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#14 Web3 Auth with Dynamic co-founder Itai | POT: The Cryptocurrency Podcast
77 Plays2 years ago
Dynamic emerged from a desire to tackle the complexities associated with using blockchain technology. The result is a web3 authentication solution with support for tradition social and web2 logins.
Bridging Web3 and Traditional Authentication
For Dynamic - Web3 comes first meaning that their authentication solution was built with web3 at the core of the application, however it also offers tradition web3 Auth and SSO and can link the various different identities between each other.
The company's approach enables users to log in using familiar methods such as email, Google, and Discord, while simultaneously creating a wallet in the background. This blend of traditional and blockchain-based authentication aims to democratize access to crypto-enabled applications, ensuring that users can enjoy the benefits of blockchain technology without needing to navigate its complexities.
This is a trend that's been emerging in crypto in the last year and we'll likely see more and more user-focused solutions where complexity keeps being abstracted away.
The Future of Digital Identity and Authentication
The conversation touched on several forward-thinking concepts, including account abstraction and token-bound accounts. These innovations represent a leap towards more secure, flexible, and user-friendly digital interactions.
Account abstraction, for instance, allows for customizing wallet functionalities, potentially transforming how users manage digital assets and identities. Similarly, the introduction of token-bound accounts opens up new avenues for asset ownership and transfer, illustrating the dynamic nature of blockchain technology's evolution.
The Expansive Potential of Web3 Applications
Creating tools for developers means that you get to see some of the absolutely wild and unique ideas that people are building, from reimagining music ownership on the blockchain to tokenizing real-world assets like land and collector's items.
These examples underscore the transformative impact of web3 technologies across various sectors, highlighting the vast potential for creating new experiences and value propositions.
Looking Ahead: Dynamic.xyz's Vision for 2024
As Dynamic.xyz looks to the future, the focus remains on simplifying the integration of web3 technologies into everyday applications.
The goal is to make deploying crypto-related functionalities as straightforward as possible for developers, thereby accelerating the adoption of blockchain technology across different digital experiences.
Recommended
Transcript
Introduction to Crypto's Focus Areas
00:00:00
Speaker
There's a little bit of a focus, I think, too much on the pricing side of crypto, but the tech side of crypto is actually really cool, right? You can look at companies like Visa and MasterCard and their experimentation there, which is it is fundamentally a better financial rail for a lot of things versus an ACH or a SWIFT.
Introducing 'Proof of Talk' Podcast
00:00:26
Speaker
Hello and welcome to Proof of Talk, the cryptocurrency podcast where we invite leaders and builders into the space to come on and talk about their experience in the industry as well as the projects and products that they've been building. My name is Andre and I've been in the cryptocurrency space since 2017.
Andre's Background and Introduction of Itai
00:00:40
Speaker
I've also helped co-found algorithmic crypto trading platform ACIR that enables users to quickly and easily automate their trades while managing the risk. I'm here today with Itai, who is the CEO of a Web3 authentication solution called dynamic.xyz.
00:00:56
Speaker
How are you doing, man? I am doing well. Life's good. How about you? Yeah, same. Pretty good. Pretty good. I think, look, I think you guys have a really cool solution. I think I've seen authentication, like many authentication solutions, but I don't think I've seen a Web3 focus authentication solution that's also doing SSO and some other bits. So I think it'd be fantastic to explore that.
Itai's Journey into Cryptocurrency
00:01:21
Speaker
I just thought
00:01:22
Speaker
Maybe it's a question that I started asking people now that I find really different answers. Like, how did you get into crypto and Web3? And what's your journey being like to get to the point where you are right now? Yeah, absolutely. So we so my co-founder, the folks that are dynamic or two, it's my co-founder Yoni and me. Yoni is
00:01:47
Speaker
I think one of the best engineers of all time. And I'm more on the product and kind of business-y side. And Yoni and I have known each other for about 18 years at this point. And in 2012, 2013, we started getting really into crypto.
00:02:04
Speaker
And so, you know, I think we bought our first Bitcoin around that time.
Founding of Dynamic and Inspiration from Solana
00:02:09
Speaker
And if you kind of go back and look at kind of the chat history between Yoni and me over the last, you know, 10, 12 years, I would argue that about 75% is crypto related.
00:02:21
Speaker
Damn. We've been obsessed with this concept of shared rails of kind of a decentralized system where you can transfer value globally for a very long time, but always from the sidelines.
00:02:36
Speaker
I would argue we got into crypto twice the first time when we actually got interested in this space in 2012, 2013 and started being obsessed with it and followed. We thought we were late to Bitcoin and late to Ethereum and late to Solana and we had all those feelings. But then the second time we got into crypto was when we actually started Dynamic. It was very clear to us that we're going to start a company. It was very clear to us that we're going to start a company crypto because that was the topic we were most excited about.
