Transcript
Speaker: Hello, everyone, and welcome back to the Polymath Experience.
Speaker: I'm your host, Polymath.
Speaker: And today, we have someone who, in a sea of AI-generated content on Twitter, is a breath of fresh air.
Speaker: When they're just trying to get a few bucks, you can count on him to bring in a new perspective.
Speaker: No one's covered before.
Speaker: He doesn't just scratch the surface.
Speaker: He goes deep.
Speaker: and he's focused on uncovering interesting and important pieces of information.
Speaker: Recently, he was one of the only ones I saw who was covering the courtyard Pokemon drop as it was happening.
Speaker: And yeah, he brings in his experience as a Big Four consultant to do it from an angle that's just not being done elsewhere.
Speaker: So, Sammy, welcome to the show.
Speaker: What an intro.
Speaker: I appreciate it.
Speaker: Good to be here.
Speaker: My pleasure.
Speaker: My pleasure.
Speaker: Well, I only have special people on the show, so they deserve a special introduction.
Speaker: That's great.
Speaker: It's probably one of the warmest welcomes I've ever had.
Speaker: So yeah, I appreciate it.
Speaker: I'm glad you like it.
Speaker: When we were chatting before, you were telling me about your first days in crypto and this romantic era of the COVID lockdown in Melbourne.
Speaker: Can you go back into this a little bit and remind me, remind us of what got you into the rabbit hole, what caught your attention, all of that?
Speaker: Absolutely.
Speaker: Yeah, I think, I mean, that seems like a decade ago now.
Speaker: So long ago, but it's only what, two years?
Speaker: So I think, I mean, I first touched crypto back, so I started working EY.
Speaker: It's probably almost a decade ago now.
Speaker: So I qualified with them, but left them, joined a fintech.
Speaker: And that was my first exposure to crypto because everyone's kind of tech curious.
Speaker: They were buying, I think it was like Litecoin, Bitcoin.
Speaker: I don't think it was even ETH then, but people were buying up that stuff.
Speaker: And I bought a little bit, dabbled, but then kind of lost interest and moved overseas.
Speaker: So other priorities took place.
Speaker: And I think that's when moving to Australia,
Speaker: So I was over there for four years from London, hit the lockdown of COVID in 2020 and just went down that rabbit hole then.
Speaker: So we were kind of confined to one hour exercise a day and we had like a curfew from 8pm to 5am.
Speaker: So we weren't allowed out between those hours.
Speaker: So I was like, okay, well, I'll fill this time with something that I'm interested in.
Speaker: So I kind of started watching videos and kind of understanding more about what's going on in the market.
Speaker: And I was like, oh, this blockchain stuff, it kind of makes sense.
Speaker: So I was working back at Ernst & Young in Melbourne at the time, did a comment to Sydney, started speaking to a few of the guys there, understood that they had like a blockchain working group.
Speaker: So kind of got more involved in that.
Speaker: And then, yeah, just started.
Speaker: realized institutions were coming if they were interested then it's probably going to be here to stay regulators were starting getting inquisitive putting out consultation papers so okay well this this is clearly here to stay let me go down the rabbit hole start doing some qualifications internal credentials with eY
Speaker: And then realized I was probably learning at a faster pace on my own than I was at the firm.
Speaker: So I kind of went on my own.
Speaker: And that would have been November 2021.
Speaker: There was a flurry of activity in mid-2021 with NFTs.
Speaker: And I think Damien Hirst was what piqued my interest.
Speaker: So the currency.
Speaker: And he's a British artist.
Speaker: And he...
Speaker: created this really interesting idea where you use NFTs to either redeem the physical by burning the NFT or you keep the digital equivalent, but you burn the physical.
Speaker: And I thought that was the first proper use case of this tech that I thought, well, this is something that could be used.
Speaker: So that, to me and my housemate, both actually applied to get this piece.
Speaker: I think it was like $2,000 or something at the time.
Speaker: Immediately after sale, it went up to like 11 ETH, which at 4K per ETH, that's like 44K.
Speaker: K or whatever it was.
Speaker: Um, so yeah, he, he ended up getting it.
Speaker: I didn't get it.
Speaker: So yeah, I was a little bit like I introduced him to it as well.
Speaker: And it was like, Oh yeah, he was a passionate, uh, Damien Hirst fan as well.
Speaker: So he ended up keeping it, riding it all the way up, all the way back down.
Speaker: Nice.
Speaker: Yeah.
Speaker: It's, uh, it's,
Speaker: It was a bit of a whirlwind.
Speaker: I think back in 2021, that blow off top of NFTs, I think it was around about August time and then the second one in January 2022.
Speaker: It was just crazy to see the level of interest, the level of trading going on, the money flowing in.
Speaker: And yeah, I've just stayed interested, curious ever since and just been exploring different types of tech that's been happening.
Speaker: Yeah, so I think from then, just started writing stuff on Twitter, probably in late 2021, early 2022.
Speaker: And it's just kind of snowballed from there.
Speaker: Thank you, man.
Speaker: Yeah, looking back on those times, now the market is probably closer to its real value because there's no speculation going on.
Speaker: So when you see the levels, especially the trading volume, it was completely nuts what you'd see in a day.
Speaker: Do you remember, because you just mentioned that you found blockchain interesting.
Speaker: And in my experience, we all have that one trigger.
Speaker: that one thing that really based on our own experiences and our own mindset really triggers us in, all right, like this is, this is for me.
Speaker: Was there anything specific for you that was like the aha moment?
Speaker: That aha moment was probably, I think being able to see everything on chain.
Speaker: So just like, I mean, I worked in, so I started in audit.
Speaker: So in terms of like transactions, ledgers, things like that, centralized ledgers.
Speaker: Um,
Speaker: And then kind of moved into consulting advisory.
Speaker: But I think just being able to, I found getting people's data or client data very difficult sometimes.
Speaker: You'd have all these systems sometimes which is not right or not accurate and they didn't kind of reconcile and all this kind of stuff.
Speaker: But then seeing...
Speaker: blockchain where you had all this open ledger, transparent, like literally just export all the data there or just scrape it or whatever.
Speaker: I was like, well, this is just, it's the ledgers there.
Speaker: It's immutable.
Speaker: You can't, you can't change it.
Speaker: And I know like centralized systems, you have these, you have like audit trails and things like that, but it's, I feel like you can probably edit those ledgers a lot more easily.
Speaker: So from a professional skepticism audit background, I was just like,
Speaker: I just feel like this is just superior tech.
Speaker: I don't understand why people aren't using this.
Speaker: And I think it is just, I mean, a lot of my clients were insurers and you had policy admin systems that would be dating back.
Speaker: I mean, sometimes like 30 or 40 years.
Speaker: So you'd have a mismatch of about 30 different systems that would get aggregated into another ledger or whatever.
Speaker: And it would just be chaos.
Speaker: And especially when you have mergers and acquisitions between companies where you have incumbent systems and things like that.
Speaker: So I think having one source of truth, it just makes sense to me.
Speaker: It's so powerful.
Speaker: Yeah, coming from that background and seeing...
Speaker: where I think it's probably going to go with all these financial institutions eventually.
Speaker: Yeah, I think the penny just dropped then.
Speaker: That makes so much sense.
Speaker: Do you think we're ever... Because there is a big... A lot of companies like to cover up their tracks.
Speaker: There is magical accounting techniques to do what you want or delay things.
Speaker: I was watching this documentary...
Speaker: What's that Japanese camera company, Olympus?
Speaker: Did you, did you, I'll send you later on, I'll send you, I'll send you a documentary on this.
Speaker: It was, it was fascinating.
Speaker: And especially because it was the first time where you could see that business in Japan is very, it's very important when you're a business person, you're providing for people.
Speaker: And so there's this notion of respect and of like being the man of the, of the company.
Speaker: And so betraying or even, yeah, betraying that trust, even without any ill will is terrible.
Speaker: And so they,
Speaker: covered up their accounting in ways to buy them time.
Speaker: And this was just like a top of head example.
Speaker: But do you think we're ever going to move to a place where there's this level of transparency?
Speaker: as like you have a blockchain and stakeholders and even maybe users see accounting in real time?
Speaker: No, it will never be like that.
Speaker: So it will be, you'll have permission blockchains, you'll have, I think blockchains where
Speaker: I mean, you're going to have the companies that like the internal companies probably going to have unfettered access or even like certain departments will, but they wouldn't even let the entire company have full access because there's going to be sensitive data.
Speaker: And I think ZK, so zero knowledge is one way of, I think, hiding some of that sensitive data.
Speaker: I think there's some innovation there, but yeah, permission blockchains are one thing.
Speaker: So yeah.
Speaker: It's interesting about the whole cultural thing because I actually had a few Japanese clients.
Speaker: I used to be called Sami-san and all this kind of stuff.
Speaker: It's interesting seeing cultures overlap with the tech side of things as well because I agree that some cultures are probably going to be less accepting than others to change.
Speaker: I think...
Speaker: Yeah, it's difficult because I wouldn't say that companies generally want to be transparent with regulators.
Speaker: I mean, when they build up the systems, they have governance processes.
Speaker: It's in interest to do that.
Speaker: It's just that you're going to have a few bad actors within companies that probably potentially want to hide things.
Speaker: And that's probably because they're doing stuff that's not right.
Speaker: And I think that
Speaker: my old role as an auditor would be to look for errors.
Speaker: And then also if we stumbled across stuff that, I mean, that could be to do with fraud or negligence or whatever.
