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Our guest this week is Kanpai Pandas CEO, Ice Bagz. Kanpai Pandas is an omnichain NFT project built on layer zero tech that just launched their latest collection on Solana. With collectibles spanning across 8 different networks, a media business, clothing line, events, and high-profile ambassadors in the contact sports industry, Kanpai Pandas is more than an NFT project, it’s a movement.
Show Notes:
00:52 - Kanpai Pandas / Origin story
04:22 - How does learning from building businesses translate into the Web3 space
06:45 - From Roblox to the Panda project
09:10 - UFC
10:53 - Streetwear and theNFT space.
14:07 - Reaching a broader audience
15:49 - Revenue, general growth, and the state of the NFT industry
17:47 - Why mint a Kanpai panda?
20:31 - Multichain
21:25 - How does Solana fit / Solana specific projects.
22:18 - A builder he admires in the Web3 space
Full Transcript:
Brian Friel (00:00):
Hey everyone, and welcome to The Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web 3.0 space forward. I'm Brian Friel, developer relations at Phantom, and I'm super excited to introduce our guests, Ice Bagz, the CEO of Kanpai Pandas. Ice Bagz, welcome to the show.
Ice Bagz (00:22):
Appreciate you, Brian. Glad to be here, man.
Brian Friel (00:25):
Yeah, we're glad to have you too. And if no one from Phantom or Solana has told you yet, officially welcome to Solana. We're super stoked to have you guys.
Ice Bagz (00:33):
Appreciate it.
Brian Friel (00:34):
Maybe we could start there. There's a lot of folks in Solana who are in the NFT space. There's an NFT ecosystem I'd say that's very much unique to Solana. You guys are coming from this from a lot of different angles. This is your eighth different chain. Can you tell us a little bit about Kanpai Pandas? What's the origin story there and what is Kanpai Pandas?
Ice Bagz (00:54):
Pandas in general is originally an Omnichain project built on layer zero tech. That's why we're now coming to Solana. Originally we had planned Solana as the eighth chain. It just took longer than expected with layer zero building the bridge out. Of course, everything with FTX and all that stuff happened a year ago and it kind of stalled out the processes and the way people were spending money. So we went back and forth quite a bit, like do we just go ahead and do the rest of it on Eth or do we hold off? Do we wait to get into the Solana ecosystem? And I made the decision, let's just wait, even though it's a long time, because this has been probably eight months coming, but I just wanted to get into another ecosystem. The cool thing about our project being Omnichain is we mint it on Optimism, and BSC, and Eth, and Arbitrum, and AVAX and all these other chains, and it helps you kind of bring those communities in too, right? Because people become so kind of stuck in one chain or one FT project or whatever it may be.
(01:47):
That's just not my belief in crypto, my belief in crypto is people should be trying and experimenting, and I think in a couple of years from now, hopefully you won't even know that you're moving from one chain to another chain. Hopefully it's a much more seamless process. That's kind of the goal here. So, we were one of the very first ones that really used that tech. I think Lil Pudgys ended up switching over and re-dropping an Omnichain contract as well. But I think more projects should be. I'm excited to come to the Solana ecosystem. Like you said, it's very different. It's very kind of tunnel vision and closed off compared to some of the other chains, for sure. But that's the way it is and that's why it interests me to get in there, because if you look at what they've done, they made DeGods, they made y00ts, they made some of these bigger projects, I would say even more so than the founders.
(02:31):
It was really the ecosystem and the hype and just kind of that grit of, "We are Solana," that built this stuff. And so I'm like, well, fuck it, why would I not want to be a part of that? You know what I mean? With my project. Very early on I was involved in helping with the honoraries, things like that. That was the meta back then. This is still in the bear market, April of '22. So it was still bear market, but I'd helped do this. The mint was pretty hyped up and then the contract broke, all kinds of shit happened. Shit hits the fan. I'd never spent any time in Discord before until that moment.
Brian Friel (03:01):
It's eyeopening.
Ice Bagz (03:02):
And yeah, I didn't know if I ever wanted to get back in, because it was just "Rug, rug, rug." And I'm like, "What the fuck is everybody talking about?" So, eventually I ended up taking over the project very early on, hadn't minted out, took us seven months to mint out. I'd say we're probably the only project that actually stuck around and built, A, during the bear and then, B, during a seven-month mint. Most founders would've just hit the fucking road by then. I don't think anybody can argue that fact. So I pulled about 600 K out of my own pocket to build the business, to get something going, to prove myself, prove the project. So we did that, worked endlessly for seven months, finally minted out the seventh chain at that time, and we've been building ever since. So that's kind of the origin story to it. But yeah, it's one of those things that I'm glad I did it now, but there was a long period of time where I was like, what the hell am I doing?
Brian Friel (03:49):
Yeah, no, I totally understand that. I think there's a lot of interesting things there that we can go into. I mean, you guys are doing things your own way in a very unique way. I mean the Omnichain thing on its own. But one thing I want to hit on is what you talked about where you didn't actually found the project yourself. You came in through the honorary process, you saw an opportunity here and you basically took a project that you saw its potential and took it to the next level. Just briefly, I want to learn a little bit more too about your background. So you're an entrepreneur, you've built businesses yourself. How do those learnings translate to the Web 3.0 space?
Ice Bagz (04:23):
So it's massive and we actually had a space about it this morning and I had my whole team up talking. And we're seeing this seismic shift right now from hype and marketing and all this other stuff to what are they actually building and what are they actually doing and do they have actual goals and business plans and people in place that can execute? And I think that we're going to continue to see that. So I'm a lifelong entrepreneur. 20 years old, moved to Mexico, worked in the manufacturing business for five years. Came back, did sales for a couple of years, and then decided to start my own business. I was very good at sales. I could talk and I was very good at it. I made good money, but I hated it. I hated getting up and going and doing it every day. So my wife was pregnant at the time, we didn't have much money.
(05:07):
I'm like, "Babe, I've got an idea for a business here it is." Literally that night we sat down and drew it up on a napkin. She made the logo and everything, and I literally quit the next day and went and started knocking on doors and that's how I started my business. So my first year, I think I made $32,000. My second year I made like $55,000 and many years later I built it into a multiple eight figure business, and I've launched other stuff since then. Really got bored of managing big companies, 50, a hundred employees. It got exhausting to me and I wasn't having fun anymore. So I put people in those places to handle those businesses. I started in crypto full-time in early '18, so I've been around for longer than most of the people in the space. Got into that. I was trading coins and advising on projects and things like that.
(05:49):
And then in '21, I guess is when I started getting into the NFT space and didn't really understand it at all. The funny thing is the thing that made it click with me was my son constantly fucking swiping our credit card on Roblox, and I'm like, "What are you doing?" I'm like, "Show me," right? And he's like buying Roblox and he's getting these skins and he's changing his skins into every game he goes into and I'm like, all right, this is starting to click a little bit here. And if you look at what we've built, we took a lot of the Roblox mechanics with the trait swapping and the point system and things like that because it's proven and it works.
Brian Friel (06:24):
Yeah. So let's talk a little bit about that too. So you guys have everything that you're doing in the digital world, the trait swapping everything there, and then you have all this other stuff that you guys are doing, I'd say in the real world too, your activations there. Maybe let's hone in on the digital to start. So you saw your son swiping on Roblox. How did that influence where you took this Panda project?
Ice Bagz (06:44):
For sure. So kind of where we started was in real life experiences, networking, highly important, that type of stuff. We have a suite at Allegiance Stadium in Vegas for 15 years. So we have all the football games, all the concerts, everything that goes on the shows, et cetera, there. We do UFC events, we throw Pandamonium, which is a huge festival, day long and night long festival. So it started off with that and then I was like, all right, we've really got to branch out and build this project out a little more and be able to capture an audience that's much wider than people that want to go to physical events. We started building this point system out. We spent about seven months on this. We spent probably about three months in planning and about four months in building, but we built out a centralized point system.
(07:24):
We call it the PPDEX, but it's got your point system, it's got a casino integrated, a sports book integrated, poker room, et cetera. So you can use those points that Japandas earned on a daily basis to play games, play against your friends, whatever. Then you can also buy traits. We can drop trait packs whenever we want to. We can do it for things that are culturally relevant and it doesn't become stale. And there's always this ongoing debate of like, well, should you maintain the metadata of an NFT or should it be changeable? You should have trait swapping. And I say, look, unless you're fucking Punks, right? We're building something here that's innovative and that's going to continue to grow for the next 10, 20 years, whatever. I think it's silly to think otherwise and to think that that's going to hurt the project because able to now not only do traits, keep it fresh and keep the community engaged, but it also allows us a massive opportunity down the road to partner up with other companies.
(08:14):
They can drop their own trait packs within our system. We released what we call DRIP. It's a digital plus real items for pandas. So what we did there was we came up with a collection of items and one's like a diamond encrusted pendant, one's a t-shirt, one's a hat. And then what you do is when you buy that, you get the physical, you get the digital trait that you can put on your panda, and that way everybody knows you own this limited edition run, but in the virtual world. And then you also receive an NFT showing digital ownership, so it's got an NFC chip embedded in it. And so some of those things I think is where it's really going to lend itself to large collaborations for us down the road we're already working on. Our first drop is going to be with Bo Nickal, the UFC star. He's got a ScrapLife clothing line, and so we're big into the UFC scene and the combat sports scene. So we're going to collab with him and come up with an item drop there.
Brian Friel (09:01):
Talk a little bit more about that. So you guys do a lot in UFC actually. So in addition to that, you guys work with Jon Jones, Roy Jones Jr. What led you to the UFC in particular?
Ice Bagz (09:10):
So it's such a massively growing market that's underutilized from a marketing perspective, in my opinion. Over the last couple of years. If you pay attention and you go to the fights or you watch the fights on TV, you see the front rows are nothing but the biggest soccer stars, the biggest football stars, the biggest basketball stars, and these guys are like... It's just something they can't do. And now it's exploding globally. I mean outside of soccer, it's probably one of those really global, global sports and people just don't pay enough attention to it. And the stuff that's come out of there... I don't know how old you are, but I don't know if you know Tapout and Affliction and all these fucking lines that were geared towards that arena. They were just all awful.
(09:49):
And so I was like, why don't we create... It doesn't even have to be an athletic wear line, just a fresh street wear line that's geared towards marketing to those people. And it's been very successful. Like you said, we've got Jon, we've got Mighty Mouse, we've got Bo Nickal, we've got Mike Perry. I mean, we've got probably 50 athletes on a roster. Part of it is one of my advisors and stakeholders as Malki Kawa who owns First Round Management and they're one of the top three management companies on the planet.
Brian Friel (10:13):
So that seems like an insight that's almost completely separate from everything you're doing in NFT land is you notice this sport that's up and coming, UFC. I mean I'm 30, for reference, but 15 years ago when I was a kid in high school, it was very fringe. And now I'd say it's completely blown up, but there aren't clear ways to tap into. Those audiences I think are still forming as everything's moving digital, there's not clear connections there. It sounds like though what you guys are doing, at least in the short term too, is even just focusing on just pure, real world street wear. Are these even tied to the NFTs currently? I mean some of them feature the pandas for sure, but how is that audience resonating with what you guys are building in parallel with everything you're doing in the NFT space?
Ice Bagz (10:53):
So it's really a twofold answer. One is you've got to be able to build revenue sources or your NFT project's dead. You can't just continue to mint, mint, mint. That meta is long gone. Yuga was probably the last one to successfully do that. We've seen Azuki failed miserably trying to do it. I don't see that meta coming back. Royalties are in the toilet. So you've got to build a business around this, right? And I'm sorry, but let's be realistic here. With $2 million mint, you're not going to go build some kind of Web 3.0 game that millions of people are going to play. It's not going to happen. So you've got to come up with, okay, what can we do that our community likes that can also generate money but also not generate money off the backs of them at all times. And so clothing line was like number one. We're like, okay, but let's do this right.
(11:34):
Not just bullshit merch drops, let's actually build out a clothing line with an actual campaign with people wearing it and build something out of it. And so when I lived in Mexico when I was 20 to 25, I was in the manufacturing industry, so I've been in that industry for a long time, but that's one. Number two is we're building out Kanpai media right now. We just launched our first podcast called Overdogs. We've had Sean Strickland on, Mighty Mouse on, Bo Nickal on, Mike Perry on. We're filming with Jon Jones on Friday. It's been highly successful. Our third episode was Mighty Mouse and it's already done 130,000 views between Spotify and YouTube. So wildly successful start to that. Obviously it's very hard to get those kind of high caliber players on every time, but we're able to do it and that gives us a major edge on the competition.
(12:18):
I mean just also the way we approach it versus other shows, et cetera, et cetera. But now we're in talks too with some of the biggest players on the planet as far as sponsorships go in that show. So you got to find ways like that A, expands your audience, and then B, also drive revenue so that you can do stuff for the community five years from now and you're not just dead in the water. I mean, believe me, there's so many projects right now that are dead, they just don't know it yet, and we're not going to be one of those. When it comes back to tying the NFTs to these brands with clothing, for example, you've either got a chip embedded that goes back to the website and teaches people about who Kanpai Pandas are, or you've got QR codes on them. So you're essentially building this big funnel, you're projecting it to the masses, but you can't shove NFTs down normies' throats.
(13:04):
When Jon Jones and I first met, it was like March 4th week, he was fighting Ciryl Gane, and I remember we were in the elevator and he was like, "Yo, how do you want me to explain this?" And I was like, "Don't. I don't want you talking about fucking NFTs on Twitter and Instagram and all this stuff. You're going to get flamed," right?
Brian Friel (13:21):
Yeah.
Ice Bagz (13:22):
So you take a smarter approach. You say, "Okay, it's the clothing line, Jon. That's all it is." Now people start to fall in love with the clothing line, and then as you progress down the road, now you're introducing them into this system. Now it's like, "Okay, I love this brand and what these guys are about, and oh, there's a membership pass that I can buy and get access to all this cool shit that's also part of their community?" That's where you start to convert people. It's not upfront.
Brian Friel (13:46):
Yeah, no, that makes a lot of sense. It's like starting with the user. What do they actually want? Building something that people actually want and building your audience that way. I think the UFC angle is really interesting. I don't know of any other project out there that's focusing on that. Would you say that that's your main focus right now at Kanpai, or are you guys also exploring other avenues to reach a broader audience to basically expand your top of funnel?
Ice Bagz (14:07):
So right now it's combat sports. We've done some with NFL players, things like that, but right now it's working, right? And so when you have something that's so young and it's working, you don't pivot.
Brian Friel (14:16):
Yeah.
Ice Bagz (14:17):
Believe me, I'm an experienced business leader. I've had plenty of successes, plenty of failures, and I know when to pivot and you don't pivot when you're having success. You pivot when you're not having success and you pivot quickly. But when you're having success through combat sports, and it's not even just UFC, right? If you look at PFL, PFL is now massively growing. They're on ESPN. You've got One Championship where Mighty Mouse is, you've got Bellator. All these up and coming leagues, bare knuckle boxing is exploding. If you look at what Mike Perry did from converting to the UFC over to bare knuckle boxing, his worth is exploding right now, and that's what we're focusing on. We're looking at all this stuff that's up and coming that's bringing in huge crowds and huge viewerships, and we're saying, okay, well how can we work this angle to get our brand in there and be the brand that people recognize when it comes to these sports?
Brian Friel (15:01):
Yeah. No, that makes a lot of sense. You mentioned a couple of things throughout these stories of revenue as a constant theme. We started with your background as an entrepreneur building businesses. You mentioned you were in the manufacturing industry. Is that correct when you got your start?
Ice Bagz (15:14):
Yeah.
Brian Friel (15:15):
And as we're recording, this is August 2023. The NFT ecosystem, I would say, is going through a tough time as a whole of figuring out what is the future of this ecosystem, especially as it relates to revenue and sustainability. How do you think about that as it relates to NFTs in particular? You guys are doing everything you're doing right now with the street wear. Is revenue a top focus for you right now or are you more focused on general growth, expanding top of funnel? How does your business experience guide your instincts of what's important right now given the state of the NFT industry?
Ice Bagz (15:49):
So the good thing is I've got a really experienced team and a really experienced advisory board and stakeholders because I'm much more of a creative. I like to kind of test the waters and see what we could do here and there, what would be unique that we could develop. And then I've got the guy that kind of runs project management for us, was managing nine figure projects and hundreds of people. The guy that runs Kanpai Media for us was an exec at Red Bull Music. The thing is, when you're building a business, you got to surround yourself with the right people. Our advisory board is like, it's fucking phenomenal. It would be killer for a Fortune 1000 company, and we've got it in the NFT space, which is super unique. It gives us access to whatever we need and whoever we need. Revenue is always going to be a top priority.
(16:29):
I don't look at this as like an NFT project. I look at this as a business that we're building. It's really a large media business, but it's got a clothing line and it's got its fingers into the UFC space and the combat sports space, and that'll eventually grow into a broader sports space. The thing is content creation and revenue sources and driving the community and giving them fun things to do is probably the top three for me. And that's why we do a lot of stuff like Premier Fantasy Soccer League right now. The winner gets tickets to the Champions League finals at Wembley Stadium. We're about to drop NFL, winner gets two Super Bowl tickets. We're about to drop a poker circuit in our poker room. Winner gets a WSOP seat. So those type of things right there, especially in a bear market, it's just engaging as hell.
Brian Friel (17:13):
Yeah. No, that makes a lot of sense. From everything that you guys are doing in the business, switching back to the community as a whole and what people can expect. You just launched on Solana this week. You currently are minting right now as the time of this recording. We'll try to get something out there just in time. But for everyone who's been in the Solana ecosystem these past two years, they're focused almost exclusively on Solana. I'd say that everything you've talked about is pretty much a breath of fresh air. You guys are doing a lot of stuff outside of crypto, but for those people, if you were to talk to them, what should they be thinking about as it comes to Kanpai Pandas? Why should somebody go and mint a Kanpai Panda today?
Ice Bagz (17:47):
I'm going to hit on the point that you asked earlier that I don't think I really responded to, but having a competent leadership team that has experience in navigating tough markets, whether it be a bear market and NFTs or it be a bear market in real estate or stocks or whatever, it's all the same shit. So it's like we've all been there and done that. For that reason, we've been able to flourish and it hasn't been able to bother us as much because we just continue building and building and building because I know the end of the bear market's going to come and all the groundwork and foundation and everything that we're working on is going to be laid for the bull market. So then we'll reap the rewards then. So that's not really a major focus of ours. Ours is doing what we say, laying out a solid game plan, having the steps in place to accomplish those plans, and most people don't.
