Tyler Spalding - Why Decentralisation Will Bring Huge Value And Freedom To Our Finances

Full transcript: Tyler Spalding on London Real

2:39 This is London Real. I am Brian Rose. My guest today is Tyler Spalding, the technologist, software engineer, entrepreneur and blockchain investor You’ve spent the last 20 years innovating, investing in and developing new technologies Along the way, authoring over 50 patents and working on the NASA space shuttle program, you were an early Bitcoin adopter in 2011 and were heavily involved in the first wave of cryptocurrency investment in 2018. You co-founded the payment network Flexa, which makes it easier for retailers and businesses to accept crypto payments using the AMP token, which now has over a 2 billion dollars in market cap.

3:13 Tyler, welcome to London Real. Thanks for having me. This is going to be really exciting. Nice to formally meet you, Brian, and looking forward to the conversation. Look, I’m super excited.

3:24 We also share a really weird background. I study mechanical engineering. I actually worked at the Aerospace Corporation for two summers in Los Angeles before I actually took a bunch of finance classes at the Sloan School of Management. For people that don’t know, Tyler was also mechanical engineer to aerospace, and you also, I think, spent two years at the Sloan School of Management as well. You know, when you look back on those engineering days, what do you remember?

3:50 Do you miss anything about it? You know, I know you were working for NASA and all that stuff. What do you remember? Wow. So, that question, you can get at the heartstrings.

4:00 So the short answer is I miss it deeply. But I have managed to cope. So I guess I’m just an engineer completely an engineer by trade. So as much more in hardware, aerospace, mechanical as you mentioned, and so I think working at NASA and being able to, you know, put vehicles up into space and meet all the astronauts and feel this, like intense pride with your work is something you really just can’t accomplish anywhere else. So I passionately missed that.

4:31 Absolutely, love it But I don’t have any regrets, and the main issue is that when you’re working on these large-scale projects, you know, I worked on, you know, the Mars crew module which might go land on Mars and take people to Mars in a few more years maybe, and that was actually in 2007 2008 I was working on that. So the time scales are just so much longer, and then when you start getting into software and now even in a completely exponential world of crypto you can, you know, make changes, life-altering changes, in a matter of minutes, days, weeks, and so that’s really what kind of drove me more in the software, but as a, like, kind of a deeper engineer I do miss some of that analysis and working through that for sure. But it’s definitely evolved into something that I’m really equally as proud of, and also just kind of solving some really large-scale problems, which is exciting.

5:26 Yeah, you’re giving me flashbacks because, you know, when I was at MIT we had a four-year degree in mechanical engineering and one of the big classes was, it’s called 270, where they give you a box of stuff and you have to build these robots that fight each other. It became quite famous, and I worked at Ford Motor Company for a summer. I used to have a 68 Mustang, and when I was at Ford I was at the plants. I went to the casting plant but, and I was working on, like, an emissions device for a Crown Vic that was going to be made six years from now.

5:50 And when I was at Aerospace Corp we were working on the Galileo space probe. I think the high-gain antenna wasn’t working, and it was out in space, and we were trying to figure out how to get it working and like you said, it’s cool doing real tangible things, but the time scale is so extended compared to software, let alone crypto, where things can blockchain, where things can happen at a hyper-accelerated rate So it is different worlds, right? Yeah, very much.

6:20 But yeah, it’s kind of like I said, I treasure and deeply value every minute I spent on the space shuttle program and really wouldn’t trade it for anything else, and all the other agencies I got to work through, because it’s really this larger web. So it’s, you know, Raytheon and Northrop Grumman and Boeing and all the other contractors of the Air Force. I did some other really interesting composite work with them, so it’s like getting to see some of this more deeply and be a part of that, like bigger mission.

6:47 I mean, they’re, it’s tough, right? There’s a lot of companies, and you know, other corporations that have done well and have great brands. They have great products, and you feel that sense of pride, but man, when you walk into like, you know, the secret, like, the security areas you’re badging in and you’re sitting here with, like, 20 years worth of astronaut photos and the actual hardware, and you’re driving up and there’s rockets outside. That sense of pride, and, like, all right, we have to do this.

7:15 It’s just like nothing else I’ve ever felt, and so that was a really, really cool experience. Yeah, it’s almost epic, the kind of things you’re doing. I mean, it’s, you know, what’s the biggest thing that human manatee has ever done. Put a man on the Moon, right? That’s most people would have to agree Oh, and we, we only have an hour or so here, but if we had about a day or so, I strongly agree with that statement to such an intensity.

7:41 And just for a little bit, maybe for other users or viewers, if you research what the effects of the Moon landings, the Apollo program actually influenced, it literally created all of Silicon Valley. So everything we know about where it is how it got built, all the capital, all the other companies modern venture firms, most of the most valuable companies in the world, why they all came from, literally stemmed from the space program, funding Fairchild Semiconductor. The founders then moved on.

8:12 It’s even, validating these MIT engineers coming from Boston that, you know, all you did was go to work for GE. You didn’t start your own company, and you’re just completely crazy. They went out and did that. No one else could buy their product because it was the new transistor, and no one had enough money. No one had the use, but the space program had lots of money to fund the exact thing that they needed in order to make it a success.

8:34 And so it’s a long, long rabbit hole very deep, but I strongly believe that. And that’s actually probably the most significant thing we’ve ever done, as part of just humanity. Wow, all right, I’m gonna think about that later. I have never actually heard that thesis, that the space program then created, you know, that early, like you said, transistor kind of VC vibe that then exploded into, without the Valley It’s definitely a phenomenon, very geographic and time specific, but I hadn’t thought about the space program pushing that.

9:04 Just think JFK making that speech, that one day, right? Just brought everything in motion. Then you wanna, and then, yeah, not to go too, then what’s even more crazy is that as supportive as JFK was of the entire program, he was actually gonna cancel it because it was behind schedule, it was costing more money, it was losing favoritism. So he was, and this is all documented, like, in Smithsonian, and there’s, like, lots of literature around this. So he was literally gonna cancel it, and then when he got assassinated it was then viewed as, like, oh, we now can’t cancel this.

9:38 This is going to become, like, a motivating, a rallying like, even though it costs a lot more money, the cost actually lessened in the public sphere. So it actually, you know, LBJ then picked this up, and then now finish the program when it was actually gonna be canceled. So the weird serendipity around how this comes together is completely insane. That is so intense. I mean, I spent six months this year running to be Mayor of London, and I didn’t win, if you didn’t notice.

10:04 And I got to see a little bit of politics. I have never been a politician, but I can see how, you know, it’s all about selling it to the public, isn’t it, to keep that funding going? And that’s interesting. I’m gonna look into that as well. Before we go on to, you know, talk about finance today, when you see Elon Musk doing SpaceX versus what NASA was doing, what do you see, pros and cons?

10:26 I would say personally they’re very, they’re good at marketing it. Like, they really do the finishing touches. They do the comms really well, not that it was ever bad in the past, but they seem to do it super slick, and they sell that dream, which is all part of the funding too. What do you see when you see that from, as an insider? Oh, it’s absolutely vital.

10:46 So the key thing is that what SpaceX is really doing is commercializing spaceflight, cargo into space, because that’s what the space shuttle was supposed to be it was literally called Space Transportation System, STS, and it ended up costing a lot more money than people really recognized, and so to get hardware in the space or lower Earth orbit is incredibly expensive, and the reality is, for, it’s going to be a business, right? NASA and the governments are not going to be good at owning, you know, a private business. So what they do, it allows NASA to focus on lots and lots and dollars on the crazy stuff, getting people to Mars right, doing all these other experiments, building the space station, running all these, like, very specific experiments that cost lots of money, and can also have, like, international exposure, whereas then these private companies can now focus on getting things, you know, hardware stuff into space, and that’s going to be really revolutionary for us.

11:43 Like, one really easy piece is once we can start getting satellite internet. I mean, we have this, it works, and so as the dollars, just as the price goes down a little, you know, within the next 10 years, is completely not unreasonable to think we’ll have, you know, broadband internet everywhere in the world, on any location, in the, on the entire Earth, where, you know, our kids, when you say, oh back in the day, when we have Wi-Fi, right, in the Sahara Desert, they’ll be like, what do you mean we have Wi-Fi everywhere? It works all the time.

12:11 This internet is ubiquitous, right? And you know that’s a reality that’s coming very soon, and it will get created exactly through putting all this hardware into space, maintaining it and doing it in a cost-effective way, and that’s not something the government’s really well suited for. So SpaceX is playing a very vital, I mean, absolutely vital role in commercializing that component of, like, kind of spaceflight. Yeah, when you listen to Elon talk about his, you know, dropping the cost per pound of getting something into low Earth orbit, and the, hey, he plans to kind of make it, like, one tenth of what it is, you know, in five years’ time you can start to see what you’re talking about.

12:49 What he’s talking about, I think it’s hard for the public to understand what that will mean. Just like the public, it’s hard for them to understand what the internet was gonna mean, or what blockchain is gonna mean, but if you’re a technologist, you can kind of be like, oh, wow, this is gonna open up so much stuff. Yeah, it’s, it was, the space program was 45,000 per pound to get up into orbit. And so, and now as it relates to crypto, now you can see how, I mean, we have internet everywhere.

13:16 I mean, think about what that’s going to mean now for people, be able to participate in proof of stake networks using their phones, having now universal access, now it’s actually, as you know, all worlds converge into software. This becomes even way more exciting for crypto. It is now truly democratizes anyone in the world, be able to participate in these networks like never before. Right. So that’s another kind of side, like, huge tangential benefit of space.

13:42 Right. So that space-enabled potentially grow up broadband everywhere could tap into those two to four billion people of unbanked people out there, maybe give them mobile access, and pull them in to this exciting world of crypto, blockchain and all the new, new monetary services. Yeah, absolutely. Think about repressed states, right? Like, right now, if you’re in certain states you can’t get uncensored internet.

14:06 I mean, you will very soon, and there won’t be anything states can do about it, because now you can access it globally. It’ll be satellite era. It’s all, I mean, it’s so inevitable. It’s only, I mean, within 10 years. Like, it’s inevitability for sure.

14:18 That’s exciting. You know, Tyler, it just crossed my mind that you look a little bit like a potential astronaut, like one of the guys from The Right Stuff, a little bit, you know. I’m too tall. I would not do well in confined environments for too long at the time. It’s funny.