Speaker: But I think that there are going to be bad actors in companies.
Speaker: It's just human nature.
Speaker: There are going to be those bad people.
Speaker: But I don't necessarily think that
Speaker: Companies generally, when you get to a certain size, are going to want to mislead or hide some of those things.
Speaker: Yes, they're going to want to keep things confidential from a competitive standpoint, but I don't think that they would do it intentionally just to...
Speaker: like hinder progress or like hinder that level of transparency.
Speaker: I think eventually it's going to change.
Speaker: It's just a matter of time.
Speaker: And I think the biggest issue is the first movers are going to, they're going to have to have quite a big upfront cost.
Speaker: See that the investment's going to be quite big.
Speaker: So it's going to be a trade-off between like the innovation that you, or the benefits that you're going to receive from it to the innovation that's going to, or the upfront cost that's going to get that innovation kicked off.
Speaker: So I think there's always going to be a business case that they have to put internally to,
Speaker: a board of directors or whoever to get signed off.
Speaker: And I think with those big companies, those processes can take years.
Speaker: What do you see the opportunities being for the company?
Speaker: Why, in your perspective, would they be incentivized to use it despite the huge upfront cost?
Speaker: Well, fraud is a huge issue with companies, especially when I used to work at financial institutions, you'd have pension fraud was huge where you'd have
Speaker: internal and external.
Speaker: Like people would be chartle bad actors would be trying to defraud and change things in the ledger to then be able to extract funds similar with insurers.
Speaker: So you'd have fortunate activity there where you'd have fortunate claims or like, or people would make changes in the ledger to then siphon funds off.
Speaker: And I think
Speaker: it kind of prevents you from doing that.
Speaker: And you have, I think that it's almost a deterrent as well.
Speaker: If you've got this immutable blockchain, you're going to have to post transactions that are probably going to get spotted a little bit more easily to then get away with that kind of stuff.
Speaker: So I think having an immutable decentralized ledger, it just, yeah, it kind of makes sense from a forward standpoint.
Speaker: I think as well, just the cost being cost effective.
Speaker: Like if you have like a reliable source of truth, you know,
Speaker: The amount that companies spend on making sure that things reconcile, that they are correct, accurate, complete, like all those things, like it can cost an enormous amount of money in time and having reviews, external reviews, peer reviews, all that kind of stuff.
Speaker: I think it will cut costs.
Speaker: If you can just rely on that being true, then you won't have to get like the IT team to come in and make sure that things are complete and accurate or provide reports or you like...
Speaker: For instance, audit costs might go down because you might have them come in and be like, okay, well, you're using this ledger.
Speaker: We can just rely on it.
Speaker: Therefore, it will take us less time to do it.
Speaker: We'll reduce our fee.
Speaker: I think there's just so many different angles that you can implement with like blockchain tank that you'll benefit from from a corporate standpoint.
Speaker: But then it just does come down to like the cost benefit analysis.
Speaker: Like,
Speaker: it might cost millions to implement this system, but you might not see those benefits for the next like 10 years.
Speaker: So in which case, I think anyone in a short term position that's got like maybe a two to five year time horizon in a decision making position is probably less likely to go with that.
Speaker: But if for instance, it's a 500k initial outlay, but the paybacks within a year, then they're going to be like, well, yeah, of course, we're going to go with that.
Speaker: And I think that we'll probably get to that point at some point.
Speaker: But yeah, it's going to be a way off.
Speaker: Although, I mean, we're seeing what recently with the UBS news on tokenization with like a, I think they're working with the Singapore Central Bank.
Speaker: So they're looking to tokenize assets.
Speaker: Same with, I mean, Citibank recently, London Stock Exchange.
Speaker: I think recently we saw ANZ partner with Chainlink to kind of,
Speaker: use their CCIP, which I think is like, it's kind of like an Oracle system.
Speaker: So off-chain data with on-chain and like marrying up the two.
Speaker: So I think like there's so much that's happening.
Speaker: And I saw recently a report that BCG said that asset tokenization would be worth 30 trillion by 2030 or 13 trillion, sorry.
Speaker: So huge.
Speaker: Which I think at the moment it's like, it's way less than a trillion.
Speaker: It's like, yeah.
Speaker: maybe a couple of hundred million, but I mean, the upside is huge.
Speaker: It's just kind of, we're seeing stuff come through now.
Speaker: So yeah.
Speaker: Yeah.
Speaker: It's, it's, it's really bubbling up everywhere on, on, on all fronts.
Speaker: It's, it's very interesting to get this perspective because I, I've always been focused on like the decentralized side of things, you know, not the efficiency, the traceability, the, the, and type fraud and,
Speaker: And so it's very cool to see that side of things and to remember that blockchain is literally going to permeate our society as a whole.
Speaker: in the next 20, 40, 60 years.
Speaker: I don't know when.
Speaker: I'm super curious about a few things.
Speaker: But in our realm right now, what was it like at the beginning at EY?
Speaker: How did you approach consulting blockchain businesses?
Speaker: I've got a little bit of an answer, but what types of businesses were there?
Speaker: What were they asking of you at that point?
Speaker: So, I mean, I joined their working group, but it was more just very much building out like a pipeline of potential clients and looking at leads and things like that at that point.
Speaker: So, I mean, consulting-wise, a lot of the clients that I think EY would do work for would be
Speaker: I mean, it would effectively be like proof of reserves.
Speaker: So auditing their reserves to make sure that they're complete, that they exist.
Speaker: And that kind of stuff is, I mean, you look at a lot of these big exchanges where they do all these Merkle tree testing.
Speaker: It would be kind of that sort of stuff.
Speaker: And I think there was a lot of other firms that did the likes of Binance, Coinbase,
Speaker: I think we had maybe some, I think we'd maybe looking at doing some work with VV when I was there and then some other companies.
Speaker: But yeah, I think proof of reserves was one thing.
Speaker: But then, I mean, blockchain consulting can go all the way through to supply and chain management.
Speaker: So...
Speaker: I think BHP, which was like a mining and minerals company.
Speaker: So you'd effectively have stuff dug up out of the ground.
Speaker: It would then be put onto a system or whatever, and you track that around to where it was supposed to be delivered.
Speaker: So then it could be, yeah, and that would go on ships.
Speaker: That would go domestically around Australia.
Speaker: And I think there was even implementing blockchain with
Speaker: Marine, I think companies with like integrating blockchain based systems for like the, I think, I can't remember the name of it.
Speaker: There was, there was like a startup that integrated or worked with, it was like an insurer that worked with a specific blockchain.
Speaker: I can't remember off the top of my head.
Speaker: It was pretty bad.
Speaker: It's a VeChain?
Speaker: No.
Speaker: It's the only one that comes to mind when, when I, when the concept of supply chain comes up.
Speaker: So I,
Speaker: No, it wasn't VeChain.
Speaker: It was, I can't remember.
Speaker: I think, I know EY was working with Polygon at one point, whether they were building a separate blockchain on Polygon or at the time.
Speaker: But yeah, I mean, there was a number of different clients that they were working with and it was completely different capacities.
Speaker: But I think a lot of it was being driven out of the US.
Speaker: When I was in Australia, it was quite a small team and people were kind of doing it as a side hustle to their existing roles at EY.
Speaker: But I think most of it came out
Speaker: came out of the US, maybe to an extent in the UK, but Australia was kind of like piloting it over there.
Speaker: And I know that
Speaker: I think the guys were working, I think ASIC or whoever the regulator was at the time, was sending out consultations or requests for consultations around blockchain, crypto.
Speaker: And I think EY was responding to that at the time.
Speaker: So that was kind of progressing.
Speaker: And I think the Australian Stock Exchange looked to integrate, effectively do what the London Stock Exchange group was doing at the moment, was tokenizing assets for security.
Speaker: So they have like a chess system in Australia, which is effectively,
Speaker: you're testing like the existence of these assets or the ownership back to whoever that certificate says.
Speaker: So for a lot of our clients, we would go back to chess statements to verify that they're the owner of these assets and there might be equities or whatever it might be, but they were looking to tokenize all that at one point.
Speaker: I haven't checked recently to where it got to.
Speaker: I think it might've got
Speaker: delayed just because again cost benefit analysis but yeah I think that was quite interesting at the time and I was like okay well that's happening yeah and I think the Australian like regulator is probably quite progressive it seems to be quite proactive the fact that
Speaker: ANZ is working with Chainlink and I think they were the first bank to issue an Australian backed stablecoin.
Speaker: So I think there's like a number of things that are happening over there that probably is maybe slightly ahead of the UK and the rest of the world.
Speaker: I don't think it gets the coverage.
Speaker: Maybe that's why I kind of got interested into it because I was seeing a lot of activity from institutions, regulators,
Speaker: Whereas had I been in the UK or elsewhere, maybe I wouldn't have seen that and maybe not got as interested and potentially still be working in a corporate job as opposed to a digital nomad roaming rounds, working with magic internet money.
Speaker: So...
Speaker: What a crazy world we're living in at the moment.
Speaker: We're still in this phase where the market is not mature and the businesses that are Web3 are not mature.
Speaker: It's still very much projects with a few businesses here and there that have a grasp on thing.
Speaker: From your experience as a consultant, what are the big mistakes that you see those projects doing that they're going to need to fix if they want to level up?
Speaker: I think the biggest thing is they build out a roadmap or a promise.
Speaker: They mint a project and then they don't meet what they're intending to do.