(18:29):
In the NFT space, I've never seen anything more disorganized and with poorer teams, I guess, leading projects and large amounts of money in my life, and I've been in all kinds of different business sectors. So to me, it's a positive for us. We're seeing this a lot more now, but you've got to have a team in place that has experience that knows what the fuck they're doing and can actually execute on what they say they're going to do. But at the same time, besides that, we just do a lot of cool shit. You've got this cool trait swapping mechanism, and we have this game within a game where you can add to your rarity based on traits that you add in and things like that and earn more points. Or you can go into the raffle section and use those points to win concert tickets and football tickets and sports memorabilia and shit, we just gave away a four-day trip to my town and we're going out on the boat. They get to bring 10 people. We're going out on the boat for four days, but that's great networking. It's a free vacation. We do a lot of cool stuff like that to keep people engaged.
Brian Friel (19:24):
That makes a lot of sense. It's like an internet native club for everyone who's already into everything that you guys are doing outside of this. They're loyal people who use your brand, they love your street wear and they want to connect digitally with everyone else. It feels the same way.
Ice Bagz (19:35):
Yeah, I mean, if you look at NFTs in general, right? What's the main use case for NFTs right now? It's really a membership pass. I've been a member of 20 golf clubs in my life, and you go and you pay this fee to join the club, and then you pay a monthly fee to be a part of the club, and then you pay a cart fee just every time you go play. And when you leave the club, you don't get shit back because you don't own it. And so that's really what NFTs are right now. They're social membership passes. You have access to all of this stuff except you own the fucking rights to it. So when you sell it, you can sell it, which is so different than the old business models of these clubs. To me, that's what NFTs are right now outside of digital collectible, digital art, there's some decent gaming stuff out there, but not much.
Brian Friel (20:19):
Yeah. No, that makes sense. Bringing it back to where you guys are at now, this is the eighth and final chain. You guys are here at Solana, I take it, there's no more change expansions from here. Eight is the number that you guys are sticking with, is that right?
Ice Bagz (20:31):
It's a 10,000 set collection, and so this is the last thousand. So we've minted out, I think 530 of the last thousand right now, which in less than two days is not bad. Considering it's the most expensive mint ever to be on Solana and the fucking market conditions are laughable, right? I feel like we've been highly successful already, and I personally think we actually mint it out by Sunday evening. And if that does, I think it's a super bullish catalyst for what we're building because it tells me even in these conditions, people are still digging what we're doing.
Brian Friel (21:02):
So where does Solana fit in with everything else you guys are doing from here? You guys have eight chains. Managing a project on eight different chains is a lot of work in its own right. Outside of everything you guys are doing in the physical world, how do you think about what you're doing in just the pure digital world going forward? Is there anything specific to Solana that you are really excited about, especially as it relates to tapping into everything you're doing with your business side of things?
Ice Bagz (21:25):
Yeah, so I think there's a lot of innovation going on in Solana, right? And I've spent the last few months talking to a lot of the big builders in the Solana ecosystem. So I think there's actually probably some cooler stuff being built on Solana than even on Ethereum, personally. So yeah, we're going to look and talk to all these guys that are building over in Solana and see what they offer and see if there's something that integrates with what we're doing at this time or anything that potentially integrates with what we do in the future. That's always something that we're looking at. If you stop innovating, you're dead. So we're always looking at like, here's the next three-month plan that we need to execute, but what is the six-month plan? By the time you get month six or something out, you may find something else by then that may be more pressing or have bigger potential.
Brian Friel (22:05):
Well, Bagz, it's been awesome. Love hearing your story. Love hearing the Kanpai Panda story as well. One closing question that we ask all our guests, and I want to hear this answer from you as well, is, who is a builder that you admire in the Web 3.0 space?
Ice Bagz (22:18):
In the Web 3.0 space? I like what the guys over at Mad Lads are doing. I like what the guys at Tensor are doing. I like what Degen Ape Academy is doing. I like what Luca is doing with the toys and the IP. Again, that's one of the biggest things that I think people need to understand is revenue. If you can't drive revenue, you can't run a fucking business. So I'd say that's probably a pretty good roundup. There's more out there for sure. That's a good start.
Brian Friel (22:41):
Bagz, this has been awesome. Where can people go to learn more about Kanpai Pandas?
Ice Bagz (22:46):
Go to kanpaipandas.io.
Brian Friel (22:47):
Ice Bagz, the CEO of Kanpai Pandas, thanks so much for coming on Zeitgeist and sharing your story.
Ice Bagz (22:52):
Yeah, appreciate it, man.
-
Our guest this week is Alex.BSL, the co-CEO at Blocksmith Labs, the company behind the Smyths NFT collection.
Alex.BSL joins Brian Friel to discuss the origin story of Blocksmith Labs and how they started with the goal of creating NFT collections that provide real value, not just hype. He talks about their different products, including Mercury, a pre-mint tool, and Atlas, a hub for NFT activity. Alex also mentions their focus on solving problems and how they build products based on metas.
Brian and Alex dive into Smyths, Blocksmith Labs' classic early PFP collection, and its ascension to a premium collection. They talk about the launch of Megos, a new collection that will target a different demographic, with a focus on casual mobile gaming. Alex highlights the importance of building IP and how it takes more than dropping an NFT collection to create a brand.
Show Notes:
0:49 - Who is Alex.BSL / Starting on Solana?
2:04 - Transitioning to Web3
4:55 - The initial goal for Blocksmith Labs
7:15 - Who is Blocksmith Labs working with / Some of the early products
9:32 - Process for building / what the market needs
11:58 - Origin story of Smiths
13:12 - Evolution of Smyths in the future
17:05 - The Meegos collection
21:02 - How to unblock crypto to make a mainstream splash in gaming
23:57 - When is Migos coming
25:20 - Where can people find out more about MeeJump/Meegos?
26:21 - A builder he admires in the Solana ecosystem
Full Transcript:
Brian Friel (00:06):
Hey, everyone, and welcome to The Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web 3.0 space forward. I'm Brian Friel, Developer Relations at Phantom, and I'm super excited to introduce our guest, Alex.BSL, the co-CEO at Blocksmith Labs, the company behind the Smyths NFT collection. Alex, welcome to the show.
Alex.BSL (00:28):
Hey, glad to be here.
Brian Friel (00:29):
Really excited to talk with you today. I've seen you over the years, my time on Solana, all across the crypto Twitter sphere. You guys have built a lot in the last couple of years that I want to get into. But maybe before we start talking about Blocksmith Labs and everything you're up to, I'd love to learn a little bit about you. Who is Alex.BSL and how did you get started in Solana?
Alex.BSL (00:49):
I think a lot of people know this, but my Web 2.0 career has been 10 years of shipping products for top tech companies. Over the last 10 years, I've worked with Apple, Cisco, Coinbase. Coinbase was my last Web 2.0 job. And then my first Web 3.0 job was DeGods. I started there as a mod just out of accident, and then lead dev. And then I started my own thing, Blocksmith Labs, because I wanted to do different things with Blocksmith Labs. It didn't really align with the incentives and what they wanted to do with DeGods. Yeah, that's the light version of it. We can go deeper.
Brian Friel (01:28):
Yeah. When you said you were working with all these Web 2.0 companies, was that in a technical capacity? You mentioned you were lead dev for DeGods at one point, but you also have experience running projects as well from an operational standpoint.
Alex.BSL (01:40):
I was a full stack engineer for the last 10 years. I led teams. I also did dev work over the last 10 years at different levels and capacities, but I've been mostly a dev for a decade.
Brian Friel (01:55):
Love it. What was the moment then when you're working in these Web 2.0 capacities, working with great companies, that made you decide, "Hey, Web 3.0 is something I need to jump into"?
Alex.BSL (02:05):
Web 3.0 just started out of curiosity. Because when you're a Web 2.0 dev and if you're a dev that's working with big companies, you got to stay on the cutting edge of the technology. Otherwise, someone with one year, two years of experience will come over and take your position. So you got to always be on the cutting edge. That's why I think around 2020, the huge high brand blockchain and crypto, it was all around. Just out of curiosity, I started learning about Eth and Bitcoin. I researched every single token and coin under 100 market cap. That's how I started this. It was just educational for me in the beginning. I started on Eth, started learning Solidity, and then I built some tabs. It was fun. It was fine. I ended up in Solana just by pure accident. Like I said, I was learning about every single thing every single day.
(02:58):
And then one day on Decrypt, I saw this article about Degen Apes mint and how it's going to be a huge thing and how it's going to break Solana. Just out of curiosity, I ended up and then I minted. But in Solana, once you click mint, it hits you different. You can't go back. Because when I was on Eth, I was minting stuff, I was doing shit, but it felt so backward to me. I'm going to be a 100% honest with you on this. Because imagine the next billion people, you're asking for them to pay $10, $20. Imagine you, going and buying a salad and there's a tax of 10 more dollars. It felt so backward to me. I understood what B2C meant and why it's the way it is, but it didn't make sense to me. But I was still going on with it.
(03:40):
But once I hit mint on Solana, it just hit me. "Oh, this is the closest thing people are used to in terms of experience." I haven't looked back since then. I've been in Solana. I've just done everything to add value to the ecosystem, and the ecosystem has given me so much back.
Brian Friel (03:56):
Yeah, I think that story resonates with a lot of people, the Degen Ape mint being that flagship moment where everyone realized, why do we need to settle for subpar user experiences? The mint itself was, I remember, chaotic, which is true Degen Ape form, which is great, but the network was held enough. Great.
Alex.BSL (04:14):
Yeah, I was up until 6:00 AM to mint, and it was chaotic. There was no Candy Machine by then. I remember that. Yeah. Candy Machine was born out of necessity from that mint. Yeah, I remember that in those days.
Brian Friel (04:27):
Yeah, we've come a long way. It can be easy to forget how much has been built.
Alex.BSL (04:32):
Now, you can just mint and it'll drop 150K NFTs out of nowhere with $100.
Brian Friel (04:37):
Yeah, and it's only going to get crazier, I imagine. Let's go back to that time. You've already researched crypto. You just made the Degen Ape mint. You have all this wealth of experience. You mentioned that you briefly worked with DeGods, but when you were ready to start Blocksmith Labs, what was it that you were pursuing? What was it that you set out to do with Blocksmith Labs?
Alex.BSL (04:55):
I always see new technologies and new industries. What problem are they solving? What is this adding to the society that people would need? That's how I see things. By then, I've not seen any NFT collection doing anything more than minting more collections, airdropping hype there was about NFTs. I wanted Blocksmith Labs to be a blueprint for the next generation of NFTs, or at least a new category of NFTs that can actually provide real value. It's not just hype. It's not just, "Oh, this is going to go to the moon." We have seen that a lot. Because 99% of those projects that are just solely based on hype, they mint and then they drop. I don't know if you remember, there was a time in Solana where there were 10 projects minting at the same day. It was like, you hit something. Oh, it hits? It's fine. You're ragged? You move on.
(05:47):
The reason none of them last is that first thing, the NFT business model, I think it's not set up in a way to last long. Some projects realize this over time, like Pudgy Penguins. Now, they're trying to sell physical products so that they can use the brand, use the IP, sell products, make revenue and last longer as a company. But I realized this back two years ago, and that is why BSL started in a different way. Oh, we are going to create products, have users, create value, and then we are going to drive them back to Smyths, our first NFT collection. I don't want to take too much credit for this, but since then, you have seen this new kind of NFT projects who are actually building products, who are using this as a seed round to build their own products, services, and bring value back.
(06:39):
It's not really just about hype or just about pumping bags. It's also about contributing to the ecosystem, building relationships, helping other NFT projects. I'd like to think we have been successful in that, and now, you have been seeing that a lot of projects mention us as their favorite builders. Maybe we are successful in doing that.
Brian Friel (06:57):
Let's dive into that. You mentioned that you guys have taken a real builder-first mentality. I think you guys describe yourself as a Web 3.0 or crypto B2B SaaS company. What is the other businesses in this B2B relationship? Who are you guys working with, and what are some of these early products that you guys have started to build for them?
Alex.BSL (07:15):
Our first product was Mercury. We have onboarded over 1100 projects on Mercury. I think it was the defining moment on Solana where projects, you realized, you could do actual things, create products, create services, being the hype cycle, being the attention cycle. Because now, you see projects doing a lot of other things to stay in the hype cycle, to stay in the attention. Back then, Mercury was all we needed because every time a hype project was on Mercury, we also monetized it in a clever way. We didn't take money from those projects. We took percentage of white list spots and auctioned them, and raffled them in our own token called Forge. That helped add a lot of value to Forge, which, in turn, added value to our NFT, Smyths.
(08:02):
Before Mercury was a thing, the way you submitted wallets was literally manual. You had to either give your wallet, or you had to give your Discord accounts and then give wallets. We automated all of that. No, we cannot take it for granted. Now, there is Atlas, a lot of other tools. But then, it was a huge thing. We solved a problem. Like I said early on, that's my core belief, that you have to solve a problem. That is why even in Atlas, we have something called a white list marketplace. That only came up because people were selling white lists as spots, but they were selling on shady Discord accounts. You had to give up your wallet, and then there was a middleman. You had to put collateral, all kinds of shit.
(08:44):
But that is why we know there is a problem and we solved it. And then it was a huge success. That is how I see our products adding value to the ecosystem and us getting back value.
Brian Friel (08:54):
You mentioned two products there I just want to hit on. Mercury, which is a white list management tool-
Alex.BSL (08:59):
We have a ton more.
Brian Friel (09:00):
Right. ... Atlas, which is this hub for NFT activity. You guys have built a ton more. You guys, list them off here. I know Bifrost, which is a price discovery launchpad. You guys have Raven and Shift. You guys have basically built out this entire suite of tools and infrastructure for other NFT projects to leverage and build their own brands and communities based on them.
(09:23):
I guess, zooming out on everything that you guys have built, how do you decide what is your process there? Who do you talk to first, and how do you realize that this is what the market needs?
Alex.BSL (09:33):
That's a good question. You know what? We are only a four-member full-time team for the past one-and-a-half years, and with the extended team, it's around 20, 21, the full team. But since the inception, there are only four full-time members in Blocksmith Labs. It's crazy how much we've been able to achieve with just four full-time members. It makes it even harder to make a decision, and that is why you don't see Bifrost running now. You don't see Shift running now. Raven is still there. It's self-service. It goes on by itself there, but we haven't made really significant changes to Raven. We are completely focusing on Atlas now.
(10:09):
The way I see it is, the space moves so fast and people need stuff based on a meta. There was a meta of needing a good, premium launchpad when Bifrost was a thing. It was a natural extension in the NFT lifecycle. We had Mercury, which is a pre-mint tool, and then we built a mint tool, which is a launchpad. And then we built post-mint tools, which is Raven and Shift. That was the thinking behind. "Oh, we are going to build everything around NFT lifecycle. Oh, there's going to be pre-mint tools, mint tools, post-mint tools." That was the thinking. But over time, we realized that we have our shit in way too many products. We need to focus on a single product and go deep, instead of going wide. That is why we turned off a lot of products.
(10:58):
Now, we are solely focusing on Atlas, if there's anything that we want to add. We are planning to integrate Raven even into Atlas, so that's our mentality now. Yeah. Before then, it was just building products and seeing what works, and I believe that's also helped us keeping the attention for a long time. Because if we didn't build all those products, we wouldn't have the same reputation that we have today. We wouldn't be in people's minds today. I think that helped us. They were cool experiments, but we've found our footing now, and we are happy with focusing on Atlas completely now.
Brian Friel (11:35):
That's great to hear. You mentioned some of the other things that you guys offer as well. You mentioned the Forge token, which we can talk about some of the synergies there with what you're building. But you guys also have a couple NFT collections to talk about. First off being Smyths. Smyths, I would say, is what most people think of when they think of Blocksmith Labs. Can you walk us through some of the origin story of how Smyths came to be?
Alex.BSL (11:58):
It was me and Harmy. Harmy and I were in DeGods. He was also doing some dev work for DeGods. And then we were both just discussing tech stuff and we realized that we have had the same thought process about how NFT should be like and what the future of NFT should be like. That's the only reason we started this.
(12:20):
Since we're also good with the execution speed, a lot of this stuff that you see, probably from idea to execution, none of it would've taken more than three months. I think there was something, that they built something for the TIROCULAR donations. From idea to execution, it was just three hours.
(12:38):
Since we're able to execute things fast, we have the capability, even with a smaller team, to make decisions on the fly. Not just think about something now and wait for six months and the meta is gone and no one cares about it anymore. It's not like that.
Brian Friel (12:54):
You had mentioned a lot about metas there. Smyths being one of those classic early PFP collections and have since gone through an as ascension, so to speak, I think you guys went from OG Smyths to ascended Smyths, talk a little bit about that process. Is that something that might continue to evolve in the future?
Alex.BSL (13:12):
Yeah, 100%. The next thing coming up after Megos Mint, which is our second collection, is Fund of Youth for Smyths. That's going to fix more problems, I think, that Smyths has now, which is to do with rarity, top ranks not being top-rank-looking. A lot of stuff like that will be fixed. We are in a very specific niche. It's strong, muscular Norse men. We want the art to be more accessible, more relatable for a lot more people, so we'll be doing something around that as well.
Brian Friel (13:47):
Oh, yeah. If you haven't seen these, these are strong Norse men that are true builders. They're all holding hammers and wrenches.
Alex.BSL (13:55):
Yeah. Hammers and weapons and all kinds of shit. Actually, to your question, we needed that ascension upgrade to be honest. It just came out of necessary. Because when we minted, Harmy and I, my co-founder, we were both devs. We didn't really care about art a lot. To be honest, we left all the art decisions to the artists, and obviously, he didn't care about the collection as much as us. So he did his best. But then, I think in a month, we realized that, oh, this needs to change. If you're really serious about making a PFP collection, we should go all in. This half-arsing two things is not working. We've got to full-arse this thing. That is why we had to do it.
(14:37):
Actually, there was a point where we wanted to do cards with three different kinds of rarities. I'm glad we didn't do that. I'm glad I made the decision to stick with PFP. It was born out of necessity and I'm glad we did that. It helped a lot of people, and it also helped us distinguish between different Smyths. Because the early versions were a lot more zoomed out, you couldn't figure them out. Small Twitter, PFP circle. Now, it's all about optimizing that small, little thing that you see on Twitter. Also, with Megos, we are always testing. How is it looking on Twitter in this small size? How is it looking on a huge screen on the Mac size when you print it and stuff like that?
Brian Friel (15:20):
Yeah, it's interesting to think about. If you're running this community or a collection like this, the end goal is you want people representing this picture as their identity on the internet.
