Stani Kulechov - How Aave is Leading the World in Decentralised Finance

Full transcript: Stani Kulechov on London Real

2:41 This is London Real, I am Brian Rose. My guest today is Stanley Kubichov, the technologist, entrepreneur, decentralized finance innovator and thought leader. At 13 years old in Helsinki, Finland, you started programming code before discovering Ethereum and realized how it could massively impact the traditional financial system. In 2017, you founded EafLend, one of the first decentralized peer-to-peer lending platforms, and in 2018, rebranded it as Aave, which during the DeFi summer of 2020 became the biggest DeFi credit market in the world, reaching over $1.5 billion in total value locked.

3:16 Today, Aave has $19 billion in deposits, 8.5 billion in borrowing, making you the leading decentralized finance asset platform in the world and a true pioneer in the space. Danny, welcome to London Real. Thanks Brian, very, very excited to be here. Good, I’m so excited to have you here. And look, you are one of the OG’s of the DeFi ecosystem and OG means original gangster for people that don’t know.

3:39 And I’ve had Ice-T in here who knows a bit about original gangsters, so I can say that. I’m not so cool as Ice-T, but that’s pretty nice. I mean, everyone feels to be like OG in the space because things are very early still, So everyone will be an OG end of the day. Yeah, no, that’s a really good point. And I want to talk about everything you’ve been here, but without the work that Ave did in 2020, I would argue there would not be the DeFi market as we know it today.

4:06 I think there was some amazing work done last summer and I want to talk about what it was like to be there. And of course, how you built it and what the future looks like as well. Quick background on me, just so we can get on the same page. I actually started coding when I was 10 or 11 years old. My mom bought me an Apple two plus computer when I was in San Diego, California and I started programming like basic or something.

4:27 And then I went to a junior high school that taught Fortran and Pascal. So I actually was gonna be a kind of a coder and I even took some assembly language back in the day. Ended up going to MIT, but I got seduced by Wall Street and I went from MIT to Wall Street in 1993. They were hiring rocket scientists to come in and help them price complex financial derivative markets. And I was in the fixed income market, which you’re in basically as well, and fixed outcome basically means the debt markets.

4:57 And Wall Street, people think about stockbrokers, but the big money on Wall Street is in fixed income because it’s so much bigger as a market. And I got placed on this desk at a company called Bankers Trust. And we were probably one of the pioneers when it came to fixed income derivatives. And we knew how to price options, all sorts of yield instruments, you name it. And we were doing some of the most complex stuff out there.

5:21 And I got to learn on the floor with a bunch of crazy Gordon Gecko type people. I mean, it was really intense. And again, the yield curve is something that we used to talk about. It’s kind of a description of the return you get on an asset from say one day out to 30 years. And in the U.S., the fixed income market, it’s really deep.

5:40 You’ve got U.S. Treasuries, you’ve got a fixed floating swap book, which I worked on for a long time. And so I got to see this thing in action and we were doing some original gangster shit there as well. That’s OG. Yeah, that’s OG.

5:52 So I got into that and I really enjoyed it. Later I went to the credit markets, I came to London, I did credit derivatives for 10 years, which was again, very interesting. And then in 2011, I had enough, as I told you out there, I got tired of being a greedy banker and I started broadcasting London Real. So the past 10 years, we haven’t been talking about DeFi because there was no DeFi then, But we did talk to Max Kaiser in 2013 and he was screaming about Bitcoin.

6:16 Andreas Antonopoulos was here in 2015, 2017, 2019. I’m sure you’ve listened to his lectures and seen him. Andreas was telling us about the internet and money and the future before it happened, before you guys built it. And so we had these conversations, but it didn’t really click for us. Then last year we kind of fought openly with YouTube about freedom of speech.

6:39 I ran for mayor of London, just because you saw the pictures out there. Very cool. Yeah, and then we didn’t win in May, and then we decided when we came back to really focus on something new, and I looked at DeFi, and I thought, oh my God, I looked at the value locked up in Aave. I looked at the DeFi summer, and I saw, I think at one point it was nearly 100 billion in total value locked in the network. I saw innovation and the rate of innovation I hadn’t seen since I was on Wall Street, and I had a bank with 20,000 employees with a balance sheet and a direct line to the Fed.

7:12 And we were doing this innovation. And I can see now you’ve got 10 guys and a dog in Tel Aviv, or nine girls and a cat in St. Petersburg, and they’re putting out these DeFi protocols. And I thought, wow, this is amazing, this is impressive. And I thought we better go in on this.

7:28 So we decided to go all in for the next 10 years. We started having conversations with people like you. So that brings me up to now. Obviously, the DeFi summer last year was an amazing explosion in instruments that most people didn’t even understand necessarily, borrowing and lending. And I still have some of my students in my DeFi academy saying, why is this important?

7:49 Like, why is this important? But it is important. So I wanna talk to you about why this is such an important building block of the marketplace. I also wanna say that my mother, 76 year old, Betty Rose in San Diego, as of Sunday owns crypto. Amazing, that’s a big achievement.

8:06 It’s big. It’s getting everywhere now. Yeah, she’s spent her whole life investing in real assets and now she’s continuing, obviously digital assets. But she owns property, she’s comfortable with property. Just like Robert Kiyosaki of Rich Dad Poor Daddy’s, comfortable with property.

8:19 Now she’s on MetaMasks, she’s got ETH, some stablecoin, and some Chainlink. My daughter at 17 has the same. And she’s very comfortable with it. And the last thing I said to her on Sunday night, I said, Mom, do you know how you could go to the bank right now and finance one of your properties? She paid them all off, by the way, over 30 years of mortgages.

8:36 She said, yeah. And I said, you know how it takes paperwork and the bank takes a cut and it’s a big pain? I said, you could finance your coins right now on a place like Aave. And she said, wow. So that’s real world back to this DeFi world, but it’s happening and it’s happening really quick.

8:54 So much to talk to you about. Let’s talk about August 25th last year when CoinDesk comes out and says Aave is now the the biggest lending protocol in the world. Obviously you didn’t get that overnight. What was that day like? What was the summer like?

9:08 And maybe explain to people, what was the DeFi summer and what were you guys doing then? Yeah, I mean, everything kind of like started back in a few years ago with our first kind of like a protocol It Land. And that was pretty much like the, like kind of like a bird stones in decentralized finance. So we created the protocol where you can pretty much borrow against your assets, cryptographic assets. And it didn’t get much traction because there wasn’t that many users and protocols didn’t talk to each other.

9:40 There was one decentralized exchange where you could swap your digital assets. So we kind of created this lending part for the ecosystem. But in, I would say like last year, especially like a year before, we started to see more composability where you had developers like us building something, other developers, different part of the board building, another kind of building block, and someone else coming and building on top of this too. And you have this kind of like a financial legacy stacking on top and creating products.

10:13 And when that started to become like this compressibility, more obvious, we started to get more and more products and more bigger ecosystem and builders became users and then actually they started to build more products. Like we started to build more protocols that are just more functional. For example, back in the days we created the protocol where you created practically a loan offer or a loan request to get funded. And now you just come to the other protocol, which has, the other protocol itself is decentralized, which means that no one actually controls these protocols.

10:50 Like no one controls the Bitcoin protocol or Ethereum protocol. It runs currently on multiple different chains. One of the changes is Ethereum blockchain. And it means that if you want to have any kind of a change in the protocol itself, you have to go through this governance process. So the users that the stakeholders come together, vote on different decisions and those smart contracts will change.

11:13 And we as the builders of the protocol can’t change it. So that’s the kind of like how the protocols work. And you have like 100 access points there. So you can just come and deposit your cryptographic assets and earn, it just became very simple. But to get to this point, it took like a few years of like different kinds of implementations.

11:32 And because we were building an open system, so when we built something and deployed to the blockchain network, someone else can come and copy what’s been built, improve it and build something better. And this constant innovation cycle led to products that are actually usable by your grandma, your daughter and that’s why we are here. And without this innovation cycle and all these builders, we will not be in this kind of like a DeFi summer and Ava probably will not exist.

12:03 So it’s kind of like the success of Ava is the success of the whole DeFi ecosystem and the builders, I would say. And that whole open source aspect, that’s something that’s typical of the blockchain and crypto space in general, but you guys probably really made a push, right? To get these protocols as soon as possible to your community and your developers. And which again, is it’s almost against the old capitalistic model, right? Steve Jobs would roll over in his grave.

12:30 For sure. Because the app and the app store is all about control and they take money on the back of it. You in the space and obvious particularly, you’re like, take the code because that’s the way we grow. Is that, and also that’s the right thing to do. Yeah, and if you look at something like Microsoft and how Bill Gates run Microsoft, It’s always about proprietary and modes.

12:52 How do you build modes, for example? And then open source. That concept of modes is a big thing, right? Exactly. To keep people out of your castle.

12:58 Exactly, so you basically have something like this kind of defensibility. But end of the day, an open source used to be in software that you use it in some way to attract a community, and attract developers, and then you still build a proprietary product on top of it. But here in DeFi, you don’t have any modes. So kind of like a software. So whatever you build, you build openly, you create it and you put it in the public, and then you want people to use it and build other things on top.

13:26 So you kind of like just be a part of building something bigger. And the kind of like the only mode you have as a team is pretty much the talent you have and things you can build and the brand. So let’s say the more you build very interesting things and experiment, the more kind of like attractive you become in the space and people follow what you are doing. And for example, we don’t see Ava as the developer team, any kind of like a DeFi, we’re not a DeFi company, we’re basically a team that builds web trees.

13:58 So we built one part of decentralized finance, now we’re focusing on building a social graph, decentralized social graph, and tomorrow we might be focusing on maybe decentralized e-commerce. So our goal is just to build the web tree and the pieces that are now missing. Okay, let’s talk about, you said Web 3.0, maybe we define it really quickly. because a lot of people in your ecosystem think about Web 1.0, 2.0, 3.0, and again, you just said it, we’re not a DeFi company, we’re a Web 3.0 company, which means you’re thinking bigger.

14:30 How do you explain that Web 1, 2, and 3 to people, like your mom? Yeah, I would say kind of like Web 1 is where things, like internet became a kind of like a, obviously like a public network. Then Web 2 is more about, you started to kind of like a see this centralized company is becoming, you know, bigger usage. So instead of like you storing your data, you give up your data into, let’s say, if you’re social media to social media companies and you kind of are trusting centralized service providers.

15:02 And web three is more about how you can actually keep your data, keep your keys, keep your finances and decide like what do you share and also like how you transact. Because for example, it’s not about software, It’s also about services. For example, if you go to a bank and you deposit funds, it’s pretty much like being in a, some sort of like a web one, two realm where you are like actually trusting someone. But WebTree is about where you don’t need to trust a centralized party.

15:31 You actually control your keys. If you control your keys, you control your Bitcoin, your Ethereum, your deposits into the Avi protocol or some other DeFi protocol, you might control your social graph network because you have the keys. So it’s all about, there isn’t anymore this idea of centralized kind of like a network or a party that you are giving up your data and you’re feeding them which are using that data to sell your services. Instead, you’re practically having everything on your own possession first time, kind of like with the use of technology.

16:05 And that’s pretty much like web tree. It’s a long explanation, but maybe because there’s just so many things happening at the same time. It’s a really important concept, and I don’t think it’s one as humans that we’re even used to. I had Sandeep, the COO of Polygon, and he said, Brian, this isn’t technology, it’s a paradigm shift. He said a couple hundred years ago, maybe in Finland, and maybe here in the UK, we had kings that told us what to do with queens, and we were like, okay, now we have governments, then we have banks, and now we have Facebook and Google, but at the end of the day, we don’t really own our money because the bank has custody of it.

16:42 That kind of tells us what to do. Facebook controls our data. I broadcast on YouTube, but I found out last year that they might stop me at some point. Exactly, so you need basically some sort of decentralized social media where you can broadcast like in a way where, you know, you can decide like what the audience basically can see. So it’s all about decentralization where actually, and part of the decentralization isn’t even like the censorship resistance, but that it’s actually not any more centralized kind of like a entity is deciding things, but community is deciding instead.

17:16 So for example, the Ava protocol example where not Ava, not any centralized party is controlling the protocol. Instead, there’s a community that decides like what kind of assets could be listed in the future into the protocol that you can borrow against, what stablecoins could be added there, how the protocol could be upgraded and changed. It goes from the idea of like, hey, let’s trust Google, Facebook, JPM, or SHB. into something like, hey, let’s decide as a community how we will build in the future.

17:48 And the interesting part here is that there’s always a minority in the community and you never want to kind of like, you have to take the ideas of the minority as well because there’s always a risk in an open source system where if you don’t have a wide consensus, they can always fork your code and create a spinoff community. And that actually creates this competition and constant mindfulness that you need to ensure that everyone is kind of like working towards the same direction and you can’t be, you have to be very altruistic when you govern these protocols. Right, and I think you’re a big fan of the hard fork threat being an important part of governance, right?

18:29 Knowing that at some point people could leave. Like I, my daughter, she’s 17, she lives at home. If my rules get too draconian, she’ll leave. She’s like, I’m gonna move in with my friend. I’ll be like, oops, I didn’t want to go that far, I want you to be part of this family, I just want you to stop misbehaving.