14:35 I had Chris Hadfield in here, who was up in space for, I think, over a year, he was that Canadian astronaut that took all the pictures and did the Major Tom video up there, and I think he just came out with a book, a couple books ago, and he was talking about how all the isolation we felt in the pandemic. He said that’s what space is like. It’s totally uncertain. You can’t talk to anybody. You don’t know what’s going to happen, and it was just, it was a really good reflection of kind of where we’re at now, from someone who’d kind of been in space.

15:04 I want to ask you quickly about MIT Sloan School of Management, and then I want to jump into Flexa on AMP. You spent some time there. I learned some. I took about a year of courses there back in when I graduated, back in the day, early 90s, and I learned futures and options and all sorts of great stuff. I really learned about it when I was on Wall Street trading it, but it was a great environment.

15:23 I’m actually watching a course, Gary Gensler talk on blockchain and at Sloan in 2018. It’s very interesting to watch Gary. I’m about 12 hours in First of all, he’s extremely intelligent and explains blockchain really well, and also reminds people that cryptography’s been around for a while. you know, as zero-knowledge proofs have been wild way before the crypto, not to mention all the elements of the internet was involved way before the dot-com boom. So he has a good kind of a history, like you do.

15:52 You know, with space program and technology, what’s the one thing you got from Sloan? There were many. I’d say the most important, for sure, was literally just the people. So it was the focus, and And for me, I’d already started a couple companies. I had some exits, and so for me it was really the time to break away and just meet really smart people over a long period without all the stress and the burden of running a company, having a job, right, having other accountabilities.

16:21 That was really what was so valuable to me, and honestly Some of those friendships I’ve maintained are going to be absolutely lifelong friendships. Even this week, one of my friends hadn’t known before was when someone in my graduating class is the founder of Celo, another blockchain project that’s also consumer focused around, you know, spending crypto now all over the world. So it’s this, just completely You know, like, kind of total serendipity of how we’re doing somewhat similar things and still get to work on these things.

16:54 He’s one of my good friends, and getting to see him this week, even, too. So it’s like that’s the sort of thing, I feel like you get from one of those top schools, and then particularly MIT, just because it’s a little more unique. It’s kind of self-caters, people come in self-selecting into that kind of cultural mindset of being a little weird. I think in a really good, positive way, it draws out really that meritocracy, you know, a little bit more of this engineering quirkiness, which I absolutely love, and I think is the greatest thing.

17:24 Yeah, MIT, that we definitely embraced the weirdness there. For sure, it was funny because I met someone later who was down the road at Harvard, and they were like, oh, well, at Harvard, you know, how you had to belong to the dinner club and the this and that, and at MIT it was just like, are you smart or not, can you deliver or not, can you embrace it or not. We don’t care, anybody, anything else. It was, and it again, embraces the weirdness, and it was fun.

17:50 I was one of those pesky undergrads in those in the Sloan schools who, you know, was doing vector calculus and was probably blowing you guys away on the math, and you were one of the people that would come, either from, you know, Wall Street, or coming from a little bit of time off and probably struggling. Well, you probably weren’t, but some of the people were struggling with the math. I remember those times. Do you miss Boston at all? Yeah, yeah, I like it because it’s the most European U.S. city, and so it’s really small.

18:19 It’s got, you know, a little bit of history. The US, you know, it’s something we don’t really have, is longer term history So when you go visit some of these other, you know, as you travel, particularly around Europe, wow, these are 500 year old buildings, 600 year old buildings, thousands, and no, we got like 200 at best, right? So, and that’s not all bad, but so it’s cool to have some of that history that is really still prevalent, I think, in Boston as, like, this kind of the heart, I think, of, like, historic United States.

18:48 I really like. Yeah, that’s true actually. I probably value it more now that I’ve been in London. You go back in Boston you see statues and all the stuff that happened there over hundreds of years. So it’s actually, I got married around earlier in the Boston Library.

19:03 So that was a whole part of, I actually met my wife in Boston. we went to school together, and so that was like a big thing for us. So it was really cool having just being in that heart of the city, in that building. That’s epic. I got fond memories of that place.

19:20 Again, I went to, I was 18 years old and I went there and lived in a fraternity house in Cambridge for four years. One of my fraternity brothers just became the California state senator, Alex Padilla, as well. Really weird stuff, you know, at the time we just were like, you know, but then, like, over time people go do crazy stuff, and you’re like, what, and he’s probably thinking, and then Brian Rose became the guy from London Real. So yeah, it’s weird how people do interesting things.

19:46 All right, let’s jump into Flexa and everything you’ve been doing since 2018. and the AMP token. You said that you are, quote, unlocking the value where you have it, and I want to just give it a little reference before you can explain what you’re doing. I created something we call the DeFi Academy, and I got hundreds of students that are going through the education process of learning about DeFi, and, you know, two of the things they complain about, quite frankly, Tyler, is getting fiat into crypto and then using their crypto, you know, and they’re both very difficult things, and I think you’re potentially solving that secondary one.

20:20 Is that right? Now they’re almost two different worlds like, there’s an on-ramp and an off-ramp, and when you’re on the highway of crypto, you’re involved, you’re invested, you can maybe go to the DEXes, but when you’re off, you’re not, and right now when it comes to payment there’s so many people that are talking about crypto, that invest in crypto, but I would say very few of those people use crypto to go buy things at Starbucks, at restaurants, etc., and I think that’s where you guys come in. So maybe you can tell me and tell everybody here, what is the thesis behind Flexa, what have you guys been doing?

20:51 Sure. So yeah, like, kind of your first point there around just crypto usage and the prevalence that we’re now seeing which is fantastic. That’s great for these peer-to-peer networks as decentralized money or value and those sorts of things, which is excellent, but now to bring it more into, like, this real world or using it for, like, merchants right? They don’t. There’s so many different types of chains, assets, that complexity around what these things are, even classifying them right?

21:21 They’re kind of securities. They’re kind of currencies, but they’re not. They’re sort of this, like, new instrument that’s been created, and then it’s all digital format. So a merchant, though, really would love to get paid with anything as long as it can be cheaper or faster or have less fraud. Is there some benefit to them?

21:37 But there’s just no way, being a large merchant, you can integrate any of this sort of stuff at any realistic scale. So Flexa now has looked at this and said, oh, we can use some of the power of these new decentralized networks and actually drive the cost of, like, validating payments and the risk associated with payments down to almost zero, and we could build a network that uses some of this new technology. And then what we do is really just integrate with the merchants across their entire stack, so the software, the hardware, everything they already have, just to make accepting all these new types of assets just extremely simple.

22:13 So no new upgrades, no new hardware, no even new flows, right? Everything being exactly the same. And so Flexa is really about integrating very deeply with everything a merchant will have in store, online, and now allowing universal acceptance of assets from really any wallet too, which is the other really important piece. So it’s As this is evolved from day one, any asset. So it could be cryptocurrency assets, loyalty point assets, your bank balance, anything where you already have your app and you have value on it, you could now essentially pay through Flexa, like that’s really what the vision has been, and then now incorporating that into a new structure that allows this to be, you know, less than a tenth of the price or less than a tenth of the cost to a merchant, and then without all the fraud becomes really compelling to them to embrace something like this.

23:02 Yeah, that’s what, I, you really caught my eye when I first started watching some videos on you because, look, it’s one thing if you are able to allow me to take my crypto and make payments with it, like that would already be something we don’t see right now, and I’d love to walk through the current state of the union when it comes to crypto payments, but if I could take my phone and use what you’re doing to tap into my bank and do a bank transfer, which I can’t do right now to buy a cup of coffee at Starbucks? If I could tap into my loyalty points, if I could tap into a number of assets, I don’t know, my tokenized real estate or my cattle or whatever, I don’t know, maybe the sky’s the limit. And again, as there becomes exchanges for some of these tokens, whether it’s loyalty points or something, you know, that gets really kind of mind-bending, where potentially I’ve got all these assets on my phone or in my own little metaverse that I can exchange with someone else, as long as there’s a payment system that I guess can recognize them, collateralize them and then secu make sure they’re secure.

24:01 Is that the kind of vision you have? That’s exactly the vision. And so it’s really focused on commerce, though, so I will say we won’t really, you know, we can help facilitate some peer-to-peer and others, but for us it’s really about how do we just make this work for commerce. And then the real key is how does it become just so dead simple, either exactly as it is now or much easier. So on the merchant side, they get paid exactly like they would.

24:27 They get fiat currencies in their bank account that looks all exactly the same for reconciliation. how they get money, how they treat money, what it all looks like in their back of house, identical And then to the consumer, how do you make it that all these other assets, you just tap a button and scan something. It’s literally that simple. If you add anything else into this flow, it’ll just never work, and so people really like to approach some of this, of all my new technology or my new token or my new consensus or this, this, this right?

24:56 It’s never going to reach real mainstream adoption because you have to make it so simple to where the reality is So sometimes people will say to me, well, how are you gonna, how are you gonna onboard and explain all of this to new users or these new wallets, or how do you grow us? Like, well, we’re not, we’re actually not going to do it. This is going to power the things they’re doing, and they won’t even know, and frankly, they won’t care. Just like when you take your phone, it has Apple Pay, and you hold it up to the RFID stuff happens behind the scenes, and as a user you could really care less.

25:27 Honestly, as a merchant, you could care less you just want to get paid. It’s all about making that transaction happen. And currently the majority of those transactions are routed through many complexities that cost a lot of money and expose lots of vulnerability, that, you know, are 50 years old and have just, you know, they’ve been great monopolies, and so they haven’t been able to. They don’t need to innovate. These are extremely profitable companies doing this, and so there’s a lot left there, and so now this is kind of exactly how innovation works when there’s a new technology that can completely change the game, and that’s really what we’re seeing now.

26:04 Yeah, I guess as an entrepreneur, you really got to focus on solving one specific problem. Everybody wants you to solve 10 problems, but there’s no way any company actually successfully does that. Amazon isn’t good at having stores, and Walmart’s not good at delivering packages so right, stick to your, stick to what you’re good at, and I think I heard you quote somewhere that, like, 86 of the commercial transactions are taking place in person anyways, and that’s the market you’re going for.

26:31 Did I get that stat right, or was that pre-pandemic, or no, that’s post-pandemic? Really? It’s actually that would be over 90 in the US. Yeah, that’s what surprised most people, because they just assume they’re making everything online in payments, but is the reality different, because they’re not remembering each one of those physical payments they make. So think about anyone that drives.

26:53 All your fuel purchases are done in person. When you go to the grocery store, all of those purchases are done in person. Still, you know, clothing and other, like, durable goods at home, all your furniture, a lot of it is purchased in person. So there’s surprisingly a lot more you know, physical retail payments that I think people recognize, particularly around grocery. You know, those are some of the biggest markets out there.