Alex.BSL (15:30):
It has to be optimized, yeah.
Brian Friel (15:32):
Yeah, how you come to something that serves a large number of people. There's thousands of people who own these PFPs. I don't even know if there are thousands of strong Norse men on the internet wielding hammers and wrenches, but I think it symbolizes something that people want, that builder mentality.
Alex.BSL (15:50):
Yeah. It also attracted a different kind of user base and that is why out of necessity, we have a second collection. The way we ran Smyths, the way we ran Blocksmith Labs, attracted a demographic of older gentlemen who know how sustainable businesses are run, but they don't have the time to go on Twitter, be active on Twitter. They just want to buy this and just go on and do their own thing, run their own business.
(16:17):
There are a lot of business owners within Smyths who don't really have time for crypto as much, but they bought Smyths because the way we ran things, they understood, "Oh, this is the only legit project that can sustain for a long time, because they have a different business model than all the other NFT collections." It has its pros and cons, and that is why we have a second collection called Megos, which is going to target a different demographic; people who are into gaming, content creation, who are more active on Twitter. Yeah, that is why Megos will exist.
Brian Friel (16:49):
Let's dive into that. Let's talk more about Megos. You mentioned some of the inspiration there, that you want to appeal to a broader audience, potentially a younger crowd. There's also a game involved with Megos as I understand. Can you talk a little bit about everything that you guys have planned for that collection?
Alex.BSL (17:05):
I think there's a niche no one's really focusing, in the NFT space at least, that is casual mobile gaming. It's a huge industry. It's bigger than traditional PC gaming or PS5, Xbox gaming. I tweeted this art earlier today. Candy Crush alone makes more than a billion dollars per year, and it's growing at 15%. PUBG Mobile is making more than a billion dollars. And some games you have not heard of, Clash of Titans is making 500 million. There are so many casual games that makes millions and millions of users. We've also seen the growth of IP from a simple mobile game to a movie with Angry Birds.
(17:49):
It was a super simple mobile game, but it was so successful and they were making so much money, they made so many of those games. They had merchandise, events, products, a movie. I don't even know what other shit they have, but it's a true testament to the fact that if you want to build IP, you really need some product or some service. I think a lot of people in the NFT ecosystem don't really understand when they say, "I want to build an IP." It's not just, "Oh, I'm going to drop this NFT collection and people are going to start caring about me."
(18:21):
It's never like that because it took years and years for, let's say, Harry Potter, for people who care about the IP or the characters. It takes some sort of a movie, a game, some sort of product or a service, or anything like that. That is why we are now focused on the gaming and content creation with Megos. Because gaming is not just a single thing anymore, it's an experience. People stream a lot. People make content around games a lot now, and I consume a lot of that content. I've been watching GTA role-play videos a lot, and they have millions and millions of views. I bet there are more people watching than there are people playing these games. I think they go hand-in-hand, and these niche, no one's really targeting it.
(19:10):
I like what Pudgy is doing. I'm going to bring that back up. They're selling those toys. If they're successful in selling those toys to 100,000 people, a million people, a lot more people are going to know Pudgies. And then the brand and the IP, over years, is going to be valuable. We are targeting this demographic and these gamers and content creators. MeJump is only the first thing, and we are going to have something called MeArcade, different kinds of games and fun game theories involving different types of cutting edge technology. Maybe a year from now, you're going to have a game on Apple Vision Pro because we can do that. We have proven that over time that we can take cutting edge technology and make something out of it.
(19:55):
With MeJump, compress NFTs. We have worked on it. There is no end. In fact, there is no tooling, but we made it work. And now, MeJump is live. The MeCartridges are going to users, they're playing them, they're burning them. It's a fun game mechanic. In the first 24 hours, 3,000 of them were burned, so it's clearly working. That'll be what Megos is about.
Brian Friel (20:16):
Oh, you're going deep on it. I love it because it's an exciting new product that you guys are coming up with. It makes me wonder too, and I want to ask you this, is I'm someone who grew up in this age where, and I think a lot of the younger generation just natively understands, there is a massive market for not only just playing video games, but like you said, watching and consuming content related to video games. Twitch is massive, YouTube Gaming is massive, and it really only feels like this is going to accelerate.
(20:41):
It feels like there's this really natural complimentary pairing with what's happening in crypto and in gaming when you consider, at the end of the day, digital items. There's communities that are being built online, people want to own their assets. I'm curious to hear your perspective. Is there anything that's currently blocking, or would be an unlock for crypto to make a mainstream splash into gaming?
Alex.BSL (21:02):
Oh, into gaming? I truly believe that the missing part are the wallets. Because when you go on to a website in the Web 2.0, you're annoyed if there is no Google sign in or Twitter sign in, or Apple sign in. Oh, I got to put in my email and then have to create a password? It's annoying. Even if you just add two more clicks, it's annoying to the user. Imagine pushing them to create a wallet, understand on-ramp money, transfer it to their wallets and remember their mnemonic phrase, save it somewhere. This is all, I think, a huge blocker when you want to onboard millions and millions of users. I truly think the wallets have the power to make crypto mainstream. Because imagine, a wallet could replace everything from sign in to checkout.
(21:55):
You could be signing in with your Phantom wallet and then you could check out with your Phantom wallet, and everything is seamless. You don't even have to go through all that process of Stripe, and then you're going to have to create a card, debit card. You know how it is. Yeah. To be honest, I think wallets have that capability and in the future, I think there will be versions of these wallets that will do this. I think I saw this. I don't remember the wallet. I think I just saw this today, that they have an option on mobile, sign in with wallet. And when you do that, it creates a wallet for you and then you can download. Something like that.
(22:33):
So I think removing those steps for the next 500 million users who are used to one-click checkouts. You know how Amazon is? It's just one click, done. It gets to your home. Why do we have so many steps in Web 3.0 and on wallets?
Brian Friel (22:49):
No, it's a huge thing We think about too, making these things intuitive. I think there's a lot of layers to all of this. There's the game developers that we need to work with. There's operating systems, app stores, all of that.
Alex.BSL (23:02):
Yeah. To be honest, I believe Phantom has done the best job. I believe a huge part of Solana's success is Phantom. I think everyone's first experience on Solana, at least around Degen Apes mint, was Phantom wallet. And then anyone that's coming from MetaMask, this is fucking 10X upgrade. And then that was really the thing that hooked me into Solana, and you guys have done a great job.
Brian Friel (23:30):
Wow. Very kind. Yeah, thank you so much. Appreciate it. That was my experience, too. I was just a user of Phantom at the time with the Degen Ape mint. Wasn't working for the team, but-
Alex.BSL (23:38):
Crazy.
Brian Friel (23:38):
Yeah. No, I definitely resonate with that. Well, Alex, I guess turning back real quick just to Megos, we talked about a lot there with gaming and what you guys have upcoming. But what can you tell people about when Megos is coming, what they can expect when MeJump is launching? Is there anything you can share, or what people should be thinking about in the next couple months?
Alex.BSL (23:58):
Oh, MeJump is live right now. You can go on and play.
Brian Friel (24:00):
Oh, I love it.
Alex.BSL (24:01):
We went live yesterday. That's what I was saying. We have 150K compressed NFTs. It dropped to a lot of communities in the ecosystem and the first 24 hours, I think just half an hour ago, it was 24 hours, they burned around 3000 compressed NFTs out of 150K. It's a fun game mechanic usually because I'll tell you how we use compressed NFTs. There's something called MeCartridge. The supply is 150K and then we drop them, and it's used as an in-game item. You're going for a run in the game, so it's an endless jumper. If you die somewhere, to continue the game, you have to burn the NFT. That's how it works. We have up to five per run.
(24:45):
Usually, I think in the Web 2.0 world, you see buy some sort of credits in that place. In Candy Crush when you couldn't do it, you click on something. Buy using real money, and then you continue the game. We have seen this model work in a lot of Web 2.0 games. We have adopted that same model and we're using Web 3.0 compressed NFTs with this. It's been fun. The people are having a lot of fun. It's addictive. People are raging and also having fun at the same time. Yeah, it's a good sign.
Brian Friel (25:14):
Oh, that's great to hear. Well, where can people then go, I'd say, to learn more about Megos in particular, or MeJump?
Alex.BSL (25:20):
Oh, everything we have is on Megos NFT Twitter. All the information is right there. You can go, or you can come to Megos' Discord, discord.gg/megos, and then you can ask any questions. We have a team all the time answering all kinds of questions.
(25:36):
Yeah. We have one more thing after MeJump. MeJump is going to run for four weeks, and we are distributing 1000 white list spots through MeJump. We distributed 3,000 through MeBoard, which was our first experience. Yeah, third is going to be MeList. It's not what you think it is. It's going to come later, and we are going to mint a claim after the MeList ends.
Brian Friel (26:04):
Awesome. We've got a lot of stuff coming down the pipe here to be excited about. Well, Alex, this has been an awesome discussion. I got to ask this question because Blocksmith Labs has a reputation for being builders. We would love to know, who is a builder that you admire in the Solana ecosystem?
Alex.BSL (26:22):
That's a tough question. I like Famous Foxes. I think we both are at the same level, but we sit in our own space and don't really bother each other. Yeah, I like them.
Brian Friel (26:35):
Okay. Awesome.
Alex.BSL (26:35):
Maybe you've had that answer as well.
Brian Friel (26:37):
Yeah, we've had Drax TS on the show as well. I think he actually might have been the one that shouted you guys out as well, so there's a mutual respect there for the NFT builders.
Alex.BSL (26:45):
Yeah, 100% we do. Yeah.
Brian Friel (26:46):
Well, maybe we'll have to do a follow-up episode, get you and Drax on, and see what you guys are all up to in a year from now. You guys have been putting out a lot, and I know the Solana ecosystem is very thankful to have you guys involved.
Alex.BSL (26:58):
I appreciate it. Thank you.
Brian Friel (26:59):
Alex.BSL, the co-CEO of Blocksmith Labs. Thanks so much for coming on The Zeitgeist.
Alex.BSL (27:03):
Thanks for having me, Brian.
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Eksik bölüm mü var?
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Our guests this week are Vibhu Norby and Degen Poet. Vibhu is the founder of DRiP, a platform that allows users to receive free NFT collectibles, commissioned from artists and projects across the landscape of crypto. The project has grown exponentially since its inception, with over 300,000 wallets receiving at least one NFT a week. Degen Poet, a prolific artist on Solana, has been a key collaborator on the project.
Vibhu and Degen Poet discuss how DRiP is changing the game for NFTs and why the first experience people have with blockchain should be through art. Plus, they share their unique processes for creating and distributing NFTs, and why they choose to plant their flag in Solana.
Show Notes:
0:56 - Latest News
3:05 - What is Drip?
5:22 - Origin story of Degen Poet, starting working in Solana and Vibh
10:13 - Workflow with NFTs
12:54 - Working with other artists
16:01 - How Drip helps Degen Poet’s work
17:51 - Only on Solana
21:42 - How is drip breaking phantom?
22:50 - Future looking like Instagram
26:53 - Platforms like Drip vs. traditional mediums
30:40 - Things to change /have changed in the industry
33:52 - A builder they admire in the Solana ecosystem?
Full Transcript:
Brian Friel (00:00):
Hey, everyone and welcome to the Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web 3.0 Space forward. I'm Brian Friel, developer relations at Phantom. And I'm super excited to reintroduce our first repeat guest, Vibhu Norby, as well as Solana's very own Degen poet, Vibhu and DP, welcome to the show.
Vibhu Norby (00:27):
What's up? Thanks for having me back.
Degen Poet (00:30):
Hey, thanks so much for having us.
Brian Friel (00:32):
Vibhu, I mentioned this before recording, but you're a friend of the pod. You're the first official repeat guest of the Zeitgeist, and the last time we had you on was October of last year and you were working on Solana Spaces, which was a really big and audacious project I'd say, and a lot has happened since then and you're still working on big and audacious projects on Solana. Can you walk us through what has changed in the last couple months and what are you working on today?
Vibhu Norby (00:56):
Good times, good memories. Yeah. What happened in between October and now? What changed? Funnily enough, Drip actually started that same month. We actually started sending NFTs to people starting with Vincenzo in late October. I think we did two drop before Breakpoint. Yeah, things were going fine and then our world got flipped upside down once again by those who must not be named. For a couple months there, I think we were trying to figure out how we were going to continue to operate the stores. Obviously Phantom was a major benefactor of spaces along with Solana Foundation, but they who must not be named were also major sponsors and it was kind of the three pillars of our business and one of them got pulled out. And simultaneously with all of that, Drip was blowing up and changing everything for us internally. Coming into January, every single week we were stacking at 15, 20% week-over-week growth on the list organically.
(01:51):
And between December 1st and the shutdown of Spaces, our Twitter following more than doubled and all of the new growth were people coming to us for stuff related to Drip. And so I was spending my time going between doing customer service for Drip, talking to artists, and then the store was starting to feel like it was losing its voice a bit kind of naturally in that. Yeah. I mean as much as we loved it for a bunch of different reasons, it just made sense for us to take this traumatic pivot from physical retail stores to free NFTs. I think it was a really good decision. I think one of my best decisions so far in life because since we closed down Spaces, Drip has grown five, six x since then. We've really greatly expanded the product and kind of the vision for it and I think we're making a big impact on Solana and crypto in general.
Brian Friel (02:45):
You mentioned that this was born out of Solana Spaces originally, it was almost just this separate side thing you were doing and became this absolute beast that had to be unleashed. For those who aren't familiar with what Drip is, can you describe what Drip is, how it operates today, and then maybe talk a little bit about the scale that you guys are currently operating at?
Vibhu Norby (03:05):
Yeah, sure. Really simple value prop. You sign in with Phantom, you get an invite code and you start getting free collectibles. You can kind of engage with the product as much or as little as you want. By default, you get a free collectible from us every Wednesday and those collectibles are NFTs and they're real on chain Solana NFTs and we commission those pieces from artists and projects, not just now within Solana but across the landscape of crypto. And we pay for the airdrop costs and it's totally free. It's one of the few things in all of our industry that starts at free, ends at free. You don't need any tokens in your wallet, you don't have to go through KYC with an exchange. More recently, a couple months ago in March, we started adding these additional lists that you could subscribe to. Degen Poet was number one, but since then we've added another seven creators and we launched two new streams every Friday.
(03:57):
Those work the same way. You sign up for an individual creator that you love, can be an artist, could be a brand, could be NFT project, a video creator, influencer. They send you free collectibles on some regular basis and you can collect them, you can trade them, you can hold them, you can brag to your friends about what you got. In terms of growth, we've continued to grow 10, 15% a week even at a very big size now. There's two kind of stats that kind of matter. One is we consider non-fraudulent wallets as many people tried to farm Drip in the past. That number in real time right now is 300,000 and we're sending out at least 300,000 NFTs a week on showcase right now. But in total, every single week across all of our creators now, we're sending well over a million collectibles every single week. This is unbelievable groundbreaking stuff. It's not happening anywhere else in our industry, but people fall in love with Drip every single day. It's been awesome.
Brian Friel (04:49):
Yeah. I've been a day one subscriber of Drip. I love it. It's such a delightful thing to have all this new art coming in your inbox every day. You kind of hinted at this only possible at Solana, which I want to dive into too. But you did mention there, Degen Poet, and I'd be remiss if we didn't introduce Degen Poet now to the show. I think if you're a listener and you've been around the Solana space, especially on Twitter, you've seen Degen Poet, I'd say one of the most prolific artists on Solana for some time now. Degen Poet, for those who don't know, can you introduce who you are, how you got started on Solana, and then how you also started working with Vibhu?
Degen Poet (05:22):
I guess I'm Degen Poet. I live in Chicago with my wife and a couple dogs. I got started in Solana in the summer of 2021. I was just basically doing trading and stuff in Bitcoin and then trading all the other coins. I did some leverage trading on CuCoin and then found Solana through the whole Sam Coins DeFi on Solana first. I think Radium was my first stop. That's kind of my first experience with it all. I thought NFTs were garbage and a silly idea and all those things. I had probably been out of poetry for, I don't know, seven or eight years at that point. I did all of my college education and got an MFA in poetry and then just decided that it wasn't a great career path as far as the money you could make and what you had to do to support yourself as a poet is pretty difficult in the real world.
(06:16):
I gave that up and just kind of did business for a living, did computers, Excel, stuff like that. That's how I kind of made a living and then found Solana through all this. I started buying some stuff on Digitalize. I bought a Solana Monkey, a viking I think pretty early on and papered it way too early. But I think it was at that point where I decided maybe I should try poems as NFTs just because nobody else was doing it. I figured it'd at least be a unique way to try. The first thing I got started on was gmu poems, which was basically an NFT, which was a list of words. And at the time they were going really hot because they were based on this Eth derivative of something called Loot, I think. But I was mad at it because I was like, how is it worth so much money and doing so great? And it's literally just a random list of words, but instead of being mad at it, I decided to kind of embrace it and then just filled in the spaces between the words with poems.
(07:11):
And I did 200 of those in a month and that's how I got my start on Solana. And then just was making NFTs nonstop ever since, mainly through Exchange Art, doing one of one art. And then over the last year or so since Editions opened up, did additions on exchange art, and then that all just kind of led me to Vibhu and Drip. I really like serving a large audience with art. I mean that was always really fun with Editions. And then with Additions, I wanted to deliver them at a low cost, but that just invites bots to basically come in and flip your stuff. Bots were making way more money than I was off my art just because of the setup, you know what I mean? That's, I think, what intrigued me about Drip is I could achieve this thing that I wanted, which was giving art to all these people on Solana for free basically. And then there's no real bots, everyone's trying to sign up as an individual and gets it airdropped. It's not like a mint. Yeah, I think that's kind of where it all started and how it all made sense for the way that I was distributing my art.
Brian Friel (08:12):
Yeah, you hit on a lot there. I think that journey of trying out Solana for the first time, this new primordial soup of ecosystem projects and then this totally irrational NFT market, everyone gets dive into it. I think a lot of people can resonate that picture.
Vibhu Norby (08:26):
Right. I got to interject here because Degen Poet just introduced himself for five minutes and not one time did he mention the word typewriter, which is what he's most famous for of all things is that he didn't say the word typewriter.
Brian Friel (08:42):
Yeah.
Vibhu Norby (08:43):
But how did you find a typewriter? Just tell us that quickly.