18:43 So it’s true with the community, if people have seen in the past, I think Ethereum Classic, Bitcoin Cash, these are instruments that decided to go their own ways with their own rules and try to go it alone. And that sometimes can split up a community and split up liquidity, but also it can keep everybody on the same page, right? Keep the right things happening with the right protocol. Exactly. And also, it creates, I would say, like an alternative, whatever already exists.

19:10 And maybe if two different kinds of groups are innovating, maybe we’ll see two different alternatives, you know, in terms of innovation. And it gives also space for new people to come in and build things. So I think, like, forking is good. And some forks are meme forks. I mean, there was a one decentralized protocol that basically had a complete meme fork that became actually a very substantial protocol in terms of like how much value it has in the smartphone jacks.

19:37 But it’s always like a good to have this thread, you know, that, you know, if you become like a dictator in the protocol, as a like a larger stakeholder, there’s always a risk that the minority can just fork it and create something better. And they have chances to thrive, especially because they can create incentives in a cryptographic way. So I think blockchain is not only about decentralization, but decentralization plus incentives because Because we had distributed models, peer-to-peer systems, file sharing and whatnot, but they never were beyond this barter economy where you share a song and basically I share a song and we exchanged.

20:13 Napster. Exactly. There was no way to quantify value or transfer value. Exactly. And now, first time ever, you have cryptoeconomics, you have incentives, you can organize these into a fashion as an organization, vote on things, and everything is based on this smart project-based software. So that makes a big difference now and why it’s a big movement at the end of the day. Yeah, when I watched what you guys were doing, so I call that, when I relooked at DeFi, when I was at Bankers Trust, I had a bunch of direct phone lines and I could choose which broker to use at the Chicago Mercantile Exchange or the Bond Future. I could choose which company to trade Treasuries with and you know they would give me better liquidity and And they might take me out for a steak dinner or take me to the to the Knicks on the floor But I never got offered ownership in their company or the protocol And when I saw you guys in the DeFi summer and some of the lending protocol saying guess what?

21:07 We’ll give you an interest on your soul. You’ll grow your crypto. That’s the best way you explain Lending market you get to grow your crypto But you also get some of these extra tokens in this protocol that will also accrue value That is a mind-blowing concept that you would have never seen in traditional finance or probably impossible to do without a blockchain. Or in an economy. Imagine even taking a Uber ride. Each time you take a Uber ride, you get a small portion of Uber equity or eating at, let’s say, drinking in a pub or going out somewhere or, you know, watching a sports game, you get part of ownership of that sports club.

21:43 So like all this concept of like ownership has it’s what web tree does very well Is that it just like changes the way so as a user you become a stakeholder So basically because you use the products and the protocols you have the kind of like a most skin in the game to decide like how There will be built compared where you know a traditional model where you have a company stakeholders investors and investors are kind of like incentivized to Create products that create more value for them so they have like the monetary stake but the user has not only kind of like user has the stake of like using a good product and Then if you get like some sort of like discounts ownerships and and additional like kind of like yield for that That’s amazing. Yeah, it’s a whole new paradigm shift and it’s super exciting and it’s also all on the blockchain Yeah, and transparently that’s the thing like when you compare like this interest finance to traditional finance what amazes me like how transparent everything is.

22:42 So if you go currently into the Ava protocol or any DeFi protocol out there, you see each and every transaction on the blockchain, every single second. So you see like what’s the colorization ratios on the Ava protocol, what kind of assets are borrowed, what kind of interest rates, you see like the historical data so you can even quantify for the future. So these protocols are auditable by anyone every single second, which means that anyone can build better risk management tools as well and because the data is accurate there.

23:15 Compared for example, financial crisis in 2008, it’s very difficult to understand what kind of exposures, for example, JPM had against Goldman and Goldman against, let’s say, Bank of America and whatnot. You have this financial reporting, but it’s not the same thing as you have financial reporting on the whole state of the economy each single second, which means that anyone can build better risk management tools any part of the board. And that’s what’s happening in the other protocol.

23:42 We saw a proposal coming from a firm called Gauntlet which does stress testing and risk management in the Web3 and they practically make it a proposal of changing risk parameters. And it’s kind of like a decent way of building not just like better finance, more like efficient, but also like more risk-aware finance, which is good for everyone, especially for the users. Yeah, the transparency cannot be overstated. Yeah. When I worked on Wall Street, the whole game was secrecy.

24:12 Exactly. The whole game was a lack of information from your customers. Yeah. That’s why we got paid millions of dollars a year. If you ever look at those phones in the movie Wall Street, they’re these black phones, and I used to have two, I could talk on two phones at once, by the way.

24:23 They have a clicker in the middle of the phone. What’s that for? It’s to mute, so you cannot tell people information. Exactly. And we would do massive derivative trades, hundreds of millions of dollars a notional between banks and they were never reported to anyone.

24:39 And that’s why I think what Stani is referring to is in the financial crisis, when everything went wrong, the Fed comes in and says, okay, where’s the risk? And everyone says. No one knows. We don’t know. It’s all on a ISDA document that was signed off that’s eight pages long or it’s in a risk management system internally to the bank.

24:54 But you literally have no idea what the risk is. Exactly. And then it starts getting ugly as it did with Lehman and these other places. But our job was literally not to tell our customer’s information. Exactly, and that’s not possible in web trade because you see everything.

25:09 And end of the day, what amazes me, how these communities are managing risk. So all of these communities, they consist of developers, there might be some professionals there, but they’re users that are using these protocols and practically making decisions on what kind of risk matter measures to apply. And crypto is very volatile. It’s volatile than anything else. And, you know, when these collaterals reduce in value, you know, there’s this kind of liquidations going on the different protocols, and they have been very resilient on what’s happened this year in the big market drop and last year.

25:46 So it just showcases that you don’t need to be a financial advocate to actually build good protocols and risk cover systems. You just need to have a group of people as a community, like using the product and the deciding that, hey, what’s good for the product? And that will work. We have like basically multiple protocols now in DeFi that just have amazing risk management. And I’m pretty sure when we look back into this thing, like we get inspired that you don’t need to have like necessarily like similar backgrounds, just modeling risk.

26:20 You can just have people that are using and have a lot of like kind of like a stake in the system. And it’s been impressive. Cause like you said, it’s almost like a public display of a stress test. Yes. there and I was talking to Dan Moore head of Pantera Capital who was raising Bitcoin funds in 2013 who you know tried to buy 2 million dollars of Bitcoin on Coindesk and there were on Coinbase and there were four employees and he couldn’t get it done and he said Brian look at Bitcoin for example he said for 13 years it’s been stress-tested by every terrorist group every government group every CIA FBI group in the world and yet it’s never had downtime he said you can’t say that about any banking system in the world yeah exactly you You can’t say that about Facebook and Google.

27:02 They’ve all had downtime. And yet a network like Bitcoin has made it through that without breaking. And again, Ethereum now, all the developers, all the protocols, and again, you’re talking about big market moves. So Black Thursday last year, this year when Bitcoin comes off 50%, now what happens? Do the stablecoins stay stable?

27:21 Do I get my lending securities back? And we’re seeing these public displays of kind of a stress test. Yeah. of discussion. So if you see some sort of like a kind of like unwanted behavior, the communities will talk about it, you know, publicly in the forums and Twitter.

27:38 And you quickly like the communities react very quickly. And because it’s a system where it’s based on the communities, like it’s very difficult to act against a protocol and kind of like because like everyone is trying to achieve the very same goal. Of course, like when things scale and you have more like commercial actors going, The next question is how you keep the protocols somehow like a friendly environment where people care about decentralization, financial inclusion.

28:08 But that’s the thing with the forking. If there’s some sort of issues where the community members aren’t, they don’t see it as beneficial for the protocol, they can always fork. And this risk is amazing because you can’t fork JPM, you can’t fork Bank of America. It takes 50 years to get to the same level. But in DeFi, you can basically fork any protocol, and if you do it the right way, you can get very quickly in the same spot.

28:34 And that’s something that also keeps us kind of active, like how we ensure as a stakeholder we build good protocols for people. So you’re a politician, not a CEO? Well, I would say that I’m more of a builder. I don’t like politics because it takes so much time, but politics is an important part. So decentralized finance is interesting because there’s this component of building things and then there’s this component of governing things.

28:59 I’m more of a builder. I like to build things and let other people to govern them. That’s pretty much like my vision. But also, I have a saying in some of the things I build. So maybe I want to say, hey, I like what’s happening, but my opinion is this.

29:16 But I want to do it in a way that my social capital isn’t like saturating what’s good for the protocol. So that’s the thing. Even if you deploy things, for example Vitalik created the Ethereum, was founded it and he’s active there, the community is still, you know, this kind of like a social capital, you need to be careful because you need to ensure that you don’t direct too much the whole community and let this kind of space and involvement there. It’s a fine line, you know, and we haven’t seen it go too wrong.

29:46 I don’t think although there were a bunch of co-founders of Ethereum, they all kind of went their separate ways. You got the top founder, you got Charles Hossons doing Cardano. We’ll talk about Cardano later. I know you have an opinion about that. But it is a weird place where your thought leader, politician, CEO, and also you’re supposed to be building and coding a little in your spare time too, right?

30:04 Yeah, exactly. And have some free time as well on top of that. It’s a lot to do. Yeah. You look pretty good actually for a guy.

30:11 Yeah, thank you. Now, I just spent six months running to be mayor of London and I got a taste of politics, a taste. America you look at America now and you see a potential a few hard-fork opportunities, right? And again, there’s also innovation there Yeah so look at the way Florida and Texas dealt with the pandemic and they chose different things to do versus California and New York and They got different results and different economies and people move there on the back of it Which is kind of maybe a hard-fork vote. Yeah, if you move from one protocol to another call the state So you can see how politics has this as well when I ran for London And you can’t necessarily hard fork London, although there are, you know, 32 boroughs and each one makes some independent decision-making.

30:52 But also, politics can be a little frustrating. There’s a book in Britain and America called The Tyranny of the Majority, right? I mean, the majority rule sounds good and it’s how democracy works. Exactly. And you can’t fork.

31:02 You know, you’re kind of stuck. So you have to grow the minority. But in Web3, what happens is that with decentralization, you can basically take that code and fork it and say that, okay, this is our vision, this is how we’re going to differentiate. If you’re early, you get more incentivized, and people follow. Some people follow just because of the incentives, and some people follow because of the frustration.

31:24 But this kind of like a forking ensures that you have an ecosystem where if there isn’t large enough consensus, which is important in decentralization because otherwise you are back into the centralized model. So what happens is that you don’t have wide consensus, you see forks and they evolve something. Some of the forks might be opportunistic, they don’t go anywhere. I think I’m not sure like many of the Bitcoin forks will survive at some point. But then again, when you have let’s say forks on Ethereum on certain protocols, there might be like a different way of building things and that’s totally fine.

31:57 So I think that will be like the key thing. And we don’t see forks often because it’s very radical measure. It’s kind of like rage quitting from a DAO. But it’s just a way of when you need to radically take a new direction of what you’re building. Yeah. And again, you spoke earlier about how composability is a really important piece, which means what you build is a piece of Lego that other people can use to go create whatever they want. And the more you can make it complete and not owned by you, that’s a big part of the protocol, as well as you like this concept of immutable code, of having this piece of code out there that’s a smart contract in and of itself, does something and again, doesn’t have.

32:33 And no one can change it. That’s the most, that’s the kind of like perfect thing to do. But there’s there’s also issues related to that. I think like a perfect protocol is when you build something, only the most necessary part of the protocol, and deploy it and see what other people will build. So you have this kind of like a protocol, I would say like experimentation market fit or protocol market fit where you try something and see how the community reacts and what they can build. Because if you start to build everything in a monolithic way, what happens is you get a community of more of like spectators or maybe parameters governors but what you want to essentially do is that you don’t want to only decentralize people who govern the protocol but you want to decentralize also people who build the protocol so that way kind of like if the governance wants to make different kinds of decisions and the builders aren’t happy you don’t have anyone to implement those changes and for example in Ava protocol you can delegate the voting power so if you are a holder of of, you can delegate to someone, so-called protocol politician, but you can also delegate the proposition power, which means that if you look into the traditional system, usually like the lawmaking is monopolized in a way that you have one lawmaker, and then you have politicians who vote in different kind of like ways.

33:54 But delegating proposition power means that you make the codemakers, lawmakers to compete on the proposals, which these protocol politicians end of the day vote. And that’s why the decentralization of builders is like the last and biggest component that we need to kind of like work upon in the whole space. But in the perfect manner, you create a protocol that just has the essentials and see how others will build on top. That’s like the most like valuable scenario.

34:21 Why did Ave win? Diaker started before you, compound started before you, but Ave’s got clearly the leader. Why did you guys win? I think it’s because of the inclusivity and the way we are build everything. So we always try to be very inclusive when we, let’s say, tap into different communities, list assets, look into other kind of like I change when we’re building.