Speaker: I think what needs to happen going forward is they actually build the product first, which I know can be difficult with funding, or at least a prototype to an extent so that
Speaker: you can actually have something tangible to show for it because like so many times, I remember in 2021 especially, people would launch with all these lofty promises of maybe a game or like, or whatever it might be, not knowing the sheer amount of work that would need to go in to then deliver it.
Speaker: And they completely wildly miscalculated how much they needed in funds or they might just not manage their treasury appropriately and they just run out of runway.
Speaker: And then they just either slow rug or they just kind of just basically say to them, sorry, guys, we've run out of money.
Speaker: Or they try and raise a second round from their community.
Speaker: And yeah, it just goes south.
Speaker: So I think like proper planning and implementing.
Speaker: And I think that even when you look at, there was a raft of activity where a lot of projects were getting VC funding.
Speaker: And I think they were effectively cherry picking the ones that had like an MVP or had something that was...
Speaker: tangible to show for it.
Speaker: And I think there was a lot of time that as soon as there was a VC announcement around the project, it would just pump up because people would assume that they've done their due diligence and whatnot.
Speaker: And I think it just went through the cycle of being like, you could throw money at anything, it would pump in price and effectively die after that because there'd be no tangible...
Speaker: thing behind it to they have a product, they get VC backed, it pumps, and then it kind of does relatively well.
Speaker: And then say 50% of it drops off.
Speaker: The other side kind of builds out maybe some software or something useful, but then people use interests and move on to the next shiny object.
Speaker: So it's like,
Speaker: I think people's attention spans are very fleeting.
Speaker: And I think retaining that attention as a project has always been very difficult.
Speaker: Even the top projects, you see them being really successful and then all of a sudden something happening and it just, like the price of the NFTs dropped completely.
Speaker: But I think the biggest thing is just building a, if you want to build a company, build a company with real revenues and complement it with NFTs as technology.
Speaker: I think that's probably the angle that I would push rather than
Speaker: making a NFT based company because you're kind of trying to find a solution for it then rather than having a product or a service and then complementing or enhancing that with NFT.
Speaker: So which is why I see like loyalty reward programs, ticketing, like all these kind of things are just it kind of makes sense.
Speaker: Even even PFPs with Reddit avatars, but having a lower cost to acquire them.
Speaker: That kind of makes sense as well.
Speaker: I think long gone are the days where you can like mint a PFP project and expect that to go to the moon because I think it's just a speculative asset to a degree.
Speaker: And then if you try to start adding utility to that PFP, all of a sudden, especially if you can tie cash flows to it,
Speaker: you're going to effectively completely undermine the current value because I guess from a financial perspective, you have like present value future cashflow model.
Speaker: So you can literally just, you can then work out, okay, well, what revenue am I going to get from this based on what they, the utility that they've put to it?
Speaker: Okay, well, I'll discount those cashflows back to today.
Speaker: And that's what the value of that actual PFP then comes.
Speaker: And it's like, well, what's the point in,
Speaker: doing a pfp project if you're just going to add other utility to it so i think it's just working out what like what are you actually doing as a business what are the revenues like um and just does actually doing an nft make sense you could do like a software as a solution or something like that it might make more sense like you don't have to use nfts i think does tokenization make sense and i think you touched on courtyard recently and i think that that just like as a penny penny drop moment where
Speaker: you have these actual physical assets that have value and you're tokenizing them, putting them on chain, but you know that there's like a custodian.
Speaker: So Brinks that's been around for 150 years is partnered with Courtyard.
Speaker: So they can actually hold those physical assets reliably.
Speaker: And you know that whatever they're going to tokenize, you can redeem through their platform with Brinks.
Speaker: So, and that NFT that you're buying, like the actual NFT, I don't know how much that
Speaker: is really valued, but the actual, cause you, the intrinsic value is the underlying collectible.
Speaker: So you know that you can redeem that asset and then sell that collectible elsewhere or just keep it or like there's actual utility to that.
Speaker: Whereas I think with a lot of PFP projects specifically,
Speaker: could literally go to zero because the intrinsic value is it's just the image.
Speaker: Like that's, that's all the value is.
Speaker: So it's a lot more risk.
Speaker: And I think like we're finding that there's actually more use cases to NFTs now and people are actually putting them to, to use, which is incredible.
Speaker: Especially with like NFT lending and all that kind of stuff that opens up a raft of global liquidity.
Speaker: Yeah.
Speaker: It's, it's really tricky because we still haven't, I think, I think,
Speaker: Most people and most businesses and projects still don't really see NFTs for what they are.
Speaker: Usually they get stuck on one idea of NFTs as a way to raise funds, for example.
Speaker: And then what do we do with them?
Speaker: Whereas, yeah, the case of Courtyard is very simple.
Speaker: It's a way for you to purchase something that exists in the real world without any of the...
Speaker: Like how do I take care of it?
Speaker: How do I resell it?
Speaker: How do I store it?
Speaker: And yeah, this whole like very speculative phase was based on the promise of what could be and the value of the network was in the people that were in the network.
Speaker: Since that was the only thing, as soon as someone starts leaving the network, the PFP in and of itself loses value.
Speaker: I'm glad we're beyond those days.
Speaker: I'm glad we're moving on.
Speaker: It's been, yeah, it lasted long enough.
Speaker: Yeah, I think it's progress.
Speaker: Yeah, it's natural.
Speaker: I mean, you've probably heard this a million times, but people liken it to the dot-com bubble.
Speaker: And then you have those companies kind of come out of it, the Ebays, the Amazons, and other companies that are now maybe over a trillion dollar market cap that went down like 95%.
Speaker: But I think that's because they actually built products that people wanted and then developed and built on that.
Speaker: And I think we'll probably get to that point where
Speaker: I think we're still in those ashes and we probably will be for next year or two.
Speaker: But I think there's companies now that are building real tech that can be used that will develop into those next big companies or probably just be acquired by them.
Speaker: But it's just interesting to see that.
Speaker: And I think blockchain and NFTs will be, I mean, there'll be the ownership layer of the internet.
Speaker: So I think it's here to stay.
Speaker: You're talking about building...
Speaker: a product that works and then growing it.
Speaker: One thing that I like about or that I care about with these more the decentralized side of things, maybe not the blockchain use case, the corporate use cases, is that you can gather your initial community, your minimum viable community and paint them a picture of a future and build it together.
Speaker: What we've seen is that that minimum viable community that would need to be a thousand people, we're trying to reach 30,000 people or 50,000 people because that's how we cash out the most.
Speaker: And what I regret is that we fall back on VCs and institutions because they have the money and they have the funds.
Speaker: And I would love for us as a
Speaker: as an ecosystem to find a sweet spot with teams that have enough of a vision, that have proper planning, that have an idea of their costs, that are able to build an initial community based on that vision and on the costs and the needs and start to build together.
Speaker: Because,
Speaker: I hate it when I'm looking at the project pie chart and it's like 20% for that group of investors.
Speaker: And I care so much about decentralization.
Speaker: And so for me, we need to reach that point.
Speaker: And I don't know how we get there.
Speaker: I think the decentralization point is a very interesting one because I mean, I hear the phrase with Henry Ford.
Speaker: If you asked the people what they wanted, they'd say faster horses, but then he went and built a car.
Speaker: So I think there's a reason why
Speaker: certain project founders, like they need to lead because they probably have those ideas that actually will change the future or they will create products that will be really impressive and they won't be what the community necessarily would think of.
Speaker: But I think once you get to a certain size, then yeah, I understand that decentralization makes sense from a risk perspective, but I still think like the decision-making process and how
Speaker: quickly you can execute those decisions and doing it effectively.
Speaker: I think it becomes like the bureaucracy, like it can slow things down, which I think should be fine for like a very large company.
Speaker: It's why you have like with those listed companies, quarterly reporting and quarterly board meetings, having things approved.
Speaker: It's why it takes like at least three months for a decision to be made.
Speaker: And it's why startups are so agile.
Speaker: Like you go in with like an idea in the morning and then by the evening,
Speaker: you have everything implemented and it's just a completely different change of pace.
Speaker: And I think like having worked across multiple, I find the startup stuff more exciting and that's kind of where I've veered to and why I'm kind of in this space because there is so much happening.
Speaker: But yeah, I think to the decentralization point, I think there's definitely a balancing act depending on the size of the company, the stage that that company's in, where it's the early stage of the life cycle because you need that
Speaker: that shift in decision-making process to happen quickly to then actually come with something.
Speaker: Because if you have it decentralized from the beginning,
Speaker: then I just don't think anything would ever get done.
Speaker: And I don't think, I mean, there might be a few that come out really well.
Speaker: And I think, I don't know too much about the now and so our ecosystem, but it's, I'm assuming that's a decision-making process and they ended up having to fork it because, yeah, I think there's a split in the community.
Speaker: So it's a challenging one.
Speaker: I'm like all for decentralization, but I think there's probably like an optimal trade-off.
Speaker: Yeah, I agree with you.
Speaker: And I'm glad you're raising this because it allows us the chance to talk about what decentralization is.
Speaker: Because so far, we've talked about it in a black and white manner, where you have some things on the end of the spectrum that are not decentralized.
Speaker: And you have other things at the other end of the spectrum that are where everyone has a vote, usually based on the tokens that they hold.
Speaker: And I think that the sweet spot will be somewhere in the middle where you have governance that's more decentralized than that other end of the spectrum, but where governance is distributed to the right people.
Speaker: It's so easy right now to use SBTs and to...
Speaker: give someone governance over product development and give someone else governance over the global governance of the ecosystem that you're, that you're referring to.