Degen Poet (08:47):
Let's see here. I was cleaning out my sister's ex-husband's parents' basement and we found a typewriter when I was in college, and I think I just got really into them at that point because I was doing poetry and stuff and just would smoke tobacco pipes and type on a typewriter pretending I was some guy. I think that's where it all started. And then it picked back up again around Solana or whatever. My wife bought me a typewriter as an anniversary present. That was the first one that I really beat the crap out of for Solana. That's, I guess, what started it. From poems to trying to make something visually more appealing is really what it all clicked with. With NFTs specifically, I started out with just Photoshop and text and I needed some way of making it visually more appealing because that's how you get sales. But that basically took me from a poet to someone who makes art with a typewriter was kind of because people really pretty pictures on NFTs and turns out I like making them. There you go.
Brian Friel (09:51):
I think Vibhu brings up a great point there. I mean, Degen Poet I think is prolific and well known for having this unique process with a typewriter. If you could expand a little bit on that, Degen Poet, how do you go about creating these collections and is there anything that you do with Drip in particular that is different from either your normal flow or other flows that you know of of NFT artists on Solana?
Degen Poet (10:13):
Yeah. I mean I guess one of my main things that I've sort of been consistent with are the profile pictures. As a legendary, I'll take an existing Solana profile picture and just kind of do a typewriter version of those. For that process, I basically sketch a version of the profile picture with a pen, and then those were sort of my guides for the typewriter. I've done it freehand on the typewriter before, but you're only exposing a small portion of the paper at a time and it's really hard to get the proportions right. It's helpful to kind of map them out with a pen or marker sketch first. And then I do go through with a detailed typewriter version of it. I try to pull in words or traits or something to do with the NFT as part of the words that make up the image just as a piece of interest if you zoomed in.
(11:03):
And then I'll print out another copy of that. I'll do another sketch or sometimes I'll just paint on the typewriter piece itself and I'll use oil pastels or watercolor. At the end of the day I'm layering two scans. One of them is basically just the typewriter ink and then another one is this sort of painted version and I layered them on top of each other so you get a colored version of a typewriter piece, and that's kind of how all the profile pictures start. I think that's definitely pretty unique, just using all the physical pieces and really trying to make it all from physical scans versus any sort of digital pieces. And then anything digital is really for animation. Sometimes I'll type out every single frame and I'll make individual frames physically for everything that I'm animating. Other times I'll just cut out a piece of the eye or a piece of a lip or something like that on Photoshop and move it around, save a few different images or change colors or something. I do some Photoshopping to get the pieces animated, which I think just kind of adds another level to it. Typewriter is such an old physical looking thing. And so it's interesting, I think, to see it in an animation style. That's something I've really leveled up with Drip. I feel like I've done way more animations with Drip than any of my art sort of previously.
Brian Friel (12:22):
You hit a lot there throughout the intro and throughout describing your process, but basically this journey, I think a lot of people resonate with coming to Solana, seeing this fragmented NFT landscape ripe with speculation. That doesn't always make sense, but I think Drip's unique in that it's changing all these models, it's flipping them on their head. Vibhu, can you speak a little bit to who you're working with? Who are these artists that are now reaching out to you? I think you've proven this model with the Degen Poet, but when you talk to artists on Solana, what's attractive to Drip for them?
Vibhu Norby (12:54):
Yeah. I want to touch on something that you reminded me of, which is that the transition from Spaces to Drip, although on the surface is very jarring, the thing that kind of ties them together was that when we were meeting people in real life trying to introduce them to blockchains, what we found time and time again was that it was the art and the PFPs that were resonating with people in the store. It wasn't all the other stuff. And yet the way that most people have gotten into here is through an exchange where it's all about trading. And so I put this on Twitter many times, but things would be different today and they will be different in the future if the first experience that people have of this amazing technology is art, right? It's la piece from Degen Poet. It just changed everything. What am I looking for in artists?n
(13:38):
I probably talk to between 20 and 30 artists every single week, artists, projects, creators, and we probably filled about 100 requests per week, I would say right now. We have a really high bar. There's only three slots per week now. There's a showcase and there's two channels. And we book these things out for months in advance. The thing that resonates to me the most is artists that see themselves as more than just putting their pen or their paintbrush on paper, whatever their medium is, but as content creators as well. I think what attracted me to Degen Poet for a long time and I think why people love Degen Poet, yeah, the art is really good and I think that has to be there, but there's a lot of really good art. It's Degen Poet's personality. It's how that comes out in his work.
(14:22):
It's how he tells a story around his pieces. He publishes videos of the typewriter itself and the creation process. To me, we definitely have an eye for these kind of super artists who are brand building for themselves and have a vision for how to take care of their community in addition. To me, I mean, there's a lot of amazing artists in the world and if you just take blockchain out of it, you can walk into any gallery and see these incredible things. But there's this disconnect between the thing that you're buying and the person that made it and you. And in crypto, it gives this opportunity to cut out that piece and just connect directly with the creator. And if the creator takes advantage of that, that's very attractive to us. That tells me that they're thinking differently about what crypto can add to them. We have a pretty high bar, to be honest.
(15:08):
I mean I think we could fill up Drip with illustration and other techniques. There's a lot of amazing photographers, but I think at least in the early stages here, we have the opportunity to be curatorial a bit and relentlessly, we've been programming out our new channels trying to bring something different to the table each week. I think if you fast forwarded a year, it's going to be full of the same stuff that Instagram is full of and other big networks, it's just kind of natural. But right now we have an opportunity to keep a vision for what a collectible can kind of be. I don't know. I kind of know when I see it, but that's probably my framework.
Brian Friel (15:44):
Yeah. You hit on a couple things there with, not just just filling with great art, but the way that this can change the relationship between an artist and their fans. Degen Poet, from your experience, how has working with Drip influenced both the way that people discover your content, but also the relationships that you have with your collectors? Yeah,
Degen Poet (16:01):
Yeah. I mean it definitely makes it a much wider net, which is nice. They have a larger community to gather around. It feels like everyone who's kind of a channel in Drip is part of a little club or group or something. And so a lot of the same collectors will collect from multiple channels across Drip and things like that. There's more going on than just my art, but it still feels like a piece of a larger community. Everyone's kind of bringing a different style of Drip to the table. It takes less pressure off of my shoulders where I have to have my own Discord or be so focused and all these things. I could do that if I wanted, but I don't have to. Drip is big enough and has enough engagement from the tools that they provide that it helps sustain that better than I could than when I was alone.
(16:47):
And yeah, I guess you get a lot more people, right. You really do get people who would never have bought my art. And it's not because they didn't like it, they probably couldn't afford it or they didn't really know about it, but they happened to get in through Drip. And so get new people who earnestly really enjoy the art because that's how they found it. They found it from something free, they weren't trying to flip it and that's how they found it. Yeah, I don't know. It definitely casts a wider net and I feel you do boil up more people that just truly enjoy what you do versus the other side. Yeah, that's been great for that.
Brian Friel (17:23):
Yeah. I want to pause here and just dive into a topic that we mentioned briefly at the start, which is Solana. Degen Poet, you described your journey to finding Solana and I mentioned that I think if anyone's been around crypto Twitter, they know who you are. Prolific typewriter artist of Solana. Vibhu, you've been deeply involved with Solana for over a year and now. Why do you guys plant your flag in Solana, and what about Solana is able to make this a reality where no other blockchain can really do what Drip is doing?
Vibhu Norby (17:51):
I'm trying to refashion myself a little bit in our narrative because I mean you'll see on our Twitter page and on our site, occasionally we'll talk about Solana, but we've been trying to focus on the collectibles. I mean even with NFTs, I've eliminated using that word on our corporate account entirely in very specific cases. I don't think anybody on the consumer side really cares about that. But from the builder's perspective, two aspects. One is that they pioneered the state compression model, which allows us to do NFTs at a very, very big scale relative to the old version for a very low cost, a couple $100 per million, totally affordable for a business like us. And I think the second thing is that Solana has a really active developer community and some really amazing devs inside of it that are hunting for things to build.
(18:35):
And it's really competitive too. All the infrastructure around anything new on Solana develops fast. Perfect example of that is Tensor. We went live with it March 22nd, three months ago, and it's certainly been a couple weeks, maybe two or three weeks because they went live with trading on there. And it's an amazing experience and people can trade these compressed NFTs, 200 at a time and there's a brand new kind of thing, right. But it's not just them, there's B Man who built this tool called PopKey, it's Keerel who built the Drip tracker. There's just all these amazing 10X engineers, if you will, itching to be involved and be part of the Solana community. And we feel like anything that we can't get to, someone else is just going to build anyway. And hey, when we're ready, maybe we'll pick it up. Or maybe that tool just kind of develops its own path and we don't have to touch it.
(19:28):
And that thing is unique to crypto too because all of our NFTs are composable. It just really does. We're kept to such a high bar of development 'cause if we don't reach that bar, then three other companies are going to recreate what we're doing, do it better, and then people also going to just take our content and then do it better on top of our content and our data. I don't know about other chains, maybe they have that too, but I've just observed that Solana is, because of the size of our community and the energy there, seems to attack these things with a lot of vigor that I didn't see, at least in Ethereum when I was first getting into this space.
Brian Friel (20:02):
No, I couldn't agree more. I think Solana has carved out its own kernel of a genuine dev community. It's a double-edged sword like you say, because it's highly composable and you have this great force everyone will want to build with you, but it invites a lot of competition where if you do slack, there will be people who will take what you do and run with it. But I think so far you guys have done a really great job of really leading in this vertical of Solana. DP, do you have anything to add to what Vibhu said with respect to Solana, maybe from an artist's perspective?
Degen Poet (20:31):
As far as only possible on Solana, I definitely think it comes down to the compressed NFT. You can't cost effectively drop a million NFTs a week on any other blockchain, not even close to a 1,000X, not even close. I think that's the core of it that allows us to be different on Solana. But then all that other stuff, the unspoken kind of stuff is just the energy of the people here on the chain and the fact that Tensor and all the rest, not only do you have to be able to mint one million NFTs a week for low cost, but you also have to have people that can build stuff to do with them. And that is, I think, an underappreciated aspect of Solana. And I feel like Drip, from my perspective, all we have to do is just kind of continue growing the market for compressed NFTs, continue add channels and add people kind of doing stuff with compressed NFTs and then Solana will provide. As you get bigger and there's more market, more people want something, then Solana starts to make those things happen. I think we'll see that and that will be incredible.
Vibhu Norby (21:32):
I'm going to flip it back to you, Brian, as well. How is Drip breaking Phantom and what does Phantom need to address?
Degen Poet (21:37):
Yeah. When can I hold 5,000 NFTs please?
Vibhu Norby (21:38):
There you go.
Brian Friel (21:41):
Yeah, no, I would say from a dev perspective at Phantom side, we were early to support compressed NFTs, but it's almost a naive assumption that hey, we ship support and we'll be good because it basically is opening Pandora's box where now people just go wild whenever they're given a new medium to express with this kind of stuff. And we saw it firsthand with Tensor launching their NFT marketplace. We're getting requests, why can't I sign 5,000 transactions at once? You guys can't simulate 5,000 different transactions, but it makes us go back to basically first principles and what is the wallet being used for here? How should we be basically specializing the wallet and what do our users really want this for? And I think, Vibhu, you painted a great story at the start of this where eight months ago, the world was ending for all of Solana, they who should not be named. And in six to eight months, you've gone from that state to completely bootstrapping an organic network with hundreds of thousands of users who love and use this product every day.
(22:34):
How do we stay adaptable enough for that, huge question and a huge challenge and was really the fun of what's working in this space I think is all about. Vibhu, you mentioned a little bit too on the future of, I think you hinted a year out from now looking like Instagram. Can you say more about that?
Vibhu Norby (22:49):
Yeah. Depending on the day I wake up and I think about YouTube or Instagram or Twitch or Patreon or Roblox or you name it. There isn't a perfect analogy for this stuff because it kind of is a blend of a lot of different things. I mean literally every single day we're trying to address a problem in our product and we search for some mental model from some other place and see if that kind of makes sense. And not all of it does, but Instagram is such a simple product to talk about because it is a simple product. Everybody, not just creators, but normal people post photos to their feed or stories and then you follow their friends and you follow the celebrities or influencer, whatever that you like and that stuff shows up in your feed. And you think nothing of it. Okay, I go about my day, I open the app, I click something and I'm good, I'm happy, I close it.
(23:43):
But what's sitting underneath of Instagram is this advertising industrial complex that is calculating an enormous amount of data for every single thing that you do on the app. You open the story, how long did you open the story for? How many people are you connected to that also did the same thing? They're building profiles. I used to work on this stuff. I know this is what we do. Yeah, there's a reason for it. I don't think it's bad. I don't think advertising is bad. I want to put that out there. I know Anatolia thinks it's evil and it's part of the reason why he talks about Solana as the anti-spam control network, but it is good for small businesses, but the group that gets abused in that situation are the users and the creators that actually use the app. You go talk to any creator on any network that's not on the top 1% and they're making almost no money from these things.
(24:33):
We have an artist that's launching tomorrow called Bangers. He has 200,000 on Instagram. He has three and a half billion views of her content on Giffy. 'Cause she makes all these animated gifs and she told me that she made $20 from Giffy and almost nothing from Instagram ever. I mean we just don't think about it. But people build their livelihoods and businesses on these social platforms and increasingly so. I mean young people today, you ask them what they want to be when they grow up, it's not a firefighter. They want to be content creators, they want to be YouTubers, they want to be TikTokers, literally what they want to do. But when we examine these platforms and how they treat all of the kind of participants in that ecosystem, you just see this thing where all the power and all the money is aggregating inside of these couple of companies, ByteDance with TikTok, Facebook, Google, Amazon.
(25:28):
The trifecta of these trillion-dollar companies. Where I want to take Drip is, hey, let's take that model that we know people because people like to just follow someone and see their content, but let's start to tweak the internal economics of each of these components and do it in a way that over the next couple years, creators can make more money from this stuff. Even users might be able to make money, which is a very new concept, but it's something that is normal in crypto and just not normal in Web 2.0. If we can successfully build a model that's better, there's no reason why creators won't come over, it's just an awareness thing. Can we get the word out and can we make this easy to use and safe? I don't know if that's Instagram or it's YouTube or whatever. Instagram is the easiest thing to talk about. I think Drip is a really big idea. I hope that there's many other entrepreneurs that are looking at what we're doing and thinking, hey, maybe this kind of thing could apply in other categories too, and together we can come after these conglomerates, give the power back to the people and that would be a beautiful thing.
Brian Friel (26:31):
I couldn't agree more. Degen Poet, when you hear that and you take into consideration everything you told us about your journey starting on these fragmented marketplaces and everything and now everything that you've been doing with Drip, how do you think your relationship with Drip will evolve? Do you foresee the majority of your art being now distributed via platforms like these versus traditional mediums?
Degen Poet (26:52):
Yeah, for sure. Solana NFTs in the first place gave me a place for my art. I tried to be a poet in the real world and didn't really see the value in it even to publish a book and to get nothing back and to spend all the money to publish it, that kind of thing. Just NFTs and Solana in general as a first step was incredible to me to be able to make any kind of money off of my art period. And then that is what led me to become an artist. I wasn't making pictures or whatever before this, so it allowed me to exist as an artist in the first place. And then I guess I got hungry for the idea that you could live off this as a career or something. For me, I guess, I just want to create a space where people after me, people around me can do this seriously as 50% or more of their income for their lives.
(27:45):
I guess that's what I want to continue to push on at Drip, things like donations, et cetera, but finding a way to make them work and have them be something on a consistent basis that again, another artist can use that model and create a source of income that's reasonably dependable. A weekly Drip of donations I think is way more sustainable and understandable than when you're going to sell in your next auction. You sort of have a steady growth than all the rest of it. And so I don't know, it's just a better model to actually build a true career off of. Yeah, I don't know. For me, continue to find ways to take advantage of Drip and put all my work there that makes sense. I still have some one-on-ones outside of Drip, but I might even incorporate those into Drip someday. Yeah. I mean for me, as long as they let me Drip, I'm dripping. As long as the door is open for me, that's what I'm going to do for sure. Yeah.
Vibhu Norby (28:43):
Degen Poet is actually more close to the prototypical Solana artist than you would think. When I'm talking to an artist, I always ask, what's your full-time job? Very few of them are artists full-time. I mean that is really uncommon and it's really hard to make a living that way. Most of the artists that we work with are graphic designers and they make websites for clients and they're being creative maybe in some other way, but it isn't their source of income. And I don't think that if you look at this generation that wants to be content creators, that all of them can be content creators and make a living. Someone has to put food on the table, right. But you can add a little bit of extra for some of these folks and for the top 1% of them, or top 5% or top 10% of them to be able to make a reasonable living from doing this, I think is possible.
(29:33):
And my gold star metric for, I'm going to use Degen poet as our test baby, is how close can we get to replacing the income from his W2 job over the next year? We're actually not that far away. We're making progress and we continue to tweak that and it will pay back dividends. If he can be full-time on this and he'll be able to have, I don't know how he has a full-time job already. That part's a mystery to me, but in theory, more art, more content, more delight for people, that will help us grow too. DP and I are very aligned on that as a kind of a side quest to just getting art into people's hands.
Brian Friel (30:08):
Yeah. I think that's a great first goal. When you guys think about how we get to a world where the Degen Poets of the world can do this full time no questions asked, it's like an afterthought to even consider another job. Are there anything that you think that we need to change as an industry, something we should stop doing? And I ask this question because last time we had you on the show, Vibhu, you had a couple hot takes that you dropped, mostly around how a number grow up is very bad for the industry. I want to ask, has that thinking evolved at all for you, Vibhu? And then I also later want to hear some Degen Poet has any ideas on that as well.
Vibhu Norby (30:41):
I'm still on the same train. Number go up, number go down both equally bad in many different ways. The only thing is I really feel it when if you're sitting on Twitter all day, you really feel the price. You don't even have to look at the tweets. When Bitcoin was over 30K yesterday, I felt it. I didn't even have to look at my app. When Solana's down, you feel it. For better or for worse, the audience there is highly effective. And so I can't help but be empathetic to it, but it's actually an imperative for our industry to survive, especially in the US for us to move past the tokens, we have to. I strongly feel that, this is going to offend some people. I'm just trying to be careful how I say this. I think that the OG crypto community who was here in 2015 to 2017, the ICO era and these people are holding our industry back in a lot of ways.
(31:37):
I think they're all over our biggest applications and our biggest exchanges and this and that. And I think somewhere in the back of all these folks heads, they can't get over the fact that the bull market's going to come back again and they're going to have a Lambo. And it just doesn't make sense if we're serious about this being in the hands of billions of people, sorry, we can't make a Lambo for all seven, eight billion people on earth. Some of us have to drive a Honda Civic, some of us have to drive a bike. Can we get bike money for everybody? Can we get there first and let go of the kind of grasp of all the token people? That's where I'm at. I could be wrong. Maybe I'm flawed, maybe everyone can have a Lambo. I would love one, but that's not where I see the future.