27:17 So we’re like, you know, a movie theater, right? All these things you start adding up. I actually do a lot of these things as, like, a human, a physical human being, and I’m making all these payments where a lot of the convenience products you’re often buying online. So e-commerce is still absolutely still accelerating, right? So it’s not slowing down at all, and the pandemic made it growing faster.

27:37 So I think that number is going to continue going down and down and down, but I don’t see a world where it becomes zero or there’ll be some point where it stabilizes, where there’s a certain amount of things we always buy in person. It’ll just maintain that way. Yeah, now that I think about it, every time I double click my phone and use Apple Pay during the day, it’s quite a few times, you know, because I’m walking here, doing this, doing that. So it’s actually more than I you know, how often do I use Amazon?

28:01 Once every couple days. So it makes a really good point. All right, let’s look at a use case scenario. Right now, say I go to a store that accepts say Bitcoin, if you find one out there, or Litecoin and it gives me the option of paying with crypto versus that same store that accepts Flexa, and I don’t know a good example. I don’t know if Starbucks accepts that.

28:22 Probably it doesn’t, but I walk in right now first of all, is it even physically possible to pay with Bitcoin with the speed of transactions right now? What is the current state of the art, because I don’t think most people know transaction times any of those other friction points that are currently there Oh man, that’s a, I could take a few hours to answer that question. The short answer is pens and it’s all about the context. So first thing is do people want to spend Bitcoins?

28:51 That’s already a whole hurdle and discussion right just there, but assuming they do, which is, but they don’t. They don’t do I don’t think that. I mean, why would you? Right, it’s really, it’s narrative right now, right, wrong, or whatever is that it’s a store of value, and why would you go buy things with the store value that you bought with the intent of it appreciating further? You know, as a narrative, right?

29:15 So you can agree or disagree, but that is the prominent narrative. So I don’t really think people want to spend that stuff, but assuming they do now, it really depends on what you’re buying and what the context is. If it’s someone that you reasonably trust or it’s a small transaction, you could probably do zero, you know, unconfirmed transactions, you know, just anything in the mempool. It’s gonna be fine, and you can actually get transactions pretty quickly that way.

29:39 So buying coffee in a reasonable way from someone or a small or medium-sized merchant might just work great, actually, with like Bitcoin. With Bitcoin would probably, but only Bitcoin right now nothing else would. Almost anything, right? If it was a small transaction, if you were to give me ten dollars in crypto with really, because the only thing that can happen is that you would basically replace that transaction with a higher fee transaction, or you could work through some sort of malicious network to try to take over the network, or you had some insider information, you knew there was going to be some sort of weird fork happening.

30:13 Like these sorts of things. The reality is, for a 10 transaction, that just doesn’t play into the scope of practical usability. So for small transactions, I think it’s just completely fine. You can just say, oh, it hit the mempool, it only takes a few seconds. Like, this would actually be fine, and I can accept this payment.

30:31 The problem, though, is that it starts to scale, that becomes now non-trivial of what risk is actually there. So there isn’t an exact, you know, threshold but let’s say you’re someone like Walmart, and you might be accepting 10 million dollars with the transactions within 10 minutes. That’s now a problem, because that is a scale where now a miner could collude and actually, you know, present a different version of the chain, and now all those transactions never occurred, right?

30:59 Or you could replace all those transactions, you know, with replaced by fee, and now, and that’s so economically feasible, like, in fact, it’s like the outcome. This is what fraudsters do. There’s literally, stats that say something like a sad stat of something like, all internet traffic to the continent of Africa, like 60 percent is fraud, like 6-0, because of how many operations been set up there around just, like, literally financial transaction fraud so that’s just the scale that we’re dealing with, to where if you’re going to open up a network like this, like they don’t understand it now, and it’s not accepted the same way, but there is zero chance that if there’s a vulnerability where people can print tens of millions of dollars just through a simple vulnerability like that, it will happen.

31:44 So there’s a threshold where it becomes practically usable and fine, versus there’s no possible way we would ever consider this, because this would be financial suicide. So there’s some inflection in the middle, now, even though these are in persons, because it’s one thing if I swarm their online site with, you know, 400 orders and a thousand each, but if you got to be in person for each one, does that reduce the chance of fraud, or they’ll still, it still can be done? Still depends.

32:09 Right, so let’s say it was large enough and I was buying a 5,000 TV or something, right, from one of these places, and then I had a hundred of my friends, or a thousand, because again, these are crime syndicates that literally do this today, and a thousand people are now all of a sudden buying these multi-thousand dollar TVs to really push this up into the multi-million dollar figures all at once. And at a scale like Walmart, I mean, you have more than a thousand stores, so that’s actually barely feasible and wouldn’t even look all that crazy to happen. And what they do is you make all those transactions, and all of a sudden there’s millions of dollars worth of, you know, one confirmation transactions, and then you could just, you know, attack the chain and potentially, you know, publish a new version, and you could collude with miners.

32:56 Again, is it likely? Probably not, but it’s a possibility. And it’s certainly not a risk that a merchant would underwrite by saying, oh yeah, we’ll do this, and we’re totally subject to this black swan of something happening, and we could just lose all these transactions, all this value, at any given time because, yeah, the short is just talking around economic finality, to where the easier description is let’s just hypothetically say it costs 50,000 to, it’s close, writes a block to the Bitcoin blockchain.

33:28 Right? So if that costs you fifty thousand dollars, if I’m going to give you five hundred thousand dollars in a transaction, well, economically, just very hand-wavy and straightforward, I should wait for 10 Bitcoin blocks because in theory, then it’s economically advantageous to you to try to build the system to actually, you know, take over the chain, rewrite transactions. I need 10 blocks, which would equate to 500,000 worth of value where you’d get more than that back if you were able to rewrite the chain in less than 10 blocks.

34:00 So that’s you know, a little bit of hand-wavy math, but the concept is absolutely true, and so that’s what this economic finality concept is, you know, everyone likes to talk about, oh, this state of this blockchain is final, right? This is a final state, like, totally immutable. Like, yes, but there’s always a cost where it can be. There’s always a non-infinite cost to make something completely rewritable and to change the state of the chain. If you take over the chain, or in a proof of state network, there’s other types of different attacks that you can experience.

34:33 So again, you just need to get to a state where it’s economically infeasible or economically not valuable, and then you’re in great shape. Right? So I am, I’m by no means saying this is a negative necessarily, the system, but it’s a limitation that to really harness all these sorts of payments, you just need to be really aware of, you know, it’s things like how exchanges, right? Crypto exchanges are the same where they wait for a certain amount of confirmations before they’ll let you trade or draw assets.

35:02 So it’s all just very much the same concept. What kind of coins are going through your brain when you’re thinking about this? Like, I guess you’re clearly thinking about Bitcoin, maybe Ethereum, maybe Dogecoin, because people use it, you know? Are there other coins that you’re already thinking? You said proof of stake.

35:17 I don’t think any of those yet have proof of stake, so you’re thinking about a few other. What are some of them, you know, without calling out everybody? The coins that you just think, for you know, big market shares, I better be thinking about those use cases? Oh man. We really need to see.

35:33 I honestly don’t think any of the proof of stake networks, currently, despite their market caps, have much fundamental usage beyond just, like, sort of speculation, and they’re really much in the building stages right now which isn’t bad, but they’re sort of growing, and we’ll have to see what people start to use for a lot of people are trying to say, oh, you have this Ethereum clone or this Ethereum killer, and we’re just gonna make something faster. It’s like, well, you know, that’s done. It’s done really well.

36:00 It has, like, an extremely secure base layer security so it remains to be seen. I think there’s definitely some interesting technologies that are out there that might end up being. I think they’ll end up being collaborative with Ethereum. Personally, that’s my personal take, is that they’ll start enabling other types of computations or other types of value that then you could potentially write proofs to the Ethereum chain, or things like that. That I think they can all coexist.

36:27 I think the world of thinking there’s going to be one universal blockchain and nothing else, you know, not hundreds of others. I don’t think it’s really possible. I mean, we can’t as humans agree on anything we have, you know, we don’t even know how many countries there are, right? I mean, that’s literally a statement like how many countries are there in the world? Well, it depends who you’re talking to.

36:45 There’s between 180 to 210, right? So to think that we’re all just gonna have one universal base layer, I think isn’t really going to happen. So there’ll be room for a lot of these things to coexist and work together. So we’ll really just see. Um, but currently I don’t see any of the other high-performance chain getting non-trivial adoption and things that Ethereum already is doing, and that’s not intended to be a negative statement or an acute story statement, just I think that’s the way it is.

37:17 Okay, are we talking about Cardano? Is that like the next? It’s the third largest market cap, and it’s the only proof of stake that’s really up there in the top. I guess Solana is a proof of stake. Uh, yeah, I wouldn’t even have Cardano even in the list.

37:29 I even just mentioned, because they’re just like, even pre, that’s a whole nother game. But yeah, like Solana would be the one I think, uh, I think has the most universal interest in the technology, and I think that the most people I’ve talked to, VCs, projects, otherwise it’s very interesting. I guess to put it that way. And then, uh, Avalanche also has a, you know, fairly novel consensus mechanism Both of these, you know, these chains, though, are doing what, like, 110,000.

37:58 The true value of something like Ethereum but then they have market caps of like 10 to 20 of Ethereum, so you can see the, the speculative interest. That’s not to say they’re bad, but their, their interest has definitely outgrown the true utility that they have, which you know, that is what it is. Um, so again, I’m not even necessarily saying that’s bad, or I’m not trying to throw shade on those. But that’s just the state, I think, of the real usage Really good observation.

38:24 Are there any others that come in that list you think about? Solana, AVAX, are there one or two others that are kind of around there? Yeah, uh, so Terra is very interesting, mainly because they now have the UST token and how that is minted on chain, and they have a really interesting economic model with LUNA. So basically, to create UST, you need to burn LUNA, which is kind of interesting. So you know, thinking about something like that, and it’s a permissionless system.

38:51 So think about, you know, USDC on Ethereum. Let’s say you had to burn ether in order to mint USDC. Like that’s kind of an interesting concept. So there’s getting to be more and more traction, and then particularly because Terra, uh, launching initially in Southeast Asia, having, Try platform, I mean, they’re literally in the billions of dollars transacted already on chain, which I mean, that’s in like a couple years. So that’s real world utility and usage that also gets very interesting.

39:22 So now trying to enable some of that now in the US. I mean, that’s something we would love to be, you know, work on with them, and we’re close with them, and have been, you know, seeing what all this can look like, but now taking those assets, you know, permissionlessly derived assets you can now spend at, you know, merchants across the U.S. Get really interesting That’s very exciting. Any other names come to mind on the proof of stake side? Those would be, I think, the main candidates that you’d see for sure, and proof of work Those would be the main, the current ones, right?