34:44 For example, we listed different kinds, as a community, we listed like different kinds of assets that, for example, other more, I would say like maximalism community members will not approve. We listed theta before anyone else has a lending currency. It’s still a lending currency, not a collateral. BTC so we were able to unlock the value of BTC than anyone else so Bitcoin as a lending instrument Exactly on Ethereum. Yeah, and the same we were in Polygon like Sandeep we had As well so kind of like and now like expanding so our community has been very inclusive and this inclusiveness has been very rewarding so in terms of assets and and Link community was one of the first we listed and it gave a lot of traction as well It’s just like kind of like seeing where are those communities that are untapped and going and servicing them It’s just like we could imagine if there’s a world somewhere where people don’t have mobile phones and you go and give them mobile phones Or give them internet connection satellite connection Give cars people will be happy and the thing what we did like of course like we didn’t give physical objects We gave them accessibility to unlock value get yield just basic financial tools. And that’s part of the whole financial inclusion, not of like in this micro, like communities, but in macro level. For example, now anyone who is accessing over the 100 different access points into the Aave protocol globally, they get the same yield. So if I access from

36:10 London, if someone access from Singapore, you know, they have the same equal opportunity for that. And that’s like financial inclusion, what we’re doing. And I believe that decent finance mostly will be adopted through like maybe like institutions, financial intermediaries, you know, could be part of a software stack in big banks. But the main difference that we did now is that you have direct access into decentralized protocols if you don’t like your service providers, which means that we first time ever in history, we created finance as a human right after the barter economy. And that’s very big. Such an important part. And again, you know, last year we were really fighting for freedom of speech which I didn’t understand what it really meant until it gets taken away from you. Exactly. And this year I was campaigning to be mayor of London and I was in the middle of the street talking to my iPhone and five police fans surrounded me and they said you’re banned from campaigning and I thought there’s something wrong with that so we fought back for free and fair elections and then I’m looking about finance I think it’s one of the last human rights that doesn’t exist. Yeah exactly and Privacy yeah privacy But like again, it’s one thing for you and I to have access to it But you know if you’re on the African subcontinent or in some of the places in Asia and India You might not have that basic human right to borrow lend access to financial markets

37:29 And I always tell this tale of two women like my mom 76 and she’s in California There’s a 76 year old woman in Ethiopia. They both were single mothers They both raised three kids, but my mom had the option of investing in property that was stable And this woman might have only had the option of investing in a local currency that was devalued Yeah property that was seized by the government and a business that was made redundant because of civil war and now this woman in Ethiopia and my mom both have access to Digital property and maybe to lending and borrowing through what you do I mean it really is a human rights it is it is and the thing is like kind of like essentially what defy is it’s a marketplace of liquidity and algorithms that allocate the liquidity in different kinds of opportunities and algorithm is part of let’s say our protocol is algorithm and maker that’s an algorithm essentially it’s basically code base and first time ever you have this kind of like an ocean of liquidity so I think like when you think about DeFi and try to explain it to a like a wider concept what’s happening here DeFi is kind of like an ocean so no one controls it Like, you cannot claim ocean, which is like everyone’s right, right?

38:41 But then you have different kind of ports in different countries, like those are the coin basis of the world, the fintechs of the world and banks of the world and institutions. Like everyone has the access to the ocean through a port, for example, but you don’t need a port. You can go and swim from the beach to the sea and you have this accessibility. But the cool part is that, you know, anyone can contribute. Any part of the world, you can create a new innovation.

39:04 And first time ever you have developers building at the same time into the same financial infrastructure, the same kind of software base. So it’s very even difficult to create a parallel system where you want to create, okay, let’s create a different kind of DeFi where we have a bit more decentralization but we know the actors or some sort of like a mesh. Because you have so much innovation going and this efficiency that end of the day it’s more efficient to use DeFi, and it’s ever, ever growing because of innovation.

39:36 So let’s say the more capital is coming into the decentralized finance, the more innovation is going on. There’s more demand again, and you have this constant cycle. And at some point, we can take the capital out of the DeFi by creating trust networks. So for example, I might need a collateral, I might need an Ethereum to borrow stablecoins. But I also can deposit Ethereum, borrow stablecoins, and give that borrowing power to someone else, for example, that I trust.

40:01 Other part of the world, so I can delegate my borrowing power and that person can actually draw those stablecoins and convert them national currencies and whatnot, then we can create this kind of like a trust network on top of the decentralized finance layer. And I think it’s just like an ability of like realizing that it’s something, it’s going to just be basis of the whole finance and it’s just software and it’s good for everyone. It isn’t going to remove traditional finance completely.

40:32 It’s just like traditional finance actually will be more efficient because they have better software now. Right. And I want to talk about what you’re doing with the banks right now. First, let me just zoom out really quick and talk to the people that just bought their first crypto, right? So my daughter, she’s 17, my mom’s got her chain link into some Tether and some Etherm as well.

40:51 And one of my students the other night in the DeFi Academy said, Brian, why is this important? need to lend or borrow, maybe explain what is it at the core of what you do and why is that important? Because so many people new to this space don’t understand finance. I worked in finance and you know that borrowing and lending is the critical to the whole yield curve and all the infrastructure. But how do you tell people that just got here why what you’re doing is so important when it’s so simple?

41:20 Yeah, it’s end of the day, like when you come to crypto, you have cryptographic assets. So they’re like, if you buy, let’s say, one Bitcoin or one Ethereum or 1,000 stablecoins, it will be 1,000 stablecoins. And what the Avi protocol does is that it basically, when you deposit into the protocol, it starts to grow algorithmically the balance of your holdings. It means that the same way as you will go to a bank and you deposit your funds and you get interest on top of them.

41:47 And it’s an important part of the whole ecosystem because getting yield means that normally in economy you have inflation. So even if you have $100,000 in your bank account, let’s say dollars, from five years from now if there is inflation, that $100,000 becomes actually less in purchasing power. And getting yield is a way to actually fight against that like a loss. Essentially you’re losing all this high money when you hold money. When you’re not spending, you’re losing money.

42:19 That’s the thing. But also when you’re spending, you’re using money as well. So it’s kind of like a dilemma. But what yield does, it basically fights against the inflation that we have. And inflation is because we put more money into the economy because there is more demand, but also in a way that we create the demand by pushing funds into the economy, meaning that when there’s more money, you are spending that money somewhere.

42:43 And that essentially gets the prices go up, which is inflation. So essentially, getting yield means that you get less crude in the economy. That’s why it’s important. Right. And that’s important.

42:55 So anybody that owns crypto, you could be growing that crypto. And again, compound interest, I think Ben Franklin in America always talked about interest and then interest on your interest. Exactly, combining. So again, if you just let it sit, any asset anywhere, you’re losing that. You’re losing, yeah.

43:08 Because someone could be using that and they’ll pay you to use that. Exactly. Banks aren’t paying anything because they don’t need the consumer’s funds. They can go to different kind of channels, for example, Europe and elsewhere, you have this kind of way. For example, in England here, money is created from air.

43:27 It’s actually like 3% is cash, but for example, when I go and I need a mortgage, for example, that money doesn’t exist. So, for example, I get a 500,000 pound mortgage. If I get the mortgage, what it means is that the bank has the ability to print that balance to you, and then it means that I get the $500,000 in pounds plus I pay interest. Then I buy the house, for example. Now, once I bought the house, I’m left with the house and paying interest, though.

43:56 But someone else gets the capital. So every single pound that is in circulation, someone is paying interest on that. This is something that people don’t know, especially consumers, because they think economics Works in the way it used to work, where you put money into the bank, someone borrows it. But if that will be the case, you will get more from banks as interest yield. But they can actually create that balance by themselves.

44:24 So they don’t need consumers’ money. That’s why Decent as Finance creates an ecosystem where you can actually convert your assets to cryptographic stablecoins, put them into yield, because there’s constant innovation, new financial primitives, and that creates a new market, essentially. But that’s why it’s cool, like all this innovation. Let’s talk about stablecoins, something I don’t think anyone saw come in five years ago. And it’s probably the biggest mover in this space, innovation, and the biggest part of liquidity.

44:53 And maybe you can talk about this. Again, one of my students day and night said, Brian, I bought some of the stablecoin. And I’m really frustrated because Bitcoin’s up, Ethereum’s up. But my USDC, it’s still a dollar. This is ridiculous.

45:05 And I said, OK. I said, it’s stable. And they said, well, that’s not very interesting or exciting. And I thought, actually, sometimes boring is an asset. Sometimes boring is good. Sometimes fixed is really good.

45:15 And I always talk about I have two boys at home. They’re four and five years old. And when it comes to babysitters, I choose the most boring babysitter possible because I want everything to be boring at my house. I don’t want any volatility or weirdness going on. So people will pay for that stability. Tell me about maybe define what a stable coin is and how How has that market changed, and how big of a market is it for you, and not only that, for the adoption of everybody into this space?

45:42 Yeah, I mean, stablecoin is a simple kind of like an asset that tracks, let’s say, a stable value, such as, for example, USD. So you can create a stablecoin by just having, there’s an entity that has, let’s say, $1 in their bank account against every stablecoin they create. The USDC from circle is this kind of system, or you might have a maker which is collateralized system which is backed by, let’s say, Ethereum. So you put Ethereum into the so-called vault, and then you mint the token that tracks USD price.

46:18 And because there’s more collateral than there is actually the value of the stablecoins, you have folks that are buying and selling that stablecoin at the exact kind of like a tracking price. So essentially, you have stable value on cryptographic ledger. And why it’s important is that normally when you hold Ethereum, the value goes up and down. So there’s not much things you can do. So when we started Eatland back in days, there wasn’t any stable points on the whole Ethereum ledger.

46:48 So we created a system also where you could borrow 100 USD worth of Ethereum and you need to return 100 USD worth of Ethereum. So when you borrow and you convert to, let’s say, USD through Coinbase, you still have like kind of like a borrowing amount of 100 USD and you have that exposure. But it’s not very convenient, it’s not movable, but stablecoin, I can transfer the stablecoin to you and it’s still the stable value. And why it’s interesting is that because when you have something stable, you actually have a balance.

47:19 So you don’t want to get paid, let’s say, in one-eighths, which is let’s say $3,000 to $4,000 at the moment, and essentially, three weeks or four weeks from now, it might be more or less, and it’s difficult to pay bills from something that fluctuates a lot. So the stablecoin fixes that. And that’s, for institutions, it’s very important because when you have stable value, you can do different kinds of investments and use different kind of product because you can quantify things.

47:50 So that’s the thing. like stablecoins is definitely changed the whole ecosystem and created the yield. So now that you, it’s nice to get yield on your cryptographic assets, but when you have stable value, it brings more cash because essentially Bitcoin, Ethereum, they’re kind of like a store of value because you’re betting on the network, you’re betting on the whole ecosystem, but cash is cash. It’s basically follow something that is already proven and depending what it it is following a US dollar, pounds, or whatnot.

48:22 Yeah, the whole asset class is fascinating. And you’ve got places like probably like you and Coinbase that are offering, you know, three, 4% yields on a USDC or DT stable coin. Whereas you go to your bank and you’d be lucky to get a quarter of a percent interest rate maybe, you know, or a half a percent if you’re lucky. If you’re lucky. So it becomes this big eye-opener of, wow, there’s real yield there.

48:44 And if you’re not like Michael Saylor, CEO of MicroStrategy, who’s ready to put $5 billion on his public balance sheet of Bitcoin and take the volatility with it and take all the filings and stuff, and also have crypto assets on a public balance sheet, but you’re still interested in this crypto space. You can start thinking about stablecoins, right? And thinking about the yield you could get on those stablecoins. And this is kind of the next level of some of the Web3.0 or some of the other things you guys are developing because right now we haven’t seen any banks put crypto on their balance sheets.

49:15 And we probably won’t for a while. Not for a while, but I guess it starts happening with the private banks at any time soon. I mean, that thing is like everything moves in cycles, right? So when we have like a bull market cycle, everyone is excited, banks are interested in there, researching more when we have bear market, kind of like interest goes away a bit. So it’s always like the market cycles determine a lot of kind of like different like interest, and what people are building in outside of the kind of like a DeFi space, but I think it will happen at some point from the private banking perspective, yeah.

49:49 They’ll have stablecoins. I think so, I think so. But in the meantime, they are eyeing this and you can potentially give them access to these massive yields and these massive markets. And we know the dollar balance is probably the biggest asset class in the world. And so you wanna try to stand in between these groups of potentially centralized financial institutions and these decentralized protocols.

50:13 When you ask the average consumer on the street, sometimes they’re thinking, okay, I’m gonna buy Bitcoin and I’m gonna hold it forever and I hope the banks burn. But also that’s probably not realistic in the long run because we have to find a way of incorporating this financial system in the DeFi space, right? And that seems like that’s where a lot of your brain power is going in the future. Yeah, for example, we have been working on this, there’s a bunch of kind of like institutional entities working together on this off-the-art market.

50:40 And one of the things for institutions going into DeFi, there’s already a bunch of institutions depositing into DeFi and using these different kinds of protocols. It’s kind of like their risk appetite of understanding what is DeFi and the risk involved. And what we created is this kind of like an ARK market where you have this whitelister entity. So that whitelister entity can actually whitelist the suppliers, the borrowers, and the liquidators. So you as a user of this ARK market, which is segregated from the main of a market, is that you know the counterparties, which is interesting because then you can create more institution market, like a private market there.