Degen Poet (32:20):
Yeah. I mean I guess I feel similarly. I guess you want to create a space in the blockchain where the number go up and down doesn't really affect your day to day of enjoyment. You don't think about the price of a t-shirt or a box of Legos or whatever it is going up and down. You still just consume them because you want it or you like it here and there. I think of the Pokemon card analogy when it comes to this. I think with Drip House where they're just cards in general. I think there's a space for the legendaries or whatever it is, smaller supplies, having numbers go up. I do think that creates a lot of fun and excitement, brings people on, all that, but it really needs to be balanced with the day to day. Your reason for being here can't be that, because if it is, then it's like yeah, it doesn't feel sustainable and you're just building a system where there's a small amount of winners and most people are losers. And so it's like what are you really doing for the world at that point? We need to find a way to create value for digital assets that's just inherent in whatever the object is. It's not because of a price or a speculation, it's just because you value whatever the thing is.
Brian Friel (33:31):
Yeah, I couldn't agree more. I think you guys are on the right path here and I think a lot of people who use Drip every day are resonating with what you guys are doing. Well, guys, this has been a really awesome conversation. One question we always ask our guests, I'd love to hear this from each of you, maybe starting with Degen Poet, is who is a fellow builder that you admire in the Solana ecosystem?
Degen Poet (33:52):
I really like the Foxes a lot. I like drags and I like the Foxy Dev. I think that they've done an awesome job of trying to find actually useful stuff that people could use on Solana and bringing it into their system and I've seen them do some stuff overnight for people and all the rest of it. Really like them. Really like the guys at Tenor too. I mean the stuff that they've done for us in compressed NFTs is pretty incredible. Everyone on those teams is great.
Brian Friel (34:21):
I agree. Vibhu.
Vibhu Norby (34:22):
I'm going to recall 'cause I'm a second time guest, the answers I gave last time, 'cause it's kind of funny in retrospect. I think I mentioned Ahkshe from Super Team who I would give again and again. He's been such an amazing supporter of me and Drip and places before that. And I think at the time I also gave Frank Deca as my other answer. I still have a soft spot for him. I know he left Solana, but I can't help but admire the fanatical community building that he has. But yeah, I mean today, the couple of people that came to mind for me were, yeah, I mean the Tensor guys are amazing. These guys are just... A hilarious story. I pinged Ilia, the founder, yesterday and I asked them, hey, can I have a vector version of your logo? And I kid you'd not. The second I typed that, I see Ilia is typing and then three seconds later the vector file was there and I was like, did you just have this sitting on your desktop ready to drop into this?
Brian Friel (35:15):
Copied on the clipboard already? Yeah.
Vibhu Norby (35:17):
They really don't like that. Just really responsive. I respect that a lot. I want to give a shout-out to a guy named Carol who I won't dox him. He's a really impressive guy in real life and I got to know that after I spoke to him. There's these people in our community that are anonymous. I think he's an OK Bear or whatever, maybe a monkey business, and you find out their real life and they're like some VP of some big company. You just never know who you're talking to. But he's been, both for Drip and for Dialect, who I also listed as my admiration for, he's just been building stuff for free that benefit our communities and hundreds of thousands of people use those tools every single week to track their Drip collection. He's KIRYL_SOL, I believe he is his Twitter handle. Yeah, huge ups to that guy for carrying collectibles into the future.
Brian Friel (36:06):
I love it. These are all future guests of the podcast we're naming here. We have to get these guys on, have them tell their story as well. But yeah, Vibhu, Degen Poet, I just want to thank you guys from the Phantom team. We love everything that you guys are up to. We really think that Drip House arose at a time when Solana needed it most. We think you guys really carry a light forward for a way that pioneer's a new model for art on Solana, for artists making a living. Really excited for everything that you guys have to come. Thank you so much for your time on Zeitgeist.
Degen Poet (36:33):
Thanks for having us.
Vibhu Norby (36:34):
Thanks. Bye.
-
Our guests this week are Trevor Bacon and Kellan Grenier, co-founders of Parcl.
Parcl is a blockchain-native platform that allows users to trade real estate on Solana, democratizing access to the world's largest asset class. Parcl offers a unique architecture that enables users to make perpetual predictions on the median price per square foot of real estate in different markets across the US. Parcl also allows users to take long or short positions and provides a novel architecture that is purpose-built for low volatility assets without a liquid spot market.
Show Notes:
01:00 - Background / Origin Story
04:33 - Why Solana?
06:20 - Who is Parcl built for?
08:29 - How does Parcl work?
10:59 - How can Parcl help more traditional real estate users?
13:28 - Permission-less and composable
14:50 - Spinning up a new market
17:38 - Real estate royale.
19:13 - What's next for Parcel?
20:56 - A builder they admire in the Solana ecosystem
Full Transcript:
Brian Friel (00:00):
Hey everyone, and welcome to The Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the web three space forward. I'm Brian Friel, developer relations at Phantom. I'm super excited to introduce our guest, Trevor Bacon and Kellan Grenier, the co-founders of Parcl. Parcl is a synthetic asset protocol built on Solana, that allows users to invest in a digital square foot of real estate in neighborhoods worldwide. Trevor and Kellan, welcome to the show.
Trevor Bacon (00:33):
Thanks for having us. Appreciate it.
Kellan Grenier (00:35):
Great to be here, Brian.
Brian Friel (00:36):
Super excited to talk to you guys today. I just checked out Parcl app, and seeing all the feeds across the US, New York, Brooklyn, all these really awesome areas where you can trade. I think it makes perfect sense with what Solana was built for, has totally [inaudible 00:00:51] NASDAQ at blockchain speed. Before we dive into everything about Parcl, I'd love to learn a little bit about you guys. Who are you guys, and what made you start Parcl?
Trevor Bacon (01:00):
Thanks, again, for having us, Brian. I'll start. I'll pass it to Kellan. So prior to starting Parcl, Kellan and I worked together at a hedge fund focused on technology equities, internet software payments, semiconductors. And during COVID, there was a lot of real estate volatility, and there was, really, no way to trade real estate like we were trading stocks. And so we started to look into ways in which we could do that. There were options, like fractionalized real estate, or tokenized real estate, but they're limited by scale, because you need capital to buy properties that are fractionalized, and you need time to close those deals.
(01:36):
So we took a different approach, which is a top-down approach. We have created indexes that track the price per square foot, based on public real estate information and real estate transactions, basically, listings and sales. Those go into a database, and outcomes... A price per square foot, or a market price for neighborhoods and cities across the country today, in the US. Over time, we are going to be expanding into international geographies. And so that price goes out to the blockchain, and traders can, long or short, see these, based on their view of various locations.
Kellan Grenier (02:11):
I'll quickly give my background, Trevor covered most of it, but... Traditional finance background, most recently, at a hedge fund, before that, at a Japanese bank, and then at a market research firm before that, always covering tech hardware. That's how I got indoctrinated into blockchain, was modeling, how many, GPUs... The networks we're going to consume. And then, around COVID, with all the real estate volatility, and volatility across all assets, and no way to express a trade, that's what led to Parcl. It seems so obvious. Missing from the structure of markets was a liquidity venue for residential real estate.
Brian Friel (02:46):
Yeah, I think, myself and many others can resonate with that, especially with the amount of capital involved to get involved with real estate as a young person. It's very prohibitive. Trevor, maybe starting with you guys, you mentioned that you were at a hedge fund before this. Had either of you guys interacted with crypto before this? And was crypto one of the first things that came to mind? Kellan, you just said, this was obvious in hindsight, but was crypto the first tool that you reached for, or did you actually attempt... To be able to trade this with other methods?
Trevor Bacon (03:15):
Yeah. As Kellan mentioned, he had been indoctrinating the crypto for about five years, I as well. When you're on Wall Street, and there's trends, the banks, typically, showcase the companies that are prevalent in those trends. So I got early access to the management teams of consensus, and Ripple, amongst others. That's how it worked, but that's... When I got introduced to blockchain, that was the 2017 timeframe. So we refer to ourselves as using blockchain rails. The primary collateral on the Parcl protocol is USDC. And so it's, basically, dollars versus real estate prices.
(03:51):
For us, blockchain introduces an efficient exchange layer, and a settlement layer, that is scalable, and you can create a product like ours, with relatively, substantially, less resources than you would a traditional centralized exchange. And so at the same time we were starting this, DeFi was becoming much more prevalent, on the heels of DeFi Summer, which led us to start to explore the various ways in which you can pull capital in a distributed fashion. For us, it made sense. I think that's the main point of technology, is to drive efficiency. And blockchain really does that, for our use case, in particular.
Brian Friel (04:29):
On that note, was there anything in particular about Solana... Bright start on Solana?
Trevor Bacon (04:33):
Yeah. The technology thesis on Solana, which, I think, still holds true today is, it's fast, it's cheap, it's scalable. And we viewed that as something that would persist into the future. And so that fit well in this model, especially for real estate, given... It has lower volatility, and therefore, a lower return profile. So at the time, there weren't many viable EVM scaling solutions in the market. So this was in summer of 2021, arbitrary and optimism weren't quite there yet. And so that's why we decided to go on Solana.
Brian Friel (05:08):
That's awesome.
Kellan Grenier (05:09):
One thing I want to add there is, real estate is lower volatility, and therefore, has a lower return profile, but we've ran and done all sorts of analysis. It's sharp ratio, which is a measure of risk adjusted returns, is through the roof, in any given year, especially over the past two decades, it's just blowing everything else away. And it's really interesting, because residential real estate is the only asset that the majority of the population... Nearly everyone has access to a 5X leverage, through a mortgage. That's the gate to participate in the market, but you need the down payment, still. That's a pretty big gate. So introduce Parcl, basically, create the exact same return profile, tracking these underlying price feeds, the prices in these markets that are transactions in real world homes, and offer that to the masses. It's a pretty powerful product.
Brian Friel (05:53):
Yeah, let's dig into that a little more. That's a really great point you raised, Kellan. You have this background on Wall Street, you know what pro traders are looking for, you talk about sharp ratios of how sophisticated investors are looking access to this. But really, at the end of the day, I would argue that it's the little guy, it's young people, probably a lot of people who are interested in crypto too, who just want access to these markets, don't have the capital. You guys have clearly built a lot, but is there a particular type of user that you guys are looking to serve at Parcl?
Kellan Grenier (06:20):
Yes and no. There's a curve in terms of who would be interested in using this product. And obviously, it's fairly blockchain native today, especially in how it's delivered. You have a Phantom wallet, you have assets on Solana's blockchain, you connect to the dApp, and you interact with a smart contract. So small pool of people, but growing, hopefully, growing a lot over the next couple of years. But over time, this is a product that can onboard millions, and hundreds of millions, and maybe, eventually, billions of people into this ecosystem, because it's such a compelling offering. Everyone has a relationship with real estate, everyone's off sides, either they're too long, if they own their home, or they're too underexposed, if they rent. I think that opens up the aperture to who the core user is, right? Today, it's blockchain-native folks that have an interest in trading anything, but many of them in trading real estate, specifically.
(07:07):
Over time, it's going to be, very, much more like a tailored offering for people that are seeking this exact exposure, that, maybe, this is the first time they've ever interacted with a blockchain. And I think that that is what has everyone so excited, whether it's folks on Solana's team... You mentioned that you just started digging in, and as... You pretty excited, Brian. So it's truly like a killer app, consumer app for blockchain. And then eventually, institutions will use it, right? Because there's no venue for liquidity, in any scale, in residential real estate, it's just... There's definitely no short-side or sell-side liquidity. All the liquidity is long, and it takes forever, and high barriers to entry. So if you play that all out, there's a very large group of users in capital that is interacting with this product.
Brian Friel (07:50):
That's great. Yeah, let's go through that user journey there. You mentioned... Someone shows up for the first time, they have a Phantom wallet, maybe they're a longtime crypto user, and they're excited to participate in their first form of real estate, or maybe, this is, really, just a means to an end, they get a Phantom wallet just to purely go through this. What are some of the particular intricacies of the Parcl model? So you mentioned, this is a lot different from REITs, or fractional ownership. When a user connects a wallet, and they hit "Buy," and say they want to purchase real estate, essentially, in New York, or in the Brooklyn area, they think that area is going up, what are the terms of that purchase? What does the liquidity look like there? What do they need to know after they've decided to hit "Buy?"
Kellan Grenier (08:29):
It's a perpetual prediction, Brian. So these pools, every day, the prices update. And the price that you are trading is the median price per square foot in... I'll use New York as an example. What does that composed of? All five boroughs, every transaction, every sale that hits the county records, and then all listings, which represent the asking price, and that... All converges on this median, which is meant to be the market price. Every day, that price updates. There's a new price based on all the transactions that happened yesterday, and over the trailing couple weeks. And now, you have a new price. What you've noticed is that real estate, actually, moves on a daily basis, and perhaps, even hour by hour. An agent closes a home, they tell their other agent, now there's a new market price. So when people go to trade, that's what they're trading. And they're effectively making a perpetual prediction.
(09:16):
I believe I'm getting long New York at 600 and whatever dollars. And maybe I put in exactly 600, and whatever USDC. So now, I own one square foot of New York. And I can leave that open as long as I want. I could close it tomorrow, I could close it in a week. I'm effectively trading, investing, betting, however you want to define it, that that price will rise. On the other side, there's someone taking the other side of that. There's someone that's short. And what we found is that these markets, over time, generally, balance out. There's people that have different views on real estate. Sometimes, they tilt very long, and others, they tilt short. Everyone's short San Francisco right now, and it's tilted fairly short since this product launch.
Brian Friel (09:53):
I need to sign up for Parcl now, as I'm recording this from San Francisco. You guys are the ones in New York.
Kellan Grenier (09:59):
And Boston and Chicago, which have performed really well over the past couple months, are the two most long right now. And then, the rest of the markets are fairly balanced, but that can change overnight. The market reacts pretty quickly to changes in price, and changes in sentiment and news, and whatnot. So it's a really cool product. And in the simplest terms, you are effectively predicting that price will either rise or fall, and placing your wager accordingly.
Brian Friel (10:23):
That's an awesome picture you paint. And yeah, to that point, I'm going to need to load up my wallet here, and protect myself a little bit, from being in San Francisco. But you mentioned the idea of, prices are updating on a 24-hour basis here. Part of Solana's key advantages are that... It actually allows a product like this to exist, but there's another type of user that you alluded to a little bit prior, someone who's, maybe, already long real estate in the form of a big mortgage, and they're afraid that, maybe, they bid off a little more than they can chew, and they lever it up on a place in SF, before the tech crash, and they want to protect that. How can Parcl help a user like that?
Trevor Bacon (10:58):
That's a great question. I forgot the one other reason why we chose Solana with the wallet infrastructure. So shout out to Phantom, the plug, but it's actually true. What Parcl offers is native short exposure, if one so chooses. And today, there really aren't many ways in which... The short specific geographies. REITs are a common example of a real estate investment. However, REITs are usually types of assets spread across the country, think of data centers or apartment buildings. There's no geographic specificity. And so what Parcl offers is the ability for people to have specific geographies that they'd like to invest in, long or short. And therefore, you can make much more targeted investments, either for or against.
Kellan Grenier (11:43):
I would just add, this is so composable, and it's in the eye of the beholder, what this product can do. If you own a home, like we said earlier, and you just said, Brian, you're way overweight real estate, as a percentage of your net assets, most likely, and you have a big mortgage, it's your largest asset, it also is your largest liability. What if you wanted to hedge? How would you do that? You really cannot. There's really no way to do that without touching your loan structure, and that wouldn't be a perfect hedge anyway. So this is a product where you can get that short exposure whenever you feel like... You're offsides more than you want to be, you can come to this product, assuming you're eligible to use it, connect your wallet, place that short bet, lock in your paper gains, or protect yourself on the downside.
(12:25):
We talk to a lot of people, and they hear that, and they say, "Well, isn't this also like a synthetic insurance?" Say that there's a hurricane bearing down on Miami, no insurer would write you a policy in that situation. You could short Miami real estate to protect yourself. Obviously, you probably won't be alone. And the market's going to skew. And you might have to pay some funding fees, but it's available to you as a product. So there's so many novel elements that introduces... Like exposure that you just can't get anywhere else, whether it's protecting the gains that you've realized in your home, you don't want to sell it and move, or as an insurance product. It's limitless, how you can use it.
Brian Friel (13:04):
Kellan, you bring up a good point there, about the composable nature of this. And earlier, you guys mentioned, for every buyer, there's a seller. And obviously, this is a provision marketplace, anyone come up with a wallet, and connect wallet, and get started. So under the hood, how is that facilitated? I believe you guys are using an AMM. And some part of this... Because I see a section on your site about providing liquidity. Can you speak a little bit more of the mechanics behind that?
Trevor Bacon (13:29):
We permission the pools ourselves, Parcl, as the development company permissions the pools. And so we have the authority to launch pools. Over time, we see a potential path, where it's more permissionless, and people can use the AMM to spin up their own pools, have their own front ends, and have their own products. So I think one of the beautiful things about the protocol is that it can facilitate a lot of different types of products that we can't, or don't have the interest in creating, such as structured products options, as Kellan mentioned, insurance. So there's a whole ecosystem here, to be built. And I think it's incumbent upon us to facilitate developers over time, and once we think that the product's ready to release into a more permissionless environment, to facilitate that developer ecosystem, that we can underpin.
Brian Friel (14:16):
Yeah. I could see this whole world, where... It's already on chain, like you said, Solana is this giant, composable state machine. And it'd be really awesome to plug this, also, just into existing DeFi protocols, I'm thinking. You're on a drift, or you're on Jupiter, and you want to be making multiple swaps at once, you can, basically, bundle these into the existing DeFi activities you're already making on Solana. Maybe talk a little bit about that process of... What it's like today, to spin up a new market. What are all the pieces that are involved, both from a technical side... But I'm sure there's also, probably, a lot on the operational side as well. Maybe, Trevor, can you speak to that?
Trevor Bacon (14:51):
So now that we have the infrastructure in place, it's not terribly hard to spin up a new market. One thing to consider is that the data comes from a entity called Parcl Labs. And Parcl Labs has an API that has all the price feeds available to the public, and also for the Parcl protocols, Oracle, to consume. So if we were going to, let's say, launch a Paris price feed, so the price feed gets enabled in the API, on the Parcl lab side, the API connects to the Oracle, the Oracle connects to the smart contract, and there's the pool for traders to trade. So it's relatively simple. It's not without work, but we have the infrastructure in place to spin up. Currently, we have 15 markets we're launching, Austin, and then, I think we'll be in the international realm later this month.
