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#40 - Consensus mechanisms, community building and AI with Charles Adkins | Hedera Hashgraph
3 Plays2 minutes ago
Charles Adkins is CEO of Hedera Foundation. He previously served as President of Hedera Hashgraph, LLC. Charles is a seasoned leader with years of experience in the blockchain and crypto space, having previously worked at Polygon Labs and Aptos.
Hedera’s Governance Model and Council Structure
Charles emphasized Hedera’s governance framework as a critical differentiator. The Hedera Governing Council, composed of 39 global enterprises and institutions, ensures decentralized decision-making. Adkins clarified that no single entity controls the network, with council members rotating every three years to prevent centralization. This structure, he argued, fosters stability and long-term trust for enterprises exploring blockchain solutions.
Adkins also addressed critiques of the council model, acknowledging that critics often conflate “permissioned” governance with “centralized” control. He countered that Hedera’s permissionless network allows anyone to participate as users or node operators, while governance remains in the hands of vetted organizations to mitigate risks like protocol capture.
A significant portion of the discussion focused on Hedera’s energy efficiency. Adkins highlighted its hashgraph consensus algorithm, which eliminates proof-of-work mining. According to third-party audits, Hedera’s carbon footprint is “negligible” compared to traditional blockchains. This efficiency, he noted, aligns with growing enterprise demand for sustainable solutions, particularly in industries like supply chain and ESG reporting.
The host raised questions about scalability trade-offs, but Adkins asserted that hashgraph’s asynchronous Byzantine Fault Tolerance (aBFT) ensures high throughput (10,000+ transactions per second) without compromising security. He cited partnerships with organizations like the World Economic Forum and the Linux Foundation as validation of Hedera’s technical rigor.
When asked about competition from Ethereum or Solana, Adkins distinguished Hedera’s focus on regulated industries. “We’re not trying to be everything to everyone,” he said, pointing to Hedera’s native compliance tools, such as optional KYC for token issuers. He also discussed the importance of stablecoins for enterprise payments, revealing that Hedera is working with multiple issuers to launch compliant stablecoin solutions.
DeFi and Developer Ecosystem Growth
Despite Hedera’s enterprise focus, Adkins acknowledged the need to cultivate a robust DeFi ecosystem. He highlighted recent growth in Total Value Locked (TVL) and developer activity, attributing this momentum to grants from the Hedera Foundation and partnerships with platforms like Karate Labs for no-code smart contracts.
The host pressed on whether Hedera’s regulatory-friendly approach might deter DeFi purists. Adkins responded that transparency and compliance are inevitable as blockchain matures. “The industry is moving beyond ‘Wild West’ experimentation,” he said, adding that Hedera aims to balance innovation with real-world legal frameworks.
Regulatory Challenges and Future Roadmap
Adkins expressed cautious optimism about global crypto regulation, praising the EU’s MiCA framework for providing clarity. However, he criticized the U.S.’s enforcement-heavy approach, arguing it stifles innovation. Looking ahead, he teased upcoming upgrades to Hedera’s smart contract engine and expanded support for privacy-preserving applications like zero-knowledge proofs.
This podcast is fuelled by Algorithmic Cryptocurrency Trading Platform Aesir. Use code AESIRPOT20 at checkout for 20% off on all subscription plans, forever at aesircrypto.com
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Transcript
The Role of Community in Crypto Culture
00:00:08
Speaker
one of the things that I really like about this industry is that you know community sense and community spirit is pretty much what brings everyone together. And it's interesting to see how communities think, right? And you get that from like the community aspect, from the memes that they create, from the way they interact with each other on Twitter and social media, and also from the governance layer as well. like There's so many...
00:00:32
Speaker
things that are interconnected that then create this kind of map of of ah of ah like a hive mind, right? Like each community, like Adera has its own kind of like hive mind and people, you know, believe in those in certain principles. And then you've got Bitcoin, you've got Ethereum, all these that are all believers in some things. And, you know, as an independent, as a human, as as ah as a person, you have obviously, you know, infinite complexity, but then you're talking about a group and it's very It's very cohesive beliefs. It suddenly becomes not quite like an echo chamber, but something that can be predicted. You can predict how people are going to think in general about this or that if you were to present it to the community rather than an individual.
00:01:12
Speaker
Yeah, I mean, it it is one of those areas where kind of the community at large really will tell you where the market needs to go. There's not a lot of cases where this particular market is telling the community what's next. I mean, it's it's a reactive market to what the community and the culture is actually hoping to see. um And when you go against the market,
00:01:37
Speaker
it's tough. I mean, it's it's really tough to survive if you're going to go against the will of you know hundreds of thousands, potentially millions of community members. ah It's going to be hard for you to make a market.
Evolution of Communities: From Cults to Cultures
00:01:47
Speaker
I mean, it's it's kind of that that linear system of creating an economy. It starts out as kind of a cult.
00:01:54
Speaker
And Lily Liu at Solana alludes to this a lot. And you know it starts out as a cult, then you get into culture, ah then you create a community. And once you have your community,
00:02:06
Speaker
you know You start thinking about ways to create an economy around that, just like as if you were in a city. Cities typically start out as a handful of villagers. It grows into, what what do we want this culture to be? Are we all about this specific thing or you know a specific belief system?
00:02:21
Speaker
And then once you have a larger community, now you have to start thinking, wow, we have we have a lot of people here. How do we create an economy and a business for these people? I mean, we need to support them into creating their own startups. We have to you know pay attention to what their needs are.
00:02:35
Speaker
i mean, you essentially create a digital city and an economy around that. And you know if you get stuck in just the cult phase, that's where you really get the echo chamber
The Resilience of Meme Coins
00:02:46
Speaker
issues. Or if you get stuck in the culture phase,
00:02:49
Speaker
You get a lot of the meme coins, you get a lot of the things that are really heavy on speculation, but don't actually mature into having a real community or, and especially they never mature into having a true economy. A lot of it's just based on back and forth speculation. So you've got to take it all, all four steps to make something um big and worthwhile.
00:03:09
Speaker
hundred percent Though it does surprise me how much fuel there is in that culture tank, you know, because you see you see things like Shiba and like all these meme coins and dodge, man, they just keep running, right? Like every time Reddit says like, oh, it's a shit coin. it's got no value. It's going to be dump or whatever. Inevitably the opposite happens.
00:03:27
Speaker
It's just nuts. Yeah. I mean, the the value is in the value isn't a culture of of the people creating their own their own economy around it. yeah. You know, it it just depends on what the focus is. I mean, coins like that, typically the economy is built on that culture of people just trading those markets back and forth, um not necessarily building a lot of applications and, and you know, bigger technology uses for, i would just say like the general public.
00:03:54
Speaker
You know, those kind of coins are not really general public accessible type of tokens where they're going to be able to link that to any kind of real technology piece. yeah It's not like a public good or a service that has any fundamental value.