00:03:06
Speaker
Right. When did you found Dynamic? We found Dynamic officially end of 2021. So December 2021, we raised our seed shortly thereafter, and then we started building an actual company. All right. Congrats. Thank you. Also, congratulations on the Solana support. I noticed that you've recently started adding that, so that's fantastic. Thank you. I appreciate that. That actually, by the way, that ties into why we started Dynamic. So we, you know, and around
00:03:35
Speaker
September, October 2021, um, we got obsessed with anything Solana related and we, I think we were trying to mint Dejan Apes with one of the first Solana mints and we got so upset by the process. We're like, okay, clearly there needs to be a better way here. Uh, so actually Solana is not just an announcement
Tech Affordability and Solana Phones
00:03:59
Speaker
today. It's actually a part of the reason why we started dynamic. We actually had on our,
00:04:05
Speaker
seed kind of, you know, wish list to get investment from Solana and work closely with that team, which we did. And so it's kind of a full circle for us on that launch. That's incredible. Do you have a Solana phone? I do not have a Solana phone. I kind of wish I did. I have, I've, I've, I've found about multiple things. Solana phones, one of them in the Apple vision pro is the second at this point. So I, it's both are on my wish list of things to when they get.
00:04:34
Speaker
I know I know that feeling. I feel like I'm in the exact same spot. So I've just recently found out Solana are doing a preorder for chapter two, which is supposed to come out in 2025. And if you get it now, you only need to pay like four hundred and fifty dollars, which for a mobile phone, that's super cheap. So I'm really considering it. You should go for it. You should go for it again. I don't think about it as four hundred and fifty dollars. Think about it as
00:05:03
Speaker
one eighth the price of Apple Vision Pro. So I think everything should be priced in number of Apple Vision Pros.
00:05:12
Speaker
I don't know what it's like in the US. I think the price in the state starts with like 3,500 or something in Europe.
Crypto as Invisible Infrastructure
00:05:20
Speaker
It's insane. It hasn't yet been released in Europe, but there's some, there's some leaked footage about what the pricing is going to be about. So I think the top of the range, which has, I think maybe a terabyte of memory. Maybe I'm wrong, but I think it's got like a terabyte. It's 6,000 euros. Wow. Okay. That's, I mean, again, think about it. That's 12 Solana phones.
00:05:43
Speaker
Yeah, that is crazy. I do hope that future iterations are going to be a bit more affordable because at this price point, it's just like a toy for the rich. I don't think how you would normally... I just don't justify spending six grand on that kind of device. Imagine you could get yourself a really high-end computer, a great phone, a VR headset, and probably a scooter, electric scooter, if you want it all in that price.
00:06:10
Speaker
That is a good point. That is a good point. It is very out of reach. I 100% agree. I think it's also TBD, whether it's actually something you use on a day to day basis.
00:06:20
Speaker
Yeah, we'll see if it's actually going to disrupt the way people do things. It is interesting tech. I like the technology behind it. I saw a few videos of the features that it has. There's definitely potential and I'm interested, but I'm not like 6,000 euros interested. I agree.
00:06:41
Speaker
Okay, so obviously you do Web3 first, but you also do SSO, you do Google, you do Discord, you do X and authentication with social media. What's the connection between the two? Yeah, so actually on the SSL side or the email, social, phone, login, it's not the login side on its own, it's login plus the generation of an embedded wallet.
00:07:05
Speaker
And really that part of the business is around solving this really interesting problem, which is we fundamentally believe that anything you use, if you open your phone and look at your apps in a couple of years, everything will have a crypto component. And it might be in the forefront, right? It might be that you open your app and you can see crypto in the forefront. It might be completely the rails for your application to transfer money or transfer identity without you ever knowing.
00:07:33
Speaker
If it's the rails for your identity, if you log in and you can, you log into app A and you can send money to a different app, app B, and it just kind of works and it's dollars on one end and dollars on the other or euros or anything like that or pounds, you shouldn't need to know it's crypto. You should just log in with your email or Google, et cetera, and have everything work.
00:07:55
Speaker
And so that part of the business, what we're trying to do there is help developers create that experience, create essentially the crypto-enabled stack. The ability for you to log in with your email address, log in with your social address, but then generate a wallet, which is your outlet to the crypto ecosystem and use that as a way to kind of create these really innovative apps.
00:08:18
Speaker
They use crypto in the background, but without folks saying crypto
User-Friendly Crypto Integration
00:08:22
Speaker
at all. We see a lot of our customers, by the way, do that today. So IYK that's doing physical to digital experiences or bracket game, which is a social kind of sports game or anything like that, have completely abstract away crypto and use email, social login, and put crypto in the background.
00:08:42
Speaker
That's really interesting. And it's really interesting you've mentioned the word abstract away crypto or the complexity of crypto. I was literally talking to OKX's chief of innovation the other day, and I'm not sure if I'm supposed to say this. I guess I'll find out. Yeah, everyone's been talking for weeks, I guess.
00:09:04
Speaker
Yeah, but they're also introducing a crypto wallet that's supposed to abstract away from the user having to connect to different blockchains. So they're going to support 85 plus blockchains straight out of the box. So it's like your gateway to Web3. It's no longer, oh, this is EVM or it's just here. Here's the entirety of Web3. That is very much where I think we'll go as an industry.
00:09:33
Speaker
which is crypto is this magical thing. It really is this magical thing that allows you to create permissionless innovation on top of these shared networks. It's the concept of
00:09:50
Speaker
an email network where I can send something from Google and you can get in an Outlook, but for money and for identity and for everything else. But the challenge is there's a lot of complexity and implementation of this stuff, right? It's not. So what we'll see in my opinion over the next couple months and years is that abstraction
00:10:11
Speaker
And that abstraction layer is a combination of authentication, and embedded wallets, and account abstraction, and on-ramps, and off-ramps, and to your point, abstraction of chains.