51:25 And the idea is to give more like a comfort zone for institutions to try to define from this perspective before they enter into, they get more clarity, for example, from regulators and they can actually access the main decentralized finance market. It’s kind of like a derivative market build on top and segregated from DeFi. And that’s just going to increase DeFi volumes and increase all the good things that are happening in the sales finance. Yeah, exactly.

51:50 Yeah, and I think a lot of people can’t see that behind the scenes, whereas if you’re a typical retail investor or a small investor or a new investor, you’re buying Avalanche, you’re buying this coin, you’re buying that coin, but you’re not seeing that the stablecoin is driving all the innovation and potential volumes that’s going to give you liquidity, you new protocols, give you new options, and take us in the right direction. Yeah, because cash is very movable. So it’s obvious kind of like a composability feature.

52:14 All right. Talk to me about the future of the blockchain and where all the action is going to be. We’ve seen Solana make a crazy run. By the way, Solana is short for Solana Beach, which is a mile away from where I grew up, by the way. So those guys are going to have to airdrop me something.

52:28 But we saw Solana as a layer one solution, getting a lot of price action. Okay, it’s now the sixth or seventh largest market cap, but also a lot of users, and it’s actually getting functionality, NFTs as well, and I do want to talk about NFTs, we’ll get there. You also see Cardano just launched her smart contract. I had Sandeep on here, Polygon is doing some impressive stuff on making Ethereum faster and cheaper. What do you see as the future?

52:52 And I think you might have once said, if newcomers are still buying Cardano, we have a lot of work to do on education, unquote. What did you mean by that? And what do you think is the future? Yeah, maybe I kind of like wanted to say that, you know, it’s just like, you know, most of the innovation is not in Cardano, I would say. It’s of course in Ethereum because of the developer’s perspective, the community has been always.

53:14 But I will say like what Aave has been doing and where the ecosystem will move is this kind of like a multi-network. So you have Ethereum, you will have Polygon, you will have Solana Cardano and you have Avalanche which is now growing quite a lot and they have their own kind of builder community. And we’ll see like these different kinds of like a networks going on. And that’s how we and also you have layer twos that you have basically networks that are their own networks but they’re settling their transactions into let’s say Ethereum or other networks, so called layer twos.

53:44 So we’ll see like not just kind of like a horizontal expansion where we have different networks and also like the Polkadot but also like I would say like this vertical where you have layer twos on top. So because now the transaction we have on Ethereum, it becomes very expensive to transact there. So you need to take some of the transactions elsewhere where you don’t need the same security, let’s say to Polygon or to somewhere else L2. So we’ll see like this networks of like multi-dimensional kind of like a perspective.

54:18 It’s kind of like good example is that if you have something very, very valuable in real life, you will use a safe. If you’re just carrying a couple of hundred bucks, you would just use a wallet. You don’t care if your wallet gets lost or something happens. You lose a couple of hundred bucks, cards you have to reorder, right? But if you have something very, very valuable, you’re using a vault and Ethereum is kind of like a vault.

54:42 And now what we’re doing is like we’re carrying this vault everywhere and it’s heavy, you need a lot of energy, whereas you can just carry a wallet and less secure for the things that you don’t need the same security. So that is something which is going to restructure. So you can use, let’s say if you mint an NFT, you might mint it elsewhere than in layer one, or maybe that you want to mint it on Ethereum because you have this Ethereum culture there. All your users are in Ethereum, so it’s important to mint it there, but you can do it elsewhere.

55:12 So it becomes like a more of like how much security you want to apply on what you’re doing and culture, because every blockchain is not only security, it’s also culture. So it’s like two components there. Can you explain how a blockchain is culture and how do you manage that, you know? Yeah. Well, for example, in Ethereum, the culture is whatever there is built and ideas coming in.

55:34 So for example, CryptoPunks that has a project built like a few years ago and I remember I used to buy Punks like back those days and you know, this was fun moon cats and then you have like you have our protocol, you have DeFi there and you have people associated people who have like kind of like I usually say that like obvious obvious always like multi-chain and like our on-chain headquarters is in Ethereum because we have born and raised there that’s where we started and off-chain is here in London but like we we see like people also like participating other like you know you might be very active in the ecosystem of Ethereum, Avalanche, polygonal Solana but you know you participate in different cultures because the one blockchain depending on developers followers people who interact there they form a culture you go to different kinds of events you know off chain you have certain opinions and they differentiate and that’s how the culture is born and it’s the culture is pretty much like a community culture is just like a wider concept of a community where you’re participating but also you You might not participate, but you’re like you’re kind of like some sort of like number of like this bigger movement.

56:46 Okay, third largest market cap is Cardano Charles Hoskinson just announced smart contracts. They got their conference of September. He’s on the show in a few weeks. Why or why not? Is this the future?

56:59 Why will this not solve all of our problems? It’s really depends on the leadership as well. So I mean, if they will essentially if they have a lot of like active community there, a lot of building happening. If they’re able to engage audience to build things and users to come, they will be successful. Just as, for example, Ethereum will be successful.

57:19 And everything is so early. We don’t even know, will Ethereum exist in five years? Will something else exist? Maybe we’ll have something better, faster, stronger, I don’t know. But essentially, once the ecosystem starts to pick up, and there’s things to…

57:36 Now with smart contracts, of course, now you can build things. So their next step is to build a community there and see how things are going. And if there’s a DeFi market there, if there’s a swapping functionality, maybe there’s something need for Aave protocol there as well. So Aave is never looking into too much that we are sticking into this one particular protocol. If there’s a community and culture, we want to support that culture.

58:02 And that’s how this inclusivity has brought us to where we are today. So we would like to see innovation everywhere. All right. So if I’m reading in between the lines, you say, show me, don’t tell me. You want to see proof that Cardano is going to have developers, real world use of that blockchain.

58:20 There’s been a lot of talk and a lot of hype and a lot of belief for many, many years that obviously a lot of people are buying into literally with the token. So far, you haven’t seen any proof that it’s going to work and everybody wants to see that. Exactly. Also, the thing is that I don’t even live in that community. Maybe at some point when there’s more and more activity happening, something like that comes into my…

58:42 Also, I’m a creator and I say, okay, that’s interesting. But essentially, I don’t even make decisions end of the day. It’s about the ABBA community, what they want to do and deploy. Because you can take the contracts and deploy them anywhere and you can have this kind of activity. So, essentially, I think if something will be deployed in Cardano from the ABBA community, It is the community that is doing the team.

59:04 Could Cardano replace Ethereum or not? I don’t think so because you already have this track record of builders on Ethereum and culture. And we see always a backslash of things coming again popular. For example, CryptoPunks, it was fun for me at MoonCats three years ago. And now this year, last year, they became popular again.

59:27 And probably the same thing will happen three years from now, five years from now. So this community evolves over time. I would say it’s just a different culture there, but I would say that who uses Ethereum might use Cardano, might use Avalanche, might use Solana. So people will travel a lot because of the breaches. I think you will be less worried about being very into one particular blockchain.

59:53 You will want to be a bit everywhere, and that’s pretty good. Okay. Let’s talk about NFTs, non-fungible tokens. We’ve been mentioning the crypto punks, which we’ve seen going for million dollar plus. Now we’ve seen ETH rocks, one of a hundred, I think the floor price is now a million dollars.

1:00:11 We’ve seen the apes going, I think a million dollars, one went on Solana. Explain to people your take on non-fungible token. Also you recently sold an NFT for over a million dollars. It’s got kind of pictures of you on the background with balloons. It’s a gift for something, and it’s beautiful, and you’re beautiful, but a million dollars is a lot of money for that piece.

1:00:37 How do you get your head around NFTs and how do you explain it to people? For me, NFTs is very simple. It’s just linking to a particular content, and it’s not about actually the content itself. It’s actually the relationship between the creator with the audience or whoever buys that linking. It’s kind of like you might have music, for example.

1:00:58 You might hear a song on a radio. You might have an album. You might have a record of a particular – that’s a vinyl record of a song, right? And when someone signs, let’s say, the creator of that record signs that physical object, that’s kind of what NFT is. It’s a cryptographic signature into a linking to something.

1:01:20 And the link could be visual content, media, but it can also be a promise, let’s say, If you have this NFT and you come to me, I give you a box of shoes and you can wear those shoes. They’re yours. So NFTs can be pretty much any kind of like a promise or linking. Smart contracts. Yeah, essentially, because of the smart contracts, you can program things.

1:01:42 You can program things in a way that if you buy two NFTs, I will send you a third one automatically when you climb your second NFT. And NFTs are interesting because they’re tied into the visual now, like visual content, music, and video. So it sparks a lot of kind of interest from the mainstream and from the creator communities. So creators are looking into the space, wow, people are buying this stuff. I sell my stuff in a gallery and no one cares.

1:02:14 And I see people selling, you know, buying and selling things at higher price and, you know, they have value and they have provenance on chain. Because of the smart contracts, you can see systems where if I buy an NFT, maybe five other people will buy it, or if I sell this NFT to someone else, it might trade higher because it has my name before that, the provenance there. And also you can program things, you can program royalties. So whenever I sell the NFT in the marketplace, 25% of that sale price goes back to the creator.

1:02:46 So you can actually create cash flows. You make one painting once and you get always when it’s sold royalty from that you you have in some like Economists right kind of yeah copyright basically Yeah, which in previously never happened because I didn’t make any money off his paintings because you know, we sold them once exactly Right exactly and so you can design this in and that’s where it becomes interesting Yeah with these NFTs and I think like we’re even not in the like like high in the innovation curve from NFTs There’s sort of experimentations I experienced with NFTs and we’re focusing now on building this social craft, social media protocol which has this NFT features there, like heavily involved. And I just see that there’s so much things coming up in the future, what you can do and experiment.

1:03:33 And the more we get craters in, the more kind of like a, like adoption we’ll get because Because now NFT has got the interest of traders, more mainstream, and it’s just a way to onboard more people. And I don’t know what will be where the NFT space will go, but definitely will evolve. We’re not near like in close of the kind of like, we have built everything. The NFT market by one recent estimate is $28 billion, 14% of say $2 trillion in DeFi. It’s significant.

1:04:06 Yeah. And it might be even bigger. And at some point there isn’t like distinction what is an FT and what is DeFi because an FT, for example, a crypto-punk worth of million dollars could be used as a collateral in Avi in the future, which we are, for example, working upon. And you can borrow assets against it. An FT can represent even a physical object.

1:04:25 It can be, you know, a pair of shoes. It can be my hoodie or like even like a right to wear my hoodie for a week. It can be in the future even a property once we get there. There’s a lot of like regulation and stuff that is challenging still, but essentially there’s like many things you can do attached to the physical as well. Essentially NFTs define there will not be clear distinction because what blockchain does very well is that it stores of value.

1:04:53 And in defying and governance tokens, it’s more about storing monetary value, but also storing a bit of the community value, the social capital, but NFTs, they bring that aspect more because when you hold a crypto-punk, you actually are not just holding like a piece of image, like linking to that image that is signed by the creator, but you’re also holding the value of the community at the same time. And once you have, for example, social media protocol, you can also have like your social capital followers on chain. So blockchain does practically what it does very well is store of different kinds of values and you can mirror it.

1:05:27 If someone has, maybe not my physical hoodie as an NFT, but let’s say a virtual version of it, and by owning this NFT, they can actually wear it in different kinds of meta versus games, that is a big opportunity because Fortnite, all these game skins are traded all the time and it’s a big business at the end of the day. And that’s like cryptography will allow you to own that. If Fortnite goes down tomorrow, everyone loses their assets. But if you have the cryptography and NFTs, you can just go to a next game, you know, someone who can build a game where you can use those assets again because you own them with the NFTs. That’s probably the best explanation I’ve ever heard of between the real world and the metaverse NFTs. By the way, do we just create an NFT which is the right to wear Stanny’s hoodie that he wore on London Real?

1:06:13 For one week. The one that you wore right now on London Real for one week, that’s an NFT. Yeah. Alright, we just created. We’ll be taking the bids later. I don’t know where we’re gonna put it on the open sea. That’s an interesting experiment, yeah. I hope they return it because like if if they’d have returned, like.

1:06:26 But they break the smart contract, right? You put some things in there. That’s interesting when you say about the gaming. I was thinking about Michael Jackson’s glove. You know, you used to have that sparkly glove and that was this epic piece.

1:06:36 I’m sure it’s in a museum or in a hard rock cafe somewhere, right? So that’s a collectible, but imagine having the, first of all, the blockchain verified ownership of that. And then now you could have it in a video game and there would be the one glove that’s in Fortnite that you can wear. And you’re, oh, you’re the guy with the Michael Jackson glove. And then if you said if it’s on the Ethereum blockchain, maybe you can transfer it between games.