00:04:10
Speaker
I guess the value is a lot more hedonistic. Oh, look, I got this silly dog meme coin in my wallet. It makes me feel good. Right. It's not utilitarian value, is it? Yeah, exactly. So how did you get into crypto?
00:04:24
Speaker
Like, how did you like first hear about, i guess, crypto
Personal Journeys in the Crypto Space
00:04:28
Speaker
in general? And you thought like, that's a thing that you want to pursue? I mean, I first heard about ah crypto pretty early on with Bitcoin.
00:04:38
Speaker
um I always tell my story and I tell it in a dramatic way that I bought Bitcoin at $23. And then I tell the second part of the story that I sold it all at $30 and then everyone gets really sad.
00:04:52
Speaker
um But unfortunately, yeah, that that's that's kind of how that went. um And then kind of one of my first ah actual... I would say tokens I really paid attention to.
00:05:05
Speaker
i mean, obviously Polygon. I worked at Polygon really early on, found out about that L2 from Ethereum. um Essentially, they're just very much a retail market and they needed some kind of enterprise focus. People were starting to get interested in how do we utilize this for enterprise applications.
00:05:21
Speaker
um I went there right around the same time, actually a little bit before that. um I had saw that Google X made a really early investment into Chainlink. And um I was like, wow, OK, like typically Google X doesn't do things where they see any potential of failure.
00:05:38
Speaker
And so I did you know start to buy, you know accumulate some Chainlink over time. Right. So that was really interesting for me. I just thought Chainlink had a really kind of dynamic roadmap on how they viewed the world around crypto and oracles and and transferring that information.
00:05:57
Speaker
um you know And then I learned about Hedera actually in 2018, 19. um Went through the white paper, watched a lot of Lehman's discussions on on YouTube. And I was like, okay, this is
Hedera's Strategic Shift
00:06:10
Speaker
this is something really interesting here. This is very different from a lot of the technology that's out there.
00:06:16
Speaker
I could see some pretty big advantages. Didn't do much about it at the time. had, you know, once HBAR became available, I i held some HBAR and then moving into ah kind of going over into Aptos, which, you know, is the layer one that spun out of the DM project, the Libra coin that was built inside of Facebook at the time.
00:06:37
Speaker
um And they kind of split off into Aptos, SWE, and I think Linnea is the other protocol that a lot of those original, that original team kind of split up into. So I was there doing, you know, most of Aptos business development.
00:06:52
Speaker
um Then I got a call from Hedera and they were like, you know, would you be interested in having this discussion around round coming over? And so, you know, ever since that time, it's 11 months now, it'll be a ah year next month being at Hedera.
00:07:07
Speaker
um Just really kind of, ah you know, seeing how we can move this protocol into the next level. ah we We just, we're ready, we're ready for ah some advancement. So I'm getting pretty excited.
00:07:19
Speaker
That's cool, man. What would you say the next level is then? I think the next level for Hedera is, you know originally it was all very enterprise focused. And I think today it's you know it's still enterprise focused, but it's by nature of the council. Now that worked to a massive benefit to Hedera in the early days when a lot of protocols were really struggling to have any kind of reputation because a lot of large enterprises wouldn't work with them.
00:07:44
Speaker
um Whereas Hedera, you know, we had these large enterprises come into the governing council, Google, Dell, um you know, names like that. They come and they sit on the governing council and you're like, okay, this network actually has some governance guardrails that work really well.
00:07:59
Speaker
ah We trust these companies that are here. They help, you know, kind of talk about the network in a way that's different from, you know, the way that DGENs had typically been talking about it.
00:08:10
Speaker
Right. So Hedera like really kind of skipped over the whole, i don't to say they completely skipped it over because the community built it, but the community was the one that backed the entire retail market. They're the ones that built all the NFTs, the wallets, um all the DeFi protocols.
00:08:25
Speaker
And I think that's the thing that now, The funny thing is you go to an enterprise now or you go to an institution now, they want to know your your DeFi TVL. They want to know your liquidity.
00:08:37
Speaker
They want to know what bridges that you have available, what custodians you have available. And that was the exciting thing coming into Hedera is like a lot of that work had not been done yet. And we've been doing a lot of that groundwork this year.
00:08:50
Speaker
And just really starting to get um kind of a foothold on the retail market. And so now we realize like, hey, look, for the next couple of years, we're going to have to really think about this retail market.
00:09:01
Speaker
And it's not just because of the retail market. it's It is an important foundational piece to getting larger businesses interested. You have to have TVL, you have to have DeFi, you have to have bridges and custodians, and you don't really get the attention, especially of custodians, you don't get any attention from them unless you have significant TVL and liquidity.
00:09:23
Speaker
It's just not gonna happen.
Enterprise Influence on Protocol Development
00:09:26
Speaker
So, i mean, we're excited to really start going into that phase of of the business and um getting a little bit more focused on those those foundational pieces.
00:09:36
Speaker
That's really cool. I wasn't aware that you have in a council that you've got like institutional members in in in part part of your council. I think that's really interesting as ah as a concept in blockchain and in Web3.
00:09:49
Speaker
um And I wonder how how does that kind of work with the fact that a lot of it comes from like this anti-establishment kind of feeling feeling this kind of you know We're going to do it our own way.
00:10:02
Speaker
um Do you think institutional input into these products is making it better ah in a sense or for the general public as well? Because obviously the funds and everything that they have available and the know-how.
00:10:17
Speaker
Yeah. I mean, right now they currently, i think they're running in parallel. So the enterprises that sit on the council are really giving us good input as to how a protocol should be built that actually works with their legacy systems or their enterprise sales cycle or the level of security that they're going to be asking for, the uptime they're going to be asking for.
00:10:37
Speaker
The benefit of that is that the general everyday user, the retail user who wants to build their business and, um you know, maybe bring a startup to market using Hedera as their DLT, um they already get the benefit of all of that enterprise grade network activity and, you know, just going into their product. And there's no difference in, you know, it's not like there's some significant pricing difference or there's nothing different for the retail user than there is from somebody like Google building something on Hedera. It's just,
00:11:09
Speaker
the same set of code. It's just that we we utilize those those enterprises to really give us information to how to make the network as robust as we can possibly make it. um So they really do run in parallel. It's not it like i mean, google ah I'll refer to Google again. You know, they have They have Gmail, they have G Drive, they have you know a lot of things that are available to the average everyday user, but then they have you know a lot of enterprises use Gmail and Google tools as the the backbone to run their organization. So we're kind of taking that same approach. But you know I mean, the retail and individual user and getting, i think getting people inspired to really see that Hedera is a good place to build your business is is the focus now.
00:11:51
Speaker
Right, right. And do you lean on um on your on their technology stack as well? Or is it more just advisory role in the council? Yeah, I mean, a lot of them want to implement the DLT into stuff that they're building now. So, you know, they'll they're interested in using it for like the AI data provenance. They're interested in using it for tokenization.