Speaker: And you could very well compartmentalize the decision-making and the governance in, all right, like this is a major strategy change.
Speaker: And we believe as a,
Speaker: shepherding team leading team because you always need a leading group of people that's how communities have always worked but we'd like your we'd like your your opinion that's what i i my initial foray into into this was building a dow a couple years ago and that's what we did we made a lot of like the smaller nitty-gritty decisions by ourselves like what marketing agency to go with and what uh
Speaker: were investing in NFTs also, and sometimes we kept that a little bit centralized.
Speaker: But when there were decisions that impacted
Speaker: the whole ecosystem, the whole group, then we try to invite them into the debate and into the decision making.
Speaker: And so I think there is a way to do this.
Speaker: I mean, it makes sense to put those big decisions to the masses for, yeah.
Speaker: I think the only thing is though, to what extent are we rehashing existing governance processes?
Speaker: but just putting them on chain.
Speaker: Because you could have like, you could delegate your vote or whatever to a group of people.
Speaker: They could then make that decision making process for you because you're trusting them that they make the right decision for you based on your interests.
Speaker: And as long as it's sufficiently spread across multiple people, then maybe they'll end up with the right decision.
Speaker: But to what extent is that done with
Speaker: like a board of directors where you have a balanced board of directors that will make a decision, like they'll make a decision or they'll challenge things in the interests of shareholders against management.
Speaker: And it's like,
Speaker: Are we just basically taking what we had originally and putting it on chain?
Speaker: That's my only challenge.
Speaker: And how do we actually improve that, improve that actual process?
Speaker: It's a difficult one.
Speaker: It's not something that will be solved overnight, but it's an iterative process.
Speaker: Yeah, it is.
Speaker: It definitely is.
Speaker: And I think where it starts is that in the systems that we're considering right now,
Speaker: the masses, so the users or the stakeholders will have more of a say or at least more visibility into who ends up in these positions.
Speaker: I think that's the end goal.
Speaker: And that's what we're trying to do in the ecosystem that the DAO is telling you about is growing into.
Speaker: We're trying to make sure
Speaker: that we have the proper people who are aligned both with the set of values that we have and the business objectives, and then try to do a balancing act with the people that they're representing or that they'll be bringing in.
Speaker: And that's what's really hard about where we are, about what we're doing as a whole, as an ecosystem, because
Speaker: It changes governance, it changes the financial economic systems that we're building, it changes how product is being developed and designed.
Speaker: And so you have to adjust and work on a little bit of everything if you want it to be successful.
Speaker: But we're still, like you're saying, we're still iterating and figuring out what works and what doesn't.
Speaker: It must be really interesting having that, the journey that you've had with that DAO though, because you're still working with it now, aren't you?
Speaker: Yeah, it's been fascinating because I came in with – in 2017, my eureka moment was really decentralization.
Speaker: It was the solution to everything that I'd noticed because I came from a law background.
Speaker: I trained as a lawyer.
Speaker: I'd been observing institutions because I did international law and then business law, and I was a big fan of tech.
Speaker: It was really easy to see the problems.
Speaker: You had international law that was completely disconnected from the ground.
Speaker: The people that it was representing were...
Speaker: It would take from the event and its legal resolution, it would sometimes take like 10 years.
Speaker: And so it made no sense in the fast-paced environment that we're in.
Speaker: And then you could see tech that was building these crazy efficient systems where all of the value of 90 or 80% of the value would go to a small group of people.
Speaker: And so, decentralization for me, it solved all of this and it created an idealist in me.
Speaker: And I spent like three, four years building this up in my mind and thinking, yes, we need decentralization, we need to give people the power.
Speaker: And then we had a small doubt, like it was three or four, 500 people maybe.
Speaker: And it was impossible to get a good decision to happen because you would throw in a vote and people would just say yes.
Speaker: Or people would just say no.
Speaker: There was no real debate or no communication.
Speaker: And it taught me a lot about, yes, decentralization is good, but it needs to be nuanced.
Speaker: It needs to be balanced.
Speaker: And you can't just give decision power to anyone.
Speaker: Otherwise, you're going nowhere.
Speaker: So, yeah, it's really been... It's difficult though because how do you give it to the right people without being biased?
Speaker: It depends.
Speaker: It really depends on the system and what you're trying to build.
Speaker: You must know about BioPills, right?
Speaker: Yeah, BYA Pills.
Speaker: Yeah, yeah, yeah.
Speaker: They're doing it perfectly in my books because they're building a... I think it's going to be a triple game and they're keeping all of the right...
Speaker: decisions to themselves and giving governance, giving a say, giving a choice and a voice to the people in their community.
Speaker: It's not very decentralized because they're building the game, they built the world, they make a lot of the design decisions, all of that.
Speaker: But they're building their ecosystem in a way where
Speaker: people in their community like how to say in the names of the places and the map and the name of the characters and they're building the lore of the world together.
Speaker: It's not perfectly decentralized.
Speaker: It's probably more on the centralized end of the spectrum, but it's decentralized enough because they're creating something that actually belongs to everyone where the economy is going to belong to the people in this.
Speaker: one way to do it in the gaming example for example.
Speaker: I remember them actually because I ended up I think I minted a pill and then I got the avatar got the vehicle as well.
Speaker: I completely missed the land minting window.
Speaker: I think it was like 0.1 ETH mint but I think it rocketed to like over an ETH for the land alone.
Speaker: Yeah it went crazy.
Speaker: But yeah I think I
Speaker: I still own those assets, but I haven't had the time to check in.
Speaker: So I think what I found really interesting about that project was when you got that pill and they had that app on your phone that you could literally, whatever pill you had, you then see the trippy experience that you could literally view it through your phone.
Speaker: And I thought that was really innovative.
Speaker: And I was like, these guys are obviously well-educated.
Speaker: They're well-educated.
Speaker: in the in the tech tech world to be able to do that as a side project to the main thing that they're building i was like this is keeping the community engaged and i know some some friends in real life that actually went pretty ham on that that collection bought a hell of a lot and i think got is it the goddess as well and yeah wow so it's but then they equally they just held them and it's kind of gone up
Speaker: extremely high in price and then come back down with the entire market.
Speaker: So it's interesting that they're still building and you think they've got a lot of hope with that.
Speaker: Because I think gaming is a very challenging niche to break into.
Speaker: Everyone's building a game.
Speaker: You've got these AAA companies that are coming in, gaming studios, that have so much funding.
Speaker: And if you're competing with them, it's always going to be a challenge to, A, get the attention out there.
Speaker: Because I know, especially with mobile gaming, the majority of the spend is on marketing.
Speaker: You could build an amazing product, but if you can't get that out there to the masses to get that universal appeal, then are you going to get the right number of players?
Speaker: But I guess it does come down to what is the right number of players to sustain that game?
Speaker: And I think you touched on that earlier on.
Speaker: Whether it's the core 1000 members or whether it's 10,000, it might not be going for the millions.
Speaker: So interesting one.
Speaker: Yeah, it's so exciting everywhere you look.
Speaker: I wanted to have a little exercise with you.
Speaker: What do you think... I pointed out Pudgy, Artifact, Yuga and Izuki.
Speaker: What do you think Pudgy is doing very well right now that others... Because we're talking about a blueprint right now.
Speaker: A lot of people are.
Speaker: What is the blueprint that you think they're building for future NFC projects?
Speaker: So Pudgies is a little bit different because Luca acquired them for two and a half million back in April last year.
Speaker: I feel like his interests are aligned in the sense with the community.
Speaker: He's not like a founder that's launched a project, got a load of mint proceeds and then been like, oh, you know what?
Speaker: It's actually quite hard.
Speaker: I'm going to step away and take a paycheck and just leave.
Speaker: He's kind of got that vested interest in the project that he wants to see it succeed.
Speaker: He's also got a very... His background is commerce and I think he was very successful at that.
Speaker: And it's clear that with the Walmart partnership recently, I don't think anyone's got that.
Speaker: So anyone that tries to copy their playbook, his network is probably...
Speaker: part of that value and the ability to get those toys in those stores to have that additional toy line is like i think quite unique for for an nft project specifically like he was got it on amazon like he's he's making all these partnerships work um and he's creating real revenues for the project and i think the biggest thing for i mean he touched on this like funnel so the the attention funnel where he gets the toys in in walmart stores he gets all these giffies all these like things on instagram gets the attention gets the eyes on them
Speaker: that creates like demand for the products.
Speaker: And eventually like you've got these 8,808 pudgies that are effectively the first editions and the nature of people is going to be, well, I want to, I want to collect that, uh, holographic charizard, the first edition shadowless charizard, because it's the rarest.
Speaker: And I think the value of blockchain is that you can prove that it's the rarest.
Speaker: So like these Pudgies, effectively, he's going to drive demand to that.
Speaker: But the thing that I find really interesting is that's not the pure value proposition because you've also got this whole licensing thing as well.
Speaker: So if you want to see your Pudgie in stores, then it might be a licensable Pudgie.
Speaker: And then people are starting to look at all these different NFTs as to which one's the cutest as opposed to which one has the rarest trait.
Speaker: So it's just switching up.
Speaker: like what the community perceives about it and actually driving, driving value back to his core holders, which I don't think a lot of projects have done.
Speaker: Even you go, I don't know what, I mean, I like what they're doing with the other side, but I'm not a holder because there's always that, that debate that is it, is that ecosystem becoming diluted now?