1:06:58 Exactly. And it starts getting really interesting and creative. I mean, what you guys have done in DeFi, that in the NFT space, I mean, there’s so many dimensions we can’t even conceive of right now. Yeah, it’s a metaverse. Like the way Moneylegos is a metaverse of a financial building box, in NFTs, for example, if there is a crypto-punk holders, I could tomorrow create a game that if you are a crypto-punk holder, you can actually come to the game.

1:07:23 Or same with, for example, Avagotchi, it’s a ecosystem project within the Ava ecosystem, and it’s kind of like similar to CryptoPunks where you have this kind of like pixelized ghost. They have different properties. If you deposit into the Ava protocol, you kind of like, I unlock those ghosts and then you can wear them and they have consumables and whatnot. Someone can create a game, let’s say, saying that if you have a CryptoPunk and Avagotchi, you can actually access the game and battle against them, You know, and it just opens new possibilities for developers for inviting communities, so you don’t need to create everything from scratch a completely new game, but you actually like, you just can create some base layer, one part of a game and invite all the assets there.

1:08:06 And that’s a way to boost up gaming community in your new game. That’s fascinating. What are the big mistakes happening in NFTs right now? Do you think? Biggest mistakes is that we don’t experiment enough.

1:08:17 I think that’s just like, There’s a lot of cool things happening at the moment, but we just kind of like, we should push more forward. We should try different things, experiment. And also, I think maybe one thing is that people are falling too much, it’s the same thing. Everyone wants to have a CryptoPong, everyone wants to have like, let’s say, some other kind of like collectible, but people should just follow what they want to do. If you like something else, just like, that’s totally fine and that’s interesting.

1:08:46 Like this concentration of like social capital is something that is a bit like boring me, but at the same time, it’s normal. You know, if your friend has Nike’s or Adidas, you know, you want to have two and you have this kind of like a formal there, but it can be also like a bit of like a dangerous and maybe not even healthy for your mental health at some point. So I could see like more of like seeing new things coming up and I love derivatives because that’s also like form of like flirting with the innovation and getting things forward, but I would like to see more experimentation.

1:09:19 This state of NFTs reminds me a little bit about what Andreas Antonopoulos said about email. And when he was on here, he said, most of our first experience with the internet was email. And when I got to MIT, they gave me an account at MIT in 1989, and it was like MIT.alumni.edu or whatever. And I got to send an email to my brother at Stanford and I didn’t use the internet for six years because that’s what I thought it was. And then in 1995, I opened up Netscape browser and I thought, oh wow, this is what the internet is.

1:09:47 And later I have a YouTube channel. So this is what the internet is. And now I’m seeing, you know, blockchain. Okay, I think maybe NFTs right now, we’re seeing JPEGs that we might not relate with and we’re thinking that’s NFTs, but that’s just very V1 or maybe V2 of NFTs. Exactly.

1:10:02 As it gets deeper and multi-dimensional, our minds will be starting to be blown with what these things can ultimately represent. Experiences, communities, meta-verses, all of these weird smart contract, accessibility, privilege things that are in these NFTs. Exactly. Essentially, it’s a way to build communities, boost up communities, building a social graph, what kind of NFTs people have and what they’re interested in and using that to reward the communities. You can reward people, you can reward all the, let’s say, crypto punk holders by, you know, sending out every crypto bank or letting them claim.

1:10:42 There was one project where there was one sitting from Berkeley, he created a project where every crypto punk holder could come and claim their crypto body. So you kind of expand the metaverse. So the next thing is like, you can, you know, adopt a crypto kid, you know, or something. You know, there’s like a lot of things you can expand the metaverse and that’s the beauty. As I mentioned, the beautiful thing is to create a protocol where you create just one component and let the community build rest of the functions.

1:11:09 And this is the exact thing, people will just build and build and build. And if you have one NFT, you have right to claim another one and you build this metaverse. And I think that’s the cool part of the whole decentralization. Yeah, I think I was looking at if it was crypto-punks or maybe you generate apes and every owner of one of the apes or the punks had a dog as well, it was like a dog you could unlock in the background that you didn’t know you had.

1:11:32 And that was all these dogs. Yeah, exactly. And then it goes down into the metaverse, all right, my grandpa just rolled over in his grave and said, yeah, but it’s just a black and white rock. So what do you say to that, Stanley, when someone says, but it’s just a PNG of a black and white rock? And it’s a million dollars, what’s going on here?

1:11:51 Yeah, people actually trade even signatures, that’s one example. But people also trade art that is worth millions and millions of dollars. And there’s even provenance where, you know, if some kind of like some person owned art before you, that is kind of like well-known curator, for example, that might increase the price when you buy it afterwards. The same way as if I own an FT, but everything is in transparent and immutable in a blockchain and verified.

1:12:17 You can verify that that signature came from a person of a publicly known account compared to, for example, a signature in a painting. Like how do I know that a Monolysa is actually done by the right person? or let’s say some other kind of like a thing, art piece. Essentially, everything is visual for us and we build the value, we people. The painting isn’t, it’s a beautiful painting, for example, but the value is because we give the value.

1:12:43 If you choose to give the value for signatures, the value is there. If you give the value to curtains, they will be valuable. I don’t know why a painting costs millions of dollars but curtains can cost millions of dollars. It’s all about where we direct the value as a communitist. Yeah, it’s interesting you say that.

1:13:00 I was talking about Ice-T, the original gangster himself, who was on the show last year. OG. Yeah, OG, and it’s one of my favorite albums. He’s a groundbreaker when it comes to his art, but he introduced his first NFT yesterday. And I looked at it and I thought, you know what?

1:13:15 I don’t know if I want that, but then I thought to myself, man, if I could have the original copy of New Jack City, that would mean so much to me as a person. And then I ask myself, why does that mean something to you? Because my kids would think that’s ridiculous. And again, it’s a piece of me in nostalgia, my DNA, my upbringing, and would I pay a million dollars for that? Probably.

1:13:38 So it’s like you start to see that maybe you don’t see the value in someone else’s eyes. But if you value it, clearly humans value things for various reasons, and this is a real economy. And we have that experience. So I had a friend who actually bought an art piece, like a painting of kind of like a butterfly gun, right? And the artist, at some point, like a few weeks, I actually was a couple of months before this event.

1:14:02 So what happened is that he created NFT of exactly the same piece, just an NFT, a picture representing the original one. And he has the original one in his home. So I bought the NFT version. And for me, the NFT version is the valuable one because it’s like signed by him and cryptographically that has meaning to me more. And he has the original one.

1:14:22 And he claims that the original one is better. I’m saying that the NFT is better. And recently, with the NFT experiment that I sold over $1 million, he basically changed his mind a bit in saying, okay, you know what? That’s something pretty interesting. So people shift value, especially when the NFTs start to pick up in value and price, because price is an indicator of how much value people are putting into something.

1:14:45 And if people start to put more value on cryptographic verified things, whether it’s JPG, where it’s like access to a physical object, it becomes like valuable. And that doesn’t mean that physical like paintings will not have value. They will have the value even probably more because people care more about art if they care about like NFTs. And everything is portable. I can show my collection.

1:15:08 Like yesterday I was showing in an NFT event here in London, like my whole collection. I have over I think like 2000 NFTs. Wow. I have on your MetaMask wallet or where do you have them? How do you show them? Well, I think how far is in my My dog’s MetaMask wallets. Well, it’s connected to the ledger But I go to a website where I can get my all my NFTs and then I have like a one Address, which I use also to buy because it’s more easier. I don’t need to connect the ledger So in the leisure a store the most valuable ones and then you know Then I have like a MetaMask which I just use frequently to buy things I never saw any NFT that I bought, so.

1:15:48 Wow. And so you’re showing someone on your mobile phone your NFTs. What’s the reaction? People are like asking like, what is this? They don’t get the cryptographic part.

1:15:57 They see pictures like it’s like showing Pinterest to them. If they’re not aware of the space, if they’re aware of the space, they just get like very, very excited. And they’re super impressed. Yeah. Yeah.

1:16:08 Isn’t that fascinating? So back in the day, you would have to have the piece of art on your wall, someone would have to come to your house. Yeah. look at my piece of art or you’d have to wait for them to ask about the art and then you could be like, oh, this is something I got and it used to be owned by this provenance and it cost me this at the Basel Art Fair and the artist is now dead because of his overdose and blah blah blah and you would show it and that would only happen what four times a year when people come to your house.

1:16:31 Now you got your NFTs on your mobile on demand. You can post the address on your Twitter. Someone can click through see you bought it on the blockchain and now in a weird way art has more value somehow because it’s digitized and on the blockchain. It’s more appreciated. There’s more followers and art actually has like cash flow.

1:16:49 If you go to like a museum and you pay for the ticket, you actually are paying to see things like physically. So you’re paying for like you could somehow like even calculate which painting people come to see. Like for example Mona Lisa is more attractive for obvious reasons and Mona Lisa might have cash flow more because people come to that museum to basically look at Mona Lisa, right? And that’s something I haven’t seen in an NFT space because you see everything publicly, but actually what you can do, people can come and sign.

1:17:18 Let’s say I saw this thing and I pay, let’s say, $2 for just like signing that I saw this thing. And someone else will say, okay, this guy saw this thing, pretty cool, but this doesn’t exist in an NFT space. But that’s an interesting concept that traditional art actually has even cash flow element into them. You’re thinking like the founder of a cash flow product and again like the transparency of the blockchain is an important point here because we can See potentially 28 billion dollars locked whereas before if you told me to quantify the modern art market It would be very hard right how much traded at the Basel art fair how much is owned?

1:17:50 We probably couldn’t quantify it and if you could see it It would probably surprise you as well especially some of the weird things that’s going on out there that people are selling But we can’t see it But now it’s right in front of our faces and people are saying well What about this and what about that? Now I wanna ask you the hard question because AVE was built on the concept of fungible tokens. The whole point of AVE means I can come with the Bitcoin I got from Max Keiser in 2013 or the one that was just mined last year and they’re all fungible.

1:18:21 They all can be treated as the same one and then I can come and lend and borrow on your protocol and that’s one of the reasons AVE is amazing. Now I have a non-fungible token, That means there’s one of them by definition. Okay, but I spent a million dollars. I bought yours for 1.3 million or 1.15 million and I wanna fund it because I need to borrow some money and I don’t wanna sell it and I can’t sell it because of liquidity. Now I go to a market that’s used to having massive amounts of liquidity because of the fungibility.

1:18:48 Now I’ve got NFTs. So how do you create a finance market around something that’s unique? It’s very fascinating because essentially like non-fungible token is just an asset that is kind of like, I mean, it’s particular assets. So you definitely can create a market like where that’s what we are working on about how to use non-fungible tokens as a collateral. And it’s kind of a different game because like it’s more of a game where, for example, Christie’s and Sotheby’s, if you want to sell some art, you go there and you ask for a cash advance.

1:19:18 Someone comes, appraises the work saying that, okay, this particular artist has done previous works that are priced on this one and during this market conditions, during this year’s. So we assume that this value is here and this might be the price it will be auctioned. And then we can give you a advance of 20%, 40%. So they’re usually very low loan-to-value ratios. When you look at non-fungible assets, stocks, for example, or let’s say cryptographic assets on the other protocol, there’s loan-to-value ratios between, let’s say 50 to 75.

1:19:55 And you can get more out of your collateral, but because of the liquidity and the markets are traded all the time. So here you get like less out of the system, but that’s because like there might be less activity of like buying and selling like liquidity. But the end of the day, it doesn’t mean that you can’t borrow against that asset. I mean, in UK here, it’s very common concept of equity release. So if you have a house, you have basically value in that house, you can actually unlock part of the value by getting a loan against your property.

1:20:26 So the same way you can do with an unfundable token. So you can’t go maybe up to the like one-on-one value like what someone will pay, but part of it you can unlock. And that’s already like a big thing. If you have CryptoPunk that’s worth $1 million getting two to $300,000 from that and being able to buy something else, it’s a big thing. Has anyone financed NFT?

1:20:50 Have you guys yet? Or what if it will, it would probably be a crypto-punk, right? Because it’s something that’s liquid, that’s fairly stable right now. I mean, will that be the first NFT that’s financed on? Yeah, definitely.

1:21:02 I mean, there’s already kind of like iterations of like NFT as a collateral, we have done it previously in some hackathon. So it’s possible, technically it’s possible. And the concept is like how the underwriter market will evolve. So practically in the beginning, people will have to underwrite these different kinds of NFTs. So let’s say I’m okay with funding crypto punks up to this level. I’m not okay of funding. Let’s say Board apes into this particular level or at all for example And then it’s interesting to see like how this underwriting market will evolve. Let’s say like how they will Determine like what they will actually like fund so individual underwriters. Yeah, will you create liquidity pools around entities?

1:21:44 I don’t think liquidity pools even is necessary because what we saw in OpenSea is that especially OpenSea getting more bigger volumes than Uniswap for example and all this like automated market makers we saw that you actually don’t need to create a kind of like a pool model unless like you want a bit of more efficiency but this kind of like a order book style of system would work very well. Right. So have a marketplace to start. Exactly. Yeah.

1:22:16 And then again, you can choose the exposure. Right. And maybe you only need 10 people involved to get a decent bid offer. Yeah, exactly. 50% loan to value.