00:12:12
Speaker
They want to understand how to use it for payment rails. So, yes, they're they're advising on how to kind of harden the network and make it more usable ah for an enterprise. But at the same time, I mean, there're they're building proof of concepts and they're wanting to use the network just the same as as an everyday user would.
00:12:31
Speaker
Very interesting. So what would you say then is one of the more web 3 driven or like web 3 enthusiast um institutions that you're working with? Because like the the landscape that I saw back in 2020, 2021, everyone wanted to be in web 3.
00:12:48
Speaker
And then, you know, the market didn't keep going exponentially as it, you know, barely, rarely ever does. And then i saw a lot of like strategic withdrawals from the Web3 space, like companies that were, you know, well, a lot of them were, some of them were grifters at the time. You're looking at Ubisoft or companies like that, that were like, we're going to put NFT into every game. We're going to make any every game. Like you can buy your AK-47s and your skins. it's like, people were like, no, we don't want any of that. Take it away.
00:13:16
Speaker
um And
Enterprise Interest in Web3
00:13:18
Speaker
obviously market reacted, people weren't happy that didn't happen. And that's a recurring story with a lot of organizations that I think started with like the wrong idea of what Web3 and blockchain is and what the customer wants.
00:13:31
Speaker
And then they had to basically just call it quits for a while. um So I'm wondering what are the the ones that you think have managed to avoid this and have a good understanding of what this ecosystem actually needs.
00:13:47
Speaker
Yeah, I mean, this kind of goes back to the first thing we were talking about around getting some clear regulations around how to actually interact with a network that has a utility token.
00:13:59
Speaker
I think there's a lot of council members and a lot of people just in general from the enterprise side that are really interested in diving into web three They start digging into it with their teams. Can we do this? Can we not do that?
00:14:11
Speaker
So many of them are are just they're terrified of of holding and and transferring a token. They're terrified of maybe operating you know nodes. And you know our organizations were lucky. I mean, we have council members that are willing to do that. So I'd say, I mean, any organization that sits on our council has already shown they're willing to put their foot forward and say, hey, look, Web3 is serious for us.
00:14:32
Speaker
a getting into this industry is serious for us. The ones that are going to have the biggest problems, they they don't even apply to be on our council. I mean, they they just know that they've probably got, you know, two to three more years until they get some clear regulation before they're really allowed to do a lot of these things. I mean, gaming was a prime example of this. um You know, early on, gaming was like the really hot thing to do. And like you said, like NFTs for transferring assets or like randomized verifiably randomized loot boxes to make sure influencers weren't getting out like dropped the coolest stuff. Like that was cool until a lot of the gaming companies were like, oh, wait a minute, we have to do this with a token.
00:15:10
Speaker
And then they start talking to all their teams and they're like, ah, maybe we don't actually want to do that because if you have on-ramp and off-ramps, then we have to be concerned about the actual value of this. And then how do we do the taxes? And it just became this big mess of complexity that they were not ready to deal with because, know,
00:15:27
Speaker
You know, users, um we're not lining up asking for Web3 kind of features quite yet. um Once we start making these things easier and regulations extremely clear across the globe, that's the other thing. I mean, there's there's some regional arbitrage where there's a lot of benefits of doing this in some regions and not in others.
00:15:49
Speaker
The gaming companies are global. They have to make sure this is accepted everywhere. um The other thing is ensuring that they just create a good game. I mean, gaming companies want to make great games. And I think we can all probably... Not all of them do, not Ubisoft. Sorry to interrupt.
00:16:03
Speaker
I mean, a lot of... So a lot of the original Web3 games were not good games. they They were bad games that just had, like, the first couple of levels had some cool speculation and and token grinding to, like, get you to earn some tokens. But, like, overall, not great games. so We have to kind of graduate from that into getting good games, getting clear regulation.
00:16:24
Speaker
But all the people on our council, I mean, they're obviously deeply interested in Web3 or they they wouldn't even have engaged with us and and be sitting there today. Right. Yeah. And I think that's a very good point. It's it's getting people that are actually interested. And and gaming is is, I think it's such ah it's such a great like marrying of the technologies because the like blockchain can really push a game, you know,
00:16:48
Speaker
to do things that we wouldn't even think of up until blockchain,
Web3's Impact on Gaming
00:16:52
Speaker
right? Like imagine having an interconnected network where you can import ah like your armor or your so weapons like in between different games and use them in other games.
00:17:02
Speaker
Like it's just like the possibilities are almost endless. um I think there's also been a few good, I think, um companies that have started to build with Web3 in mind, but not to, you know, not to make it a disservice to the people, but actually to figure out what are the use cases. I think um I was talking to Steve Wade from from ah Midnight. They've built Evergreen and they have like a collection of different games that kind of all fit into this like almost meta world where the things that you do in various games affect your main character in this in this main kind of universe world.
00:17:36
Speaker
Yeah. And I think we're just going to that that's what I wanted to always see. And this is kind of the benefit to publishers. Like if you have several titles and you can figure out a really good schema where if a weapon in game a can be ported across as a skin in game B and maybe a vehicle in game C, but you're all within the same publisher universe, that really benefits them.
00:18:01
Speaker
And, you know, they can stay within that that single publisher, go across multiple titles and still have a lot of those assets that that operate on all of the games.
00:18:11
Speaker
I think the other thing is like one of the things to do, you know, a lot of game publishers, they're really like, oh, we don't want to do that because, you know, we get so many speculators in our games. Like they're just there to like earn these tokens or do these like small activities and then they just leave and they don't play the game.
00:18:28
Speaker
That's kind of a game design issue where you know you shouldn't allow earning until maybe like level three or four or 100 hours of gameplay. Like gate gate the time frame that gets a user involved in the game for a long enough time to where they're bought in and then unlock you know the earning aspects or the aspects of Web3 that make it a lot more cooler. like Oh, yeah.
00:18:51
Speaker
I wouldn't let people earn all that stuff from day one. They'll just create a bunch of different accounts and speculate and, you know, grind out the mechanics and just to earn the token. So, I mean, lock that stuff up until someone's put in some work.
00:19:05
Speaker
100%. just, you know, just look at how ah MMOs do it. You look at World of Warcraft, you look at other MMOs, like you don't start earning the good loot when you're level one. you You really grind your way, you do dungeons, the possibility of drop for rare items is pretty low anyway.
00:19:19
Speaker
so you're going to have to keep doing these things, keep you engaged in the game, maybe even spend some money on the game, you know, like they're really well thought out to keep the players engaged. for the long for the long run. um and And I mean, those concepts have been tested for a long time. I would think it's it's fairly, you know, an obvious choice how to design a game in a way that keeps the users, you know, enjoying the game itself rather than figuring out, okay, how can I exploit this as quickly as I possibly can?