Interoperability and Blockchain Complexity
00:10:21
Speaker
So solutions like you're describing, or bridges like layer zero, or wormhole, that essentially are all kind of different components to I want to log into an app with the way I want to today.
00:10:39
Speaker
and transfer information or money or identity to a different app and not have to worry about anything else, not have to worry about chain or conversion or on-ramp offer, just have it work, right? And that's what we're going to as an industry. And so I'm not very surprised that OKX would be or anyone else would be developing something like that. I think it's going to be an extremely powerful feature.
00:11:05
Speaker
Oh, yeah. And if you think about the kind of what enables you to do, it's actually just using it as a user because now there's only so much complexity around it. There's so many decisions at every single point, what chain you're going to use, what kind of wallet you're going to use. You can't stick with one kind of solution. If you choose Ethereum, well, you're not going to be able to connect to Solana.
00:11:28
Speaker
So you need Phantom, but then you only have Solana and nothing else if you keep track of so many different things. But I saw that you guys support Cosmos, which is really cool because I love Cosmos. And I think Cosmos is kind of this idea of, you know, the Internet of blockchains, everything interconnected.
00:11:48
Speaker
But the barrier to entry there is existing chains are finding it quite difficult to integrate with their like intercommunication protocol because it's not as easy as a bridge. The way it works is it creates kind of like a very light version of blockchain A on blockchain B. So both chains are aware of each other state.
00:12:10
Speaker
But it requires cooperation across everyone. So right now, you do have the change that started using Cosmos SDK, but you don't have the change that didn't start with Cosmos SDK in mind. Yeah, no, absolutely. I think, look, the way we think about this stuff, right, and the reason we have Cosmos and Solana and EVM is at the end of the day, complexity creates room for business opportunities. Yeah. Right.
00:12:34
Speaker
they create room for value-added service that can abstract complexity. And so every time, to your point, you describe complexity on the Cosmos chain, I hear that as an opportunity for a startup to arise and abstract that away.
00:12:55
Speaker
Yeah, no, for sure. There's so much opportunity there. There's probably too much opportunity in crypto. That's why you have so many products coming out. So if I connect my app using your Authenticator, using Dynamic on Cosmos, would I have access to the data that all Cosmos SDK chains use? Can I use all of the other apps?
00:13:18
Speaker
It's a good question. On Cosmos, we still only support third-party wallets. We don't support our embedded wallet just yet. Once we do, yes, ideally, you will be able to access all of them. There is some nuance there. It's a non-trivial project. It comes into the idea of, is an embedded wallet a global wallet or a siloed wallet? There's a lot of nuance there that we're working through.
00:13:44
Speaker
Yeah, I expect it's a non-trivial thing to do for sure. Yeah, let's call that Q3, Q4 roadmap
Dynamic's Web3 Authentication Approach
00:13:53
Speaker
items. Fair enough. But you can SSO just as you would normally and not have to worry about Web3 if you didn't want to, right? That's exactly right. So maybe we can give it in the sense of a game or a sense of, let's give two examples. So there's a company called IYK. IYK does
00:14:12
Speaker
kind of physical digital experiences, right? You might get a really nice piece of merch and then you can tap and scan it with an NFC code and get a digital version of that or digital kind of experience as a result. For that digital experience to happen, you need a wallet, right? But you, the person buying that shirt or buying that piece of merch, should not really care about any of that stuff. You just tap, you should log in with your phone and you should be good to go.
00:14:39
Speaker
And so that is an experience that we're essentially trying to build that someone going through the full crypto experience without knowing the script, or there's another company called Bracket Game that gives you the ability to buy shares, virtual shares in NFL teams for games, right? Right.
00:15:02
Speaker
You, as a person that just wants to participate with your friends, shouldn't care about crypto. You should just be able to participate and engage with the 49ers or the chiefs or anything of that sort. Those types of experiences, we call them the crypto-enabled companies, are these magical experiences where you don't see crypto at all. It's just an infrastructure layer.
00:15:27
Speaker
Yeah, and I see that kind of as a trend across different companies, which is nice to see that there's this kind of understanding that you need to abstract away from the complexity of crypto. There's these guys at Horizon. They're making a tool that allows game developers to access web3 data in game engines, like in Unreal Engine and Unity. They have SDKs for that, so you can query the chain, get the data you need.
00:15:54
Speaker
basically put it in a game. It also allows the creation of wallets under the hood. So let's say you have a player, you create an account, so your inventory is going to be basically your wallet and your items are going to be the $7.21 or $11.55 NFTs. But you as a player, you never really know that. You just go and play the game as you normally would, which is what we want, I guess.
00:16:21
Speaker
That's exactly right. Well, it's a very good point. I think there's a kind of a vicious cycle, which is you create that experience. Let's say Robin Hood creates that experience. And every time you open your Robin Hood app, it's a full wallet. But then Robin Hood or Steam or anything like that says, well, we want to be your identity provider. So let's let you connect your Robin Hood app to other apps.