Speaker: Like what's the difference between the board apes and the other side stuff?
Speaker: Like, yeah,
Speaker: And I think, is that being commingled with the ape token?
Speaker: Are you like entwining this whole ecosystem that if one part of it goes down, the whole ecosystem kind of goes down in terms of value with it?
Speaker: And I know what Matt, she's doing recently with the trying to get those bored apes into museums and things like that.
Speaker: It's kind of you're trying to distinguish between bored apes and the rest of the Yuga ecosystem because
Speaker: You want to be able to detach that and have that value attached from an artistic standpoint, which CryptoPunks do really well.
Speaker: So I think it's just I think each of these NFT projects that are starting to show signs of success, each has their own individual value proposition.
Speaker: And I think it's very it's not like it was back in 2021 where.
Speaker: You just think that it's going to have that speculative value that goes up massively.
Speaker: You've got to have those real cash flows to then demonstrate that it's a real business and just complement it with NFTs.
Speaker: And in Pudgy's case, it's just the NFTs are the first additions that you can prove ownership for that potentially one of those might get licensed as well.
Speaker: It's really like, yeah, Pudgy is really a masterclass because what's really hard to do in business is keeping things simple.
Speaker: And they've done just that.
Speaker: They create great content.
Speaker: They're broadcasting.
Speaker: Well, doing the partnerships is not the simple part, but it's... And they're distributing and keeping everyone happy.
Speaker: And they're not promising too much.
Speaker: And the expectations were so low because...
Speaker: Pudgy holders thought that they've been scammed pretty much.
Speaker: For you, it's an interesting use case because it's extremely centralized.
Speaker: There's no decision being made outside of them.
Speaker: And I completely understand certain members feeling alienated.
Speaker: Where do you stand on that?
Speaker: Do you think...
Speaker: It's fair.
Speaker: They've built it.
Speaker: They've sold it.
Speaker: They raised the funds and they're making the decisions or, or in your view, could they have done better?
Speaker: I think it's, it's very hard to say people, because I mean, they like say that they could have done better because I think it's, I mean, for a period of time, everyone was like, don't fade you go.
Speaker: Like they, then the price kept going up and the air dropped to the original holders.
Speaker: They gave value back and actually it didn't really dilute the ecosystem until the,
Speaker: what, probably earlier this year when things started to unravel from a price standpoint.
Speaker: But I mean, from an innovation standpoint, how do you sustain that?
Speaker: Like if you've got an NFT that's a PFP that's speculative, it's going to be volatile in price.
Speaker: Especially when it goes so high.
Speaker: When it goes so high, especially the people that have bought the top, who do you owe a duty of care to?
Speaker: I mean, realistically, they minted a board eight for 0.08.
Speaker: That's what the original proceeds were.
Speaker: I know that with the other side, they got a huge amount of mint proceeds from the other side.
Speaker: And the gas was pretty wild as well.
Speaker: But like, I think that it's very difficult because they are like the first in the entire ecosystem to do that.
Speaker: And you've had so many people, so many projects try to follow that playbook and just failed.
Speaker: So, and maybe it is the fact that they have this ridiculous amount of funding that they have the opportunity to build out this huge ecosystem in this world.
Speaker: And who knows, like maybe in the next bull market, all of a sudden, like,
Speaker: it just twigs and it takes off and everyone's like well it was definitely yuga all along like um but at this point in time where it's a bear market prices are suppressed things are being built but it's just not happening quick enough and people's attention spans are so so swift to move on i think it's very difficult i think in terms of if you take a step back you've got like pudgy doing their thing you've got yuga they're building stuff and people are playing it
Speaker: People are getting frustrated, but I think that's just human nature.
Speaker: People want things now, whereas they're building something for the future.
Speaker: I'm sure when they do fully launch their other side, people will get enjoyment out of it.
Speaker: I don't know whether the price tag of...
Speaker: I don't know, 50 ETH or 100 ETH for a Bored Ape way back when is worth the value of being able to access that metaverse and play your Bored Ape in there.
Speaker: I don't think that's necessarily the thing, but it's very difficult to, when an ecosystem's grown to the size it has, it's very difficult to segregate parts of it and then drive value back to those specific holders of that particular niche of that particular area of the business.
Speaker: I was chatting to someone yesterday about the heavy metal stuff.
Speaker: And I mean, they bought in quite high.
Speaker: They played the game, but they've been playing that game for like three months and they're just kind of a bit, they're now invested in it and they're just, they're just playing it for the sake of playing it.
Speaker: And to me, I don't know if that's just because Yuga is buying time with this, these side games, um, so that they can focus on their main thing, which makes sense from a business standpoint, they're trying to keep their community engaged, but
Speaker: They're building out their main long-term vision with the other side.
Speaker: And I think it's just very, very difficult to keep everyone pleased.
Speaker: So hard.
Speaker: Yeah, you kind of have to accept that you won't keep everyone pleased.
Speaker: It is possible to imagine a future...
Speaker: like not close future.
Speaker: I'm talking five, 10 years, maybe 15, where Yuga has become this massive ecosystem where it's like the player one, ready player one, Oasis.
Speaker: But it's tricky to see right now.
Speaker: And since they're treating it
Speaker: It's a business.
Speaker: It's not a Web3 business.
Speaker: It's a Web2 business that's using NFTs and that has a token for governance.
Speaker: But yeah, I'm not a holder.
Speaker: I've never been a holder, but I can understand why there would be some frustration.
Speaker: But from the business perspective, I completely get it.
Speaker: What about Artifact?
Speaker: Yeah.
Speaker: I don't know.
Speaker: I think like, I mean, they, they, the partnership with Nike, I mean, Nike pretty much just gave them, I don't know what the agreement was, but they basically got the, the green stamp for approval to go run with the funds and the brand and just do something cool with it.
Speaker: And, um,
Speaker: I don't know.
Speaker: It just seems to have faded.
Speaker: It's one of those things that was probably up there, had so much potential.
Speaker: I just don't know if the execution is there from a Web3 standpoint.
Speaker: I think at least the perception has probably changed of that particular ecosystem.
Speaker: I'm not an owner and I never have been, but I've just been an outsider looking in.
Speaker: Anyone who had an artifact or CloneX, PFP, would be like,
Speaker: I don't know, like, it's just, like, almost on a, like, way back then, it was, like, on a par with, like, you got assets almost.
Speaker: Yeah.
Speaker: Just, like, the echelon below.
Speaker: But now it's, like, I don't see anyone, really.
Speaker: There's very few.
Speaker: I think you've got one.
Speaker: But there's very few.
Speaker: Yeah.
Speaker: I feel pretty lonely at times.
Speaker: And I don't know, like,
Speaker: Ultimately, I think that comes down to, are they, were they driving value back to their holders?
Speaker: And I think maybe you as a holder can probably answer that better than I can.
Speaker: But I think the fact that there's not that many people that rock those PFPs anymore, it probably, like people want to be proud of what they're wearing.
Speaker: And I think with the pudgy news, I think we, if you look at inspect, you saw an uptick in the number of people that would rock, not just pudgies, but little pudgies.
Speaker: And I think even little pudgies are like 0.8, 0.9 each now, which is nuts for a secondary collection.
Speaker: Wait, the,
Speaker: They were like 0.4 a few days ago.
Speaker: Wow.
Speaker: Yeah, no, I think yeah, 0.42.
Speaker: Yeah, no, I think it's I like mine.
Speaker: I like the like visually and I think it looks good and I've been using it to launch this podcast and all this.
Speaker: I'm keeping it for now.
Speaker: I do have a gut feeling that they're going to do very well in the future.
Speaker: Because I think they're starting, they're getting into the mass market strategies by doing the LeBron partnerships and onboarding and all of those things.
Speaker: And it wouldn't be really hard to imagine it being the go-to digital collectible for streetwear enthusiasts.
Speaker: Forgetting about the monoliths, forgetting about the Animus projects, forgetting about all of that.
Speaker: it gives you access to a very limited drop of very cool clothing.
Speaker: And only 20,000 people in the world will have access to that.
Speaker: And so I think just for that, it could do very well.
Speaker: But same thing, not in a year or two, I think, but more in like five or six when it's really starts to get easier.
Speaker: into mainstream.
Speaker: I actually agree with that take.
Speaker: I think the potential is there.
Speaker: I think it just comes down to the execution, I think.
Speaker: Yeah.
Speaker: I mean, having the fact that it's kind of partnered or backed with Nike, it has that potential to have the right people in place to execute well, particularly as it scales.
Speaker: Whereas, I guess if you compare it to Azuki,
Speaker: I mean, they've done well from a Web3 native perspective, and they probably have people in there that have that prior experience at these big tech companies or whoever.
Speaker: I mean, they're pushing the clothing brand as well with physical back tokens and that kind of stuff.
Speaker: And it's just interesting to see, is there going to be a bunch of different projects that do well, or is it going to be...
Speaker: like projects that are backed with like backed by existing companies that have those that brand loyalty from an existing user base that you have to bootstrap that to then take off it's like i think user acquisition can always be very expensive especially for gaming and it's like probably the same with clothing as well like if you've got a loyal fan base of and the 10 000 azuki holders like yes you might be able to sell products or clothing to them but
Speaker: Will you be able to break out of that niche?
Speaker: Will you be able to resonate with an audience that's outside of the Web3 native group?
Speaker: Potentially, they might be able to, but there is that higher risk, I think.
Speaker: It's so hard.
Speaker: I have no clue what Azuki is doing.
Speaker: I don't get what their strategy is.