00:19:46
Speaker
Yeah, totally agree. Yeah, well, hopefully we'll see something. We'll see some new developments. I would really love to see like a new, like MMO, AAA style, but like be actual, you know, when I say Web3 based, I don't mean have its whole identity be Web3, because I think that's also not a good thing. You don't want a game to just be, what's unique about this game? Oh, it uses blockchain and it's, you know. Right. doing ledger things. And like, I don't want to know that I have to sign every transaction when I do a sword attack or whatever. I just wanted to give me a great experience.
00:20:19
Speaker
I couldn't care less about a technology under the hood. um um my Maybe I would, because I like to nerd out on things, but I'm sure a lot of people would just wouldn't want that to be like the unique thing about that. Yeah. I mean, it should live in the background. I mean, I know that, you know, one of the ones that it's built using some Hedera technology, um like ah Tashi.
00:20:37
Speaker
ah Tashi's a ah cool, um kind of system where, you know, it just instead of doing live real time, you know, transactions for every single thing, it just settles in specific points and updates and it just kind of lives in the background. you have And that's how it should be. Just a really good game experience and let the technology live in the background. It shouldn't be the star of the show.
00:20:59
Speaker
Yeah, 100%.
AI Integration in Hedera
00:21:01
Speaker
Same thing with AI. I feel like, again, there is ah so much potential when it comes to AI in games, when it comes to introducing LLM and just giving NPCs like a brain.
00:21:12
Speaker
I've been watching videos. I used to play Skyrim a lot like 10 years ago. right It used to be like this fantastic experience. And and then people have been modding that game still. it It's been 13 years since Skyrim was released.
00:21:24
Speaker
people are still modding the game. there They've been adding LLMs into Skyrim and they've been giving like NPCs they their own personality. And you got a little, ah um ah you can talk to them, you can use a microphone and you can ask them to tell you about the world and what quests you should do. It's like, it's really, really cool.
00:21:43
Speaker
That's really interesting. I didn't know that was happening. Yeah, it's like an emerging thing. it's it's I think it's very, it could be, I guess if you have it locally, then it can be quite computationally heavy.
00:21:54
Speaker
If it's not local, then you'd have to rely on an AI, you have to rely on open AI or hopefully something um that's not as close source as open AI. um But you need to rely on constant constant API calls and and if that's a pricing, like the pricing model could could bleed you dry if you just wanted to enjoy the game.
00:22:13
Speaker
um So I guess there's some challenges there, but it's super it's super interesting. and And I do see many really powerful AI applications in gaming and and I mean other aspects too.
00:22:24
Speaker
Yeah. um i know I know you guys have um ah ah quite ah an important like stance when it comes to AI in in in blockchain, right? Yeah, for sure. I mean, that that's you know a pretty core area.
00:22:39
Speaker
I think we have some pretty significant solutions for. So, I mean, we've really been focused in that area um just because of the some of the unique capabilities of the technology in general.
00:22:50
Speaker
Yeah. Yeah, it's a really good match to have um the Hedera DLT and AI kind of work together. So what are the actual applications of AI that you're envisioning or that you're working on at Hedera?
00:23:03
Speaker
Yeah, I mean, one of the biggest ones and kind and kind of to your point is these. So first of all, like the data models become so big and there's so much data that goes into these models that if you had to run all of them on a ah general DLT, it could become very expensive.
00:23:20
Speaker
And we obviously have incredibly low and fixed costs. if you're doing cost modeling, everything's a fixed priced in USD with Hedera. It's not really subjective to gas fees.
00:23:32
Speaker
um But really what people are doing is you're you're really wanting to create version control within your AI model. So as you're training these models, you want to tokenize the pieces of data going in.
00:23:43
Speaker
Right. um Once you have the model kind of set the way that you'd like it, um you could lock that model down as a specific, let's just say like a specific NFT. So... If you're along the the time of you building a model, you start to see of, let's say you've made ah a data update and all of a sudden the model's just like not working really well, you can go back in and just remove that token. And then you go back to your previous version. Or once you have a version you're really happy with,
00:24:11
Speaker
You want to lock this down. Let's say it's a you know a let's say it's a verified model from you know some some major brand or publisher. It's like the whatever brand official chatbot. And you've locked this down as an as an NFT.
00:24:26
Speaker
And now you start thinking about the possibilities. Or let's say it's an influencer. An influencer trains their own LLM, locks out as an NFT, and says, look, if you want... The official data I put in as an influencer, as a celebrity, um you can license that model.
00:24:40
Speaker
You can license my likeness, my image, buy, sell, trade that model as an NFT. Really, it's the data governance of what goes into a model and being able to tokenize and verify that data going in.
00:24:54
Speaker
um And then obviously there's starting to be a lot of standards around AI. So, cry you know, moving very quickly, people want least governments around the world are wanting people to prove how those models were trained and using a DLT to go back and point to these tokens.
00:25:11
Speaker
not just point to the tokens, but you know the data going in, but then there's also identifiers for who the individual was that updated the model. So you can start to see what data was put in by what person, and then you can have those be transparent for regulatory purposes.
00:25:28
Speaker
um you know the And then on Hedera in particular, not only is it cheap and fixed cost, but the way that it's not a you know linear settling blockchain. We obviously have Hashgraph, which...
00:25:41
Speaker
you know, doesn't necessarily rely on linear blocks as computing power kind of increases over time. And you have these linear settling blockchains. There's always the, you know, it hasn't really happened yet, but there's always that, that possibility that somebody, a bad actor could sneak in. Like if your transaction happens at the front of a block and you're waiting for the entire block to settle, somebody could come in and and tamper with that block. If it,
00:26:05
Speaker
If it doesn't settle quickly enough. So just having our data kind of instant settle has been has been a really big differentiator too, because you want that you want that data verified and to complete finality as instantly as you possibly can.
00:26:22
Speaker
Right. Well, I'm not a cryptography expert, but I understand that a hash graph works a little bit different than a
Hashgraph's Technological Edge
00:26:28
Speaker
blockchain does. It is still an immutable ledger. You still rely on a consensus mechanism, but you use a different way to process. Well, you can process multiple transactions within a block at the same time.
00:26:40
Speaker
Does that also mean that there's no room for front running? That's right. yeah That's correct, right? Yeah. and so And that's why, you know, on the tokenization side for financial institutions, a lot of them are starting to look to us because you're not going to have front running of trades. A lot of online gaming companies look to us because you're not going to be able to, you know, front run, you know, possible online gaming transactions.
00:27:03
Speaker
um It's, you know, an ABFT consensus. So, yeah. I think we're the only one out there, layer one that has that, where all nodes know all information at the same time and it settles instantly and not in not in linear blocks.
00:27:18
Speaker
So um a lot of people, especially for tokenization and AI, that is one of the things, not being able to front run and then bad actors not being able to jump in between a linear settling block has really gotten people to pay attention to us.