00:16:51
Speaker
And that uses a wild connect or anything like that. And so that lets you kind of exchange information and money between apps. And so there's this cycle of like crypto in the background, but then crypto turning to be in the forefront and back and forth again. So it's this really interesting, I think back and forth that we'll see, which is now everyone's around. Let's simplify this. And then I think in a year, everyone will be around. Well, great. We created these experiences. Now let's tap into this ecosystem.
00:17:19
Speaker
right yeah so once you have a product that's simple enough and works the way it should you can go back to let's explore what else we can do with this technology that doesn't necessarily mean simplifying it down but to your point about simplification you you see this in in almost every
00:17:35
Speaker
every other industry, especially in the automotive industry, you open the hood of a car 20 years ago, you're going to see all the wires and everything sticking out. You could just get in there and fix it yourself. You open the hood of a Tesla. Well, I mean, Tesla's not a good example because it doesn't have a traditional engine, but like a BMW or whatever. Do you see nothing? There's nothing there you could understand. You don't have to.
00:17:57
Speaker
That's exactly right. You don't have to, right? Like there's, um, if we go to the auth part for a second, right? When you click login with Google or login with Facebook, you don't need to know that uses OAuth, right? And you don't need to know the uses kind of how tokens get, get exchanged, uh, back and forth, or you don't need to know how GWTs work. You just need to be able to click the button and have it work. Right. Same way, by the way, when I transfer money from me to you,
00:18:25
Speaker
and you're on one side of the world, I'm on the other, I shouldn't need to know that A-C-H or Swift or anything. I just need to know that I click a button and ideally you see that money almost instantaneously and ideally it's very cheap for me to do.
00:18:43
Speaker
That's what you
Regulatory Challenges and Crypto Evolution
00:18:44
Speaker
need to know. And that is the experience that I think we're starting to see. Or you need to know that it makes sense, in my opinion, that you buy a virtual asset on game one, and you just open it and see it on game two. You just need to know that it works. You shouldn't care about the technology or the underlying experience. You just should know that it works. And that's, I think, where we're going crypto in general.
00:19:11
Speaker
Yeah, and I think to get there, you have to develop a series of tools that really help the developers create that experience because the easier it is for a developer to use the SDKs, the tools for the platform to integrate your authentication service, the easier it is for them to create the seamless experience for the user.
00:19:33
Speaker
And again, it's a recurring thing that I'm seeing. I'm seeing a lot of people in crypto building solutions for developers so that then eventually the end user will benefit from those solutions, right? And I wanted to get a little bit into kind of what's under the hood, not getting super technical, but what's under the hood a bit for dynamic. So you have a dynamic SDK for React.
00:19:59
Speaker
So people can just natively use that in React. I had to look, it seems super intuitive, super easy to use. Do you or are you planning to support other frameworks in the future? Yes, short answer is yes. Longer answer is we're going to launch React Native in a couple weeks, which is our next React Native and Expo apps.
00:20:19
Speaker
for kind of mobile native experiences. And then, obviously, we'll expand beyond React, right? At the end of the day, we're an SDK that tries to kind of extract away your authentication and better wallets. And so, whether you're building a Vue app or whether you're building a Swift app or a Kotlin app, it should just work for you.
00:20:41
Speaker
So it is very much within our roadmap for this year to expand the SDK to just give you the flexibility on the chain that you need. There's a lot of work to do that, but that's very, very much the plan is to just allow you to use it, whether it's a Unity SDK or anything like that, it should just work.
00:21:03
Speaker
Cool. And what was the main reason for choosing, for starting off with React? Are you particularly, do you prefer React instead of other frameworks like yourself? I would argue that 99% of the projects we have met in crypto use React. And so it is, uh,
00:21:24
Speaker
I can count on a single hand the number of conversations that started with people saying, Do you have a view? I was about to ask that. And so it is, there's so much dominance of React.
00:21:41
Speaker
in the space that it made sense for us to start with that. And we haven't seen, frankly, the need to kind of expand from that besides React Native very quickly because it hasn't been a sales blocker for us in that front. Right. Yeah, I mean, it makes perfect sense. You supply whatever their developer need is. And I know that React is still the most popular front-end framework for now, so that makes sense.
00:22:11
Speaker
Yeah, I think it's going to be hard to beat. I think they have a significant market dominance. Yeah, yeah. Well, they saw the Angular at some point, but eventually React became just the big. That's true. As a former Angular developer, it tells me that I kind of picked up the wrong framework, but I do not hear about it anymore. It's very sad to me. I like Angular. It was very heavy as a framework, but it's very sad to me that it went away.
00:22:42
Speaker
So I was watching Fireship. I'm not sure if you know the guy, the YouTube channel. He does some amazing videos around coding, around what's new in tech. So it kind of gives you the latest scoop in tech. So he
00:22:57
Speaker
is actually had a video on Angular, and Angular is making a comeback with a lot of features that people wanted for a long time. Now, I'm not sure if it's a comeback in the, like, React, you know, getting over React kind of way, but it seems that they're adding a lot of features that people wanted to see for a long time, simplifying it and making it easier to work with and just making it a bit lighter, too.