39:57 So Ethereum and Bitcoin are really the, you know, absolutely predominant around just everything. There’s, I think, some slight mentions around just they’ve been around for a while, have certain communities around, like, Litecoin, and then, like, even Bitcoin Cash That one’s been really challenging, just because it’s gone through, like, three or four community splits even since it split originally But I do, you know, I just have a little bit of a bias, just because, uh, Bitcoin Cash, at least what it’s trying to do in terms of its narrative. You know, what Roger talks about is what I love.

40:33 So that’s the one thing where I still, like, you look at it. It’s like, I want to see this work and I like this narrative, and it could be wrong, it could be right, but those are the things, things that get potentially used as money. I have a very, very strong preference for. So I’m very deep in the DeFi world, and having used a lot of these other products, but when something comes up that has some fundamental utility as money, I get very interested in it more naturally.

41:01 So, like, earlier in the year with all the algorithmic stablecoins, like, that was something I jumped in very, very aggressively to figure out how they all worked. You know, what could work? You know, what did all these look like? What were the differences in, like, their applications? That was the stuff that I’m very passionate about.

41:18 Will that work some at one point? Oh man, great question. As of now, no. None of the algorithmic approaches have really been sustainable, and I’d say the one I see that has the most current sustainability of something like Frax, where they have, like, a little bit of a hybrid model where it’s partially fractionalized by its, or sorry, partial, fractionally reserved with its own token. I think it’s at something like 10 or 15 collateralized by its governance token.

41:52 That’s interesting. It’s not really fully there, but this is also how a lot of it works is you create these experiments, you see how it works. And then, going back to our early conversation, it happens at rapid scale, all this stuff, the boom and bust of every single one of these tokens, of, you know, Basis Cash, Empty Set dollar dynamics, a dollar, like going the whole list, they all, like, you know, crash, burned, then went up, then went down, everything else in, like, less than a year.

42:20 All of it is only 12 months old, so it happens, you can iterate really, really quickly with this. Yeah, a little bit different than the space program in that sense. And, yeah, we’ve had Roger Ver here. He literally has given away free Bitcoin Cash. If anybody wants free Bitcoin Cash, go watch the episode he literally gives you his email, and a bunch of my team got some from him.

42:41 So, yeah, I’m a big fan of what he does there. Gas fees on Ethereum are one of the biggest complaints I get in my DeFi Academy. I’m telling you, all my students are complaining this week, and what I try to get them to do, Tyler, is I try to get them to put on their first yield swap trade, put on the first liquidity pool trade buy a simple option on Ethereum, just so they understand these instruments, even at very small transaction prices, and they’re all constantly complaining about the gas fees.

43:07 I had Stani Kulechov of Aave in here, and I said, when’s ETH 2.0 coming, and his whole business is based on Ethereum, and he said sometime in the next 10 years. And so I’m wondering, do the gas fees affect what you’re trying to do, and do you have any personal opinions about them? I also have the CEO, Polygon on here. They’re doing amazing stuff. Maybe it won’t matter.

43:25 How do these concepts play into what you’re trying to do? Oh, great question. So it, it impacts us a little but at least the core dynamics of how Flexa works. So currently, in staking your tokens, there is a cost but it’s really kind of a one-time thing, and then you’re moving things around and assigning things within the contract. We also have upgraded the AMP token to allow for you to maintain custody of your tokens.

43:52 So we’re going to be upgrading the capacity like kind of the collateral managers to make that even cheaper. So it impacts us a little, because our core functionalities aren’t like all happening with repetition or repetitive, untrained transactions. So it’s not as relevant to us. It is hyper relevant, and that no one wants to spend Ethereum assets anymore. Who’s going to spend USDC when it costs 25 to make the transaction?

44:18 I mean, no one. So that’s what really affects us more, not as, like, an actual infrastructure or our project itself, but the usability of these assets, I mean, that’s absolutely crushing that part. But there’s a few things So the first one for us, most people are going to probably be spending from custodial wallets anyway, and, and are so there’s actually a much minimized effect. That people can now just spend from their custodial wallet. The average public, I don’t think is going to be maintaining all of their keys across all these platforms, and I think that good centralized entities with certain amounts of money is just very, very good hygiene.

44:55 So I see a world where we’re using the software exactly the same way. It’s very easy. You’re tapping a button, but the assets can still be safe, regulated, you know, how all that starts to look. That’s interesting. And then also I think people very much under-appreciate that.

45:11 Again, the speed at which these technologies are growing, when you look at, oh, I mean, the internet is a perfect example that everyone can always reference. You know, when I started using the internet, and I had my Pine email client, and that was as best as I absolutely could do. There were no mobile phones. There were no laptops. There was none of this to where now we’re streaming 5G internet service, Wi-Fi on your phone, Netflix streaming like 4K video on a mobile device, is just complete.

45:39 If you have said some of that, like, I mean, the iPhone is, I forget now, how old is the iPhone? Like 12 years. It was 2007, I think 2007 it came out, so 14 years, right? 14 years. We even have that device.

45:51 So if you were to go back 10 years ago and tell people, oh, you’ll be able to stream, you know, 4K video on your phone. 4K didn’t exist. Your phone couldn’t even support that. There wasn’t even, like, why, we had three gfs right? That would have been just completely crazy, and if anyone told you that, ah, 30, 40 years will happen, well, guess what, we had it in like five or six.

46:11 So I think we’re squarely in the same situation and that Ethereum in 2017 was all speculative nonsense. It was all just these ICOs with no real utility. No one was using MetaMask. No one was using DeFi protocols. There was literally nothing.

46:27 It was pure speculation. And now it evolved very quickly, to where, even starting off, the end of LA or last summer, there’s a lot of this stuff happening. We have billions and billions of dollars in all these various protocols, like you mentioned, Aave or Compound, or You’re right. All this has happened literally within, like, 12 to 18 months, its entirety. So to now think that all of a sudden we can scale this hyper-secure base layer that quickly is a monumental task.

46:55 And so that will happen, but the reality is, yeah, like you mentioned, Polygon Arbitrum is another that is getting a lot of attention. zkSync is super, super interesting what they’ve been building. I mean, these are all, like, a year or two old projects. Like, they’re gonna start coming out quickly, and so for my more pragmatic approach, if people want to use this, and are using it and have value in it, we’re gonna scale this thing fast, and it will be in a way that users can appreciate, and it will work, but you need to have the economic value.

47:28 Imagine building a layer 2 scaling solution in 2017 you’d be looked at like an idiot. Like, what are you building? Like, no one’s using this. Gases are super cheap. No one’s using any of this stuff except buying ICO tokens, right?

47:40 So, but now two years later it was a huge deal. And so now you have to accelerate it really quickly. The same thing if you were going to build a you know, a streaming service for mobile phones in 2005 people would look at you. You know, you’re from another planet, right? So it’s really that sort of an approach where, if the value is there, it’ll bring all of the capital, all the smart people.

48:03 They will work very quickly to develop something and it will happen much quicker than I think people recognize. So, you know, within the year, or let’s say within next year for sure, I would say there’ll be established layer twos that are very much operational that’ll lower these average costs down, like, very, like, significantly and then we’re, you know, off the races, and then we just grow up from there with good user interfaces that people can tap right into, just like they do now, with their MetaMasks, etc. So that should, yeah, even that will evolve right?

48:33 It’s still a terrible experience. I mean, I’ve been in crypto for almost 11 years, and it hasn’t gotten much better. It works technically. It works, but yeah, there’s still lots of progress there too for, you know, normal people to be using this stuff and getting the benefits really making all that happen. We’re still, as crazy as this world is, I think we’re very, very much at still absolute beginning.

48:57 And this is like first inning baseball sort of stuff within crypto, in my opinion. Yeah, Anthony Scaramucci said it’s not even the first inning. He said we’re still at training camp, is the way he described this market. I didn’t think this was possible, Tyler, but you just got me even more excited about this marketplace, talking about some of that tech. And again, you’re right, the current user experience isn’t the best.

49:20 I just got my 17-year-old daughter on MetaMask. I guess got my 76-year-old mother in San Diego on MetaMask. They both have ethan stable coins, but you know, it’s still, it’s still, like I said, not the best user experience. My students have to do a Uniswap exchange on the, in the second week, and, you know, they’re holding on tight. They’re trying to get through it after they had this fairly nice experience on, say, a Coinbase or a centralized exchange.

49:45 So it’s still a little bumpy. I agree. We’ve got a ways to go, but the truth is, you know, I spent six months running to be Mayor of London, and so I was really out of touch for a while, because it was a really intense process, and we were all focused on the city and policies and stuff, but when I looked at what happened in the DeFi summer, and I looked at the value locked, the innovation happening. I had these flashbacks to Bankers Trust in the 1990s and I was like, oh my gosh, this is happening in a decentralized fashion, something that used to take me a balance sheet, a direct line to the Fed, 20,000 employees even to create these new exotic instruments, were being done by, you know, 20 guys and a dog, 12 girls and a cat in Tel Aviv, or who knows, maybe they’re anonymous, and again I was just all in, Tyler.

50:31 I saw this, and I thought, wow, I was in the dot-com boom. I was actually at a company called LuxuryFinder. I was a CFO in 1999. I remember having a conversation with the CFO of, that’s a fun job. Oh my gosh, it was going, it was going up.

50:45 I remember having a conversation with one of the guys at eToys at the time, and he actually was talking to me about fraud back then. You just had me flashbacks, and he was like, Brian, the LA gangs are involved in online fraud, and I was like, what are you talking about? And he said four or five percent of our, of our transactions are fraudulent, and this is a big deal. And again, this was still early days. So it’s interesting when you talk about that, because that’s all now been magnified so much.

51:10 But again, you know, I wasn’t really involved as I’d wanted to be in that dot-com boom, and I talked to most of my students these days, and I said, did you change your lifestyle by investing in Facebook and Google and Amazon and these other companies, and most people say no, and the whole blockchain space is almost like an opportunity to be a part of this future and build it, and I don’t know. I have to pinch myself some days. This is a pretty damn exciting space, right?

51:40 Yeah, oh, it’s unprecedented, and again, it’s, in my opinion, very, very inevitable. The, I give my, my quick pitch on it is that, as especially as relates to the internet, so you had this, you know, this decentralized system of sharing data, which grew and was great, but it has a, there’s a fundamental difference between internet and, like, crypto networks, and the easy piece is just state. So the internet is stateless. It’s just a system that allows you to write route data between each other.