Kellan Grenier (15:39):
This is a novel architecture. It is purpose-built for a low volatility asset without a liquid spot market. That defines real estate, that create redeem... Arbitrage isn't explicitly there. You could create a new house, I guess, and then come and hedge it on Parcl, like we just discussed, but that's a pretty elaborate process, way more complex than buying Solana on Jupiter, and then hedging the purp, or whatever. So what's great about the structure is that every participant in the pool is a liquidity provider. So you come in, and you make a trade, you're getting long. What happens is that, atomically, you're depositing USDC into the pool, and you're minting a liquidity token that represents your ownership interest in that pool. And then, simultaneously that notional value is getting locked into a smart contract, a decentralized smart contract, and that, effectively, recognizes where you entered the trade, what your price was, how much leverage you used, all of the elements of the trade that's relevant. And it stays locked in that contract until you, as the authority, comes in and closes the position effectively.
(16:36):
So that's how it works. And what's cool about that is that a new pool could be launched tomorrow, and start from zero. And then, Brian, you could come in and be the first trade. You could be a liquidity provider, or you could get long, you could get short. And you would be skewing that pool 100%, right? So unless someone else came in, you would, effectively, be paying yourself funding, perpetually, such that there was no gains to recognize or lose. But as soon as someone else comes in, that calculus changes, and now, you have a market. Now, it's a perpetual prediction market, a perpetual prediction AMM. And now, you have longs and shorts, effectively, paying each other. That's not exactly how it works, technically, but to the late person, that would be how it would work. So the beauty of that is, you can have a new pool every minute. And the main constraint is liquidity, but it's not, actually, a constraint, technically. So it's a really neat architecture.
Brian Friel (17:21):
The possibilities here are really exciting. And you mentioned one of the main constraints, not technically a constraint, but it is, is liquidity. So let's talk about some of the initiatives that we have, going on, to improve that. So I see that there's a new initiative here, called Real Estate Royale. Trevor, can you speak a little bit to what that is?
Trevor Bacon (17:38):
Yeah, so the Real Estate Royale is a contest series that we have, to familiarize people with the asset class, which is real estate, getting them to understand the product, how to use it. Every week, we have various prizes. And then, we have a monthly prize at the end, which is... USDC paid out to the winners. We've seen some pretty substantial gains with respect to monthly return percentages. I think last month, the winner, I think he was up 30%, which is pretty impressive, given that it's a relatively low volatility asset class. It's a way for us... Because it's a novel product, and it doesn't have, really, an analog in the real world, or something that's existing, it's a way for us to reach out to our users, get them excited and engaged, and then hear their feedback. So we conduct user interviews all the time, understand what folks need to get better educated, with tools they need to make their investment decisions. And our product team, which is excellent, is listening to that feedback and building for the user.
Brian Friel (18:34):
That's awesome. And I think now's a great time, on that note of the contest that are going on, to announce that. By the time that this episode's going to be going live, we have a special promotion with Parcl, which we're really excited to share. For the rest of the month, the first 500 new traders to Parcl, so you got to use a new address on Phantom when signing up, will receive a 10% discount for their first trade. You can learn more about that at parcl.cc/phantom. Trevor and Kellan, what's next for Parcl? You got, potentially, all these new markets coming out. Trevor, you mentioned Austin's coming live soon, potentially international. Where is your guys' focus? Maybe starting with you, Kellan. What's on the horizon?
Kellan Grenier (19:13):
Yeah. I think there are the three main things, is new users and opening up the access to as many people as possible, and helping them understand that this is something that's available to them, except for a couple jurisdictions around the world, unfortunately, the US being one of them. Hopefully, that changes much sooner rather than later. Yeah. New users, top of funnel, just introducing people to this product, letting them know that this is available, and that they can trade real estate just like they would trade anything else.
(19:38):
The other thing is expanding the offering. Trevor was teasing a couple new cities, new metros, some globally recognizable names, you can think, Paris, France, eventually, the United Kingdom, London, and then developed Asia. Eventually, it'll blanket the world, right? There will be a Parcl market wherever you live. So that's another thing that's super exciting. Trevor can touch on this, but how many different chains are, potentially, able to use this product as well? We started on Solana, for all the obvious reasons that we noted, but much larger crypto ecosystem in total, that can be addressed. So I'll pass it to Trevor to talk on that.
Trevor Bacon (20:13):
Yeah. I think, expanding geographically, because you have the ability and the capability to offer products that are dispersed globally, and then expanding the user base in terms of... Stepping into other ecosystems, such as EBM, which have their own pool of people and capital that are native there. So that's what's on the roadmap for the rest of the year.
Brian Friel (20:35):
All exciting things. As I said, we got a special promotion going, so it's a perfect time to check it out. I'll be signing up, protecting myself against the doll drums of living in SF here. Trevor and Kellan, one question I ask all of our guests, I'd love to hear this from each of you, and maybe starting with you, Trevor, is, who is a builder that you admire in the Solana ecosystem?
Trevor Bacon (20:56):
First, I'd like to shout out our team. The team is operating at an exceptionally high level, and they continue to execute against any bar, despite any macro hiccups that we may have, either globally, or in the idiosyncratic crypto space. One builder that... It's not the Solana ecosystem, per se, but I think, given all the scrutiny, Brian Armstrong has stepped up, and has largely become the future of crypto. He hasn't backed down. He's shown a lot of fortitude against the government, which he's asked to be regulated many, many, many times. And it's a tough fight, but he's standing strong. And it's admirable, in my opinion.
Kellan Grenier (21:33):
Yeah, I would totally second that. Coinbase is like the flag carrier right now, and setting the tone for the rest of the industry. And I salute them, and wish them all the luck in the world. Two quick ones that are top of mind, just because we were on a panel, actually, last week with them, the Home Base DAO team, and it's in the real world assets category, which is one that we care about a ton. Alex and Rodrigo, what they're doing is pretty interesting. They're looking at it more from the fractionalized side, and actually tokenizing real world homes, and putting them on chain, on Solana specifically, but they're doing great work, really talented team. And then, Tom at Credics. What Credics has done is really inspiring. They've been at it for a while now, really institutional friendly offering that can help onboard billions and billions of dollars into the ecosystem. So hats off to both of those teams. And there's infinitely more beyond that. And then, obviously, Parcl's development team, we think, is best in class.
Brian Friel (22:23):
Couldn't agree more. Home Base DAO was, actually, just on the podcast just before you guys, so shout out to them, Credics as well. I always see them building. I think we can all say, we're very lucky to have Coinbase representing our industry, and not giving up the good point. Trevor and Kellan, this has been an awesome conversation. Where can people go to learn more about Parcl?
Kellan Grenier (22:41):
You said it, Brian. Running a promotion for Phantom users, and launching that alongside this podcast, the first 500 new traders receive 10% discount on their first trade. There's a unique URL, be sure to use that. It's "Parcl," P-A-R-C-L, ".cc/phantom." And it's "Parcl" without an "E." So P-A-R-C-L.cc/phantom. That's the best place to go, because you'll get 10% off your first trade. Otherwise, just go to parcl.co, P-A-R-C-L.C-O, or follow us on Twitter, @Parcl.
Brian Friel (23:11):
That's awesome. Trevor and Kellan, the co-founders of Parcl, thank you so much for your time, for coming on The Zeitgeist.
Trevor Bacon (23:15):
Thanks a lot, Brian. Thanks for having us.
Kellan Grenier (23:17):
Thanks, Brian.
-
Our guest this week is Richard Wu, Co-Founder of Tensor, a Solana-based NFT marketplace tailored for professional traders. We explore the origins and journey of Tensor on Solana, and delve into the unique capabilities of their recently launched compressed NFT marketplace. Richard shares insights on the differences between traditional NFTs and Tensor's compressed NFTs, and discusses the innovative trading functionalities and community strategies in place at Tensor. We also touch on Tensor's rewards system, their upcoming NFT collection, and their strategic partnership with Metaplex.
Show Notes:
00:54 - Starting on Solana
03:37 - From Solana to Tensor
08:17 - Solana hackathons
10:16 - Only possible on Solana
12:16 - Compressed NFTs and User Experience at Tensor
15:06 - Insights on Compressed NFTs vs. NFTs
17:08 - Tensor’s trading functionalities
20:47 - Tensor’s strategy for the community
23:03 - NFT collection
24:35 - The point system
25:29 - The Solana ecosystem / Being a leader in the NFT marketplace
27:13 - Partnership with Metaplex
28:33 - A builder he admires in the Solana ecosystem?
Full Transcript:
Brian Friel (00:00):
Hey everyone and welcome to The Zeitgeist. The show where we highlight the founders, developers, and designers who are pushing the web 3.0 space forward. I'm Brian Friel, developer relations at Phantom. I'm super excited to introduce our guest, Richard Wu, the co-founder of Tensor. Tensor is the premier NFT marketplace for pro traders on Solana. Richard, welcome to the show.
Richard Wu (00:28):
Thanks for having me on, Brian. Great to be here.
Brian Friel (00:31):
I'm super excited to chat with you today. We got a lot to go into. Obviously you guys are extremely popular recently on Solana, but I think you guys have a really interesting story to tell. Going back to some of your earliest days, you and your co-founder, I remember you guys multiple times either placing highly or winning some of the Solana hackathons. Can you take us back to those early days of how you guys both got started on Solana?
Richard Wu (00:54):
Yeah, of course. Just to give some backstory maybe on myself and on Ilja, so I think not a lot of people know this, but we were both essentially strangers right before we started Tensor. And so we basically met through this co-founding matching portal online, YC Startup School. And that was sort of our first connection. We hadn't worked together before. We basically had no interactions outside of that. So one of the first things we did initially was we basically got on a call, exchanged a bunch of notes on what ideas he wanted to work on, what interests us. And for Ilja specifically, he had been building on Solana for quite some time. I was actually not familiar at all with Solana nor like crypto development in general. And so he sort of red pilled me into giving it a shot. And so our first project that we actually worked together was a hackathon project. That was sort of our NFT pricing oracle that at the time made a lot of sense.
(01:51):
So essentially what an NFT pricing oracle does is it provides price information about NFT collections so that other NFT protocols can actually consume these prices in order to do certain functions. So you can imagine a lending protocol that follows a pool based model would need some price to perform liquidations or for people to... I guess mainly for liquidations.
(02:13):
And NFT Perps, for example, is another type of protocol that would require pricing information on chain. And so that was initially the project that we worked on together. We submitted that to the Solana Riptide hackathon I believe, which I don't know if it was the second or third ever Solana hackathon, but we were pretty early on in the hackathon cycle. We just submitted our project to that hackathon because one, we wanted to win a bit of money so that we can bootstrap ourselves further in the process. And two, we just thought it would be fun to submit something. We ended up placing third in the DeFi category, which was pretty cool and the rest is sort of history.
Brian Friel (02:53):
That's awesome. And so you're famous on Twitter I would say, for being this David versus Goliath set up because you guys have gone from these two devs who just code all day submitting the hackathons to today Tensor is always up there with Magic Eden in people's minds as leading marketplaces, not just in Solana but say in NFTs across crypto. And a lot of people don't know that most of that is really built off the backs of everything that you and your co-founder have built. And starting back to those early days where you guys were just in hackathons chewing glass, so to speak, walk us through that journey. How did you guys go from that initial Solana Riptide hackathon project idea to getting the idea for Tensor, deciding this is something you actually want to build and then sticking it out and then getting product market fit like this?
Richard Wu (03:37):
I would say for us, the biggest strengths that we had as a two person team for the longest time was that we could really spend a lot of our time as founders talking to customers and understanding what their pain points are when it comes to NFT trading. So the initial idea of building an NFT trading product or platform was because Ilja and I, when we were building the NFT oracle, we were both trading NFTs on the side just to understand the market a bit more, try to understand why people are trading NFTs to begin with. And we had sort of this aha moment where I think at the time Okay Bears was minting and it was one of the hottest, if not the hottest, mint of 2022 on Solana. And we went on Magic Eden and we went on Hyperspace and we went on a bunch of other sites and we tried to buy Okay Bears, or at least I tried to buy Okay Bears, right after the mint and it was basically impossible for me to get a transaction through.
(04:32):
And I think the biggest issue then was these marketplaces weren't showing listing data fast enough and that was a huge issue for a lot of these new mints that happened after Okay Bears. There was Tripin Apes, which is also a really hot one. There was a slew of other really hyped collections that sort of faded into existence now. But it was just really difficult for me as a human trader, like NFT trader, to actually put any trades through. And that was sort of the inkling that motivated us to build something better. When we thought about our experience using trading platforms like Binance, like Buy Bit, Coinbase, we were very familiar with the idea of real time data and that speed matters a lot if you're trading in and out really quickly. That was the motivation to bring sort of the Coinbase, the centralized exchange experience, at least the speed, of it to NFT trading.
Brian Friel (05:25):
Yeah. For sure. And I've heard this from you guys before, but some of your thesis around why traders would want that because at the time, going back to those days when there was the Okay Bears hot mint, you mentioned Magic Eden being basically the only game in town to go and see these. I'd say the paradigm around NFT trading was very much you go to a site and you see a picture you like and you click buy and the model that Tensor and you guys have introduced and others like Blur have helped pioneer as well is very much spinning that on its head and making it, I'd say, less about, or maybe potentially less about, the characteristic [inaudible 00:05:59] much more around this pro trading like style interface. What were some of the insights that led you guys to believe that that was something worth betting on? Because it was very much a contrarian take at the time.
Richard Wu (06:09):
Yep, absolutely. I think at the time when we were trying to fundraise, actually... This was actually during the whole FTX collapse and Solana going to 10 bucks, but a lot of the VCs that we talked to were questioning, "Why would you build a product that is already somewhat niche like NFTs and sort of the grand scheme of crypto for an even more niche group of users?" I think one thing that we saw and we knew just from our experience in sort of TradFi as well as trading fungible tokens was that we knew that with all things trading, it follows this sort of parallel dynamic where the top, let's say, 20% of traders account for 80% of volume for any given market. That's a rough approximation. So the 80/20 rule applies here where most traders are probably not trading in size, but the ones that do are few and far between, but they want something that's more advanced, that's more catered to their style of trading that many other traders might not care for.
(07:11):
We ourselves weren't exactly that for NFT trading, but we knew a lot of people in the ecosystem who did trade NFTs in the hundreds at a time. And the whole NFT sweeping thing is kind of obvious in hindsight now, but at the time there were very few marketplaces that actually had the sweep feature and we made that one of the first features to implement, was being able to bulk sweep, being able to bulk list, being able to bulk de-list. All of that obviously is table stakes now for any marketplace, but at the time we were the only aggregator/marketplace to do it.
Brian Friel (07:44):
So you mentioned the fundraising journey there a little bit. I want to hit on that just a little bit too because you guys recently announced that you closed your first round with placeholder leading as well as a large group of angels, many of which I would say are Solana power users and probably power users of Tensor as well. What was that whole process like for you guys? And going back to when we started this conversation about the hackathons, what helped prepare you for this fundraising journey and if you could depart any wisdom on folks who are now in upcoming Solana hackathons, what would you say to this next generation of builders who are going through that?
Richard Wu (08:18):
The thing that moved the needle for us was having a really good network of both personal connections in the space. We went through this accelerator called Alliance. I think they're called Alliance Dow. They might just go by Alliance now, but they're essentially a Dow that has almost like a YC accelerator for web 3.0 companies and they actually helped us one understand the fundraising ecosystem a bit more. They also provide a tremendous value when it comes to mentorship. But they helped us connect with a lot of investors. I think when it comes to raising in a bear market, even if you have a killer team and potentially a killer product, you can still be overlooked by a lot of VCs and at this point it's just a numbers game. Get in as many calls as you can, try to prioritize the VCs that are showing interest and the ones that actually care about the founding team versus just trying to make a quick buck by flipping your token. A lot of the investors that ultimately invested, including Placeholder, came through either personal connections like other builders in the space or through the Alliance network.
Brian Friel (09:25):
That's awesome. I know many folks who were part of that rounds. I know some Phantom team members were as well very excited to be supporting you guys through that. And at the time I'd say it still was a controversial take, even though I think Blur had, at that time, gotten a decent amount of traction on EVM. You guys I think had launched around the same time Blur launched, but it had taken a little while for that same model to permeate on Solana. I guess focusing on Solana, what made you guys specifically choose to double down on it? You mentioned that your co-founder, Ilja, red pilled you on Solana early on. I'm sure when you guys were talking to VCs, everyone has an opinion on where teams should be building, but you guys have really decided to stick it out, not only double down on Solana but continue to push new features like your compressed marketplace that are only possible on Solana. So can you talk a little bit about that decision?
Richard Wu (10:17):
I think you were spot on in that a lot of VCs, in fact 95% of VCs, basically told us on the first call or asked us, "Why are you still on Solana? What are your plans for moving cross chain? Why haven't you moved off of Solana yet?" And I think for us, we're pretty good at thinking for ourselves and thinking from first principles, but even then this was post FTX and we had doubts ourselves whether or not it was a good move for us to stay on Solana and not build on Ethereum or Polygon. Ordinos wasn't a thing at the time, but the next hot chain.
(10:51):
When it comes to staying on Solana today, I think we have almost like a very strong fundamental belief that there are things that you can do on Solana that you can't do elsewhere that have been untapped when it comes to NFTs. So you mentioned compressed NFTs. I think that is a huge potential for Solana to become the number one digital asset/NFT chain in all of crypto. Just the value prop of being able to mint a million NFTs for less than a hundred dollars and being able to airdrop that for essentially free, it's just like a hundred bucks. Most companies or startups probably spend that on some random AWS service. Being able to do that basically for free is something that is very difficult to find on any other chain and we think that has a potential to onboard the next million users to Solana and even to onboard companies that are a bit hesitant about paying for gas fees on Ethereum L1 or a bit hesitant about spending a lot of money creating NFTs on any given blockchain. I think this is the way to onboard all of those skeptics and all of those people who are hesitant.
Brian Friel (11:57):
Yeah, let's dig into that more. At the time we're recording this, it's June 6th, I think you guys just last week had announced the launch of your compressed NFT marketplace. It's the first one on Solana. How has that launch gone? Who are you guys working with? Where are these compressed NFTs coming from and if I'm a user showing up to Tensor, what is that whole experience? What can I expect?