00:23:20
Speaker
I've never used React. I actually started with Vue, and I got comfortable with Vue.js, and I moved into Svelte, and I'm just playing around with Svelte, which is nice, but it's kind of strange a bit, because it forces you to do things you don't really want to do, like having a certain, like you have to name your files like page dots plus page dot Svelte, or plus server dot TS, whatever, you can't just name them whatever you want.
00:23:49
Speaker
Yeah, no, I'm with you on that. I feel like we hear of, when you get into the kind of developer tools business, like dynamic is, you realize pretty quickly that technology on its own doesn't win, but rather a community and community engagement and distribution wins.
00:24:11
Speaker
And so, my two cents, and I'll say this knowing that I'm usually wrong, so take it grain of salt, but my two cents is that, you know, React is winning not because it's the best technology. It's not winning because it has so much inertia and so much momentum behind it. It's going to be very hard to dethrone. Unrelated to whether someone comes up with a 10X thing, right? It's good enough.
00:24:38
Speaker
And so that is kind of one point I think about Angular, in my opinion, is that it wouldn't matter necessarily if Angular is 10x as good. It would matter just that React is so ingrained at this point. I think it's going to be, for many years, hard to overthrow.
00:24:57
Speaker
Yeah, definitely. I mean, that's, I feel the case with most developer tools that have wide adoption. Like you look at the banking system, 80% of it still functions on COBOL, which is a programming language written in the fifties or something. It's completely obsolete. And if you are a COBOL developer, you're making bank on that legacy code. Like it's crazy. It works well. Things are hard to change.
00:25:24
Speaker
True. Well, that's why we have crypto just to make that change in the world and to kind of bring the financial system into the 21st century. And hopefully, relation is on our side. On that front, there's a difference, in my opinion, between I think historically with crypto, there was a little bit of kind of a perception that crypto was around a rip and replace of the existing financial system.
00:25:50
Speaker
Right. And I think the progress is much more kind of an additive progress, right? And there's a little bit of a focus, I think, too much on the pricing side of crypto. But the tech side of crypto is actually really cool, right? You can look at companies like Visa and MasterCard and their experimentation there, which is it is fundamentally a better financial rail for a lot of things versus an ACH or a SWIFT.
00:26:17
Speaker
And so it can be additive. You don't have to rip out an ACH or a Swift or kind of credit card networks, but rather you have to add it as an additional option in your app and route things there when it makes sense, right? And so the thing I think crypto has going for it, in my opinion, these days is that it's not a rip and replace system, but rather it's an additive thing that can work really well over time.
Decentralized Networks and Innovation
00:26:47
Speaker
Yeah. Yeah. Well, it became an additive thing, I think, in time. I think back when it started, the idea was, OK, this is just better money, pure and simple. This just makes sense if you look at the white Bitcoin's white paper. But then all of the scalability and security issues and people's realization that this is really early and there is going to be so many exploits and other issues that are going to crop up with this technology that it's
00:27:16
Speaker
I think it's getting to a point where it makes sense to integrate within the current system rather than completely take over. I think the problem from a regulatory perspective is that integration often means reducing the possibility of what cryptocurrency can do. For instance, I think
00:27:35
Speaker
Binance will be the listing Monero on 20th of February. And I think some other exchanges have taken that step as well. And, you know, partly I can understand it, right? I can understand the listing Monero for the reason that it's being used, but it's also you're just telling people you can't have privacy. You're not allowed on chain to have any form of privacy.
00:27:59
Speaker
Yeah, it's I debate around that. I think, look, I think companies have to work within the rules defined in their respect. Right. And I think, you know, it's beyond my scope of expertise, but I would argue that there's always a balance between trust and privacy. But you're right. I think I
00:28:24
Speaker
I don't have enough context into the decision around Monero. I would argue that over time, you're probably going to get within EVM and within L2s, networks that are a little bit more privacy preserving and privacy focused, and there's going to be significant use cases for them. As long as they all play by the rules of the road, then absolutely. Not all my credit card transactions are visible to everyone.
00:28:53
Speaker
Right. And so I'm sure there's some sort of balance that we'll need to strike as an industry is kind of I think at the regulation level for what is the right balance between protecting against bad actors and kind of optimizing for privacy at the same time.
00:29:10
Speaker
Right. Yeah. And I mean, I'm not saying people are not using Monero to buy drugs. They absolutely are. Right. But people also use cash to buy drugs. You just go to your ATM, you know, take $20 out, go buy crack if you really want to. Right. No. Look, I think the
00:29:29
Speaker
Again, I don't have a strong kind of argument here for Monero specifically versus a kind of a more holistic, there's always going to be balance here, right? And like trade-offs, especially in newer financial ecosystems like crypto, where you try to find
00:29:51
Speaker
the right kind of middle ground for, you know, anything can be used as a bad tool and a good tool. Anything. Right. And so trying to find that middle ground, I think is important. And obviously you see extremism on both sides of like, Hey, allow everything and then allow nothing. And, uh, you know,
00:30:08
Speaker
Neither of those are probably the right approach versus kind of a balance there, right? There's things around the travel rule and things like that. Again, beyond my realm of expertise, but I'm sure there's going to be over time these things oscillate and get to like a steady state, usually a good one over kind of a long enough time horizon.