52:12 That’s it. So you build all your clients and all of your instruments, if you have a PayPal service or a banking service or anything else, all built up on the edges, and they can all communicate, but they still need to trust each other, and there’s no state within the core infrastructure, and that’s just the way that it was built. Now we have this new thing where state is actually fundamental into the network itself, and so if I want to share value with someone, I can do that for the first time in the actual state of the protocol, where you cannot do that in the internet.

52:44 So that’s the fundamental difference, and so when you have this new system to get that nice feature of being able to transmit, you know, money, value You know, financial instruments in this state-derived system, it’s open source because you have to be able to inspect all the code, and you have to be able to know the rules of the game for all of this state to be, like, assigned properly. So it has to be, like, a really, really accurate database. So when people are, when people are doing that I forgot what I was gonna say on that particular piece.

53:21 So, oh, so they’re, because they’re so open source, they they build on each other so quickly. So when you have open source projects, now anyone can copy it, so anyone can literally copy it very, very quickly. So now you need a business model. How do you make money off of this stuff when anyone can copy it, and the way that they do this now is building sort of like cooperatives with token networks, and so there are access rights, there’s governance rights, there’s fee models, right?

53:47 All built into the protocol itself. So it’s not, so it works very similar to a traditional company, but the way you monetize it, the way it looks and having tokens rather than, then, equity-based entities on the peripheral right? Is very different, but at the core it’s still kind of the same. But it’s not about just build this huge entity, build up all these barriers, you know, zero to one style, become a legal monopoly and just rent seek the entire thing.

54:13 That’s what we live in now. It’s migrated very quickly to now these open source protocols, where the value is actually derived and maintained in the systems themselves, and they function much more like cooperatives. And then they grow really fast. So a perfect example is something like Uniswap. Yourself’s like 18 months old, like in total, and so it’s, you know, only really been used, let’s say, 12 months and it’s getting close to where you’re going to be able to measure its settled value in trillions of dollars.

54:45 So, trillions of dollars of value settled in less than 12 months, like, from zero to that, is just completely mind-bending. And so that’s why it’s happening. Is that every single project, the virtue they have that gives this nice state-based system for people to transfer money, value and financial instruments now like never before requires that they be open source, which then enables them now to grow at an almost like a double exponential rate. When you look at, like, Bitcoin, it’s growing a little faster, I think, by some measures relative to the internet itself, but Ethereum is growing in an order of magnitude to that.

55:28 So we’re literally seeing, like, double exponential growth from the internet, now, to now, and that’s why it’s the only reason why it’s all, the software is open source, and everyone’s building out so quickly, and so it’s, it is, it’s very unprecedented that we have this opportunity now seeing all this, what this will start to empower. And that’s not to say, oh, the whole world goes away and this changes everything, and everyone uses this, and like, we live in this completely different I don’t know if I’m there, but the 20 to 50 percent of businesses and society that rely on trust or are transmitting financial instruments, where they can save so much money and efficiency by doing it this way, are absolutely going to do it. It’s just financially motivated, and so that gets really interesting.

56:14 So I think there’ll be a transformation in in many, many industries, not all, but many of them, much like we saw in, you know, the internet. There’s still certain businesses that aren’t online. Even when we were talking earlier, the grocery store and the gas pumps and all these right? They’re fundamentally kind of the same, right? So it doesn’t, like, it just sweepingly changes everything, but it’ll change many things For sure.

56:38 Yeah, that whole transition from Web 2.0 to 3.0 is a, it’s a fundamental way that we even think about venture and capitalism that hasn’t changed much in a few hundred years. And I’ve had people like Stani on the show who’s, you know, he’s, what is he, 30, you know, came from Helsinki, was a coder and now he’s running a company with 23 billion dollars in locked value, and his, you know, yield platform and he said, Brian, at the end of the day, my job is to be a good developer. He said, because if my code doesn’t work and nobody uses it, then I’m dead.

57:12 You know, he’s, it’s not like, like you said, like, the zero to one Peter Thiel thing, where I’m Mark Zuckerberg and we’re doing this my way, and I’m gonna control this, and again, you know, I’m not making any judgments there, but it’s this weird cooperative let’s make sure everyone uses it. Let’s really focus on the community. The community have to win. It’s weird, you almost have to become a politician, as opposed to megalomaniac, which used to make you a successful CEO aka Steve Jobs, you know, all these people, right?

57:38 It’s a fundamental way that we shift our brains and the way we think about capitalism. I’m actually surprised it’s even been somewhat smooth, that a few people have adopted it, because this is really different, isn’t it? Yeah, and yeah, the difference, the easy difference, is, he has all that, all those funds like in Aave, and he can’t take it. He doesn’t have access to it, right? Like, nor can anyone else, right?

58:04 So it’s not, it’s kind of these funny narratives or memes of humanity, right? Where’s, like, oh, your money isn’t safe, right? Don’t keep your money under the mattress. You’ve got to put it in the bank, because the bank will put it in the vault, and they’ll secure your money, and they’re going to watch over it, and the money will be safe in a bank. Well, it turns out, banks can steal all of your money and have stolen all of your money.

58:25 So it’s like, oh, now we need regulatory agencies to make sure that the safe, the guardian of your, of your funds, isn’t stealing it. So now there’s, like, a whole nother level on top of it, of watching the person supposed to be watching your money, and now in these protocols, it’s all open and transparent, where they can’t even take it if they wanted to. So that’s a reason why they attract so much capital. You know, Aave, Compound, perfect examples, are, I think, together, probably like 40 or 50 billion dollars worth of assets supplied, like, and they can’t take them.

58:55 They’re permissionless protocols. They don’t have the keys to those things, like, it’s all done through these governance contracts, where no single person or no group of people can actually take funds or or manipulate it in any other way, and that again is very revolutionary to what we’re even dealing with now, with Yeah, the oversight of trying to store your, you know, your money, your assets, and, you know, all these other, with all these other entities. You know, I had Jeff Booth on last week, who wrote a big book on deflation.

59:26 I forgot the exact name of it, but he’s quite a maximalist. And again, I’ve had Max Keiser on the show, but it was back in 2013. He was trying to get me to buy Bitcoin. I bought some for a hundred bucks, but I didn’t buy enough, clearly. But, you know, when Jeff says, he says, he says this, I’m curious to get your take on it.

59:43 He said, Brian, Bitcoin is completely decentralized. There is no way to try to hack in that system, but he said, but he said, if I could get a hundred people in the room and put a gun to their head, I could shut down another blockchain. Is what he said. Now maybe it’s because they’re using Amazon Web Services, or maybe it’s this, or maybe it’s that, but if they kidnap your kid and they got a gun to your head, Jeff said that, and he has some dark scenarios.

1:00:08 He said they could stop one of these networks, and I didn’t know what to say to that. What would you say to something like that, where they say that’s a very maximalist statement, but they say it’s not decentralized enough, none of these things are decentralized enough to find a way to break them. And again, you’re quite close to the fraud people, you know, some of the things they can do. Is that a fair statement or not? I really, yeah, sort of, right, everything is contextual.

1:00:35 Again, like, it’s very hard to have a binary response to a lot of these, but in general there are many blockchains that do have centralized components to them, which I absolutely agree with. So when, in terms of their, you know, proof-of-stake ownership or ability to modify transactions, which we have also seen occur many times. you know, things on, you know, EOS or the XRP Ledger, like, that there’s been many instances of those sorts of things happening to the past.

1:01:04 So, like, absolutely, there are those vulnerabilities. However, I’m also, I guess, the pragmatism in me. I actually think that even some of the decentralized networks still do have some vulnerabilities to where it’s not this infinitely untouchable, like, utopian world, either, depending on who you go after or who has access there are some vulnerable, like, non-zero applications. Like, so for instance, if you know, now Bitcoin actually got a little bit more decentralized with a lot of the movement of China, but for quite a while there were, what, like, three mining pools that controlled definitely a majority of the hash rate.

1:01:47 So that would mean there’s, let’s say, there’s three executives at every entity that could make decisions, that would be nine people. So there’s a lot of counters. Some of this, like, you know, whether it’s Bitcoin Ethereum, otherwise. Some of the maximalist thinking, I think, I think maximalism in general is very unhelpful and is generally toxic, for when you think that everything is solved by your thing. I don’t think you’re going to get very far in that, because the reality is there’s going to be lots of other things that can do, and you could even make, I think, a strong argument that Ethereum maybe has done more for the growth of Bitcoin than anything else that’s ever been done, maybe in history, and I probably agree with that statement, right?

1:02:29 Like, Ethereum, I mean, that’s crazy to think about, but Ethereum has made Bitcoin more valuable than maybe anything else that has ever happened, because think about what it’s done. It’s brought all the new talent, all the money. I mean, look at the ICO madness and everything else, even right now, all the inflows are coming in this way. All stablecoins are built on that, and, like, to just think that, oh, that’s bad, we don’t like it because it’s not our thing, and we want Bitcoin to rule everything else well, it’s, you know, very close-minded.

1:02:56 Someone’s actually really helping you at the end of the day, and you’re still just, you know, frustrated and trying to say all these negative things, and it’s not that they just have to, like, the thing, but there’s a lot more rising tide, you know, lifts all ships way more than I think people recognized, where there’s a lot of things that can be very valuable, but I think there’s vulnerabilities to pretty much every blockchain if you got really, really sophisticated and thought about what you could do to ultimately take something over. I think I did a thought experiment with someone recently, even on Bitcoin, which is, you know, how much would it cost to take over Bitcoin, to, like, literally take over, because to get 50 hash rate, like what is the cost, like, you know, there has to be one.

1:03:44 It can’t be infinite, right? And you know, maxies will say, oh, you can’t do that, it’s impossible. No, we’re humans, and we live in a human world, so it’s very possible, because, like, I even just said there were nine people before. So the way to do it, there isn’t enough hardware to buy or chips to manufacture. We’re already at, like, silicon shortages.

1:04:03 So there’s the allotment that can be developed for, like, ASIC miners right now is fully, fully exhausted, so you can’t just go make more ASIC miners. So that option would be out, but all the ASIC miners that are out there, if you just tried to buy half of them or, you know, whatever percentage you need, and these are miners or operators that have all these on farms all over the world. There’s a number that they would sell them to you at. I don’t know exactly what the number is, but let’s say it’s, you know, 10x what they bought them for, right?