Richard Wu (12:17):
So we're currently working with a number of key partners. The very first partner that we worked with was Dialect. For those who are not familiar, Dialect is this web 3.0 messaging app. They're primarily on mobile. They essentially integrate... I think of Telegram integrated with a wallet. And so they let you, for example, send solds to your contacts directly in the chat app. They also let you collect these stickers which are minted as compressed NFTs. And the interesting thing here that Dialect did with these stickers was that they essentially gave them out for free and to anyone including those who have nothing in their wallet. The great thing about compressed NFTs is they're so cheap that you can just airdrop them in mass to a ton of users and not have to think about the cost and the users themselves don't have to pay any gas to receive them.
(13:04):
Obviously you need to pay a bit of gas if you want to interact with... Let's say you want to send it to someone else or if you want to list it on the Tensor marketplace or if you want to do peer-to-peer sticker trading. But the big unlock here for Dialect was they were able to essentially give these out for free to all of their mobile app users and they can now trade them on Tensor and perhaps sell it for a bit of Soul and use that Soul to do other things.
(13:27):
Another partner we work with is Drip and they're doing something somewhat similar in that instead of stickers, they're actually doing art drops and they're working with a number of creators like Xeno, maybe not Xeno, but another artist called DJ Poet who creates these art pieces, essentially distributes them through Drip and anyone can come by and claim these art pieces for next to nothing. They just pay for transaction fees. And based on these two use cases, we think that these airdrops, these new ways of distributing essentially digital assets to users for essentially free will become more and more popular. And we may even see non NFT projects like platforms such as Dialect. Drip is technically a platform. Their specialty isn't in compressed NFTs, but that's a huge part of it. They'll start using compressed NFTs as a distribution mechanism and we want to essentially build the trading infrastructure around it and also any infrastructure required to make them successful.
Brian Friel (14:26):
Yeah. The point you hit there about it's almost like a user acquisition cost, but it just turns it on its head and it's so cheap and it's like if you think about subsidizing that to get a user's attention, I think it is something that is a unique unlock that right now it is only possible in Solana, I think is largely overlooked in the rest of the crypto community right now. It's really cool to see. Since this has gone live, how have you guys seen users interacting with this platform? I mean is it pretty much similar behavior to trading and sweeping regular NFTs? I think we're entering into the chewing glass territory of Solana where you guys are building new functionality that's kind of pushing the limits of this. But what are some of the insights you guys have seen from the early launch?
Richard Wu (15:06):
Yeah, it completely blew our expectations. I don't think we one, expected the sheer number of unique wallets or I guess in this case it's a proxy for users, the sheer number of users that actually want to trade these things. So I guess I'll give you some absolute numbers. So in the first four or five days, I think it's been four days since we launched officially, we saw over a hundred thousand sales that occurred within three, four collections. These are literally collections that launched not too long ago, so they're not like the D gods who already have a lot of hype and a massive user base. These are relatively new and upcoming projects that are experimenting with CNFTs such as Dialect, such as Drip. They're going to be massive in the future obviously, but they launched these CNFTs and we saw over a hundred thousand sales actually occur with over 7,000 unique wallets and I think we just crossed a thousand Solana volume.
(16:04):
Obviously there's a long way to go, but just based on these three or four collections that just started trading and how little time that has actually passed since we launched this blew our expectations.
Brian Friel (16:15):
Yeah. And the thousand Soul marker too is pretty wild when you consider that most of these were probably given out for free originally or very much close to free. Like Drip, you can just drop your wallet address, get these for free. Dialect, you said people are getting these stickers even on empty wallets, just being a very early user of the app. It's pretty wild that you guys are basically creating something from nothing here and I think the sheer volume of that probably speaks for itself.
(16:42):
Outside of compressed NFTs, let's talk a little bit more about some of Tenor's unique offerings. You guys cater to this pro style trader. You mentioned the 80/20 rule before that 80% of users might be more casual NFT buyers, but the 20% that are really dedicated are bringing the vast majority of volume to Solana. What are some of those advanced trading functionalities that you guys are proud of that you guys offer at Tensor?
Richard Wu (17:08):
A lot of people know us for our trading view chart if you're in pro mode and you can sort of see the live feed on the side and also an order book view, which is one of few platforms in Solana that offers all three of those. But I think that stuff is kind of table stakes for us now. I think what we're especially proud of and digging more into is sort of more features to enable someone to quickly, let's say, manage their NFTs and be able to list it instantly on Tensor and be able to de-list it instantly and essentially be able to do whatever you can think of as imaginable with their NFTs on Tensor without leaving the platform. To give you a concrete example, right now you can send 200 or 300 NFTs at once to another wallet through Tensor. So this bulk sending feature I don't think too many other marketplaces have yet, but we've essentially implemented that since I think day two or day three.
(18:03):
Obviously as you mentioned, bulk sweeping, bulk listing, bulk de-listing, those are all table stakes. I mean there's not really one specific feature that we have that no one else has besides maybe compressed NFTs, but I think we're just very focused on providing the best possible user experience and that comes with attention to detail. So it's making sure everything runs as fast as possible. There's next to no lag. Everything updates like responsively on the front end. So after you perform a listing or any transaction, the NFT instantly updates with the correct information. And that's hard to get right. It took us a lot of glass chewing to actually perfect. Every time you list a NFT, it shows up almost instantly with a new price on your front end.
Brian Friel (18:48):
Yeah, I see the tweets from you guys, all the data pipelines that you guys are building. So I know that's a lot of glass chewing, a lot of work to be done. And on that note of focusing on UX, making things easy to manage these NFTs, it's probably a good time to announce if we haven't already by the time this is live, that we'll be introducing a new feature called Instant Sell directly from Phantom and you'll be able to click on NFT and be able to instantly sell this NFT and Tensor will be one of the marketplaces that we'll be sourcing liquidity from. And in addition to that, we'll also be introducing list on Tensor directly from FAM as well. Super excited about those integrations to be working with you guys as well as supporting your guys' compressed NFT marketplace as well.
Richard Wu (19:29):
Yeah, I mean we're very excited for that feature because we know that a lot of our users are Phantom Wallet users and they've been asking us like, "Oh, when Tensor listing from Phantom?" And I think having both Instant Sell and Listing from directly and embedded into Phantom would be such a killer feature for all of our users.
Brian Friel (19:49):
Yeah, it's the next win. Ledger Mobile finally shifts so the community needs a new win to yell on Twitter but I'm excited to get this out. I think by the time this episode is live, all the listeners should be able to try it out. If you have Phantom on mobile, you can go directly in there, make your first listing, make your first instant sell all thanks to Tensor's AMMs.
(20:07):
I want to switch gears a little bit and talk about your guys' focus on community. So we might have hit on this early on in the conversation, during your fundraising process you had a huge interest from angels, many of which were power users of you guys. I'd say that you guys have a really strong unique community that's native to Solana that you guys are building for this 20% power user. Talk a little bit about some of the features that you guys have on the community side. I see a lot about rewards. I see a lot about boxes. Yeah, you guys build a lot of really awesome tech, but you guys are also doing a lot to reward your users directly. What's your guys' strategy there?
Richard Wu (20:47):
I think for us taking a step back. We sort of understand that our users are what makes us. While sure we can build a really cool product with a bunch of reliable data pipelines and we can build a really fast trading platform, without users we're nothing. And I think a lot of startups realize this sort of later on, and we understood this from day one, that users and distribution is what matters and we want to do right by our users at every given possible opportunity. I think for us, we're obviously making fees from our marketplace and we want to give that back in some ways to our users. So I'll give you a very concrete example of what we did recently. Mad Lads, obviously one of the biggest NFT mints of this year across all of crypto, they basically blew a lot of the Ethereum 24 hour volume and seven day volume charts out the window.
(21:43):
We actually did this massive giveaway/raffle where we essentially promised and committed to taking all of the marketplace fees that we took from any trading that happened on the Mad Lads collection for the next three months and basically gave it away back to the users in terms of buying back Mad Lads off the market and doing a raffle for anyone who trades Mad Lads on Tensor. And that's just one way that we want to show that we actually do care about the community and you guys are what makes Tensor great and the best way to do that is to essentially give back our fees in terms of these NFTs and these buybacks. I think going forward we want the users to be as much as a part of Tensor's journey as we are a part of Tenor's journey. Obviously that will take some time. Currently, we have the rewards and point system and that's a proxy for us to actually attribute who is the most loyal Tensor fan, who is the most loyal Tensor user. We can give you guys loop boxes, which converts into our NFT collection and other rewards in the future.
Brian Friel (22:49):
Talk a little bit more about that NFT collection. I've seen some rumors about it. The boxes are very cryptic. When I log in I see these mystery boxes, not much I can do yet with them, but there's talks of an upcoming NFT collection. What can you say about that?
Richard Wu (23:03):
So one of the best pixel artists I would say on Solana, Xeno... I think he goes by Xeno sometimes. We reached out to him pretty early on and we basically said, "Hey, you want to do a really cool pixel art PFP collection?" And we want to make that essentially the image of Tensor users. We call Tensor users Tensorians. I think what's unique about this NFT collection is that yes, it can be PFP-able. You can put it on your Twitter profile and it'll look nice because obviously Xeno is a great artist. He knows what he's doing. But two, I think we want to make the NFT collection a first class feature of Tensor. So much like how real time data, these bulk sweeping features are first class features of Tensor, we want to make the NFT collection a first class part of Tensor. So what that means is you may get benefits in the future for having a Tensorian NFT. We're still thinking of the right mechanics to introduce, but one of the things that we're committing to is making this NFT collection actually meaningful to Tensor users.
Brian Friel (24:10):
That's awesome. Well, I'd say you guys have done a really awesome job with the whole point system today. It's just even really fun, I'd say, to make trades and look in and see all the points updated in real time and leaderboards and everything. So I'm excited to see how the NFT collection ties into all that. I have a feeling it's all tied in together and there is a great plan at the works here. Do you guys have a high level ETA on when users might be able to expect more from that?
Richard Wu (24:35):
The biggest technical blocker for us for the next phase to happen was actually the compressed NFT marketplace. So that might give you a bit of a hint on what we're planning on doing. It may involve a couple of compressed NFTs. It may have something to do with these boxes. There's a lot planned for this NFT drop. It's not going to be a typical NFT drop.
Brian Friel (24:54):
Nice.
Richard Wu (24:55):
You don't just show up to Tenor and mint you an NFT. There's going to be a couple of new mechanics that we're going to be trying for the first time.
Brian Friel (25:02):
Exciting. A little bit of alpha drop there on the podcast. I love it.
(25:06):
So from where you guys sit today, just to kind of put everything in perspective, I mentioned this David versus Goliath story where it's two developers, hackathon projects, and you guys end up building the marketplace that caters to these pro users and takes over Solana by volume. How do you guys view your current position in the Solana ecosystem and what does it mean for you to be a leader in the NFT marketplace?
Richard Wu (25:30):
To be completely frank, I don't think we've necessarily won anything, won the market or become the number one marketplace definitively. We think that Magic Eden is... They're a great team. They've done a lot for the space. And I think ultimately we want to grow the entire Solana NFT space together. We don't want to essentially be the ones who takes all the pie and leaves nothing for anyone else. We want Magic Eden to succeed so that all of Solana can succeed.
(26:02):
So I think for us, while having the majority market share at any given point is nice, I think what we want to do is basically close a gap between Solana and all the other blockchains when it comes to NFT market share, which is sort of a loose term. I think compressed NFTs is one of the big bets that we're making, that this will be the reason why Solana NFTs are seen by others as competitive with Ethereum NFTs, even competitive with Ordinos because obviously Ordinos has attracted a lot of attention when it comes to NFTs. So we're going to keep innovating, build an ecosystem around CNFTs so that it's dead simple for a creator or project or platform to come in and create a bunch of CNFTs and actually get value out of it whether it's user acquisition, whether it's a new gaming mechanic that they want to experiment with, we want to make Solana and Solana CNFTs the destination for them to do that.
Brian Friel (27:00):
I love it. It's a great position to be in as a leader. I have to ask as well, I noticed you guys just today announced a new partnership with Metaplex, specifically around launchpads. Can you talk a little bit about that and how that helps grow Solana as well?
Richard Wu (27:13):
So I think the Metaplex partnership made a lot of sense for us because as we've seen with previous experiments, working on a launchpad is difficult and trying to own that all to ourselves is a monumental task, just beyond the technical parameters of building a launchpad and making sure everything runs smoothly, which we can eventually figure out. I think the Metaplex team, one thing that they have that very few teams have is that they're very great liaison between creators and sort of the rest of the ecosystem. They've essentially done quite a lot for the ecosystem, including building the NFT standard, building all the tooling around it, building Candy Machine that enabled this whole explosion of Solana NFTs to begin with. And they've done a lot when it comes to onboarding creators outside of the ecosystem. And we just felt that both of our teams had a lot of alignment here, that we both want to grow the pie together, and so it made sense to partner with them for their launchpad, for their primaries, and we can focus on the secondaries.
Brian Friel (28:14):
I love it. That's great. Well, we're excited to support both you guys. Big fans of Metaplex. Really excited for everything that's in store for you guys in the future, compressed NFTs as well.
(28:23):
Richard, this has been an awesome conversation and one closing question that we ask all our guests, and I'd love to get your take on this as well, is who is a builder that you admire in the Solana ecosystem?
Richard Wu (28:34):
The obvious answer is my co-founder. He taught me a ton. He basically fed me everything I needed to know about Solana. But outside of that, we really respect the guys at Helius a lot because when we were going through the CNFT glass eating, they were the first ones to respond to all of our dumb questions about how do CNFTs work? Why is this breaking? Why is this returning an error? They were one of the first ones to respond and they've been relentless at trying to build out essentially the infrastructure, like the RPC infrastructure for CNFTs. So they have a lot of our respect and we work closely with them. So yeah, they're one of the best builders. Yep. Yeah, he's been fighting for Solana to the ends on crypto Twitter, so a lot of respect for that.
Brian Friel (29:20):
Yeah, murder's a legend, and if you're on crypto Twitter, it's hard to miss him. We're lucky to have him not only as a staunch defender of Solana, but also as the guy who will answer your telegrams frantically at two in the morning when you're trying to eat glass and ship new features. Yeah, great answer. Well, Richard, this has been an awesome conversation. Where can folks go to learn more about Tensor?
Richard Wu (29:41):
The very first place would be our platform Tensor.Trade. That's where you can find the fastest NFT marketplace on Solana. If you want to check out some of our other stuff, we tend to do a couple of tweets every day, and big announcements happen on our Twitter. So that's twitter.com/tensor_hq.
Brian Friel (30:00):
Awesome. Well, Tensorians, you know where to go. Richard, thanks so much for coming on the show. It's Richard Wu, the co-founder of Tensor.
Richard Wu (30:08):
Appreciate the time.
-
Our guest this week is Andrew Pelekis, CEO of Claynosaurz. Claynosaurz is more than an NFT project, it's a 3D production studio full of artists from Sony, Disney, Dreamworks, Ubisoft, Netflix, Warner Bros, Marvel, Industrial Light & Magic focusing on developing quality entertainment IP in Web3.
Andrew sits down with Brian Friel to discuss the entire Claynosaurz ecosystem, building entertainment IP in Web3, the importance of quality in NFT projects, and the future of Claynosaurz which includes collectibles, toys, and content.
Show Notes:
0:50 - Background / starting in Web3 and a little bit about your background
3:30 - How did Claynosaurz start?
5:47 - Web3 vs.Web2 entertainment
12:03 - Why Solana?
14:10 - Engaging with the community
18:34 - Learning how to build strong IP native to the internet
20:03 - Who will be spearheading the future NFTs?
22:44 - Future projects for Claynosaurz
25:04 - A builder he admires in the Solana ecosystem
Full Transcript:
Brian Friel (00:05):
Hey everyone and welcome to The Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web3 space forward. I'm Brian Friel, developer relations at Phantom, and I'm super excited to introduce our guest, Andrew Pelekis, the CEO at Claynosaurz. Claynosaurz is a 3D production studio, building original IP in Web3. Andrew, welcome to the show.
Andrew Pelekis (00:27):
Hey, Brian. Thanks for having me.
Brian Friel (00:29):
Really excited to talk to you today. I'm a huge fan of what you guys have built. I know that there's a lot of listeners that are obsessed with the dinosaur NFTs you guys have created, and they are a clear winner of the cutest NFTs on Solana right now. We have a lot to jump into, but before we get into everything related to Claynosaurz, I'd love to know a little bit about you. Tell us where you got started in Web3 and a little bit about your background.
Andrew Pelekis (00:50):
Sure. So my background is probably a little bit more different than anyone else on our team, which is all geared towards creative and creating the cute characters that you're so familiar with. I come from a background in front office investments, so that's hedge funds and private equity style investment. I've done that for a little over 10 years. Most recently, two partners and I raised $250 million under a private equity umbrella fund and invested that over four years twice, so did a little under $500 million of business. We left that job, or I left that job in 2021 to pursue my own endeavors. Part of that and part of what I was doing earlier that is Web3 geared was working on attaching inventory and collateralized assets using NFTs or tokenizing those types of assets. And I had been working on that loosely in Eastern Europe, but we did a lot of work and a lot of background work on Web3 and all the different aspects of smart contracts, blockchain, and applying those things to real assets.
(01:55):
And in that pursuit, recognized there's a ton of opportunity here, a ton of great use cases. And along that path, I was advising Claynosaurz from afar for about a year before they got to mint. And realized that once they minted, they needed some help on the stuff that I'm an expert in. And I thought there was a lot of opportunity in that, especially when you consider how early on we are in the life cycle, thinking on about what I was doing in my previous job, that is to say attaching real assets via tokens. I think we're going to get there, but there's a great opportunity in the low-hanging fruit that exists in digital assets where the use case is much more applicable for the time being, and therefore a ton of use cases in the entertainment sector in particular. So jumped onto Claynosaurz late 2022, literally hours after the mint I was talking to those guys, and then the very next week, jumping in headfirst.
Brian Friel (02:50):
Oh, that's awesome. It's a unique perspective too. I think you're the first NFT CEO I should say, who comes from a professional investment, more institutional side background. I actually, myself used to work at a [inaudible 00:03:02] before I joined Phantom, and I know that that world doesn't always mesh super well with the NFT world. So you bring a pretty unique perspective to how this whole industry is shaping. But going a little bit back in time, you said you joined the team November, 2022, right around the mint. How did the Clayno team originally start? What was the vision that they got set out to do and who did they build this team with? You guys have some incredible assets. I imagine that you guys have quite a wealth of experience to have put all that stuff together.