1:22:22 A lot of people would say, hey, I’ll take it. Yeah. Give me half a billion on my crypto punk. Yeah. In financing.

1:22:28 It’s better than I’m getting now. Yeah. Which is nothing, I guess. Yeah. And the cool part about audiobooks is that it lets the market to decide everything.

1:22:35 AMMs is something that you need to constantly improve, like a version after version to get like the formulas right. But order book is like pretty much like supply demand, they will manage everything and that’s it. Okay. This has been super helpful. Final part of the NFT is this metaverse.

1:22:50 So when I keep hearing metaverse, I think about when I stuck on my Oculus and I bought some Oculus like a year ago and everybody here got an Oculus and we were all crazy about the Oculus for like a month and we took on the Jurassic Park thing and we went on the roller coaster and we went over Victoria Falls and I actually just like hanging out in the main room where it’s this super modern house that’s located in this place that looks like a cross between Rio de Janeiro and the Matterhorn. It’s just this really weird place with a swing. I find it really peaceful there.

1:23:21 And my wife watches concerts on it sometimes. She’s like rockin’ when I get home. But also I stopped usin’ it after a while. And I’m wondering, is this the metaverse or is the meta, and is this happening regardless in the next five or 10 years? I don’t game personally.

1:23:36 So when you start talking about Fortnite and your NFT, not only being something people can get of the physical version, but also the wearable version, am I just not seeing the point because I’m too old? Or is the metaverse really gonna happen for all of us? I think there’s sort of metaverses already. I think kind of like the concept of metaverse, we just like put too much of like highlight to it because essentially what metaverse is that, let’s say if you create a group chat, like every family these days has a WhatsApp group with, let’s say, or iMessages group with a few of people.

1:24:07 That’s kind of like a metaverse. It’s very limited. It’s limited to text, emojis, and whatnot. You might play a game like Fortnite. That’s a metaverse where you have, let’s say, 100 players, and they’re all doing the same thing and playing that game.

1:24:22 Then you might have more open systems where you can come and you can build things and an open game practically. Or you might have a metaverse like I’ve seen, for example, Gather, where you can create a virtual office and anyone can come with their avatar. So I guess the metaverse already existed for a long time, but we are making it like expand more, more visual, more kind of like three-dimensional. That is what’s happening. And why the tree is important here is that now how metaverse is built is built by, let’s say, Facebook and this big tech companies.

1:24:58 Accuse is owned by Facebook. They basically build not just the hardware, the software and they own the metaverse. But what Web3 does is that it takes the ownership of those assets and gives the ownership to the users and whoever wants to obtain the assets. And then you can highlight them whatever metaverse you’re using, whether you want to show a sticker in a telegram or a WhatsApp group that is an asset that you own, that’s metaverse. Or you want to show that sticker, It might be like a crypto punk. You want to like show it in a particular oculus driven metaverse You can do that as well So I think like metaverse existed always like in near future, but it’s it became more like Expansive at the moment, right? So a metaverse just by definition is just a digital communication Platform which could be like you said with more than more than two people potentially Yeah, it could be a group chat with emojis at a base layer Yeah And then it can grow into these virtual reality pieces, but the most important thing is not to allow what happened in the past in Web 2.0, which is someone else to govern the rules and the ownership.

1:26:03 Exactly, exactly. So the idea with Web 3.0 and Metaverse is that you basically open the whole development to everyone, so everyone can create alternative metaverses and compete the way you fork like calls and protocols, but also like you own the assets. So, you know, and by being part of the metaverse, you also govern it. So you bring these decentralized organizations there, DAOs and based on the asset ownerships, for example, and you can experiment. Gaming is the best places to experience things.

1:26:31 So I could imagine that not just experimenting universal basic income, but universal basic equity or land. Every player in the game could get a certain amount of more land over time, more cash, more something else. You can build a bank. I could imagine, like, in Oculus driven environment, you have a kind of like ATM teller where you can actually deposit into the other protocol. Those kind of things you can do.

1:27:00 Like the metaverse is just like an expansion of everything into a world that is beyond physical. And, you know, it doesn’t mean that the physical world becomes like less valuable. It just means that people have more breathing room in somewhere else as well. Do you think 10 years from now though, that we’re gonna spend a lot of our time plugged into a virtual reality machine? Depends how comfortable it will be.

1:27:20 Like, now it’s very difficult to spend like 10 hours. I’ve done like hours and hours spending in VR chat and elsewhere, but it’s just like, it’s still not so comfortable. When it’s like very comfortable and there’s also mixed reality, you know, like with the, you know, Ray-Ban glasses that came with Facebook, you can actually like have mixed reality in the future. And it’s just like, I think it’s a combination of everything I would say. It’s gonna be an interesting space.

1:27:46 Yeah. You mentioned ownership. talk briefly about ownership. I had Robert Leshner on here a couple weeks ago when your competitors compound and they were funded by Andreessen Horowitz, probably the biggest VC firm in the world. Let’s be honest, right? When it comes to maybe blockchain, but definitely in tech software is eating the world. Two very famous founders founded a bunch of things and they got that VC capital. You, I don’t think had any famous VC capital in your journey.

1:28:16 You built this in a homegrown manner and that’s a very, very different journey than having chunks of capital with introductions, with smart people, being in the Silicon Valley ecosystem. Tell me about that experience. Was that your choice? What benefits did it bring to you and what things maybe did it hurt you with? Yeah, I think it was more circumstantial because, for example, I was still pretty much studying in the University of Helsinki, finishing my law degree and I was always a technologist and I researched Ethereum and I didn’t have any kind of VC contacts back in those days.

1:28:54 And also kind of engineering in a very pioneering field, like Ethereum, everything is very early and what we were building was very early. And that was pretty much like the second after decentralized exchange, Ethereum, the second like DeFi protocol out there. So it was very, very early. And it wasn’t easy to get like, I sent you emails and tried to get like venture capital and try to contact some of the VCs in Silicon Valley, I didn’t get any response.

1:29:24 So I was thinking like, well, if you’re in an environment where we’re building decentralized protocols, why we can just decentralize the decentralized way, raise funds as well. And that actually worked pretty well for us because we got like community instantly. And the protocol and the stakeholders was already like the community. And this community followed us and kept expanding as we were building more and more new things. And I think that’s the advantage of decentralization that you don’t need to be, let’s say, someone from Silicon Valley with contacts, previous experience, done to three startups or whatnot and have this networking.

1:30:03 You can be just anyone, any part of the world with enough kind of like ambition, understanding what you’re doing and motivation to build something very, very cool. And that gets recognized by the community very, very fast. And essentially, it kind of like removes the need of even VCs in general, like decentralization puts every kind of like a person investor in the same level in the sense that anyone can participate. Of course, it’s challenging from the regulation perspective still, but that’s kind of like objective.

1:30:37 Now, I think I’m venture partner in one of the VC funds and at the same time, I’m doing angel investments. My idea is to give back to the ecosystem as much as possible, support projects that I really, really like, whether it’s like DeFi, NFTs or something else. But I still think the best thing is where there’s no kind of threshold to support projects that you love, whether by using them or by investing into them. And I think that’s the kind of opportunity that has to be offered to anyone.

1:31:10 So if a kid from, let’s say, from small countries in Finland can basically do this and create the biggest protocol out there, anyone can do that. And I think that could be an inspiration for everyone who is building in Web3 to do what really want to do and like aim for big. One could argue the reason you’ve been so successful is because of what you just said because you built it from the ground up leveraging the community using not only their capital but their support to create this protocol that now is number one in the space. Maybe VC almost by its definition is web 2.0 isn’t it? It is it is and it’s kind of Looks like VCs are maybe in the web tree space because of the fact that there’s so much on clarity on the migration side, so it’s easier to sell, let’s say, the stake of the protocols first to VCs and then build a protocol and whatnot, so maybe that’s the reason there.

1:32:12 Maybe we’ll see the same thing as more and more NFT projects come and NFTs are becoming like kind of like difficult to give to the community, maybe that will be the same path. But essentially it’s very verb two thing. And I think kind of like the verb three model is that if you’re a user, you should get upside. If you want to be a stakeholder with any background, you should be able to do that. So definitely like, I would say like a VC is disadvantaged in the future than advantaged.

1:32:39 For example, if you have a VC firm like A16Z, which I like their work and their visionary, things they’re doing and write things. It might be even kind of like a turn-off when you have a bigger VC like that, and then you have the community, because it’s very difficult to line those kind of like a community and VC incentives, in my opinion. Yeah, you could argue it’s impossible. I mean, again, I’m a big fan of Andreessen Horowitz that creates some great products, great visions, great, great, amazing ideas in the future, and they build a great ecosystem, invest in a lot of companies, But their model by definition is, let’s create the most amount of value in equity so we can make money and the founders and the equity holders can make money.

1:33:26 That’s the business model, right? It’s not about the community winning. Of course, usually that all happens too. I mean, they give a great user experience. But it is maybe an anachronism in that sense because it came from a world where you had to get hard to get capital, right?

1:33:41 They’re ignoring your emails. They they are access and then also they have this model which you say well, it doesn’t matter They’re just gonna give they you know Ten million euros and take 20% of the company and leave him alone But you know, there’s always this weird pressure of web 2.0 of let’s build it bigger And do we have to give the community so much? Yeah I think like the like the model of VC is maybe that can work is something where VC is built together with the the founders That doesn’t mean that they give funding and they are developers, but they actually contribute a lot.

1:34:18 So, we’ll see more of this work contribution there with experience and everything. Because the very traditional thing for VCs is to say that we will have everything, we will give connections, and we will brainstorm. But the actual amount of work is quite small because VCs are structured in a way where you focus on capital allocation, finding projects, Just finding projects and managing portfolio, looking at how things are going. But if you actually have a bigger departments where you allocate resources and build things together with these protocol founders and allocate resources and you have people to help them with designs, with the building and software and like more hands-on, that will be maybe the model where this is cancer-wide and yeah, maybe that could be the way.

1:35:05 Okay. I know you have a law degree too, which is good because I want to ask a couple questions around that to the standing That’s watching us right now. Who’s the 2016 version of you, you know how or maybe that 17 version Maybe they’ve started a dap or about to start one and they want to get into the space They want to become you know you in some way shape or form or build something as important as Abbe Did you tell would you suggest that they raise capital via equity via token?

1:35:33 And obviously, sometimes that can get you in trouble in certain places via token. I had Dan Morehouse of Pantera Capital on, and he said, Brian, there’s quite an arbitrage relationship between the equity markets and the token markets. I think his latest blockchain fund actually takes advantage of that because they can buy one on the cheap and sell one when it’s expensive because he said term sheets sit around for six months and things don’t change and the token economics, well, the tokens can change in real time.

1:35:58 Exactly. I don’t know if that’s a good or bad thing that they’re arbing that or not. But what advice would you give to that 2017 Stanny as far as raising capital because you will need probably some capital? Yeah, I would say like the best thing also whenever you’re building anything is to kind of like find like-minded people. So share what you have and I think that’s the kind of like being able to build things open fashion and finding peers, that’s the first thing.

1:36:22 If you can find peers and just buy your work, fund a project, build a project and then give the project to the community, that’s the best way. Like there you don’t have like kind of like too many moving components, fundraising or whatnot. But if you need a fundraising, then pretty much like you need to think like what components you need to build. Do you actually need to build the whole thing? Because in some cases you actually need just like maybe one to five percent to build of the 100 and then basically give it to the community and then let the rest of the community build rest of the parts.

1:36:57 I think the biggest mistake is when you want to build a monolith, a big kind of like a protocol that then you need a lot of capital and it’s intensive and that becomes very tricky. So going towards community building is the way. But then again, if it’s not possible, then of course you need to raise funds, you need to find a way how you get more stakeholders involved. Because VCs aren’t bad, especially VCs who are active in governance, A6DNC is active in governance and many other VCs out there, I mean, variant, ideal fund, and they support this ecosystem.

1:37:34 So in that sense, you definitely need to reach out. But I would definitely say that the best way to go is to go direct to the community and let the VCs follow. Let people who want to then back you follow your vision and prove their kind of worthiness. That’s the way to go, in my opinion. And if that’s not possible, then maybe you have to go.

1:37:55 But at the end of the day, I would just find peers to want to do the same thing as you are and build it without capital. Okay. And also capital potentially from community or via tokens as well. Yeah, exactly. And then allow them to appreciate the upside as they build their part of the community, they own the tokens, etc.

1:38:10 Yeah. And you govern the protocol together with the community. Okay. Regulation, obviously, you have a law degree, we just saw, we heard that the SEC is potentially suing Coinbase over their lend protocol, which I don’t think they put in place yet, which I think was to give people our interest on stablecoins. I think it was there 4% for USDC or something.

1:38:31 Now, we don’t know the details. Apparently, Coinbase doesn’t even know if it’s true. No one knows what’s happening, but we definitely see potential regulation and legal issues with some of these DeFi protocols. What’s your take on it? Also, you know, what’s your take on it the US versus global and how does it change what you do every day?