1:04:35 They’ll probably sell them to you, right? They’re capitalists, like anyone else. You think they just, like, running all these, like, Bitcoin farms, like, because that’s the cheapest way to potentially generate Bitcoin like, it’s probably easier to buy it. So there’s a price, and you could estimate just what it is. I mean, to literally buy out 50 of the miners, and I think I in very, very rough math, not getting into it here, I was getting something like 100 billion dollars, I think, was what I roughly calculated, and that could be right or wrong, but it’s probably definitely correct in order of magnitude.

1:05:09 And so to a normal person, you know, that’s outside the range of what, you know, you or I, or even Jeff Bezos could probably do, and you run the risk of people knowing what you’re doing, and it’s going to raise the price. There’s other pieces, but if you’re a state and you want to buy that, and you want to try to figure something out, and especially when everything already was in China, it was a lot more shaky than I think people realized, where you could have blocked people out, and, like, 100 billion dollars to a large state. I mean, the U.S. printed like two trillion like or whatever that the past couple of years.

1:05:42 So like, that’s very well within again, am I trying to say this is likely? Absolutely not. But is it non-zero? potential. Sure, I think so, and I think anyone that stubbornly says no, this is impossible, this could never happen, like, all I just, is, I think, is misguided, or, and just not thinking what the future will actually be.

1:06:03 And, like, again it doesn’t. It’s positive. You know, not to get into more complexity, but things around how people are so so thoroughly convinced around Bitcoin, is, you know, the greatest feature of Bitcoin is 21 million tokens that can never ever be changed. It’s like, well, sure, until we want to change it, and maybe we do want to change it someday. I’m not saying I want to change it, for the record, very, very clearly, but you know what happens when the subsidy runs out, or the subsidy is too low for the miners to actually care and write transactions of the chain anymore that means security of the network starts to go down.

1:06:40 So and then, and then, in parallel We’re building Lightning Network, which, what does that do? Oh, it enables, like, really, really low fee transactions So how would the miners make any money? No, they don’t have a subsidy anymore, which they’re living off of, and they won’t make any transaction fees, and are people going to use this to trans for stuff anyway? That remains to be seen. So there’s a lot of unknowns of this.

1:07:03 What does the state of the network look like? So maybe people say, oh, let’s just make the subsidy come back, and we can do it in, like, a low inflation. Maybe there’s gonna be 25 million Bitcoins, or whatever the number is, or the miners just say, yeah, we’ll just fork this ourselves, and we’re just gonna move this all over, and there are 30 million points now, and, like, that’s the way this is gonna work. And then you can either stay on the old chain, which is super insecure because there’s no funding to it, or this new thing that has more token.

1:07:31 I, I don’t know, and again I’m not even trying to say that that’s likely I’m just trying to say that there are alternatives, again, that I think people put blinders on, of, oh, this works, and it’s so perfect, where at the end of the day we’re people. These are economic systems. There’s a lot of selfish financial motivation within them. You know, that’s something why ether is also really compelling, because ether is like the unit of currency that runs everything.

1:07:55 So there actually is a lot of economic buy-in into the system, but the way that Bitcoin works right now, if you own Bitcoin, you have, like, literally, share zero shareholder value in the network. I mean, literally zero. Who are the people that control Bitcoin? It’s miners and the Bitcoin core, or, like, Dennis. That’s it.

1:08:16 Like, if you own Bitcoin, you can literally do nothing except participate in this ecosystem. Again, I’m not even meaning to say this is a negative thing. Like, so this is not, like, Oh, the rant, I don’t like Bitcoin. I love Bitcoin. I’m one of the earliest Bitcoin adopters in the world.

1:08:30 I probably spent almost more Bitcoin than almost anyone, and I still have a lot of it to this day, and I still use it all the time. So I am very much a bit Bitcoin proponent, but I just look at it realistically and I don’t try to put my head in the sand as an ostrich and then just try to, like, shame other projects or other innovations just because I think mine is best. And that it’s just, I’m not very tribal. I try to look at it very realistically, of where real value is coming from.

1:08:59 Yeah, those are some super interesting points. I appreciate what you say about the maxillus, and if Max Keiser is listening, Max, come on, talk to me, because he’s refusing to lately because he says I’m, I’m talking about anything but Bitcoin. Really good points, because it is a living, breathing ecosystem like you said. So if in the future the miners aren’t motivated, then your security drops, and plus we’ve seen hard forks happen in all these networks, and anyone can hard fork at any time.

1:09:25 That’s what Stani said, kept, he said that was a beautiful thing, because it keeps him honest too. You’ve got to always make sure you’re doing the right things, and providing that best tech. So I, and again, this is a very MIT thing, by the way, that Tyler just did, to do the back of the envelope calculation on what it would cost to hack into Bitcoin, and like you said, trillion dollars to a government. It’s very doable, right? You’ve seen what they spend on the space program as well.

1:09:50 Talk to me about the AMP token, because it got you guys a lot of attention. It’s a two billion dollar market cap, like in the 60s, as far as total market cap of coins, I believe. You use the AMP to kind of over-collateralize those transactions when you’re making them in real time, but it’s, you know, it’s what you guys do on the blockchain, but it’s very different token, obviously, than, say, a Uniswap or an Ethereum or a Bitcoin, as an investment, and then as a utility.

1:10:18 So maybe for people that are newish to space, or even people that are in the space What is the AMP token? How will it behave in the future, and what are some of the, its rights, and what are some of the things it doesn’t do? Sure. Well, that’s the easy part, because it only does one thing and it serves as collateral in the network or collateral for anyone else. So it’s literally got one purpose, only one purpose.

1:10:41 And it’s literally designed that way and has tried to now get as decentralized as possible to enable that. So that’s the easy question. So what it’s for, and how it even got created, and how it works, than something like Flexa Remember, I was saying Flexa now connects to every single, or the goal is all these other merchants, the hardware, the software it’s so seamless, everything is, you know, easy for them. Then we essentially open the sort of the payments pipe on the other side.

1:11:08 So we let any app in the world permissionlessly access the network and then pay assets into it. So that’s how that works, but you can’t build a permissionless network, because if any apps now come onto Flexa, they would just double spend us, or they would cheat, or they were trying to like commit fraud, because that’s how it works right now. So like, you can’t have a permissionless network without some sort of, like, collateral or proof of stake or something coming into the network to make that validated piece.

1:11:38 So now any app that joins Flexa, you can do so, you need to pledge collateral in the form of AMP into a smart contract. So let’s say it’s a hundred thousand dollars worth of tokens, that would mean that all of that app’s users can spend up to a hundred thousand dollars of unconfirmed transactions, whether that’s Bitcoin, Litecoin in the future, you know, ACH US dollars, or Ethereum assets, whatever they are, loyalty points there’s a settlement time of those assets, like we talked about earlier, that could be 30 seconds, it could be 45 days or anywhere in between. So basically Flexa as a network can then determine how long does it take for this asset transfer to be economically final, right?

1:12:26 So it is now complete. This is an irreversible transaction for all assets, and in the meantime the AMP serves as collateral backing all of those transactions, and so it’s essentially released or reusable again when the assets clear. So something like you know, Bitcoin maybe that fully clears in an hour, so now the AMP will be held for an hour, you know, the value of AMP for an hour, and then as it clears it then becomes reusable, but it just sits there.

1:12:54 Nothing else happens. It literally just sits there in that contract. very similar to, like, how a proof of stake validator would work, and that, for, you know, to write transactions on a proof of stake network, you need to hold all these tokens as, like, your stake, that I’m going to act honestly That’s exactly the proxy for how Flexa works. Is that any app, whether it be, you know, hopefully something like PayPal you know, American Express, Chase, Arjun’s wallet, BRD, right?

1:13:23 The whole spectrum that wants to join just puts the collateral into the contract, and you’re just off and running. That’s all you need to do. You just integrate in, you use the API, and it’s really that simple. So the collateral mechanism is now critical for Flexa to essentially be a dumb network and just let anything come in. It can make all the trends, you know, It’s, it’s, there’s a lot of sophistication, but it’s dumb in terms of it just accepts the assets coming in it’ll exchange them.

1:13:50 It gives the merchants, it works on everything, all behind the scenes. So that’s all the token does. But then, more importantly, so probably the most critical pieces is all the proceeds that Flexa derives, it purchases AMP tokens with, and then it distributes them back automatically to people providing the collateral. So what that means is, first, Flexa makes no money and has no business model, which seems absurd at first, but all the value is accrued in the token.

1:14:20 So now, going back to my little diatribe on these new cooperative networks, which makes them so powerful and so different, is exactly this. So now all of the stakers in the network are the ones earning all of the fees that are accruing all the value, and that creates now an absurd level of stickiness that is even more powerful than a centralized company, in my opinion. So even though what Flexa has, the AMP token is all 100 immutable, open source. Anyone can clone it tomorrow.

1:14:53 Now it’s the easiest thing to copy you can start copying all the other software we have that is open source, but now we have this network token, though, that’s powering everything with all of the lock-in and all the incentives, and this really nice virtuous cycle of, provide collateral to a wallet and you earn all of the fees, which is really compelling. And so it’s like, and then it creates more of the lock-in around the collateral, and then it’s like, and this is across any transaction that uses the Flexa network like, all of those fees are now going into purchasing the token and distributing it, and it’s a fixed supply token so it’s not emitted. There’s no other minting rights, nothing else like that.

1:15:35 It’s literally a fixed supply token. They’ll be used as collateral, and we get this really nice virtuous cycle. It’s where the users of the system ultimately own and then derive all of the value in what Flexa does. Wow, okay, I think I’ve kind of got my head around that. It’s some fascinating tokenomics.

1:15:53 I just had a weird flashback to almost like what the Aave, Compound people were doing, because I’m, I’m using, say, ETH, I’m swapping as collateral, I’m getting interest on it, but then I also get extra Compound and Aave tokens, which makes me part of the network and part of that future value creation and makes me want to, again, continue to use the system in a weird way. I’m using AMP as collateral, which, again, it does that really well, but also my collateral will appreciate over time too, because of that network effect. Is that a way of looking at that?

1:16:22 We’ll use it. Yeah, people use it for sure, because every use on Flexa results in a market purchase of the token, which is great, right? So for the people, still, and again it only has this one utility which is providing that bandwidth. So it actually is positive because the token price increases, that means more is more collateral available. So as a user, literally, as a wallet you’re getting more spending capacity, which is fantastic, which means that the network can grow, otherwise you’d be running into all these limits and you’d be bumping up into collateral.

1:16:53 So it’s actually very positive for the network to have this nice virtuous cycle continuing to kind of grow from that perspective. Did you figure this out, like, in, I think it was like 18 or 19 when you kind of created the AMP and retired to Flexa token? I mean, did you kind of see what was happening and thought, wow, if we do it this way, this engineers well, doesn’t engineer success, but engineers a greater opportunity of success. Is that kind of what happened?