00:27:34
Speaker
Right. Well, that's really important. like I know there's a lot of companies now that are talking about solving all these yeah issues with front-running on EVM chains, right? There's a lot of companies that are doing some amazing work, but the fact is that consensus mechanism, the fact that miners are able to cherry-pick the kind of transactions that they want to verify from the mempool, it always felt like a strange protocol to me. Why would you let them do that in the first place?
00:28:04
Speaker
Yeah. Yeah. I'm happy that, you know, I am not smart enough to be the person that solved that. But thankfully, we've had we've had Dr. Lehman Baird had that consensus mechanism from the original white paper. So, I mean, it's it's getting close to almost a decade now. He had already solved this problem.
00:28:21
Speaker
Wow. so I mean, really thankful that that we have him. Yeah, no, that's that's epic stuff. um I wanted to go back one second because you've said that training a model, um it has a fixed cost. ah Could you explain what what do you mean by a fixed cost?
00:28:36
Speaker
yeah ah well So the Hedera consensus service, um it's just fixed cost in USD, very low cost. so you know And this is this is one of the areas where it was really important for us to have our governing council. We were talking about before the way that enterprises think about using DLTs.
00:28:53
Speaker
um You know, when you have when you have a CFO come to you and say, you know, we need your protocol to be fixed, a fixed price where we can do a predictive cost model, because I can't go to my board of directors and explain to them that now our financial model is broken because a monkey picture got popular on the other side of the world.
00:29:16
Speaker
And so like it's funny, but it's a really good point. Like imagine explaining that to an executive at your organization that your entire forecast and your entire financial model is broken because like some random application or a random game like blew up or some meme coin like on the network is making gas fees go insane. And now you can't run your critical infrastructure at the cost that you had had hoped it would be.
00:29:42
Speaker
So on AI models, when you're training that data going in and you're you're putting that much data into a model, having that fixed and extremely low cost um available, you know how much you're going to spend kind of going into the future. just It's like a lot more predictability for people and individual builders. I mean, startups, startups you want low cost and you want to be to predict your costs.
00:30:03
Speaker
i mean, that's something from top biggest enterprise in the world to individual builder. You really need some predictability in your your cost modeling. Right. So so it's predictable it's fixed in the sense that it's fixed per token or per a certain amount of data used, but not fixed as a, hey, this is what's going to cost at the end month.
00:30:24
Speaker
It's going to cost you like, and don't know, one pence per per token or whatever you choose. Yeah, I mean, all of our all of our pricing is published on our website. So, i mean, a smart contract, a token, ah a consensus ah transaction, they're all priced a little bit differently. But I mean, all of those are published publicly and you're able to to create your models based on just knowing what those costs are going to be.
00:30:48
Speaker
That's super interesting. So does that mean that your then Hedera's own ah finances are variable, the margins for for this? Because obviously if you offer a fixed rate, then either your your profit is variable or there's some other mechanism in place that ensures that the the cost is always around the same for these ah computations.
00:31:09
Speaker
Yeah, I mean, that that the variability lands on us, but it's easier to have us manage that variability and have a lot of users than it is to push that variability onto the end user and just have chaos.
00:31:22
Speaker
I mean, we would rather we would rather give that stability to our end users and we can figure out from a variable nature how to adjust our costs ah much easier than trying to do that for hundreds of thousands of end users. It just becomes really difficult for them.
00:31:37
Speaker
Right. So it's just it's like taking the whole concept of gas out of the picture. You don't have to worry about it. Right. Yep. That's very cool. That is a really ah good way of of dealing with this. And does that maintain, I'm guessing, um the same kind of protocols for consensus mechanisms? for um like Are your miners and stakers incentivized to to operate in the same way?
00:31:59
Speaker
Yeah, I mean, all all of our our council members operate nodes. And again, because the cost is so low, the energy cost is incredibly low. I mean, we're by far the greenest blockchain out there.
00:32:11
Speaker
um You know, there's there's not a lot of costs associated with with managing nodes on our network. So, you know, we're pretty lucky with that. Yeah.
00:32:21
Speaker
Nice, man. And has this always been the case with Hedera? Was this thought out from the very beginning? Always. Yeah. Always has been. Very cool. I gotta say that. That's that's very cool. um I did. Obviously I i knew about Hedera and I've been, ah you know, following along with the development, but it's nothing I've i've kind of got into using myself.
00:32:39
Speaker
So it's really nice to hear that there's all these quality of life um improvements that that you guys work really hard to to put out there. and Yeah. yeah congratulations You should definitely check it out. We'd we'd love have you at least play around with it.
00:32:52
Speaker
hundred but where do i Where do I start? what what can i what What coding languages, what programming languages can I use to build stuff on Hedera? I mean, it's EVM compatible. You use a lot of Java.
00:33:03
Speaker
um But you can i mean you can go in on our our GitHub. Obviously, we've donated the whole base code to Linux Foundation. So it's fully open source Linux Foundation decentralized trust um under the name Project Hyro.
00:33:15
Speaker
um But that's the full Hashgraph code. You can go through hedera.com and then there's a ton of different entry points where it says if you're a developer, it'll take you right to all the docs you need to use. Right. Okay. So not not any specific language. You've got different compilers. I'm guessing different people have been have built different compilers for pretty much every language.
00:33:36
Speaker
Yep. Super cool, man. I might take up on that. I might just have a heavy play with the Hedera ecosystem. Yeah, it'd be cool. hundred percent So you're obviously working on RWA tokenization.
00:33:49
Speaker
And there's a lot of there's a lot of discussion on RWAs. I think they're definitely a huge upcoming thing. um What innovations do you guys have in this category? And is there anything cool that that you want to um get into?
00:34:04
Speaker
Yeah, I mean, I think the main one of the main things we talked about is just the way that we handle consensus, kind of getting rid of front running. The other thing is, you know, it's really efficient and low cost to do tokenization, especially if you're going to do these in a really large scale.
00:34:19
Speaker
So, I mean, we have our asset tokenization studio, which it's like a simplified creation management tool. You can tokenize assets. Yeah. using templates that are on there.
00:34:30
Speaker
um It's super user-friendly tools. So um really just this you know the speed, the low cost of transaction, and it's you know it's regulatory compliance. So you know Our public network, it it's kind of built with native support for KYC and AML. So, I mean, you need to have those things when you're making customized tokens um and whatever those may be.
00:34:55
Speaker
So, you know, thats that's one of the things that we're trying to make it as easy as possible for people to take those take those assets um and tokenize them. I mean, we we saw that with, you know, the Archax announcement.
00:35:07
Speaker
Even this morning, um State Street Global Advisors, um I think Fidelity International and Elgem have all utilized Archex, who uses Hedera to tokenize.
00:35:19
Speaker
Archex has tokenized their interest in those money market funds. And, you know, it's it's a really easy thing to do for for most people. um So, I mean, yeah, we we encourage people to to do that.