1:38:51 I would say like in terms of like regulation like Regulation is always good because like the the thing is like regulation might have different kinds of objectives and we come from a financial system where Whole the finance and economy is based on middleman so for example, you might have you have banks your financial institutions and you have this trust network like and And the regulation is there to protect, let’s say, consumers, it might be consumer protection, investor protection. And first time ever in decentralized finance, what it brings is that you have different kind of economy now. You don’t have intermediaries, essentially what you’re doing as a DeFi user or let’s say NFT user is that you are interacting directly with a piece of code that only can execute in a way that it’s programmed.

1:39:40 And you also govern that code infrastructure with your peers in the community. So it’s kind of like a different approach where smart contracts by default is regulating. And the communities are regulating. So the communities are designing what are the best rules in this community. And there are other communities are applying different kinds of rules where users can go to.

1:40:01 So we are completely like a paradigm shift from what we have in before to where we are going towards. And so I always say that smart contracts are the best rec tech tools out there because smart contracts ensure that you have certain kind of actions there, functions that can be called and they can’t be changed or the changing is difficult or it’s based on the community consensus, which actually means that you can remove this kind of like issues when you need to trust intermediaries and you need to regulate how the intermediaries go and supervise them. And then at the same time, smart contracts are also in public, blockchains are transparent, which means that you can actually audit what’s going on all the time, every second.

1:40:44 And this is like a very interesting new environment we are in. And when it comes to like Coinbase’s and this kind of like a centralized providers, they challenge now is that they kind of have like cryptographic assets, which are like, like Bitcoin is decentralized, Ethereum is decentralized, and they’re providing yields, but they’re like centralized entities there in the middle. So they’re like kind of like trying to figure out like if we are providing, we’re taking the custody in the way we used to do in the old economy, but we’re providing yield on a like decentralized ecosystem.

1:41:16 Like where are we sitting actually here? Because let’s say Bitcoin is decentralized Ethereum and whatever is built in Ethereum that is governed by the community or is immutable is in the same situation. So the question is like what happens to these middleman’s and how the regulation involves? So clarity for regulation is actually very good and welcome in the space and that helps actually everyone to see here. The problem with regulation is that what if people who are setting the rules do not understand what’s being built or what’s the innovation is here and kind of like creating bad regulation.

1:41:53 So as a lawyer, I know with a law degree, I know that you can create good law, bad law as well. It’s not because they’re bad policymakers, but the process of actually understanding the information is a very difficult game. So you think Brian Armstrong should leave the lending to you guys and stick to his knitting? No, I think he should pursue it because I think he should do whatever he thinks is right to do. I mean, if Coinbase’s idea is to create yield to hundreds of thousands or millions of users where they didn’t get before, I don’t think it’s a bad thing, especially if Coinbase is a trusted entity in the sense that, yes, Coinbase, for example, they cost 30 funds, but they have proven through a trigger that their company that is traded publicly, they basically have earned this trust.

1:42:47 So essentially like providing yields to their users from like kind of like a social-economical perspective is a good thing for users. So I think Brian like kind of like coming to the public with this and recently even BlockFi, I think it’s very brave, but it’s also like creating discussion of where we want finance to go in the future. That first version of the infrastructure bill in the States, I think would have typified all the DeFi platforms as brokers or something and almost required you guys to file reports on every transaction, which from a decentralized platform like Aave or Uniswap is impossible.

1:43:29 So how do you feel when you watch these bills being debated and you’re thinking about what’s our future and how do you deal with that and how do you move with that going forward? I think what’s important is that we always kind of like as a community, we voice out different kinds of opinions, especially because like, if you have this kind of like a big bill coming in and there’s different parts that relates, some might relate into cryptocurrency, but if you have this big bill, you know, those details aren’t for the policymakers that clear, you know, what is the ecosystem and what’s going on, for example, DeFi, NFTs, it’s a very new thing. I think the next year, for example, we’re looking to NFTs and looking into what we have actually, what is an NFT and what kind of like an implication might have in terms of regulation and it’s just like important that everyone in this space is very vocal on like kind of like their stance because that helps this kind of like activism. The same reason you for example run for a mayor like because you want the changes in the in the society and you want to make a difference and ensure that kind of like people who follow you their voices is basically heard. And the same thing like I think everyone just needs to be vocal and be kind of like activist. And decentralization is cool because in decentralization, these protocols are governed by these communities. So by nature, we’re raising kind of like an ecosystem where people are active

1:44:52 And urged to be active. And this just creates better societies when there are people who are active in voting, governing protocols, governing matters that are important to them, or delegated to someone they, for example, trust or align with opinions and policies. And this creates just just better societies end of the day. One of my guests said it was the best piece of free PR the crypto community ever got was some 70 something year old senator from Georgia on the floor of the US Senate bill or Congress talking about crypto is that it was actually a win even if the actual intricacies of the bill seemed if they were enacted to push us backwards.

1:45:32 But having the conversation and also for those politicians to know they had voters that cared. And again, I’ve ran for politics. Politicians care about two things, votes and money, right? And crypto has both of those things. So do you think that was actually a great PR piece and a great awareness piece for the crypto community?

1:45:48 And do you think they will listen going forward? I think every single voice will be listened more or less. I think it depends, of course, on the audience, but raising the concerns will always kind of create discussion and spin up new conversations. So it’s like narrative. So there’s always someone who creates the narratives and continues with the narrative.

1:46:06 So every single voice counts in my opinion. Okay. Avalanche, you launched a big kind of a co-development with them or you kind of are partnering with them on their protocol going forward. And again, I think we’ve got the CEO coming on in a couple of weeks from Avax. Talk about that and how do you choose the new kids on the block?

1:46:28 How do you prove who is going to be the people you want to partner with going forward? I mean, you see things that most of us can’t see. A lot of people out there on the streets and the taxi drivers I ride home with, I mean, they’re buying crypto on the back of somebody recommending it, let alone due diligence, let alone knowing what’s happening behind the scenes. How do you make a call on Avalanche? What are they doing that’s interesting?

1:46:50 How do you evaluate a DeFi protocol? Yeah, I think like in terms of like, usually like in terms of like this, I would say like kind of like ecosystem that are growing, it’s up to the like community to kind of like start talking about them in the forums publicly or in crypto Twitter. And then you start to see like a consensus where things are happening. And usually in one way, the other community is in one way, a bit of like an early mover. So you see like with the polygon and now with the avalanche, but there’s already some ecosystem being in those places.

1:47:27 For example, in Polygon, there was already like a substantial gaming ecosystem, NFT ecosystem, and default was just missing from there, and the community wanted to go there. And essentially, like it’s other protocol, it’s just set of smart contracts. It can be deployed anywhere, which supports EVM, Ethereum Virtual Machine, which is like supported by the Polygon and the Avalanche network. Essentially it can be deployed elsewhere. But for example, if you have a blockchain that doesn’t have EVM, then you need to move from scratch and then it requires sort of work.

1:48:02 So it’s essentially it’s up to the community where things are deployed. And for example, what Avalanche did, they distribute incentives for the, not just the other users, but let’s say other protocol users in their ecosystem. So they kind of like partner with the community and invite the community to use Avalanche, which is, in my opinion, a very interesting way to kind of like attract people to use your network. incentivize and give them the upside and the tokens and all right, and so you were impressed with what they were doing.

1:48:31 Yeah. Yeah, especially like I love teams were technically kind of like building a lot of things. And now we’re seeing like that we see more and more talent coming into the space. So many of this network actually has a lot of good developers in the network itself, but also within the ecosystem. And I’ve never seen so much talent coming from Big Tech to Webtree Space and, for example, last week I did three hires and one of them, for example, was from Apple and one from Twitter.

1:49:01 So it’s just the Big Tech talent is recognizing what’s happening and they want to come here as well and build things. Is it hard to hire people right now? No, it’s very easy. Well, that’s because you’re you, you’re you, you’re standing from Abe. But it’s because it’s interesting because, like, essentially, when you come from Big Tech, You come from an environment where you as a company harvest the data and use the data to sell services and products to those users.

1:49:27 But now you’re inviting the builders and soft skills talent to build things where everyone owns their own assets, they can decide what they interact with, and you build decentralization community-owned protocols, and you’re just part of the whole movement. It’s just like so big value proposition plus the incentives so that, you know, it makes the Web 2 look very, very bad. Yeah, we’re making it look pretty bad right now. What are you excited about as far as layer one solutions out there?

1:49:59 What do you make of Solana’s, you know, sudden rise and any other protocols that you got your eye on? I’m most excited maybe a bit also like Solana is interesting and been following that movement for a while and a bunch of course. But what’s interesting is the layer 2s. So what’s happening with Arbitrum and Optimistic Rollups, because they sell their transactions into Ethereum, the main layer. And that’s an interesting way of taking traffic out of the main network and still using the main network security, but bashing the transactions periodically.

1:50:35 Arbitrum did a very, very cool launch. And I think Optimistic Rollups will come as well. I’m following those like most kind of like excited at this moment. Yeah, okay, and if 2.0 is coming When you’re gonna make a prediction for us? Yeah, it’s hard every time I get it wrong. I think in the next 10 years I will say But we don’t need it necessarily. Yeah, such great work going on with layer two solutions. Yeah, exactly It’s just like changing the consensus from proof of work to proof of stake, which is kind of like ecologically quite powerful, I would say.

1:51:09 Right, and that will change in the future to proof of history and a variety of other proof protocols. Yeah, exactly. Tell me about you, Stanley. What is your single biggest challenge right now? I know you said you’re building out the offices in London, New York, maybe Asia, but what’s your biggest challenge?

1:51:24 I would say the biggest challenge is as obvious growing, how we ensure that we continue building things in a very decentralized fashion, in a way that how we can add more transparency on what we are doing, how we can actually build things in a way that we can experiment more. So we don’t need to build four protocols anymore, like how we can just build one small building block and let the rest of the community to build the ecosystem and manage the community and everything. Like how we can go forward from here, being something like Google, doing it very transparently and just experimenting things and letting the community actually build the other important parts and leaving a lot of space for the community.

1:52:08 And it’s not an easy thing to do when we scale. And especially kind of like we used to be 15 team members a year ago and now we’re more than 70 and we probably will be close to 100 by end of this year. So it’s definitely like a challenge as we grow as an organization. What was your worst day at Aave slash East London the last four years? I think when the market crashed and there was a lot of liquidations and kind of worrying like how all these protocols in DeFi will, how the resilience will work, but end of the day it worked pretty well.

1:52:43 I mean, I was up until I remember I flew into Helsinki, Finland to meet my family and I just saw Ethereum going down in price and all the assets and I was just kind of thinking what’s going on and I think we’re up until like 6 AM or something before I went to sleep for an hour and wake up again. So those are one of the crazy days. I think that was kind of like a tough day for me personally. But I see that the technology worked. All these protocols arrived and they’re resilient for that big market movements.

1:53:20 And crypto is the most volatile asset out there, so that’s kind of like class. So I’m pretty happy now. Black Thursday, March 12 last year, what is your job as the CEO of Aave on a day like that? And what can you do? You can’t do anything.

1:53:36 You can just look how like whatever you design and build with your team and with the rest of the community, how it plays out, like you can’t do anything end of the day. And you can just watch the liquidators kind of like biting those collateral positions and keeping the market solvent, you can just like, it’s kind of like watching, you know, some sort of like a, I don’t know, like a horror movie. That’s already been like with its own smart contracts, right, so you just have to watch it and hope it works out the way you designed it.

1:54:11 In some ways, it seems like you might have to turn into more of a politician in times like that. It seems like that would be a great time for you to be live, you know, on a program like this and just say, look, this is happening. This is what we built. We believe in these. This is an important stress test for the market in the long run.

1:54:27 And I advise everyone to remain calm, right? Cause that’s probably what you wanted to tell people, right? Is that like part of you think a leader’s job in this space or do you just kind of have to let the market do its thing? Yeah, it’s kind of letting the market and letting the community do its thing because you don’t want to be like in the kind of like community as a big voice anyways because you want to keep building things and let the kind of like more governing actors to govern the protocol, be more vocal.

1:54:53 I mean, people are active, of course. I mean, it’s something that you’re built, but essentially what you want to do is kind of like focus on building and part of the leadership is just like how you can get more talent into the space, at least like for me personally. How do you build safe things, high quality protocols, and then just like get more like people who are interested in governance to govern those protocols end of the day because that’s decentralization is all about.

1:55:22 People don’t care about listening to me or Vitalik talking, people do care but you know the sake of decentralization people care about like what is the consensus and what the consensus says and that’s why decentralization is very nice. It’s an interesting space because people wanna hear Vitalik speak and he doesn’t talk that much. Yeah, which is good. Which is good, Charles streams live on YouTube once every few days. And so, you know, people listen to him, but the whole point of even what he’s building is to take him out of the equation and to take people like you and your opinions out of the equation.

1:55:57 Which is good. Yeah, which is good. But people always kind of want a leader, right? They want a sports person. So it’s a fine line.

1:56:03 Yeah, and I think like people could have like units leading. So you might have like, you don’t always need one person, you can have like practically some sort of like a part of a DAO that might consist of leadership and you don’t always need to concentrate on one particular person. I want to lead in ways like how I can educate more people, get into the space and get more talented in the space and people to build more. That’s like my leadership, but basically how to govern a protocol that’s somewhere where I don’t want to be a leader.