1:17:17 No, all the economics was actually created right up front, because it’s really so critical. This is not a, so a lot of projects you’ll see, they’re a business or something else, and, like, ah, we can add a token or we can try to, like, sell a token or do these things for us. Flexa literally does not exist without a token. It is impossible. You, you cannot build the system, because you’d get so much fraud, which would be completely untenable, and you can’t scale something if Flexa needs to get every wallet to do a business deal with us and they don’t want to use that.

1:17:50 They want to start using public infrastructure. So it, it is literally impossible to build something like Flexa without some sort of a token, and so that was critical from day one, is figuring that out, of not only. And it’s still crazy now, you know, like, three, three and a half years later, it seems all straightforward, but these are things that, again, Uniswap didn’t exist. You know, a handful of these other, they didn’t exist yet. Like all these staking contracts didn’t exist.

1:18:14 None of this stuff was out there yet, so you really had to, like, kind of think about you know, what is just the core utility that you need, and then you figure out some of the tech later, and So that’s where AMP really came in. It was, so it fundamentally does exactly the same thing, but we built the new technology that now is going to enable it better than ever before. So, but in terms of the economics, the functionality, what it does or looks like is 100 the same.

1:18:39 So nothing had changed, really, at all. It was more, just like, some tech innovation that we could make this work better at, like, a more of, kind of, unique, a unique level to the token, but at a high level, macro is all exactly the same. Are you surprised at the market cap of AMP and when you get that feedback, what does it make you think? Man, this is the way I sort of look at, even when I was mentoring the the inning one, I view us as very much the same.

1:19:09 So this is a project that me and the founding team and others, we look at this as regardless of what the market cap or use or otherwise of AMP, boring Flexa is we’ve got, what, minimum, bare minimum, five to ten years’ worth of really hard work to even start getting this where we think it can be, because we have to, you know, all the various licensing, all the regulatory components, like, you know, setting all of this up is a very long-term game. So our aspirations of what we’re trying to do, you know, I sound, you know, a little bit like that crazy person. We’re going to connect to everything that’s going to work all over the world.

1:19:44 We’re going to accept all these assets, all these other apps, like that’s 100 our mission. So to do that as fast as this grows, you can’t build that in five or ten years. Like, this is gonna, it’s a really long-term project the way that we thought about it. So I think we’re really excited about the growth we’ve seen so far, particularly the support and the enthusiasm of people using this, so being able to go on Twitter and see people, you know, posting all their videos of people spending, and like, you know, real world stores.

1:20:12 That’s really invigorating for us to see, and we want to support this, and, you know, so much far beyond. But for us it’s Oh man, it’s, it, you know, we pay attention to it, and that’s any sort of traction. The validation and enthusiasm is always great, but for us this is so long term that we’re barely even started, and we’re already exhausted, but we’re going to hang in there. The founding team is, as literally all of us. There’s four of us.

1:20:37 We’ve all started companies before. This is not our first game by any means. So we know what we’re in for, and it’s going to be very hard, and we’re going to continue working. We’ve got an amazing team behind us now. So yeah, that’s kind of the way we always think about it.

1:20:53 It’s just little, little bumps in the road in the very long journey. Yeah, well, you guys are dealing with brick and mortar companies too, and so that’s just gonna take longer, as opposed to if you were just this pure online play. Just a couple, couple Final things. You know, as you move forward, you know, we see things like PayPal coming into this business and trying to enact payments. When you see them, are they potentially a competitor?

1:21:16 Do you see that as good news for what you guys are doing? And then just finally want to wrap up and find out, what’s your biggest challenge right now? So PayPal is sort of like all of those. So in general, I’m very happy with what PayPal is doing, because what PayPal does, it creates, it creates access to new types of assets. It creates the exposure, and people start using this.

1:21:39 So that’s great for everyone. Again, going back to my, like, anti-maxi arguments, right? If I were to say otherwise, I would be completely inconsistent. You just write off everything I just said. If I just said that PayPal is bad No, no, you just literally said, Tyler, that this makes everything else better, and it absolutely does.

1:21:56 So, so, totally, totally positive on PayPal and what they’re doing and their approach, and hopefully it’ll even go beyond that. It’s a not necessarily really a competitor, because they’re just rolling those assets into a traditional PayPal product. The merchant doesn’t get any benefit from it. So with us, we charge, you know, basis points, you know, potentially, for various transactions, or something much less than what interchanges. Whereas what PayPal does is it charges you the same rate for debit or Visa or, you know, crypto, right?

1:22:29 It’s a blended rate, so the merchant literally gets zero benefit out of someone paying with crypto, because they’re not getting the fraud guarantees. There’s, they’re not treating it any separately. So that’s why it’s like, cool, it’s great, it’s interesting, but it’s really not going to change much. And then I think if PayPal tried to change it now, their business model starts to change, and as a big, you know, very valuable public company, you’re going to try to break apart your business model and have payments, different charges or different policies for different assets, seems to me to be very untenable.

1:23:03 And what Flexa is doing is we want every single asset. So a universe where PayPal is trying to accept, you know, 20,000 different types of digital assets. I don’t know, because they’re, they are that wallet, right? They’re looking to really have that consumer experience. So for me, you know, an ideal case would be you know, we start working with them, and that PayPal could just use us for those digital asset, you know, acceptance piece and so they remain PayPal customers.

1:23:31 They have a PayPal wallet. PayPal can sell them credit products, and use, you know, how they already monetize their business, and then they just use us as the payment rail for all the digital assets in which merchants do get the benefits out of using those assets. So that, I think, I’m hoping becomes, you know, clear across other parties. And the way that you kind of perceive this, so for us, you know, we look at it very very collaborative. We’ve done, you know, the dirty work that no one else really wants to do.

1:24:00 When you use Apple Pay or PayPal or otherwise, when you scan something behind the scenes, no one cares, whatever rail is using, or however those assets or the funds are getting transmitted, no one really cares. So that’s, but that’s what we do, and that’s what we work really, really hard to do, absolutely the best. It’s like the innovators it’s like The Innovator’s Dilemma, where, you know, the innovator can never, you know, be the established company PayPal used to be the innovator, but now they have owned their own dilemma, right?

1:24:27 Because they have a business model that they, we need someone like you to innovate, right? Yeah, well, I don’t even know if you can, right? They’ve just built a niche and built the barriers, which is great and now it’s just like, what does that look like? Because certain things you can’t innovate out of, so it’s just a matter of, like, how do you still monetize, right? So it’s like a lot of these technologies, if you were a horse and buggy, right, maker, and cars come out.

1:24:53 It’s like, well, I can’t really, you need to pivot into something radically different, which is, you know, essentially impossible, or figure out ways to still monetize whatever you then have. So I see a lot of that happening. And then even the interesting thing too is how it can be very collaborative is that, so Flexa even built, you know, the majority of the infrastructure in El Salvador recently. When you have all these Bitcoin payments. So, like, we’ve done this now for an entire country.

1:25:18 It’s where the largest banks of El Salvador are using Flexa for, you know, Bitcoin deposits, online payments through their online gateway, paying Bitcoin or dollars to friends, paying their credit card bills. All of that is done now through the Flexa infrastructure that we’ve built up for them, that is now so simple to a user and everyone else. It just works behind the scenes, and it’s the boring stuff, and we’ll just make that work and continue to make that work, and so that’s where, you know, we could connect to a PayPal or others to use that very easily.

1:25:50 So I really think that it will be much more collaborative in the future Because we’re not a consumer company, we’ll really connect to all the stuff that’s already out there, and that’s really the vision. Unless it’s learned from El Salvador? I mean, you said people don’t necessarily want to spend Bitcoin, but just maybe finish up on lessons learned from El Salvador. You did this kind of on a smaller country Will, will this scale? Will people spend Bitcoin?

1:26:13 Anything that we should know that you learned or doing that? Yeah, so the coolest thing that we learned or experienced. And because we talk about these things, right, we’re already, like, years and years ahead, or something else, and so we’re working with the banks there. The number one question that came up throughout the entire process of funding your wallet, using it to pay for things, setting up an account, all these other things. Number one question by far, anything else that was out there, was what is Bitcoin?

1:26:44 So we aren’t even to the level of how do you actually do any of this. It was literally what even is this stuff? And that’s actually why I get very excited about it. So I already have my own opinions As a Bitcoin enthusiast for a country Mandating that Bitcoin is legal tender, I think that sort of is against the Bitcoin thesis, in my opinion. So as a very active user, I saw that as, like, ah, that’s that’s okay, but I’m not really gonna cheer for this, because, like, this is a centralized thing.

1:27:20 It’s a little thing of like having choice, and now it’s getting forced of, no, now you must use this, and a lot of people applauded that I was like, well, it’s not really the ethos that I, and it is what it is. So I’m not saying it’s bad, but I have that little bit of reservation around it, but I’m super excited, though, because millions of people, literally millions, have now onboarded the system that are learning about it. So that’s really the silver lining that I see.

1:27:45 And so you’re taking you know, one or two billion people that are asking the questions, what is Bitcoin, and now they’re starting to know, and that is really exciting to me, and that, to me, is like worth putting so much time and effort into what this looks like in the future, because whether it’s Bitcoin or other assets, just these systems and what they can start to enable, you know, for everyone is really exciting. So that’s the thing. I think number one learning from that, lots of hard work, by the way, and the team has done just such a phenomenal job in setting a lot of that up, particularly One of our co-founders, Trevor, who’s really led a lot of all that work with the banks, and our product work has been phenomenal.

1:28:27 So, but even on the legal side, we had to go get, you know, the ability to operate a money services business and legally transmit all this money between all these banks, you know, in 90 days. That was a process, to say the least, but one that we did, and we worked with an entire team and our team and went through to make sure it was done legally. And with the right, you know, not just a can’t go fast and break things in this financial world. Like you get one shot, then the credibility that you have.

1:28:55 So, but yeah, that’s the, from all of that, just the enthusiasm and knowing that now millions upon more millions of people will start learning about this, where, you know, and then not to go too much longer, but, you saw Facebook and Diem, right? And that I feel the same about. Yeah, what is Yeah, what did you read there? What did you read on Facebook and Diem? Yeah, so is Diem a Facebook competitor, and if you’re a Bitcoin person, should you care about Diem at all?