Speaker: And when they dropped the elementals, I thought that was the end of it.
Speaker: I thought it was like their last hooray of, okay, let's cash in, let's cash in a few more, a few more million and then done.
Speaker: I don't get it.
Speaker: I don't, I don't see what their plan is.
Speaker: Well, I think their plan was to build out like an anime storyline and then maybe try and monetize that way.
Speaker: So it's kind of looking at the pudgy angle with real revenues, but going down the act, like creating an anime, building out that kind of awareness, which kind of makes sense for that project.
Speaker: It's kind of got that culture.
Speaker: It fits pretty well.
Speaker: It's on brand, but it's expensive to do that.
Speaker: Yeah.
Speaker: And it's a risk.
Speaker: Yeah, it's a huge risk, but they have to take that risk because otherwise they're just going to
Speaker: they'll fade into the abyss of being a Web3 project that was successful and they'll just fade away without this continued innovation and potential.
Speaker: And if, like, similar with Pudgies, if they went down the angle of licensing individual Azukis that are in those animes, then you've got a real revenue coming in.
Speaker: It's like, well, that kind of makes sense.
Speaker: And they've got these, like...
Speaker: The clothing is pretty cool.
Speaker: And there was a bunch of merch that got dropped to some people, some holders recently, and they were all impressed by them.
Speaker: I didn't see anyone that was upset.
Speaker: So I think there is potential there.
Speaker: And I think currently a lot of people have short-term views on how the market's going to perform.
Speaker: But actually, I think if you have that two-year, three-year viewpoint, there's a number of projects that are probably going to do reasonably well.
Speaker: But it does come back to what is their overall vision?
Speaker: Do they intend to break into the mass market or are they happy to have a 10, 100k core fan group that that's the largest they're going to get?
Speaker: But that's sustainable.
Speaker: It's interesting.
Speaker: Yeah, it is.
Speaker: Oh man, the use cases we're going to have in like 10 years at the top business schools in the world, looking back on this exact period and our main characters.
Speaker: Especially given Luke has done that building in public, so it's literally all there for them to review.
Speaker: Yeah.
Speaker: I haven't watched that actually.
Speaker: I should.
Speaker: Okay, I have a little bit, a little segment of rapid fire questions.
Speaker: I'll throw you a question and you can throw back an answer without thinking about it too much.
Speaker: Now, if you could only buy one NFT to hold for the rest of your life, what would it be?
Speaker: I mean, at this point, I'm biased, but pudgy penguins are Genesis.
Speaker: If you could only hold one crypto for the rest of your life, what would it be?
Speaker: Yeah, fair enough.
Speaker: Who are your top three people that you vibe with the most at the moment in this space?
Speaker: That's really tough.
Speaker: Cause there's, I mean, I speak to so many people.
Speaker: So actually, I mean, there's, I guess there's different angles.
Speaker: So I think like there's been early supporters of me and they have helped me so much and I'm forever grateful.
Speaker: So like,
Speaker: whale like when i was very low number of followers like he reached out to me started like connecting with me and like he referred reference was it referred my newsletter from his newsletter just to get me off the ground and that's like i'm forever forever grateful for that and i've had chats to him with him and he's been very helpful so i'm eternally grateful to whale i mean yeah there's a number of people like i speak to so b check he got me started on my newsletter
Speaker: And he's provided like an enormous amount of guidance on that.
Speaker: And in terms of like monetization, all that kind of stuff.
Speaker: And that's been incredibly useful and very helpful.
Speaker: And yeah, we used to meet up every Wednesday in London, which was great.
Speaker: And I've met a lot of people in London as a result of that.
Speaker: So yeah, really grateful for that.
Speaker: So there's so many like Legendary, Kermit, like there's just a lot of people, Zymiri, like any, like we, I think there's a group of people that,
Speaker: We're in a similar position in like what we're doing.
Speaker: We just kind of bounce ideas off each other.
Speaker: And it's just very useful to have, it's very helpful to have that network because especially when you're working remotely, it's very difficult to know like, or make those decisions on your own.
Speaker: And it's like having people who are going through that similar,
Speaker: phase of whatever they're doing, just bounce ideas off or even just get like a different perspective.
Speaker: And sometimes, sometimes it's not aligned with what you think is the answer and it's like, okay, well, that's really interesting.
Speaker: Maybe I'll take a different approach.
Speaker: And that's, that's really, really handy.
Speaker: So yeah, it's just like three people is very difficult.
Speaker: There's just so many, and I've probably forgotten a bunch that I shouldn't have, but yeah.
Speaker: It's okay.
Speaker: They, they know that it's a tough question to answer.
Speaker: What's something about you people online don't know?
Speaker: Simple one is born on the 4th of July.
Speaker: so american independence day uh turn turn i turned 21 in america i was doing like a road trip at the time was in vegas when i was 20 some some places i could gamble some and get into places but some places i couldn't uh because my so my birthday because over there they've got the month and the day the other way around so actually in a lot of places i was passing it off as the uh what the
Speaker: 7th of April as opposed to the 4th of July.
Speaker: And then until one point I got to, I went to like some casino in Vegas and they took my ID and they were like, oh no, I think in the UK it's the other way around.
Speaker: So they took my ID, they picked up the phone and then I saw these two big bouncers like walking over.
Speaker: So I grabbed my ID and ran.
Speaker: Yeah.
Speaker: So that was, that was when I turned 21 in America.
Speaker: Memorable.
Speaker: All right, break over.
Speaker: One of the subjects that comes up the most either directly or indirectly and when we're chatting is tokenization.
Speaker: Can you give like a very simple explanation of what tokenization of real world asset is?
Speaker: What does it mean?
Speaker: It's putting them on chain.
Speaker: I mean, I can talk about the benefits and stuff like that, but I think ultimately what it is, is you're taking a physical asset.
Speaker: It doesn't even have to be physical.
Speaker: It can still be digital, but you're tokenizing it.
Speaker: So you're putting it on the blockchain.
Speaker: So the example that I think just clicks with a lot of people is Pokemon cards and Courtyard did that very well.
Speaker: So they have looked at what the weak points in that system is.
Speaker: And ultimately with any transition from physical to digital, there's going to have to be a trusted intermediary.
Speaker: So what they've done very smartly, they've gone out and they've basically said, look, who is the most reliable custodian of these physical assets?
Speaker: Oh, it's Brinks.
Speaker: Let's get them as a partner.
Speaker: And you can almost minimize that to an acceptable level of risk when it comes to tokenization of those physical assets, because you as a holder of that token knows that you can redeem that token for the physical item, whether it's a Pokemon card, whether it's a comic,
Speaker: whether it's Supreme clothing at arcade XYZ or whatever, whether it's a Rolex, whether it's like any physical asset, if you know that you can redeem it or there's a 99% chance, or you know that it's insured if things go wrong, then you're going to, it gives that token value.
Speaker: But the moment that that weak link disappears where, you know,
Speaker: Say you had all these tokens and all your assets are stored at some, I don't know, second rate custodial service that goes under and all of a sudden they sell all your assets to cover their losses and then they disappear.
Speaker: Your tokens are worthless.
Speaker: So I think the tokenization process, there's always that risk that it's probably never going to be fully decentralized Web3.
Speaker: You're going to have that intermediary.
Speaker: It's not going to be fully disintermediated.
Speaker: So I think like, yeah, the tokenization process of going from physical to digital has value so long as that weak point is fine.
Speaker: How and how does that, because it's, we're talking about a few hundred cards, for example, for the courtyard drop.
Speaker: But how does that work when all the cards, all the cars, all the watches, when everything's been tokenized in like 30 years, how does that work?
Speaker: Like, where does everything go?
Speaker: How do we, how can we, because it relies on people and it relies on physical infrastructure.
Speaker: If I own assets in a game, in a Web3 game, I'm
Speaker: They're not going to disappear.
Speaker: I don't have to trust anyone.
Speaker: That's the beauty of it.
Speaker: And so how can you, what do you do to give people certainty that they can trust those processes?
Speaker: Yeah, I mean, it comes down to risk management.
Speaker: I think that you have audits.
Speaker: So you have audits of those custodial services that say that in the event of XYZ, these assets are ring-fenced, they're safe, they're secure, the creditors have no claim on them.
Speaker: There could be insurance in place.
Speaker: So you could have a third party insurer that you take insurance out with, or as part of that arrangement with that service, you receive an insurance policy that says that in the event of this going under, and you're unable to claim those physical assets, there will be a payout to cover the market value of those assets.
Speaker: So you as a consumer or a user of that particular structure or product, you know that
Speaker: No matter what, you're going to be able to get some, if not all the value of that underlying asset back.
Speaker: And I think that it's happening now.
Speaker: Like you've got different audit firms that are getting involved.
Speaker: And I think real world asset tokenization, like all the big four audit firms are going to be doing existence testing on those assets.
Speaker: Yeah.
Speaker: There'll be the completeness and all the accuracy testing of the tokens on the blockchain, which is fine.
Speaker: But actually testing that those assets exist where they say they're stored is probably another thing that those firms will need to be engaged for.
Speaker: And I think that's probably a huge...
Speaker: I mean, I'm sure they're thinking about it, but if they're not, that's, that's where they should be thinking because that's like, that'll be a huge like revenue for them.
Speaker: Insane.
Speaker: One of the really interesting things, things you made me realize, I hadn't thought of that side of things is the, um,
Speaker: liquidity that it's going to unlock because you have all of these collectors or all of these investors in those types of assets, whether it's art or cars or watches or whatever.