00:30:35
Speaker
Yeah, no, and I completely agree. I feel like balance is definitely what's needed because you have people that are in crypto, have been in crypto for a long time and they're like really into crypto. And then you have regulators that come from the other side of traditional financial markets and they're a lot more conservative and they're a lot more apprehensive about new technologies.
00:30:58
Speaker
So I think ultimately you do have this kind of, hey, we're on one extreme and we're on the other extreme, but I feel like there's still some way to go until both those parties meet and shake hands and go like, all right, let's actually use this for a better of humanity, which is, I guess, what it's all about, ultimately.
00:31:15
Speaker
That's exactly right. I think a lot of it is moving away from the money side of crypto and talking about prices and moving into the technology side of crypto of, hey, is there a fundamentally better technology here for kind of global settlement or global exchange of identity or global exchange of kind of virtual goods versus the current systems, right? Like in my mind, the simulation I run in terms of like
00:31:42
Speaker
In my mind is, if the Visa network or the MasterCard network were decentralized networks, would you be able to build five Visa-sized companies on top of Visa, on top of Visa network? Or if the Twitter social graph was decentralized, and Twitter was a front-end for that, would you be able to build five
00:32:08
Speaker
ten innovative companies on top of it that create more market value for the industry. Right. And so that's a little bit the way I think about it is not necessarily I don't really care about the price side of crypto as much as I care about does it create enable more use cases by taking kind of a centralized network and decentralizing it in a way that allows more competition. Right. It's a very I think it's actually a very like capitalistic idea of of
00:32:36
Speaker
hey, take a network that's currently owned by a single player or a set of players and structure it in a way that enables more competition in that network. And everyone wins as a result, maybe not the incumbent, but everyone besides that kind of wins,
Regulation's Role in Crypto Integration
00:32:52
Speaker
right? And so that's a little bit how I think about like the magic here and the value here is I think we need to have more of those conversations of does it create like, does it grow the pie?
00:33:05
Speaker
Yeah, 100%. That's spot on. And I think in the long term, eventually organizations and solutions that have real use cases that grow the industry and that propel technology forward are going to shine and are going to grow. And they're going to see adoption, whereas meme coins or stuff like that, I think they're eventually going to phase out. Because you can only be hype about something without utility for so long.
00:33:34
Speaker
until you eventually get bored with it and then you move on to the next thing. So maybe there's going to be a, I don't know, a perpetual machine that keeps creating useless things. But I feel that's just a kind of a byproduct of building useful applications. Yeah, the look every. This is true for anything else, right? This is true for anything else, which is a byproduct.
00:34:03
Speaker
of a gold rush towards a new set of technologies is usually like experimentation and some of it is like bad experimentation and needs to be nipped in the butt, but there's always, you don't know, right? A lot of use cases cannot exist, are obvious in hindsight, but without doing them, you don't know. So I think about examples like the iPhone in the sense that
00:34:33
Speaker
You know, at the beginning, it didn't enable third-party apps, right? And like the Apple was very careful around that, right? And it didn't enable, and once it did, it created so many like opportunities for companies that could not exist before, right? And so it's hard to regulate this stuff beforehand because you actually don't know, it's very hard to know what comes out of an enablement of
00:35:01
Speaker
like a potential kind of new distribution channel or technology, et cetera.
Balancing Regulation and Innovation
00:35:08
Speaker
So regulation is critical, but regulation too soon is really hard. Again, I think about it as even European regulation around Apple's cable for how you charge the iPhone. Super well-intended. There are too many types and you got to have some sort of
00:35:29
Speaker
regulation around it. But hey, what if the right solution is actually no cable at all? Have you actually created more barriers versus enabled? I do not envy regulators in this sense because these are really tough problems solved.
00:35:50
Speaker
Oh, yeah. And I think more discussion around these problems eventually lead to better solutions. It's just a matter of time. Like you said, you can't regulate something until at least you have some understanding of what that thing is and where it could go from here.
Dynamic's Applications and Security Focus
00:36:06
Speaker
Yeah. But even if you have a phenomenal understanding, right, like even if like if
00:36:12
Speaker
If you were sitting there at Apple, and you know the iPhone better than anyone, would you have predicted Uber? I don't know if you would. And so even the most skilled in the weeds player doesn't necessarily not predict. A good example, I see on the dynamic side, we let you abstract the stack, abstract the crypto stack.
00:36:39
Speaker
On a day-to-day basis, I see ideas of companies that are being formed that I could not in a million years describe that idea to you beforehand. There are phenomenal ideas and they use our tech and they use our tech stack. But it's very hard for anyone. If predicting the future was easy, then we would all be very wealthy.
00:37:01
Speaker
It's very hard, I think, to predict and therefore sometimes you gotta kind of take a step back and let things unfold.
00:37:11
Speaker
Oh, yeah. And that's a very good point. And I was just about to ask you this. When you said like being at Apple, you wouldn't have predicted Uber. And I agree, you couldn't have predicted Uber or any of the other companies that are or that have had some kind of regulatory scrutiny because of the way they operate.