1:29:25 Like, probably not, right? It absolutely is not, is so fundamentally different in every single way. It’s where the Facebook coin or otherwise has nothing to do with Bitcoin. They are fundamentally different things, but sort of this theme that I’ve really been weaving together is, though, more people have digital assets, more people are going to spend them, more people want utility around this. Oh, what else is out there?

1:29:48 Oh, what’s this Bitcoin thing? Oh, I can do this but without the centralized entity, and I can set up my own. I get told, so I see it being a very similar effect, and now you’re dealing with billions of people. So I think they have bought, something like 1.7 billion worldwide users. So now, well, you see something like in El Salvador, what is Bitcoin?

1:30:07 Now you’re gonna have 1.7 billion people saying oh, what is this? What is Diem? How does this actually work? Like, what is this? Where did it come from?

1:30:14 Oh, there was an old white paper, and it’s evolved a lot. So again, I’m not trying to say the merits or or demerits of the token, but it’s going to open up so much enthusiasm and usage, and I think everyone will start to benefit. Merchants would get much cheaper transactions. So this is going to be a great utility system for them, and then people start getting onboarded and use these sorts of products way more than ever before, like I’m hoping it really becomes an inflection point for all of us, and that when people see this, there’s so much momentum around it, and news, you know, positive and negative, but everything all happening.

1:30:53 I’m hoping that it’s actually going to be a really big deal. Not like overnight things change, but where this starts to tip and where this starts to go from there. I’m very optimistic that it can. If I can, you know, launch and do 10 of what it says it can. I think it could be super interesting, and that’s for Diem, and it’ll also just pull the rest of the ecosystem along with it.

1:31:14 Absolutely, absolutely. A black hole. I think it’s good, because, yeah, new users, now that no idea what any of this is. And when we talked earlier around user interfaces, right? Like, I’ve got to imagine Facebook will make a pretty nice interface for how you interact with, like, these tokens, or even just your balances now, that’s something that others can then see.

1:31:34 And then, oh, guess what? Now the 1.7 billion users that now have a framework for working with these things, right? To understand what balances look like, how do you send it, how do you, like, all of this, you know, that even just UI/UX. I mean, they’re probably what, the most, one of the most prominent UI/UX entities in the entire world, for good or sometimes evil, right? Like, they are, for what it is now.

1:31:59 They’re going to employ that to payments, and we’re going to be able to benefit from that. They’re going to be able to balance management, token management, sending. Like, I just see all these things, and the opportunities are so widespread to where I can’t be anything but bullish for me and others in crypto, and that will just, yeah, it’ll bleed into a lot of the other things that we’re doing in a positive way, even though I am absolutely not saying that Diem has any business whatsoever as a competitor or an alternative or anything related to Bitcoin or these others.

1:32:28 They’re wildly different things. It’s like saying, yeah, here’s my gold coin, and then here’s, like, a rock, right? Like, they look a little similar, but they’re totally, totally different things. Yeah, yeah, but you’re right. I mean, first of all, I appreciate your optimism, you know, because a lot of people, it can get very tribal in this space.

1:32:46 And again, it’s one of the reasons this space exists is because it’s tribal, right? People, you know, become part of the group, and they become part of the system, and then they promote it. But I mean, it’s very easy for people to say, no, that’s bad, and that’s not the right way, and that’s wrong. That’s where we get the maximalists. But I’d agree no one’s ever said this on the show, but you’re probably right.

1:33:03 Ethereum is the greatest thing, you know, to ever increase Bitcoin’s value. I’m sure Keiser is cringing right now in his chair to hear that, but you’re right, and Diem is a great way of thinking about that because ultimately this is an education and PR battle, right? That’s what you learned in El Salvador, and again, you know, we’ve been broadcasting in this space, and ever, the whole community is like, please tell more of the world, and two percent of the world now is in this echo chamber of crypto, and we think everyone knows about it, and I try to remind everyone.

1:33:30 No one knows what an NFT is. Nobody knows what this is. Nobody knows where smart contract is. Just you and your five friends know. And so we could spend the next 10 years broadcasting educating, or maybe with Facebook putting it on, like you said, the most widely adopted user experience in the world, and in parts of India, the internet is Facebook, right?

1:33:50 They don’t know the difference, because it’s on all the mobiles and stuff So it’s only a good thing, right, if people are embracing blockchain instruments. Yeah, look at another great example in the Western Hemisphere, Central America, South America. I mean, WhatsApp has something like 95 to 98 penetration of, like, the entire population. So you literally have now tens of millions of people that all have these devices already. They know how to use them all.

1:34:18 So now they can get remittances, pay their friends, whatever else, with these new digital currencies that they’ve never had before. People still don’t, I don’t think, get it. Often, people that are fortunate enough to have bank accounts, or you pay a lot in cash. There hasn’t been this overlap where people have truly found this utility of, like, what these digital assets can look like in terms of verified transactions, quick transactions. you know, in the US we’re used to think, oh, it’s three days to get a bank transfer, to get enabled, or you have to go to the bank to, like, do this wire, and, like, you can do all these things much, much faster and more efficiently, and I don’t think a lot of people have caught that quite yet.

1:34:57 You need to see it right? Once you see it and then you use it, you start to believe in it more, rather than these things that are just these new technologies that you’re scared of. And I think the same, right? And, you know, think about Argentina or Brazil or somewhere else in South America, or it’s cash, and now there’s going to be all this app. I don’t want to put my money in there, like, I don’t trust it, or whatever, and then it’s now going to appear, and it can work, and it can work really simply.

1:35:21 There’s a lot of potential for that, of, like, what it enables. Yeah, almost back to that first statement you make. Like, there’s the value chain is in the state itself, and it’s something we’re just not used to, like, the internet changed our lives, and we’re all like, wow, but we still never got to head around the fact that money could be there, right? It’s always separate, right? Of the payout my bank, the three days, settle it, might, you might even have to have this generation die with that concept, and I got two young boys there, four and five years old.

1:35:49 They will probably grow up, like you said, where the value chain has always been in the communication chain, and now it’s normal, and we don’t even think, maybe, about a payment. You think of a payment the way you would a text message, or maybe you don’t think about it anymore. I guess that’s, I hope so. Yeah, well, Tyler, I’m surprised you’re so fresh for all the work you guys are doing in the background, because it sounds like some serious hard work. I mean, startups are always hard work, but it seems like even harder work, what you guys are doing.

1:36:18 Final thoughts for you, and, like, biggest challenges for you coming up in the next few years. Uh, there are, man, there are so many challenges to count, honestly, but I’d say the the number one would just be around continuing to grow the ecosystem with really, really smart talent, particularly engineering talent, and then even particularly with Flexa, we’re so motivated, we’re so passionate, we’re working so hard on all this, where it’s often very hard to slow down and add more people, right, and gain more functionality and scale. And so for us, having that focus, it’s a little bit of a blessing and a curse, because we’re running so fast.

1:36:56 We’re all so motivated, we’re so passionate, we love this, and we haven’t kind of grown as many folks as we really should have and we’re really excited. People haven’t left. That’s a phenomenal team, but I’d say that’s really the big challenge for us. is ensuring that we continue to grow and build the right team, and that’s always just a big challenge. So I’d say that is really what we’re at.

1:37:18 And it’s a, this industry, or this awareness of these things, have grown so fast going to the point I made earlier around the acceleration. Like, I remember telling people you know, two years ago, around, like, oh, Facebook could make a token. It, that was crazy, right? Like, they’ll never do that. Why would they ever do this?

1:37:36 That doesn’t make any sense. Well, you know, so that, to even think that we’re here, from where we were two or three years ago, is already way, way, way beyond my expectations in terms of the awareness, and it’s really just, like, purely inevitable now. So I think that, looking in that lens and how things have grown so fast across all of crypto, is, I couldn’t imagine anything more exciting than this, and having the opportunity to participate in any way.

1:38:05 It really is, I think, a once-in-a-lifetime opportunity, and there’s gonna be so much develop from this. So it’s just, I, that’s why, we, you mentioned, oh, we seem fresh. It’s because we love it. We literally love what we’re doing, and that, you know, it’s so exciting what this all looks like. So it’s so relevant, and that this has such a big impact to the world, but then it’s also really cool, and that, it, that’s another thing about like crypto that is really compelling.

1:38:32 It’s math, it’s science, it’s economics, it’s philosophic, it’s philosophy, it’s communities, it’s whatever else, everything. It’s literally like every little element of, like, a business or a technology is all woven into, like, the fabric of how these works, which it’s, they’re never a dull moment. That is absolutely for sure. It’s weird. It’s, since it’s, it’s somewhat mathematical and scientific, but in a weird way it’s a reflection of humanity You know, there’s politic, you know, it, and I always say this.

1:39:05 I mean, you know, Jeff Booth finished off his episode by saying Bitcoin will save humanity, and we could maybe insert blockchain, we’ll save humanity. But I don’t know, I think it might actually make us become the best versions of ourselves, you know, individually and as a culture, whereas there’s a tendency sometimes not to. So again, I’m 50 years old. I’ve been through a lot of different industries, you know, like I said automotive, aerospace, saw the dot-com, and I couldn’t be more excited to be in this space, and I think this is probably the most exciting time to be alive as a human, and maybe we’ll be for a thousand years, and like I said, like you, I just want to contribute in some way and be a part of it.

1:39:47 So for us, I think it’s going to be education. Is what we’re going to really focus on, because that’s something we’re pretty good at. And again, I get more excited every day that I’m in this space, and that doesn’t always happen with me. So it’s a beautiful thing, and I can feel it from you too. So, yeah, just super excited and thank you for the time.

1:40:09 If people want to learn more about Flexa or AMP as a consumer or as, you know, a retailer how do they do that? So just Flexa network is the website, so that’s much more merchant focused. there’s also amp token.org, and then on those links you’ll find other community links like Discord. We’re fairly active in Discord, email newsletters, Twitter, all that sort of stuff. So those are the two primary hubs.

1:40:38 You’ll find all sorts of information there, all right, fantastic stuff. There he is, Tyler Spalding. You’re gonna have to get to London. We’ll show you some real history over here. I’d love to.

1:40:47 We’ll take you to the, uh, to the equivalent of the Boston Library, British Museum, and stuff So look, next time you’re in London, come by, stop by the studio. Appreciate the work you’re doing. This is by far the best interview you’ve ever done, if I can say so myself. Great to see your perspectives on the rest of the market. We haven’t seen that before, and I took some real nuggets today.

1:41:05 So appreciate you, thank you so much, and we’ll see you next time on London Real. All right, thank you, Brian. It was an absolute pleasure. Thanks again, guys All right, good stuff. Thanks everybody.

1:41:14 We’ll see you next time. Bye So you