Speaker: And all of a sudden, that's going to be trillions of dollars of liquidity unlocked over the course of the next few years.
Speaker: Do you have any idea?
Speaker: It's too big for me to even grasp.
Speaker: Do you personally have an idea of how the markets will react, how the prices of those assets will react?
Speaker: What's your bet on what happens in the next few years?
Speaker: So a lot of people might think that that liquidity is going to
Speaker: pump the price of those assets but actually i don't think it's going to do that i think the issue with a lot of these smaller markets like collectibles markets specifically is it's very difficult to match a buyer and a seller in an efficient manner and i think tokenizing it putting it on chain does that but that doesn't necessarily mean that the price of those assets is going to go up actually there might be a a guy that's holding this asset that i can't find a buyer for it or can find like several buyers
Speaker: but the buyers can only find him as a seller.
Speaker: All of a sudden, if you put all that on online, you've got maybe multiple sellers, in which case the supply has just increased based on like, just because that's been tokenized, you can see it on chain.
Speaker: So actually, actually it meets its true market value a lot more efficiently because people have a complete open order book of, of what's being traded in real time, what the recent sales are.
Speaker: So yeah,
Speaker: where people would ordinarily be able to arbitrage or find opportunities in the physical collectibles market, actually, that's going to be a lot harder to do in the digital world because it's going to be a lot easier to find what the actual recent sales are and things like that.
Speaker: So I actually think it's probably, you're going to have like some surprises.
Speaker: There'll be some assets that you can't find the demand for, in which case the token is going to drop.
Speaker: But conversely, there's probably going to be a bunch of assets that like
Speaker: that would have had this perceived number in issuance, but actually the circulating supply of that on chain is actually really low.
Speaker: So the price of that might pump because you might have that demand on chain for it until such point that when those physical assets get tokenized, they might come on chain and then it kind of balances out.
Speaker: So I think there'll be like a period of time where there'll be a lot of volatility in prices, but I think they'll find that true market value a lot more efficiently.
Speaker: later on when everything is tokenized.
Speaker: I don't think it's going to be just because it's on chain, everything's going to be traded at a premium.
Speaker: I think it's just going to be like they'll find their true market value.
Speaker: But there is, I mean, having said that, so it's a bit of a rabbit hole, but there is other aspects of it that could add value.
Speaker: So say, for instance, if a company was to issue
Speaker: a physical asset, but also a tokenized asset, then they might offer extended warranty for that particular asset because they know that it's on chain.
Speaker: It's like there's more reliability around that verifiability.
Speaker: So they're willing to offer some actual extended warranty for that product.
Speaker: Now, all of a sudden, the NFT or the token has the value of what that additional cost of insurance would be.
Speaker: as a premium over the physical asset.
Speaker: Like there's ways of incentivizing, like insurance companies are going to want to have all their assets on chain because it's easier to track them, check for fraudulent stuff, authenticity.
Speaker: So they're probably more likely to offer discounts on premiums and things like that.
Speaker: So I think there's a whole raft of like intersections with different markets.
Speaker: The penny is going to drop and it's just going to roll out and there'll be so many different benefits on offer through tokenization programs as opposed to just everything being physical.
Speaker: I wonder what the effect is going to be on government and state oversight.
Speaker: once everything is on chain, it becomes easier in some ways and not so easy in other ways to, to yeah, to do surveillance, I guess.
Speaker: Yeah.
Speaker: I mean, that's, that's the age old issue of privacy commission blockchains, which I think is what ZK is like trying to do.
Speaker: Like you can, you can prove it without knowing what you're proving so you can validate it on chain, but there's a certain level of anonymity or confidentiality retained.
Speaker: So much hope and so many questions left unanswered.
Speaker: Let's move on to we're talking about gaming and gambling as well.
Speaker: And gambling is one thing.
Speaker: I love to play poker and I played it online for lack of a better option for a while.
Speaker: But I don't do it anymore because it's so...
Speaker: I find it very hard to trust online poker platforms.
Speaker: It really feels like it's not completely random.
Speaker: How do you, because you have an eye on the regulation side of things and you have an eye on the corporation side of things, corporate side of things.
Speaker: How do you see crypto gambling evolve?
Speaker: And I think the biggest question for me is,
Speaker: Do you think we ever have non-KYC decentralized gaming, gambling, or in my case, poker platforms?
Speaker: Yeah, I think there will be just out of jurisdictions that require it.
Speaker: But to your point around making sure it's truly randomized, I think if they do that on-chain, then you can prove it.
Speaker: So actually, that might completely disrupt that whole industry or at least provide that level of comfort that players need to then do that.
Speaker: And actually, if you have a company that does that and all these players are really concerned about,
Speaker: the house or the company ripping them off, then you might see a transition to decentralised gambling platforms as a result of being able to prove that that was truly random because I can see it online after the fact, obviously, because otherwise you'd probably be able to game the system if you can see it in real time.
Speaker: But yeah, I think that's probably a huge case.
Speaker: Yeah, it is.
Speaker: And oh man, I hope this industry gets disrupted because you have just a few players on that market and that are... I was playing PokerStars back then and happy with it, played another platform where...
Speaker: What was happening on the table just did not make sense from a game theory point of view.
Speaker: It was just every, there were draws at every single hand for multiple people.
Speaker: It was almost and in that case, you don't know what's happening.
Speaker: just bummed because you can't play it well?
Speaker: Or is it actually true?
Speaker: Because it's so... If the statistics don't add up and it's like, or like the chances of that happening are slim, but it keeps happening, it's like, it's a bit fishy.
Speaker: Yeah, it is.
Speaker: It is.
Speaker: And also you fall back on the fact that I'm not a computer.
Speaker: So, I'm not calculating the statistics of all the hands I've played overall.
Speaker: And so, maybe I'm being biased in my... Maybe I'm just not drawing well and maybe I'm just a sore loser.
Speaker: So, it's hard to... Yeah, that could change a lot of things.
Speaker: It could make things a lot more transparent and maybe change the perception also that we have on those types of games eventually, hopefully.
Speaker: Yeah.
Speaker: i think you've just got me uh hooked on poker again i haven't played a number of years i used to play a lot at uni yeah it's a lot of fun i prefer in-person poker though just for those exact reasons and i think like you can throw people off with you can try and like yeah trick them and stuff i know that tells are like if you're a professional poker player you can probably read through it but it's like
Speaker: when you're playing against amateurs you can kind of just trick them into thinking that you've done something bad in person i think that's part of the fun whereas online you just don't necessarily have that it's purely numbers and yeah and reaction time yeah i mean i think like talking about it again makes me want to go play well if you're ever if i'm ever in london we'll go we'll go i really want to do tournaments i've never done live tournaments have you
Speaker: No, I haven't done live tournaments.
Speaker: I did go to a couple of games that some of my friends were doing, but I don't know.
Speaker: I think I enjoyed doing it for fun.
Speaker: I just, I think I felt that because I have a very addictive personality and it's probably why I ended up in crypto and blockchain and stuff like that and went down the rabbit hole.
Speaker: But I think I would do the same with...
Speaker: with poker as well if i was to take it seriously i would probably just end up going down that rabbit hole too much and maybe that's why that uh there's so many poker players that have come into crypto because it takes a certain personality but i think i i purposely don't put i put controls in place to prevent myself from doing that because i know that it's probably not going to be good
Speaker: Yeah, good for you.
Speaker: I think it's a similar thing that attracts me to poker specifically because I tend to be too curious, for example.
Speaker: So I'll pay to see the cards, which is the dumbest thing you can do.
Speaker: But it's also a very good exercise for...
Speaker: self-control and for your mental state of like you have to constantly be focused and aware of the actions that you're taking and i think that's more than anything what i'm seeking there it's uh it's to put myself in in danger of losing money and so i have to i have to absolutely be focused and in control of of who i am and what i'm doing it's interesting
Speaker: I just want to do a last thing on because we have about 10 minutes left, I think.
Speaker: Web3 Gaming and start with a moment of silence for ether orcs.
Speaker: I think it will be remembered.
Speaker: I think it played too big a role to be forgotten.
Speaker: If the whole provenance thing of being the first fully on-chain RPG plays out, then it's going to have value, I think.
Speaker: I've still got, I don't know, 33 Genesis Orcs.
Speaker: Yeah, so that was probably the biggest hit for me.
Speaker: But actually, I learned so much about them just because... Well, so much about bridging all this kind of stuff that I probably wouldn't have otherwise done.
Speaker: And I think the...
Speaker: the excitement that I had when I read their white paper and I was like, what, you can use these NFTs to do this with the smart contract.
Speaker: And it's like, you can actually play the game and you can gamify the system.
Speaker: And I was like, I really want one.
Speaker: This is just like, I had that the first time where I had that addictive like feeling about a project.
Speaker: And the penny just dropped.
Speaker: And I was like, you can't put a price on that feeling.
Speaker: And I think what they rolled out, the rate at which they rolled it out and the way they trailblazed with the bridging to Polygon and all that kind of stuff and then actually creating a dungeon crawler around it, they had a core community of people.
Speaker: They still do to an extent, and I don't know what the DAO is going to happen with it, but they had this actual game that people wanted to play and they were willing to spend... I was probably...
Speaker: net paying to play which to me it tells me that they had a successful game i was willing to pay to play the game because i wanted to get the rewards and i wanted to hold those rewards and prove that i've played that particular limited edition dungeon or whatever and i think that that to me was like that was the first successful moment of a game being created fully on chain yeah so i think it should have value in the future and i think so many so many projects iterated from that i know wolf game did i think
Speaker: I think it was like Space Game and Wizards and Dragons and a bunch of others.