00:37:32
Speaker
Do you guys see or what kind of companies have you guys seen using your application stack and what are some of the most unique implementations of your dynamic system? Yeah, so this is where it's really cool, which we get to see everything. Over the last 48 hours, I've seen companies rethinking how they do music on chain and how you think about music ownership and sharing profits.
00:38:01
Speaker
And then I saw a company building kind of a phone first exchange for crypto that doesn't look like crypto at all. And I saw a gaming company and I saw a company that says, let's take land and tokenize it and let anyone buy that within a single click.
00:38:19
Speaker
and transfer the deed to them. And I've seen a company that takes collector's items like Pokemon cards and stores them in the vault and issues a tokenized version of that and lets you buy and sell Pokemon cards.
00:38:34
Speaker
right. And so those are those that that was my last 48 hours. Right. And so we we see such a huge breadth of different kind of experiences that it's it's actually
00:38:50
Speaker
Um, very hard to note, like I, this is my, the favorite part of my job is that like, I have a call. I think if I look at my calendar, I probably have like three other calls with potential customers today. And they are on a completely set of different kinds of experiences that they're trying to build. Um, and that that's, that's really cool. Right. It's not, it's sort of like saying.
00:39:11
Speaker
You know, the internet, there's so many use cases. It's not like a single thing. And it's pretty awesome to see. It's pretty awesome to see. And that was a non-answer answer to your question of what are people building, which is really they're building anything. They're building anything from like, you know, we've seen, I think this week, kind of a Venmo or like, you know, a PayPal-like thing for Turkey and Eastern Europe.
00:39:40
Speaker
That's a complete different thing than a financial assets company trying to tokenize something on change. Or we've seen art projects. They're trying to do some stuff. So that is a full spectrum of different types of experiences that we see every week.
00:39:57
Speaker
Yeah, I think that is the amazing thing about
Account Abstraction and Token-Bound Accounts
00:40:01
Speaker
building an application that has potentially unlimited use cases, that it enables people to do things that you could have and you could not have predicted. I think from a regulatory perspective, I guess you guys don't have too much to worry about, right? There's not a lot of financial things you need to take into account, I'm guessing.
00:40:23
Speaker
Look, so we offer non-custodial wallets. There's always regulations with regard to OFAC and SOC 2 and not SOC 2, OFAC and GDPR and CCPA and things of that sort. And we really care. At the end of the day, wallets, even though they're non-custodial, wallets have access to people's money. And those individuals are the only ones that can actually access their wallets.
00:40:52
Speaker
We have to always be thoughtful in security and how we approach that and how we approach kind of, you know, giving people and developers tools.
00:41:02
Speaker
We're working on two-factor authentication methods or other tools that developers can provide. We care about this stuff mostly from a security lens, from a trusted safety lens. We have audits and we have a bug bounty program that's an open program. We spend a lot of our time on it.
00:41:28
Speaker
Yeah, I think the bug bounty is a big one. I think leveraging community to kind of, you know, improve the product is definitely a cool, cool thing. Oh, absolutely. We use, by the way, for that, we use a phenomenal, phenomenal company called HackerOne, which kind of works with hackers to actually kind of, you know, bring those in and kind of let them poke around their system and make sure things work well. It's been awesome. Oh, so HackerOne, I'm just making a note of that. Sounds fantastic.
00:41:58
Speaker
HackerOne, nice. So going back to the idea of identities of Web3, wallet identities, and SSO, how do you guys manage this in the backend? For instance, Auth0, you can link different identities. If I have an email identity and a Google identity, those would be linked on the backend. Do you do kind of like the same thing between wallets and Google and? Yes, so exactly. So you can, we have something called multi-walled, right? Multi-walled.
00:42:27
Speaker
which inherently lets you link your email address to your wallet address, to a second wallet address, to a wallet address on Solana. So you can start building these really cool profiles for folks in a privacy preserving manner. But yes, absolutely. It's a big feature that we do. We see that for NFT marketplaces that want to let you log multiple wallets. We see that for experiences that want to start in a crypto abstracted experience, but then link your wallets thereafter.
00:42:53
Speaker
So we see a lot of those types of kind of use cases for multi-wall linking. Nice. So would you say then people kind of rely on this interconnectivity of things to access their favorite applications in an easier way? Yes, absolutely. Absolutely. And there's some really cool projects out there like Delegate that does this on Chain. Absolutely. It's a big part of what we do.
00:43:18
Speaker
Right. So it was Web 3, though, that was the main idea and then the traditional Web 2 stack on top of that. Yeah. So the main idea, I think, comes back from the hypothesis that everything becomes a wallet. Right. Right. That opens really two sides to this, which is the way you interact with sites and apps is going to be through wallets and the way your apps are built is going to have a wallet component on them. Right. So there are really two sides of the same coin. That's inherently where we play.
00:43:49
Speaker
Right. Yeah. Well, I mean, it makes sense if you kind of, I mean, it makes sense, but it also makes sense if you consider the wallet just an object that can own other things, which is essentially what data is, hierarchical structures of objects that own other objects or have limited permissions for the objects.
00:44:09
Speaker
Yes, and then by the way, that's where you start seeing things like account subtraction or ERC 6551, which is like talking about an account. There's so many interesting nuanced experiences that you can create. Oh, I saw account subtraction on your website, but I wasn't really sure what it is. Yeah, so the very basic level, account subtraction is the following, which is add additional logic to what your wallet can and can't.