00:35:33
Speaker
um We think we're one of the best at it. Of course, I'm biased. um Yeah, actually, that's that's one of the ah really funny thing that I was talking about in a previous episode. We were just talking about marketing, like marketing lingo, marketing speech, and how you know everyone goes like, oh, yeah, it's it's the best product we've ever built, if we say so ourselves. And I get you know i get it. i get it. You get to say it. At the same time, I feel like...
00:35:58
Speaker
It's become, you know, where everywhere you see, just everyone says, oh, this is this is the best thing, you know, this is the best bread you're going to buy in London or this is the best, you know, ah ah shake you're going to buy in California or something like. Obviously, there's something wrong there, you know.
00:36:12
Speaker
And I do think that we probably don't have as much regulation in in marketing products as... as we should, like people are like, the more you look into products, more you can market, the more you see that people are normally taking advantage of products that are naturally sugar-free.
00:36:32
Speaker
It means that they just have added sugar. They have added, uh, not, uh, they have like not actual sugar, but like substitutes for sugar. Um, and like, I could go on, you know, um, yeah, just, mean, we, we always encourage people like try out everything, but I mean,
00:36:49
Speaker
Really, there's a couple like areas like tokenization AI um using the consensus.
Hedera's Performance and Future Innovations
00:36:55
Speaker
it's We love for people to so try these out head to head.
00:37:00
Speaker
yeah like We love it. And like we think it's important because i mean if if you're really trying to find a combination of scale, speed, and security, and again, like we encourage people to test this in in any format they want to, i mean we really do feel pretty confident in what they'll choose.
00:37:19
Speaker
Nice, man. And what do you um what do you think the... I mean, not think, but what are the some of the the specifications of Hedera then in terms of like um you know transaction throughput, time to finality, and in these kind of things? so Yeah, I mean, right now we're you know we're right around 10,000 TPS, finality's three seconds, and it's true finality, not like, hey, you're just now starting a block type of finality.
00:37:44
Speaker
Right. So, I mean, it's it's fast, secure, secure. things settle you know fairly instantly. um Some transactions happen faster. Some happen a little bit slower. But but in general, we're we're right around that area.
00:37:57
Speaker
um The 10,000 TPS, that's been tested. we could We could probably push higher. We haven't even started um a lot of our work on on sharding or how we actually do that. So once we start moving into like sharding or doing, I mean, potentially, again, this is...
00:38:15
Speaker
This is not you know stuff that's out there. But if we start doing sharding or layer twos or things like that, I mean, we could be 10x, 20xing, those kind of numbers. But again, like we haven't even started that work. So you know I'm hesitant to say that. but So I'm guessing there just hasn't been a need for that currently.
00:38:33
Speaker
and Not right now. I mean, 10,000 TPS seems to work pretty well for for most people. You know, that's that's ah magnitudes faster than the Visa network. So until we're starting to do um as many transactions as a Visa credit card, and i think we're we're pretty good where we are.
00:38:51
Speaker
um But again, i mean, you start combining all these use cases. So if we start running, you know, financial rails and and gaming projects and sustainability and ESG projects, all of those coming together, i mean, that kind of throughput is really needed.
00:39:05
Speaker
And I mean, we could increase that over time too.
00:39:10
Speaker
um And what are some products that you think are really cool in on Hedera that people, that maybe the general public hasn't really heard of? Like any anything that, because I think you're you're in a unique position to kind of look at all these new products coming in and people building these things that maybe not a lot of people are aware of.
00:39:31
Speaker
Yeah, I mean, Prove AI is one. So Prove AI was the the former Casper Labs team. They've decided to come over and build their Prove AI model on Hedera as a network. I mean, we have a lot of DeFi protocols out there that I think are becoming really interesting. SaucerSwap, Bonzo Finance. So you know lending and collateral protocols um and DeFi.
00:39:52
Speaker
There's karate combat, which is like an m MMA sport, which a lot of people have seen out there. um It's actually growing quite a bit of following when it comes to people actually going to the events and watching these fights happen.
00:40:06
Speaker
um But they you know they have a ah token that's that's been created for gaming called, i i think it's called the Up Only Network, and um but you know they they've tokenized a lot of the way that they do fan engagement which is really interesting and then there's real fights with a gamified mechanic it's absolutely real fights and if you if you look them up um they're i would say they're probably the third most popular um fighting kind of organization now behind ufc and There's a professional fighters league. So behind UFC and PFL, I think karate combat is starting to to be at number three.
00:40:44
Speaker
um We actually had May Chan, who is the CEO of Hashpack, which is our one of our our biggest wallet providers. She actually fought in one of the fights. So sometimes we do we do the like the crypto fights there. So like crypto founders and stuff will come and kind of fight each other.
00:40:59
Speaker
so so So wait, when when BitBoy had that unhinged boxing match, was that on Karate Combat? Yeah, absolutely. No fucking way. Yeah. That's epic, man. that That's fantastic.
00:41:11
Speaker
that it does sort what There's a lot of really funny matches on there. I will be checking that out. But I mean, that's just part of it. I mean, there's there's some real, very legit fighters that that are on there too. that I mean, there's been some really good highlights from those. But that kind of buzz is like really interesting that people don't really you even knew that that was like built on Hedera because they just think you know Enterprise Chain is what is.
00:41:35
Speaker
you know what it is But I mean, we have tons of of NFT projects, wallet providers, um bridges. And then simultaneously, we have, it's it's really funny because our governing council members, you know, they'll come to the to governing council meetings. And these are like huge organizations, right? Like, yeah you know, Standard Bank and Nairobi Securities Exchange. And it's like,
00:41:58
Speaker
they're the ones talking about, did you see the latest karate combat fight? And it's like, it's like, okay guys, like we, yeah, we did. um So they're, they're the ones that get hyped up by, you know, some of the, the other use cases that we have simultaneously, you know, building their own.
00:42:13
Speaker
um It's, it's really cool to see.
Cultural Awareness in Enterprise Strategies
00:42:17
Speaker
No, that's super cool. Like I always thought the, like the crypto kind of community has, added something, you know, to to companies, to organizations that wasn't there before.
00:42:29
Speaker
You know, as I feel consumers get more and more, you know, critically aware of of products and they understand how how a pipeline works and they get more closer to like closer the product itself.
00:42:41
Speaker
Like as a user, you can actually get as close to Hedera and all of the Hedera's products as you want, right? can go to GitHub and you can check. So I feel that also creates a different level of communication, which also means that you know it can be it can be fun it doesn't have to be like super sanitized So it's really funny, and I'm um hesitant to say this when I'm going to because it's hilarious.
00:43:04
Speaker
um So one of the karate combat matches Hayley Welch went to, and most people know Hayley Welch as the Hak Tua girl. Yeah. um So you know she showed up at one of these karate combat matches. Everyone was taking pictures.