Speaker: So, yeah, I think like there has to be some sort of provenance.
Speaker: But I think in my head, for the sake of sanity, I've just kind of assumed there's a rule.
Speaker: Yeah, ruled it out.
Speaker: And then maybe in the future.
Speaker: I mean, it's on chain.
Speaker: As long as Ethereum is around, it's going to be around.
Speaker: So maybe collectors will come looking in years to come.
Speaker: I really hope that someone comes in and starts doing documentaries on those projects.
Speaker: It's bound to happen at some point, but I hope it's soon.
Speaker: Because these are... Imagine a documentary about the saga of Paji Penguins.
Speaker: That would be fantastic.
Speaker: Aether Oryx is the same.
Speaker: Did you ever play RuneScape when you were younger?
Speaker: I did, yeah.
Speaker: I was really addicted to it.
Speaker: Yeah, same.
Speaker: And I find myself now, I don't play anymore.
Speaker: I had like two months where I played a couple years ago, I think.
Speaker: And I find sometimes they pop up on my YouTube and I watch documentaries about events in RuneScape.
Speaker: Like it's so...
Speaker: It shows that a story doesn't need to be rooted in the physical world to have appeal.
Speaker: And those stories would be fantastic.
Speaker: It's the nostalgia.
Speaker: I think little things like, is it Duradel 666 or something like the Falador massacre?
Speaker: They literally created a storyline around that.
Speaker: And in reality, all that was, was someone found a glitch in the game when construction was going on that he ended up...
Speaker: going out and killing people in part of the world that you couldn't usually do that so he was taking a lot of items that were actually probably made a lot of money flipped it to another account and then in reality you could then trade that for real like it's on the black market for real money it's like yeah i don't know so many people have their childhood rooted in that and i found there's a big overlap between the runescape community and and web 3 as well people
Speaker: hustled in RuneScape and then used that, what they learned there, to come over to Web3 and do the same thing.
Speaker: Do you think, because we were talking about EtherOrgs and we were talking about the fact that straight up Ponzi in the beginning, because they're
Speaker: Like giving you a lot of assets that have real world value.
Speaker: And do you think Ponzi-nomics will become accepted growth tactic that eventually becomes a sustainable economy?
Speaker: Like, would it be okay to have things started as Ponzi-nomics and then evolve beyond that?
Speaker: It's difficult because I think like if you, if you, if you broke it down, like with a, with a Ponzi, you effectively need new people coming in to sustain it.
Speaker: So I think the issue is when those new people become yield, like that's effectively what's wrong with a Ponzi.
Speaker: Like,
Speaker: You need to have outside cash flows or a real product that people are willing to pay.
Speaker: So you need to have a consumer at some point.
Speaker: And I think that's where a lot of projects fall down because Pudgy have gone out.
Speaker: They've created a product that people want to buy.
Speaker: So they're willing to bag hold these Pudgy toys and they've paid X amount for it.
Speaker: And that effectively flows through to the pudgy ecosystem.
Speaker: So I think it's like the word Ponzi is, it's quite broad and vague, but I mean, people have referred to the U S government as a Ponzi.
Speaker: They're just printing money and then that money's devaluing and then all this kind of stuff.
Speaker: So I think, I don't know, economics to a degree does involve a certain level of Ponzinomics.
Speaker: It's just like growing the ecosystem big enough to have that liquidity flow around it sufficiently to make it viable or
Speaker: Just being smart about how you do it in a way that's not detrimental to the entire ecosystem.
Speaker: It's like, yeah, you have to have something that people are willing to buy in the end.
Speaker: I think that's just generally how I look at things.
Speaker: If there's no productive value, if you're not creating something that people want, then it's probably going to go to zero at some point.
Speaker: Yeah, absolutely.
Speaker: Yeah.
Speaker: I'm just wondering if, have you seen like the We Crashed TV show about WeWork or the one on Theranos?
Speaker: No, I might write that down actually.
Speaker: Man, you should.
Speaker: The three We Crashed, I think the Theranos one is The Inventor.
Speaker: And then there's the Uber one and like best three TV shows about like businesses ever created in my mind.
Speaker: And yeah,
Speaker: All of these, well, actually on one side you have Theranos and WeWork where it was fake it till you make it pushed to the absolute extremes.
Speaker: And then you have Uber, which is a little bit of fake it until you make it as well because you have like smart accounting, smart marketing to inflate numbers.
Speaker: Eventually through a lot of drama ended up becoming a
Speaker: a company that works.
Speaker: And I have a feeling that Ponzi-nomics could be the same thing for the economies that are being created online.
Speaker: Because you have to start somewhere and you have to give people incentives in the beginning.
Speaker: And so, it makes sense that early adopters get rewards.
Speaker: But where does that stop?
Speaker: Where do you say, all right, we've done enough and now we
Speaker: this is the product this is uh the more sustainable cash flow that's very interesting actually because i i take what you said then and i think immediately think of frontech with the bonding curve i don't know if you're yeah a little bit in that but not involved that's like i mean everyone knows that that bonding curve isn't sustainable but it incentivizes people to to play because it inflates your portfolio value and you're like oh i only put one eth in but
Speaker: my portfolio is worth like five ETH now.
Speaker: And it's largely because of the bonding curve.
Speaker: But also, I mean, they have to, like you said, they have to encourage people to come play the game early on to adopt the tech.
Speaker: And I think over time, you eventually make it more sustainable.
Speaker: But you have to reward those early adopters.
Speaker: And I think, yeah, that's one way of doing it.
Speaker: People are motivated financially.
Speaker: Yeah, it's just interesting.
Speaker: It is.
Speaker: And how do you do it in a way that's because you want to keep a level of transparency or and even if it's not
Speaker: from top-down transparency of the company actually saying, all right, we're using this mechanism to hook you in.
Speaker: At least that we are aware that this mechanism is for that sake and that this is not sustainable and not being cheated into thinking that you will forever see your money doubling every few days or a few weeks.
Speaker: Yeah, it's a good point.
Speaker: And I think anyone who gets that right is probably going to do pretty well.
Speaker: Yeah.
Speaker: And maybe that's why, I mean, people are fully aware about the bonding curve in Frentech, but they're willing to play it.
Speaker: And it does come down to gamification, PvP to an extent.
Speaker: And psychology.
Speaker: Yeah.
Speaker: I hear people already planning out strategies of leaving the Ponzi early enough so it doesn't collapse and getting the decent airdrop and this kind of stuff.
Speaker: I mean, they're fully aware.
Speaker: Well, I'm assuming they're fully aware of the risks, but it just leads me to think like,
Speaker: They're aware of what's going on, but they're willing to play the game.
Speaker: Frentech gets the fees, the protocol fees.
Speaker: They get the user activity.
Speaker: They can then do what they need to do for the next phase of the company or startup.
Speaker: And then the users get what they want because they're early adopters.
Speaker: And some people will lose out and probably just lose interest and faint away.
Speaker: But those that stick at it and play it smartly will be rewarded.
Speaker: And I think it's like any...
Speaker: I mean, it's similar with the blur farming early on.
Speaker: Those that did season one did very well, but then as soon as it became saturated and more people came into it, it became less of a successful venture.
Speaker: Maybe we'll see that with Frentech over the next couple of months where the late adopters will come in, but they'll lose out, unfortunately, because the airdrop won't be worth the offset in cost from losing whatever they'll lose from buying these keys.
Speaker: Yeah.
Speaker: Yeah.
Speaker: But for now, everyone's making money.
Speaker: Everyone's happy.
Speaker: Everyone's holding each other's keys.
Speaker: Man, thank you so much.
Speaker: This was really fun.
Speaker: I'm happy you agreed to do this.
Speaker: It's been a pleasure.
Speaker: Thanks for having me, Polymath.
Speaker: My pleasure.
Speaker: For the people who've made it this far.
Speaker: Who are you, what are you looking for at the moment?
Speaker: Who should reach out to you?
Speaker: Are there gigs you're looking for?
Speaker: Are there like specific people projects?
Speaker: Uh, to be honest, I write a newsletter and if, if you, if you enjoyed like what you heard on here, I tend to write a lot about this stuff in my newsletter.
Speaker: It's weekly, it's free.
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Speaker: So just drop me a follow, subscribe, and then yeah, just go from there.
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Speaker: Yeah.
Speaker: And if you've listened this far, please follow us everywhere.
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Speaker: Thank you for listening to this one.
Speaker: I highly encourage you to follow Sammy and to go check out his newsletter.
Speaker: I genuinely was very excited to have him because I love reading his content.
Speaker: I'm not going to lie when I say that you're probably one of the only people when I see...
Speaker: your new content, I actually read it and not have to force myself.
Speaker: Because I get triggered by other content creators on Twitter who are doing it for whom it's very clear that they're doing it for the engagement and the likes.
Speaker: Whereas for you, I sense this, like you're actually genuinely very interested in what you're doing and it shows and I'm always learning something cool and surprising.
Speaker: So,
Speaker: Thank you so much for what you do.
Speaker: Keep doing it.
Speaker: Keep inspiring and teaching us.
Speaker: And I'll talk to you soon.
Speaker: What do you say?
Speaker: I appreciate that.
Speaker: It's really, really, really welcoming.
Speaker: Thank you.
Speaker: My pleasure.
