision where you want to build, where you want to create, and where you want to use applications. That’s my message for anyone who hasn’t tried. And try a lot out and then decide where you want to stay.

1:29:19 Yeah, really good advice. Last note, just personal, John, I mean, how do you stay so fresh? You seem pretty fresh, you seem pretty excited, and I know you got 99 problems in the background, so you must have some mindset or some personal practice. How do you manage all that on a personal level? Is there anything you make sure you do every day?

1:29:40 On the deep level, it’s about enjoying what you do. If I didn’t enjoy what I was doing, again, I love people. I’m talking to people. I love coordinating with people. I love meeting them. I love being led by them when they can make me better. It’s all okay.

1:29:56 I just want to be involved in a team. But there are two things I do on a daily basis that is a religion thing. In the morning, you can see me working out. I’ll either be on a bike at the gym lifting with my trainer or something, playing a sport. And then I do 10 minutes of reflection every single night.

1:30:19 I learned this, so when I was at business school at HBS, Jack Welch came to speak to us and he said, I’m going to give you some advice that most of you will never do, but the few that do, it’s going to benefit your life and you only get it from a compounding perspective. You can’t just start it when you’re later in life. You got to start it right now. And he said his most important part of his day was the 10 to 15 minutes at night before he went to bed where he reflected and then he thought about tomorrow’s goals.

1:30:51 So every night, I think about where I went, what I did, what I accomplished, what I didn’t accomplish, and then what do I need to do tomorrow. Then after I do that, I can actually sleep. If I don’t do that, I actually cannot sleep because I’ll wake up in the middle of the night when I have forgotten, just to be clear, because I’m not perfect. If I’ve forgotten that, I see myself waking up in the middle and I say, oh my gosh, I do that. I’ve got to do that.

1:31:15 I’ve got to get going. And I’m typing. And before you know it, it’s like, wait, why am I? I can’t go back to bed. It’s because it’s already 7 o’clock.

1:31:22 I got to go out for my workout now. So those are the two habits that I have. One is that therapeutic workout in the morning and then at night, the reflection. It’s almost like meditation in a real way. So you kind of put yourself in a quiet room, close your eyes, and then just meditate, reflect, and that’s the way you kind of close out your day.

1:31:40 Exactly. Exactly. I can just see Jack saying that and looking at everybody thinking 90% of these people aren’t going to bother. But it’s a great tool. It’s that where it’s going to be the best advice you’re never going to do.

1:31:52 Right. And that’s coming from Jack Weil’s old school guy, right? Before meditation was cool, right? Last question, what was Harvard Business School like? Obviously, I was down the street in Cambridge.

1:32:04 You were an undergrad. I heard all sorts of interesting things. What’s the one thing you took away most from Harvard Business School? So in hindsight, I don’t know if you know how it’s structured, but it’s kind of like a watching. So you have these different cohorts, and there’s like five or six cohorts of 80 or something like that.

1:32:28 And each one is kind of like a note, and you get to really make decisions within that note. It’s like each class or cohort was like an out-of-the-land subnet. But then there was this common theme that bonded all these different cohorts together, and it’s one of those things where, like, you said you were Ivanka’s trust, and all of a sudden, that in itself, that shared experience. And this is the same with, you know, people in the military, that shared experience, going through the trenches together, doing those case studies, all of that gives you some sort of bond.

1:33:00 Like, even today, when there are some young alumni, just because they were at that school, I feel a connection, and I’m willing to help out and at least listen and hopefully guide them or do whatever I can to help them out. So I think that trust, again, and the reason why there wasn’t a thousand cohorts must be something about that six to seven type of thing. If you get too many cohorts, you don’t trust anyone anymore. Yeah, wow, that’s a really good observation.

1:33:27 And yeah, the older I get, I’m starting to value some of my institutional experiences more and really value them because of that shared experience. My MIT experience, my fraternity experience at MIT, my banker’s trust experience. I mean, I kind of had a feeling I was in a special place, but now that I talk to Morehead and Tepiero and all these people, they’re like, that actually was a pretty special place. And again, I’m starting to value that and then make connections on the back of that too.

1:33:54 And I appreciate your analogies on the boat team. You can learn a lot from those seals. And it’s one of the things I always go back to. I love it was Jocko Orgoggins that said that. Basically, you know, we took the bad boat team and gave them a good leader and they won everything.

1:34:09 So it was just all about teamwork and leadership and it’s a great lesson if you’re ever struggling with your team. It’s you, it’s not the team. And so it’s always good to remember. John, really appreciate what you do. I think you bring a really unique voice to this space that we really need.

1:34:28 I think Gunn is really lucky to have you as a wingman because again, I think you have a great way of communicating with the bigger world out there of what’s going on in crypto. And I had a good friend in here today and I said our job really is to get the non-crypto people into crypto. Like that’s really the big job here. And I think you’re a unique spokesperson for that and just want to compliment you. I see you at those Miami events.

1:34:54 I see you out there being a great spokesperson and explaining things in language that people can adopt. So I appreciate that. You guys are really doing an amazing job at Ava Labs. Really crushing it based on all your metrics and it couldn’t be more appreciated by us. So we appreciate what you’re doing, supporting what you’re doing.

1:35:12 I’m going to keep getting my students involved in your protocol because they’re dying for a great layer one solution that solves a bunch of their problems. So yeah, wishing you guys all the best for 2222. Looking forward to what you guys are going to bring to the table. And again, we’re here to help in any way. Brian, thank you. It was a pleasure.

1:35:29 And let’s both work on getting the next billion people over to this world. Amen to that. That’s my goal. I want to educate the next one billion people on decentralized finance. So great. We’ll do it together.

1:35:39 Appreciate that. Follow this man on Twitter. Again, AvaLabs.org, right? AvaLabs.org for the website. My personal Twitter is John, the number one WU.

1:35:49 Fantastic. And these guys are really good at business development. And so I’m guessing if you reach out, they’ll get back to you. And it’s a big deal in this space, making those partnerships happen. And we know a lot of the big players that are working with you.

1:36:00 So that’s fantastic. All right. Great stuff. Wishing you Merry Christmas. Happy New Year.

1:36:04 Thanks to everybody for watching. And we’ll see you all next time on London Real. Take care. Bye.