00:43:18
Speaker
And like the next day, we had a council meeting, and council members like, oh, did you see who was at the karate combat? It's like, it's the fun i won't I won't name names, but it's it's funny to see that that enterprises pay attention to the places where culture is kind of navigating.
00:43:34
Speaker
And that's one thing I've always wanted people to know is these enterprises are not ignoring retail and they're not ignoring where culture goes. they are you know somewhat moving at the pace that they're allowed to move.
00:43:48
Speaker
um And you know I think we should give them some, cut them some slack, be there to educate too. That's the other thing is, you know right now, a lot of enterprises and regulators too, they're they're really looking for education.
00:44:00
Speaker
I mean, all of us that work in this industry, we see it every day. We see it from morning until we go to bed and these other people don't have the benefit of doing that. So I think it's important that we, we actually do instead of just making fun of them all day or saying they're, you know, they're normies or, you know, they're terrible. Like,
00:44:18
Speaker
give them Give them some information they can use to go back to you know their organization or their constituents. If it's you know somebody in government, some good information they can use to make them look like a superstar. like yeah That will go such a long way. I don't think people realize it.
00:44:35
Speaker
Oh, no, I completely agree. Like, I feel that, ah yeah, okay, for sure, it's it's fun to just poke fun at, you know, like, big organizations just moving slowly, but that's just that's just how they work, right? Like, there's there's such, is it's like, you're thinking about this entity that is just,
00:44:52
Speaker
just has so many moving parts and the bigger it is, the more complex it is, the slower it's going to be just getting sign off from 15 different departments to do one thing. Right. um And definitely completely agree better to just get them on board and to, you know, spread the, that like the learning of it rather than to poke fun and alienate them from it.
00:45:13
Speaker
100%. And I think that's how that's how it all gets. It starts to be a bit more you know ah an inclusive space where where you get these bigger companies to actually come in and do something positive rather than be scared that it's all full of like crypto bros that just going to... You know what I mean? Well, 12-year-olds making a token and running away with a bag. Yeah, exactly. ah Fuck you.
00:45:39
Speaker
Got the money. Yeah, it's definitely not that. And I think the um obviously those are the stories that get the attention, though, right? Like anytime you see something crazy happen, it's going to get all the media attention.
00:45:52
Speaker
But that's hundred percent that's not really what we deal with on a day to day basis. No, 100%. And I kind of like, I blame the media, but not necessarily the social media. Social media is like this, you know, hive mind that kind of does whatever it wants. Though you could argue that some actors can influence that more or less. But I blame like traditional media, like old media for this kind of stuff. Like back when back when we had, ah you know, the COVID lockdowns and everything. And and and they just blew the the the gravity of the situation out of proportion. And it's always happened. Like when there's a crypto hack,
00:46:24
Speaker
Everyone goes like, oh, this this chain has been hacked for that amount of money. Is this the end for this chain? Or, you know, like, no, fuck you. It's not the end of the chain. is that It happens. look at how many Look at how much of the fiat currency is being used to just buy illegal drugs.
00:46:40
Speaker
You can't even measure because it's so much of it. I mean, how how many people get their debit card stolen every day or their credit card and just have somebody else completely defraud them of money? Like, and you just never see any news about it. It's just because it's so it's so normal and it's been so normal for so many years that this is kind of like the new and interesting thing to to point to. But i think we're actually doing ah I think we're actually doing a pretty great job at maturing as an industry. And Not any slower than any other industry. I mean, when the internet first started out, it was typically like, I mean, the two things you could do was either, you know, pornography or you got to see message boards where the punk rock bands were kind of showing up and that was it.
00:47:23
Speaker
And then 1994, Pizza Hut comes along and they put a website up and everyone's freaking out. and they're like, what has Pizza Hut got a website for? And all they did on there was collect email addresses.
00:47:35
Speaker
And it confused people so much. They're like, why does Pizza Hut like want emails? like This is the weirdest thing ever. And then 1997, Bank of America puts a payment portal online.
00:47:46
Speaker
And guess what pizza company has all the email addresses to do online ordering and delivery from? it's freaking Pizza Hut because they had enough foresight to see where the trend was going three to four years later.
00:48:00
Speaker
And all they needed was one financial institution to to join in. And from from that point, it it's game over. like it's It's e-commerce like on steroids. like people people put I mean, having your your credit cards probably saved on the internet right now. like You don't even have to type it in anymore.
00:48:15
Speaker
like That's how much people trust it. And so we i mean we're kind of going through that same trajectory of you know, manual input, saving your seed for it. Like everything seems hard and clunky right now and cartoons and weird things that don't make sense, but we're going the exact same trajectory that the internet went.
00:48:33
Speaker
And it's only going to take a handful of people to start that critical mass and a handful of companies. And then it all tips over and it all starts to run in the background.
The Importance of Verified Data in AI
00:48:42
Speaker
We all, you know, have the benefit of, of having this kind of verified technology and sure.
00:48:47
Speaker
And I tell you like the more with AI and deep fakes and, know, you know, the way that data is being used, having verified data is going to be very important. I mean, it gets to the point where, you know, IOT devices, let's say like a camera that's pointed towards a traffic intersection,
00:49:03
Speaker
that's gonna have its own account because the data coming from that verified account, you're gonna have to make sure that that's the real camera feed. Because we already, I mean, we already see people just like faking camera feeds like, oh, look at this, you know, war crime that happened or look at this, um you know, this traffic incident that happened.
00:49:21
Speaker
Come to find out it's it's a totally staged and fake thing. It's not even from a real device. So like these are things where you start thinking about scale of account creation and how many transactions out actually have to go through a network.
00:49:35
Speaker
um Scale becomes a really important thing to think about. Oh yeah, 100%. And I've also seen like legit uses of AI CCTV systems too.
00:49:45
Speaker
Like a lot of retail uses them to identify like purchase intent. They they look at metrics like average dwell time, like how much, how how how long do people spend in front of a product?
00:49:57
Speaker
And does that influence, you know, where it is placed in the store? Is there a higher like conversion rate if we put a product on the gondola versus if you put it at the back of the aisle or like, you know, there's there's so much like AI like of of AI being used in in CCTVs. It's wild that, you know, I don't know how how good that data is being anonymized. I don't even know if it's anonymized at all. like right a My face could be owned by like a hundred, a thousand different retailers for all I know.
00:50:24
Speaker
I mean, i yeah, I guess ah read the small print on that because I'm pretty sure it is that data is probably owned by the retailers, not only owned, but they're probably able to to sell and transfer that to other people too.
00:50:36
Speaker
Oh yeah, for sure. Yeah, look, is this guy is only looking at like the black clothing department. it just You want to buy his data set? it's it's it's It's crazy. Yeah. And I'm sure you're right. I'm sure that if I was to read the fine print, like it would probably be on there some somewhere.
00:50:49
Speaker
um Just as it is with ah with Adobe, they had a thing up a couple of months back and it's been resurfacing now. They've ah updated their terms of service. um so A lot of people think it's with regards to their new like AI features, but some just just think it's it's just for general purpose.