00:44:39
Speaker
So I log in with an email and I generate a wallet, right? At the very basic level, a wallet can sign things, right? But then wallets have, you know, when you sign a transaction, you need to pay gas and it needs to be in the native token of the ecosystem.
00:44:57
Speaker
Right. And you might not want to sign for everything because some signatures might be like for one cent, right? And you might want additional backup methods. So account abstraction is a layer that does that. Essentially, it generates a smart contract that sits on top of your wallet and access your wallet. So it can add logic like, hey, let me pay gas fees in USDC, or let me actually have a developer sponsor gas fees.
Expanding Dynamic's SDK and Online Resources
00:45:25
Speaker
allow me to create session keys. So really think about account abstraction as just a magical layer on top of your wallet that lets you do additional things. That's really cool.
00:45:38
Speaker
That's really good. You could definitely take that in so many directions. Could you limit the scope of your wallet in that, hey, I only want you to interact with like these 20 contracts and nothing else? Right. Yes. So really think about it as a policy engine on top of your embedded wallets. That's really cool. Have you had any companies use that and in what capacity? It's very, very common.
00:46:06
Speaker
Yeah, I'm guessing when you're building things to interact with your application, maybe you don't want to open up a vector of attack by allowing a wallet to process or to interact with other contracts they shouldn't. Yes, exactly. So really think about it as an on-chain policy engine for your wallet. That's super cool. Is that common across the industry? I wasn't aware of this, or is it just something that you guys have introduced?
00:46:29
Speaker
It's pretty common. It's starting to get more and more traction. Many think it's kind of the, you know, the next few chains will just have that built into the chain. Right. That's pretty cool. And you've also mentioned another token standard, which I... 6.5.1. This is essentially what's called token bound accounts. A token can own another token. Right.
00:47:00
Speaker
What that inherently means is that if you buy a house on chain, that house has a deed, right? The very basic approval, you have the house, but a house has several parts. It has the land, it has the structure, it has, right? And you can represent each of those as an NFT that rolls up to the bigger NFT, right? And so you can start kind of trading subset of those.
00:47:28
Speaker
Right. You can start saying, Hey, let me sell you this specific thing within the house. Right. So, um, think about it as a tree structure for NFTs. Okay. So is then the, is the six, five, five, one, the owner of the other tokens or is it the collection? It's just the standard for building that collection.
00:47:50
Speaker
Oh, that's cool. That has a lot of use cases in, well, in a lot of things. Also gaming. Yeah. I could have a character that owns other tokens that then you own the character. Yes, that is exactly right. So shameless plug for anyone who wants to read more about it. We have a blog post around that on our website. So just dynamic.xyz slash blog. We have an article around 6551.
00:48:14
Speaker
Oh, that's cool. I'll definitely check it out. I like to be up to date with these things. I also, I have it on my list to read about the ERC 404, which I still haven't yet. I know it's getting a bit more popular and it's definitely something that I need to read about. Sounds great. Yeah, there's a bunch of things I recommend. So EAP7212, RAP7560, there's a lot of really interesting ones.
00:48:42
Speaker
Awesome. And what do you guys have planned for 2024? What new features, what new cool things and additions you have planned for this year? Most of those secret, but really a very basic level at the very high level. It's about extracting more of your crypto stack.
00:49:00
Speaker
How do we make it as simple as kind of a single thing to do everything we describe? As simple as 10 minutes and you're done, right? That is our goal. That's what we're going for. And so you're gonna see us attract more and more and more of that.
00:49:17
Speaker
Awesome. That sounds fantastic. I'll definitely keep an eye out on any new updates and blog posts. Anything that you want to share with the listeners, social media plug, website, developer resources.
00:49:32
Speaker
Yeah, absolutely. So in shameless founder fashion, I will do all of those, which is, if anyone's curious to learn more about dynamic, go to dynamic.xyz. You can play around with our demo, demo.dynamic.xyz. I would suggest you start there. We're on Twitter, dynamic underscore xyz. We're on Farcaster, if you're more a crypto native
00:49:59
Speaker
person, then you might know a social network called Farkaster. We're just dynamic there. We got our handle first. You can also follow me, Itai. And that's pretty much it. If you ever need anything on the kind of learning more about dynamic and you're listening to this podcast, just reach out.
00:50:18
Speaker
Dude, that sounds incredible. Thank you so much for this. Thanks for explaining dynamic. I think it's a great solution and I wish you guys all the best. One quick question on Farcaster, because I've been reading about it this week. I'm considering getting on it. Is it worth it? Absolutely. Absolutely. Phenomenal. I strongly recommend it. It's a lot of fun. It's like a crypto Twitter, but focused on founders and builders, not on prices.
00:50:46
Speaker
And it's super insightful. That sounds ideal. I'll, I'll set up an account a hundred percent. Um, all right. Farcaster. I need to watch your handle. What's your handle? It's the tie. Okay. Sweet stuff, man. Um, well, listen, I had, I had a great time. Uh, and let's do this again sometime. Sounds awesome. I very much appreciate it. This was a lot of fun. Awesome, dude. Thanks a lot. Thanks everybody. Bye. Bye.