1:56:37 I want people who are actually doing research constantly on those topics will participate Understand the risks of how these protocols are built and then you know take the initiative there So I’m more of a like a fellow than anything else. Okay, I’m gonna ask you a question I asked Sandeep CEO or COO of Polygon a couple days ago What’s it like to suddenly be rich and to have more money than you ever have to worry about the rest of your life? How does that change you and did it change over time when it happened? Well for me, it’s kind of like Like my kind of wealth is in more like in crypto wealth.

1:57:15 So I don’t have like wealth in fiat, almost like nothing, practically. You could always borrow USDT. Yeah, exactly. And it’s kind of like numbers to me, like you don’t see the same way, like you might shop more and you kind of it gives freedom to build things. That’s the main focus point.

1:57:33 But I think like there isn’t like an amount of money that anyone actually needs more than Because, for example, the concept of billionaires, do we actually need people to have billions of dollars? Because every single dollar that you have, someone else is short on. When you’re a longer dollar, someone is short on. Is that true, or is value created? Value is also created.

1:57:54 And that’s the part of the whole NFTs and DAOs, is that because you create DAOs and you have NFTs and social capital, first time ever you can put a price tag on that social capital. In a way, for example, if you are a member of, if you have a crypto-punk, crypto-punks have value, you’re the community member, that’s social capital there. And you can basically put a price on it. And previously, like, for example, if you’re a good donator, there’s no social capital, you don’t get anything out of it.

1:58:24 Maybe some countries you get like tax breaks, but besides that, you don’t get any kind of like a, you know, that social capital activity isn’t like quantified in any way. especially in a way that is tradable somehow. So I think essentially, I’m more about into financial inclusion and how to scale this to everyone. So people can actually build things, focus on creativity and jobs that are interesting and doing that on a full-time basis and kind of like how we can remove the jobs that are necessary in the economy for creativity and how we remove the idea of like, you have to work to do something that you love.

1:59:09 How you can actually do something that you love from the first day, and you’re financially able to do that essentially. So that’s something that I’m researching now quite a lot. So the idea of a billionaire bothers you because you’re thinking if you distributed that capital to potentially thousands of other people, they could be productive in the community doing something they love and add value. And when it’s all around one person, it somehow seems maybe partially wasted.

1:59:34 Yeah, somehow I feel that way. I think you might have a point there. Also, you come from this blockchain world where you can distribute it so quickly and frictionlessly and you’ve seen the communities build only on the back of a good idea. You’ve seen people kind of grow wealthy in the back of that. So you come from this world.

1:59:50 Yeah, exactly, and also I come from Finland. So if you have any upside, it stacks very aggressively. So kind of like I’ve seen in it. And also like, which is a good thing because you have free healthcare, you have free schools and like a lot of things and Finland are free, which is not like for granted in other countries. And I’ve seen like basically when everyone has equal opportunity, like you become more creative and you can build things and you have less worry about finances and how to scale that globally, that’s the kind of like a challenge and maybe, maybe like blockchain cryptocurrencies have a like very big place in that actually making it happen.

2:00:27 What’s Finland like, what’s grown up in Helsinki like and what kind of Finnish characteristics you bring into Aave and the ecosystem? Because there is a Finnish feel here, right? Well, the name is Aave, it means Ghost in Finnish, which kind of means that, you know, when we deploy things into the mainnet, you know, we become a ghost and everyone is kind of a ghost because you don’t need like a team to run, it’s community-based. But I think people in Finland, they are quite kind of like an honest, so you’re honest and direct. But at the same time, we’re required. I guess it’s because of the coldness and the darkness and the winters.

2:01:03 But also, there’s some sort of focus on innovation all the time. I mean, I went to university, I sit in the same classrooms where Linus Torvalds sit when he was creating Linux back in the day. So Linux is from there, it’s the biggest open source, kind of like I would say like project, MySQL, one of the biggest open source databases, like there’s sort of innovation coming out of Finland. But I guess like why I’m here in London is because of like there’s amazing concentration of talent.

2:01:37 And I would love to see more like Webtree talent coming here because there’s something to be said about like physical presence and being able to brainstorm ideas with your team members and just build better protocols for the future. They just need to say kind of like a physical presence of the whole team and you’d like to people see people here as opposed to Silicon Valley. Totally. Okay. Yeah, because I think like it’s too much of concentration and I think like concentrating opportunities in the one place isn’t necessarily good what I loved about the concept of like Silicon Valley is that you concentrate talent So you could go there and you can quickly hire a lot of people who are hungry for innovation and building things But I think you should be able to create this kind of environments a bit like in decent less fashion across like the whole globe.

2:02:24 And I think it will be cool to see like London taking a step here. And that’s what we’re doing at home. We’re pretty much relocating a lot of talent to here internally and when we are hiring and those who are actually remote because we’re also like not only like we have quite flexible startups so you can work remotely as well, but we fly in people here to actually work together on new challenges of Web 3. But I could definitely see that London is in unique position of actually getting talent into the country and also building future Web 3.

2:03:03 So definitely it’s a unique place to be. And physical space is important for you. You’re building one out right now. And even though people have the option of working remotely, it’s important that they all come to the same place that has the feel and the spirit of the company and connect with each other. That’s important.

2:03:19 Yeah. Yeah. The physical space, it can be like an office. It can be a pub. It can be anything end of the day or team retreat.

2:03:26 The idea is that the old kind of type of office work disappears and the idea is to create any environments where you are inspired to come up with ideas. That might be like an, it might be an office desk for some people, but it might be just a room with whiteboards and some interesting music and interesting smells. And that inspires people to build things or some energy drink, I don’t know, anything that makes people to inspire and excited to build things.

2:03:56 Yeah, I got to get some of those rims. I really do because it’s an important point. A couple of final thoughts, London as a fintech capital has done really well. And I used to have a separate show called Silicon Reel that I had about a hundred to the top CEOs in FinTech and tech back in 1314 many of them gone on to be unicorns back when that was a big deal to be a unicorn now it’s not especially in crypto but you know London I don’t think has ever been able to punch at its weight or above its weight it’s always been the stepchild to the Valley yeah it’s never been able if I’m very honest to think big enough yeah to access a big market like America that allows you to think big I don’t know. It’s it’s maybe been a mentality maybe a capital maybe a talent thing But it’s I don’t think you could argue it ever even punched at its weight I mean, this is a major global city. Yeah with incredible talent in Europe name the massive startups that have come here It’s probably 1% of the ecosystem. Exactly. It should be 20% and I think it’s lack of leadership because I can Silicon Valley you have like thought leaders and you have pretty much like you have big companies there but they’re actively like actually creating like a cultural creating ecosystem there and sharing thoughts like I think like we have talent here and we could bring a lot of talent into London and big build scalable startup you can scale very easily here what next here

2:05:19 Is that we don’t see actually the like kind of like leadership and guiding people on how just to build in the future but like what what the society look in the future and actively participating and kind of like creating these communities and making them very accessible. And I think that’s where the kind of like thing, for example, when we look at all the like where, when we start to scale more and more, like how we can actually create leadership and how we can actually be impactful, what we’re doing not just in London, but in general, like you don’t need to write a playbook on how to build a, you know, build a startup in London, you have you can write a playbook, like how you can build something like globally very impactful but it happens to be here in London because your team is here and the culture is here and there’s sort of excitement and that’s the way to do it in my opinion and if you get this leadership will get people who are inspired to build things then things start to move good you’re gonna be one of those big leaders I hope so I think so and you’re all in on London you’re here to stay right I’m here to say yeah good me too I like this city so much I need my show after it so I agree we need more thought leaders, we need to not lose them to the Valley and to the States.

2:06:30 We need to just do bigger things. You come from an interesting space, where you come from a space that’s already global and massive and almost thinks big by definition. And so in a weird way, you have to kind of lower your head to get into the door, you know, a little bit when you come into this world here in London because you’re already thinking so big, I don’t know. And so maybe you can bring some new perspectives to it. Yeah, and if you make other people think big, That’s how you get big things achieved, I think.

2:06:56 Yeah, it is a mentality thing. I always ask a few questions at the end. I’m gonna ask you, if you could pick up a phone and ring up the 20-year-old, Stanley, and give that young man some advice, what would you tell him? And what year was that, by the way? One year, was it like 2009, no, 2000,

2:07:17 Would say 11 or something? 11, all right, so still early days. You haven’t gone to law school yet, to this point. What would you tell the 20-year-old based on everything you know now? I would say just kind of like do more research, you know, like learn more things.

2:07:32 Maybe learn more culture, I would say. Like kind of like I focus always on like career and you know, like innovation and you know, left always like a culture a bit on the side. I would just learn more culture, more arts, more sciences, especially more art, I would say. You’re catching up with your collection, I can see. On that second note, best advice you ever received, could it come from a parent or a professor or maybe somebody in the crypto space?

2:08:02 Was there something, you remember someone telling you something that was a powerful piece of advice? Nothing specific, I would say. I think best of advice I probably get from my actual partner, like my lifetime partner. But then, of course, also I get a lot of advice. It’s not necessarily to actually like the startup itself, but it might be just like things in life in general that might help and get a lot of good advice from my dad.

2:08:32 And I usually kind of like ask advice from people, like ask opinions and that’s very helpful. And a lot of good advice comes from inside of our team. You know, we help each other, we build similar things and we kind of are in the same boat and that’s been like very helpful for me. Okay, last part of that question to the 20-year-old that’s watching us now, listening to us. Again, my 17-year-old daughter was here recently and she just got in the crypto space.

2:08:59 So maybe it’s a 20-year-old that maybe owns some crypto, maybe doesn’t, obviously is on social media and digitally consuming things, looking forward to a future. What advice do you give to them about this space or their life in general or finance? Like what do you tell the younger generation? I think like whenever we find something exciting, like sharing that with someone else, like basically with friends and everyone, Like we tend to kind of like find cool things but you know, we’re not so eager maybe sharing things and if you find like the web tree space very interesting, what could be interesting is that you share with others, with your peers and educate people because at the end of the day, everything boils down to education.

2:09:38 It’s so against human nature sometimes to share, isn’t it? I mean, I have two boys, they’re four and five and try to introduce the concept of sharing. They look at me like I’m crazy. When I first started London Real, I came from a banking mentality, which was you eat what you kill. And if you make money, it means I didn’t make money.

2:09:57 And so I remember, I had to just change my mentality. I used to call it peace and love in London Real is what I would say. Because sometimes a guest was coming over and they said, the BBC wants to come over beforehand and interview me, can we use your studio? And I thought, my first reaction was, I don’t know, that’s our competition. And then I thought, this is a new almost sharing economy.

2:10:20 I mean, the podcasting was this open source, open source. And then, you know, Joe Rogan, one of the original podcasters invited me on his show and I thought, well, that’s quite anti-competitive. I mean, he’s just trying to get the best people on with the best ideas. He encourages everybody to start their own podcast. So it was a weird paradigm shift from coming in this world of scarcity to this world of sharing and abundance.

2:10:42 And as humans, you almost have to kind of check yourself because it’s not always the default, but it always results in the bigger win, doesn’t it? I think so, yeah. I think so. And I think you guys are proving it with what you do now. So, Stanley, I really appreciate all the time.

2:10:56 I also appreciate having a human in this studio. For nine years, I probably had conversations with humans, and then last year, unfortunately, we had to start doing these remote interviews, but they’re not the same. So I appreciate you coming here, incredible ideas. I’m so excited for the future of Abe. I’m so glad you’re gonna be one of these thought leaders London we need them and I appreciate everything you guys have done it’s super impressive all my Academy members are watching now I’m sure and they’re just excited but um I’m pumped for this ecosystem for me to ten twenty years I couldn’t imagine wanting to be in any other place in history right now could you know is this the most exciting place yeah I think this is amazing and I so like I try to enjoy as much as we can like I focus on building things but when When I can, I try to enjoy it as well.

2:11:42 Yeah, that’s good. Any final thoughts from you, just to anybody listening or about the ecosystem, anything? I hope people kind of like experiment and just like if it’s the first thing they hear about like crypto and the pre just like kind of like learning more and spreading that education and just like embracing it. That’s all I have to say. Yeah, I think it’s good advice.

2:12:06 The best way, start small, you know, own a small piece of an asset, finance the asset on your lending platform, and that’s the quickest way to learn. It’s usually a little uncomfortable, but it’s like the fastest way to learn, and again, this web 3.0 concept’s important, you know? Yeah. Peer-to-peer, let’s start kind of owning who we are. Exactly.

2:12:28 And it’s a beautiful paradigm shift, so. Until next time, I think you should come back here regularly and give us the state of the union, and we’re taking bids right now for the NFT of the hoodie to wear for one week and there’ll be a virtual version as well. Perfect, yeah. Awesome. Danny, thank you so much. Thank you so much. Appreciate all of you and we’ll see you next time on London Real. Thank you so much. Alright, thanks so much. Thanks everybody. We’ll see you. Bye. Thank you.