00:51:05
Speaker
Every um creative that that you build using Adobe um is sub-licensable and licensable to Adobe to distribute, ah to showcase, and to modify as they wish royalty-free.
00:51:21
Speaker
Wow, I did not see that. And I use a lot of Adobe products. Same. good That is a good call out. Honestly, yeah. look Look at the terms of service. Just a quick search on looking through the terms of service. I think it's.4.2, section 4.2.
00:51:40
Speaker
and And you'll see how it's very clearly stated that everything that you create can be licensed, sublicensed, royalty-free for any purpose that they wish. which could also include selling it as AI data, using it as through AI data, using it for their ads or whatever.
00:51:54
Speaker
Like that's just a license to steal your content. So now tell me again, who's actually pirating here? and I mean, that brings up a really good point. And that's why, you know, even tokenizing the data and the person who's giving you the data going into these models is important because if you're going to give remuneration or or micropayments to people when this model is used, that's the only way you can do it. um Acor is a company that builds health data and health data models on Hedera. And that's one of the things they do is if you're going to contribute your health data and to some of these studies, like you you should probably be compensated for it.
00:52:31
Speaker
So, you know, tokenizing that data and understanding how to make those micropayments to people contributing. i mean, that is going to be a giant economy. hundred percent. And I feel people need to be more aware of how their data is being used. I feel like terms of services is not good enough. I feel like terms of services, like the cheeky way of doing it, I'll just stick it there on like page 28 out of 455 pages of
00:52:55
Speaker
small fine and it's not just small fine print it's also like legal speech that you have to sift through so you literally need a legal expert or to take this massive document and feed it to an AI and then just be like can you decipher this for me please um it's again one of those cheeky ways like was going back to marketing speech is another one of those cheeky practices that lot of companies do to just get away with doing the bare minimum that's legal you know and then I feel like We're at a stage where, look, I think people want a good product and I feel like people are willing to to pay more for a product that gives them more value and and and respect towards their data rather than cutting corners, providing a lesser service at a slightly smaller cost. And that's in the good case because it might not even be a smaller cost.
00:53:38
Speaker
Like a lot of them are great. They even charge the same or more and just trying to get away with doing as little as they possibly can. Yeah, I mean, the value of data going forward is, I mean, exponential. And that's why I think, I mean, right now, just anything you sign up for, go into it, making the assumption that your data is being used for something, some kind of monetization, like,
00:54:02
Speaker
There's a very high likelihood that that's already happening. But, you know, the good thing is, is using a DLT again, you know, you start tokenizing this data of consumers. There's, I mean, it unlocks a whole lot of of different things where, I mean, obviously like Apple has already deprecated a lot of of cookies within, you know, things that they use. Google's deprecating third-party cookies, like I believe the end of 2025.
00:54:26
Speaker
companies need first party and zero party volunteer data from people and they're going to have to pay for it. I mean, they're going to have to pay people some kind of micro payment in exchange for their data moving forward.
00:54:38
Speaker
And then housing that on DLT, making sure that there's either just a hash of the data that points to the full PII or doing something else with it um just to ensure that it's safe. It's I mean, the the personal data of people is is being utilized so much right now that I think it's time, you know, the individual user actually gets some kind of reward, some kind of reward for that.
00:55:03
Speaker
and And micropayments and micropayments on DLT and using crypto, that now makes that possible. You know, in the past, the big excuse was, Well, you know, you we're not going to pay you 25 cents because we have to process a check and we have to like mail it out. It's more expensive to reward somebody than it's even worth it.
00:55:22
Speaker
Well, now, I mean, through crypto, you could be sending people almost like ah almost like streaming payments, like you're getting live stream micro payments every time your data is used. It's I mean, it's basically cost nothing.
00:55:34
Speaker
I mean, they should be doing this already. Right. Yeah. And you could get something like a royalty ah program, right? You're using my data, you just you pay for it as you use it. Like i ah you know Spotify pays per stream, but then Spotify is not a good example. They barely pay yeah a bands per stream. So not the best kind of approach. Don't do that.
00:55:53
Speaker
Don't be like Spotify. be just better than spotify it's It's an example of a low payment model. Exactly, yeah. If you want to get away with doing the bare minimum, that's that's the business model for you to study.
00:56:04
Speaker
um ah The one thing I'm concerned about with AI regulation, and I'm sure that we're going to have more AI regulations, it's going more difficult to to exploit people's data, which is good. But at the same time, it will also block the way of having any other potentially AI companies that that create LLMs for as cheaply as they've been created already.
00:56:24
Speaker
To the point that you know the ones that built them already, like OpenAI, Claude, a couple of others, are going to be the only LLMs on the market that are you know far more advanced than anything else because no one's going to have that. like The barriers to entry to train AI is going to be either incredibly expensive or so you know closely guarded that the ones that got away with it are the only ones that are going to stay on the market. And that kind of scares me a bit.
00:56:48
Speaker
Yeah, I mean, I'm hoping that once people start seeing the value that this can actually return to society when used the right way, that right now we don't see a, I mean, there's some, but you don't see a huge kind of open source culture in AI.
00:57:04
Speaker
And hopefully we kind of, yeah you know, start going that direction where, where things are a little bit more, you know, you have verified data sets and verified LLMs and you can start to kind of, kind of open source those for use for other people.
00:57:17
Speaker
um But again, you know, that, that data is, Those data sets are trained with a lot of individuals data. And so having that balance of rewarding people and kind of open sourcing those models is it's going to be very important. And it's going to come down to the will of a human being to do what's right.
00:57:35
Speaker
And so let's just hope that there's people out there that are going to be advocates of doing the right thing. 100%, man. Couldn't agree more. um So what do you guys have planned um for the next, I guess, year or so in Hedera? Any cool things that you want to tease at the moment?
00:57:54
Speaker
I mean, the the cool things, you know, we're still filling out the count the governing council. um So still bringing in new new companies to the council. Again, kind of a big shift in focus to, you know, obviously still paying attention to all of our enterprises, but diving really deep into the retail side.
00:58:11
Speaker
um So getting a huge focus on DeFi financial products, um just thinking about the way that we interact with retail users and individual users has been really since I've kind of come on board 11 months ago, just starting to turn the organization into understanding how important those things are.
00:58:30
Speaker
So I would just say for people, I mean, really look out for a lot of um a lot of attention coming coming to the retail space. Awesome, man. That sounds epic. And I do wish you guys all the best with that.
00:58:42
Speaker
um Listen, thanks for the conversation. This has been awesome. And yeah i can't i can't wait for us to air this. Yeah, i reach out anytime. This is a great conversation. Thanks for having me. Awesome, man. Well, have a lovely rest of your day and I'll keep in touch, brother.
00:58:55
Speaker
Yeah, thank you. You too. Take care. Bye. Bye-bye.