Andrew Pelekis (03:31):
Yeah, there's actually somewhere around a dozen founders because of the amount of work it takes to develop this 3D quality asset that we're developing. So it starts though with Nick and Dan, who are our two founders who began developing the IP with, I wouldn't say no objective in mind, but they didn't necessarily solve for distribution, right? This is a creative team who had a ton of great ideas and just said, "Hey, let's start developing them. Let's just start building IP. And people do that, they develop IP and they maybe curate and sell it to a big studio. And this is in a world in which there's no opportunity in NFTs or Web3, right? So that's a traditional path and it's quite long and laborious and a lot of late nights working with no real idea of how you're succeeding or if you're succeeding at all. And along that path, a few months later, NFTs started to blow up.
(04:22):
So this is early 2022, late 2021, the news starts picking up on NFTs. I mean, I think everyone listening will be familiar with that news cycle, and they picked up on that. Some close friends of theirs who were well acquainted with business development and marketing and Web3, basically approached them and said, "Hey, this is a great project. Why don't you test that product you're building in Web3? Why don't you curate this to be an NFT collection? And you can still build the IP beyond that once you've done that, but at least you can test early on in the life cycle. You can monetize the product before you normally would be able to and get all this active feedback."
(05:00):
And so in early 2022, I believe February, they brought on this business development team, expanded the creative team to get to this objective, which was a mint, and built from there. And eventually minted in November 2022.
Brian Friel (05:15):
That's awesome. I think a lot of people might not be familiar with that grind. The traditional, you're a creative team, you're coming from the works of Sony, Disney, Dreamworks, you want to set out on your own adventure and how do you actually take the creative ideas you have and get distribution, like you say, turn that into reality? Can you talk a little bit more about the approach that you guys are doing, building entertainment IP in Web3 and just how that differs from those traditional approaches, what those cycles are like and some of your guys' strategy in Web3 in particular?
Andrew Pelekis (05:46):
Yeah, for sure. So I think the main thing is sort of what I just touched on, which is that typically you would have to build a product to a minimum point at which you could sell it to someone. And in that environment, that minimum point with a team of, by example, our team of 12 to 14 people, if you include contractors, it's a little bit bigger, but it's a small team compared to a studio that might have hundreds or thousands of people, it takes a while to get there. And then if you've got success, if you've built something that's worthwhile to these studios, then they'll participate, right? They'll say, "Okay, well..." But that deal does not look very good because you haven't proven the product beyond this one meeting, and getting that meeting might be tough in the first place. So you sort of get taken to the bank, if you will.
(06:30):
In the environment that Web3 offers, you can test the product early on in the lifecycle. So by example, we had, like I said, a dozen or so people working on our product for about a year to get to this MVP that was in November 2022, and you're testing the product, right? Because that mint tells you, are people interested? What's the feedback like? Are we able to sell this product? So you have all this great testing environment. And then of course, as you know, crypto Twitter is very active in telling you what you are doing right and what you are doing wrong, and you get this great feedback loop. And so you get all of these things that are going on that typically would never arise at all in a traditional environment. And the only time at which it would arise would be long after you've given up the ability to creatively control your own product. You'd have given it up to a studio at some point and struck a deal and been put to the side.
Brian Friel (07:26):
Yeah, it almost seems like a total win-win because it's like you're getting these faster product development cycles. Like you said, you're getting in the hands of the users, you're figuring out really fast if this is worth investing in long term or not, but you're also getting more control of your own destiny. You don't have to grind for years and then take whatever deal comes your way. You're cutting out some of these middle men just going directly to these consumers. It's pretty cool.
(07:47):
So let's change a little bit and talk about the ecosystem that you guys have built out today. So like I said at the start, everyone remembers, I think, the mint that happened in November 2022. It was a time that I think working at Phantom, you would see a ton of these profile picture collection NFTs, where it's these static images, looking the same. And then all of a sudden, it was like a breath of fresh air seeing these fully animated, smiling dinosaurs, wacky craziness. I think you guys definitely stood out. Talk a little bit about everything that exists in the Claynosaurz ecosystem today.
Andrew Pelekis (08:20):
So there's a lot that exists today, but I would say that everything is complimentary. These are not supplementary things. So the first and most important thing is our Genesis collection. So that is the Claynosaurz collection, that is the characters we're describing. There's six species inside of that collection, and I think everyone understands those. Beyond that, we've also got a few items that exist. And so these are things that we did as a guerilla marketing effect at a number of Web3 events over the last six, seven months. Actually, the first one took place before our mint, which was the Sardinhas, which we dropped in Breakpoint Lisbon in early November 2022. And those turned into Pterodactyls now. And so those holders who were sort of pro-Clayno before we minted, they got rewarded with this very unique species that is only a set of 222. Actually, we've got that mechanism now, that kind of is a good way to explain some of the other items, which is the Claymaker and the clay, which we airdropped to all the holders I believe December and January.
(09:21):
And the Claymaker and the clay are again parts of our world that we would use to develop the product further. So the Claynosaur is the character, the Claymaker is something of a transmuter. So just like a kid playing with clay, you've got different toys that you can use to mold your clay. So the Claymaker is this all-encompassing molder, if you will. And then the clay is the stuff you mold. It's the resource which we use to mold things. To get from the Sardinha to the Pterodactyl. We have on our website, you burn the Sardinha with the Claymaker and the clay to create an egg. And then again, you take the egg and you burn that into the Pterodactyl. And so that explains the Claymaker and the clay, and those items will be used in perpetuity in our world.
(10:05):
Clay is going to be a resource that continues to be used, and the Claymaker will be something that is required to transmute these different objects or to mold these different items in our game. And then you've got other similar drops that we did. In Paris, we did the croissant, NFT Paris. In LA, we did the taco. And most recently, in New York we've done the pizza slice. And all of these things are going to be items or companions that accompany your character. So the croissant will be an item that you can put on top of your Claynosaur. The taco will similarly be an item with a similar utility. And the pizza slice is going to be a companion that will sort of follow your Claynosaur around. So all of these things are different ways to make your Claynosaur ever more unique for the user, to make it more of your own. And so they're complimentary, right? They're not supplementary.
(10:58):
Lastly, and I know I'm going through a lot of things here, we've got the most recent collection, which is the Call of Saga collection.
Brian Friel (11:05):
That's right.
Andrew Pelekis (11:05):
That's being minted on the new Solana Mobile Phone, and that's a really cool initiative. That will be a collection of Claynos. It's not part of the Genesis collection. Think of it as an expansion pack. New collection, two new species. And that's going to be exclusive to the Solana Mobile Phone. Obviously, once you mint it on the phone, you can then trade it and everyone can participate.
Brian Friel (11:28):
Yeah, I'm excited for that. I personally just got my Saga, I think two days ago, right before we're recording this in May 2023. So I got my Genesis sticker, now I'm in line for the mint. I can't wait for that. I'll be a lot of fun.
Andrew Pelekis (11:40):
Very cool.
Brian Friel (11:40):
That might be a good segue too, to talk a little bit about Solana more broadly. You kicked all this off November 2022. At that time, it was probably not the most mainstream bet to bet on Solana as an NFT ecosystem, but I think you and I both know that Solana has a lot of upside that I think a lot of people maybe aren't aware of. What in particular drew you guys to Solana?
Andrew Pelekis (12:03):
I think it's two things. The two main things are that you have to have a good transaction time, like reliable transaction time, so that when you click a button, something happens right away. I think there's research that shows that even more than one second, the user can kind of feel this lag. And the second one is a reliable transaction cost, so that there isn't an immense amount of cost to the user, so that they can freely click on things as they participate in our world.
(12:29):
And all of that goes layer backwards, which is that we're building IP. Part of building IP is building an experience that people enjoy. And for us it was very important that if we're going to expand in this web three direction. And if you're bullish on Web3 in general, you've got to be on a chain or on this platform that offers this resource in such a way that allows the entertainment not to feel laborious, right? It's got to feel seamless.
(12:57):
And so that decision was made actually before my time, which I absolutely support and I think is the correct decision, to be on Solana because you need to have that seamless entertainment experience. And I think that's where it comes from. That's the most important thing for us. And keeping in mind that we're trying to build an IP that is built on Web3, continues to build on this Web3 channel, but permeates into all of these other traditional distribution channels. And if you fast-forward 3, 4, 5 years from now, you'll probably find that the chains that succeed are the ones that are able to bring the most frictionless experience to the users, right?
Brian Friel (13:31):
Absolutely. And I think a lot of that also kind of dovetails to what you were mentioning earlier about these in-person events. You guys are giving these activations to your community live and they can use these complimentary NFTs, the croissants, the tacos that you mentioned, interact with them. It probably builds deeper relationships with these collectibles that they have. Can you talk a little bit about that strategy? I think you guys are doing a lot of unique things both on the in-person event side, but also on your guys' social media presence. Like you said, crypto Twitter, it's very active. I think you guys have a pretty amazing social media presence there. Does this all tie in together into a broader strategy? And if so, what are you guys working towards when engaging with a community like that?
Andrew Pelekis (14:11):
Yeah, this does definitely tie into a broader strategy. To talk about that strategy very quickly. Our view is that in 2023, and probably for the last five to 10 years, entertainment has shifted so drastically onto so many different formats and so many different places, where I'm sitting in front of a few screens right now, I've got my phone, I used to have two or three phones actually, and I'm sure people still have that today, and then you've got your TV and people watch all kinds of different things. And then on these computer screens, you've also got all kinds of platforms on which you can participate in.
(14:44):
So our view is an entertainment experience in 2023 and going forward has to have a very holistic approach, such that the user is able to see you in all these different places. And Twitter is one of those places, especially if you're in Web3, I think Twitter is definitely the right place to start. And so our approach to Twitter was, well, instead of just being this microphone to announce the big things that the traditional studio PR team would do, we can make this an engaging form of entertainment that speaks to our brand, that speaks to Web3, and is able to also engage the community on an ongoing basis.
(15:23):
And so we have a team that works on Twitter, headed by one of our founders, and he does most of the Twitter posting over the last year, year and a half, but it's a dedicated job for us. We take it very seriously. Similarly, we spoke about all these different items and things like that that go inside of this gamified experience. That's a whole other tangent that we think is a great place to distribute, where we think that there's a whole opportunity in building that out. And then across the content strategy, you've got, again, a lot of distribution channels in that there's micro short form if you will. We call those the two to five-second little vignettes you see on TikTok or YouTube Shorts or Instagram Reels. There's a big market in that.
(16:03):
Then you've got short-form, call it trailer-length video, which is one to two minutes, and you could tell a story in that time, but it's not a whole story. And I think a lot of that stuff often lives on YouTube and there's other platforms that are similar to that. And then you've got what's more traditional, you've got 20 plus minute shows or a movie at length, and there's a whole slug of opportunities in there as well. So our content strategy is to permeate across all these different avenues, such that a user can enjoy and sort of familiarize themselves with Claynosaurz regardless of where they are.
(16:38):
And now the last bridge to cross, which is interesting because you would think it's the most obvious one, is the one you touched on with the booster packs and all these activations in-person at these different events. And our view is that there is going to be, and I think we're working on it and trying to push the boundaries on this as much as we can with the resources that we have, especially those that are on Solana, is to bridge the gap between the physical and the digital. So the packs that we were doing in LA and York were sort of an homage to those Yu-Gi-Oh or Pokemon packs where you rip it open, you don't know what you're going to get, and there's this real sense of excitement in that. So we wanted to bring that feeling to these events in-person, and we also wanted to use that as a onboarding for people who aren't familiar with Claynosaurz yet.
(17:22):
So now, you've got this feeling of excitement and now you have a simple interaction with your phone, where you tap the card on your phone and you have these NFTs. And so what we were trying to do is physically onboard people, bridge this physical digital gap, and we're going to continue pushing in that direction on the physical side as well. So that's one of many legs to this larger content strategy.
Brian Friel (17:43):
I think you're painting this really awesome picture of the future. Because I keep going back to this tweet in my mind where Annatoli tweeted where he said, "Claynosaurz is building the next Disney." And in my head, I think of the early days of Disney, like Mickey Mouse on his steamboat, and how it was just this total game of distribution. You had movies going out, the whole country would watch the same movie, and everyone saw the same experience. And this world you're painting here is almost turning everything on its head. It's like now you guys can go out, strike your own destiny without having to set up these massive distribution lines. And it permeates everything. It's Twitter, it's YouTube, it's in-person events as well, these activations. It's an exciting world and it seems like it could go a lot of different directions from here.
(18:23):
If you had to speak to other NFT projects right now, with everything that you guys have learned so far, what kind of learnings would you share about building strong IP that's native to the internet?
Andrew Pelekis (18:35):
Quality has to come first. I think that's the most important thing. And what's important about that is that we're at a point where Web3, and NFT products in particular, get a lot of slack. Regular media, traditional media, whether that be the newspaper or just on other platforms, they're not taking us seriously. And I think a lot of that has to do with quality. Because you can say things like you're going to be the next Disney, but if you put up a picture of one NFT and then a Disney product and the two are obviously different, you're really making a tough argument because this is a product that goes to consumers. We're all consumers, so everybody can understand this. There's nobody that doesn't understand this. The quality speaks for itself.
(19:17):
So the most important thing I think at this stage, now that we're past the early days of NFTs, I'd say, where you're just sort of testing how this will work, and perhaps you're not going to invest time or money in developing and curating IP at this level, I think we're past that. And I think it's important now that focus on quality is of the utmost importance, right? Because you've got to get there and be able to compare Web3 entertainment products to traditional or Web2 entertainment products, because otherwise you're never going to onboard anybody.
Brian Friel (19:50):
Do you see a world where these traditional players, like a Disney, make their own NFT collection in the short term? Or do you think it will be mostly spearheaded by projects like Claynosaurz that are really pushing the envelope? How much do you see that those [inaudible 00:20:02] going in the next couple of years?
Andrew Pelekis (20:03):
I think Disney probably has a lot on his plate. I think a lot of studios are probably stuck in traditional models, but let's not be silly either. These are massive institutions that have been here for, in some cases, dozens and dozens of years. They've got the brand power and they've got the resources to make a good push into Web3 when and if they wanted to. And I think what they're lacking perhaps is an understanding of the community that exists in Web3 and how to interact and market in Web3. And so you sort of touched on it earlier, where you mentioned Disney back in the early days, everyone went and watched Disney because they had solved for distribution.
(20:45):
And that was a world in which distribution was super expensive. You could not distribute anything yourself as an artist, whether that was music or a movie or whatever the case may be. And so a big company like Disney is able to distribute and the consumer eats it because there's no competition. And I would say even up until maybe 15 years ago, streaming was not at the level it's at today, and distribution had just been solved in the last 10 to 15 years. Where 15 years ago, we weren't going through all these different streaming channels trying to find things, and there wasn't all these different opportunities for the consumer to look at things.
(21:24):
So I think that a lot of these big studios are stuck where they're like, "Well, our oligopolistic framework in which we control distribution no longer exists." And now they're sort of lost in this world where everyone can distribute. You and I are doing a podcast right now, this was not possible 30 years ago. And they don't know how to market in that environment, but they do have the resources to do this quickly if they wanted to. But it's that understanding of marketing and that holistic experience that I think they haven't solved for yet.
Brian Friel (21:53):
Yeah, I agree. It's crazy to think back too, like you said, the streaming is a great example. You're watching your favorite TV show this week. You take it for granted that you can just peruse Netflix or Hulu or Amazon Prime Video and all this stuff, but it was not that long ago where you didn't have any of those options. And like you said, you just consume whatever was given to you. You didn't have that choice. It's pretty cool to see that playing out in Web3 now too, or you can kind of sense that it's coming. And I'm hopeful that we'll have that same sort of aha moment in the future where we look back and say, "I can't believe that this was the way things were."
(22:24):
We talked a lot about crypto Twitter in this episode. I think crypto Twitter would kill me if I didn't ask this question, so I have to ask it. But now that we've covered everything that Claynosaurz is up to, looking ahead, is there anything you can share with the fans in particular? Anything that maybe you guys haven't discussed publicly or things that your fans can be looking forward to from the Claynosaurz ecosystem?
Andrew Pelekis (22:44):
Yeah, absolutely. So we're working on all these different tangents, and so all of those things are active. I would say one of the things we're doing first and foremost is developing our website. We need this to be a repository of all the things I've just described to you. So for those who are already active in the Claynosaurz community, there won't be anything new there necessarily. However, there will be this repository of information to onboard people and to bring people into the ecosystem. That's probably the least interesting of the things I'm going to say.
(23:10):
So going beyond that, we're working on entertainment experience, which will also live on the website. This will be a gamified experience, where people can engage with their Claynosaurz, discover part of the Claynotopia land, figure out the lore as we develop into these different regions. And also, begin to accrue drops and different things in the game that they'll be able to itemize and make those Claynosaurz more unique. That's going to be, I think, a really fun addition to our Web3 track.
(23:39):
I think on the other tracks, it's very important to note that we're starting to permeate into TikTok and into Instagram and into YouTube Shorts. That's low-hanging fruit for us, so we're going to get movement on that very soon, so look out for that. And I think probably the most exciting thing, at least for me the most exciting thing, is we're working on a few things in the merchandise realm. And if I go back to the very foundation of this company, the guys who developed this IP, their instinct from day one was, "These are going to be toys. These need to be toys." That's how they developed the IP, and that's what we've been working on for literally since day one, for over a year now, a year and a half.
(24:18):
So we are now in talks with a number of different partners to help us develop collectibles, so think high-value collectibles that we will also integrate with a digital NFT angle. We are also working on toys, generally speaking, and then a whole merchandise store as well. So there's a whole bunch of physical additions coming to the Claynosaurz world.
Brian Friel (24:42):
That's awesome. Keeping with the theme of pushing the boundaries both on the digital and in the in-person and the physical. I love it. Well, Andrew, this has been an awesome discussion, really exciting to talk to you and to hear your vision for how internet native IP is going to play out and everything that Claynosaurz is up to. One closing question that we ask all our guests, and I'd love to hear this from you, is who is a builder that you admire in the Solana ecosystem?
Andrew Pelekis (25:04):
When I first got on, and this is going to sound perhaps odd, but I really admired what the guys are doing at Backpack. I think that they're solving for a lot of friction that currently exists between Web3 and everyone else. I think if that product develops in a way that they envision, it'll be a really big step forward for the entire Web3 community. So I admire them very much. And then I also have to give a big shout-out to Aurory because these guys are... They're Montreal native like we are. They're developing what I think to be a very high quality game on the Solana ecosystem, and I believe that it's a really good showcase of what's possible on Solana that may not necessarily be possible on other L1 chains.
Brian Friel (25:51):
I love it. Two great answers. I agree. Great builders in the space, and I think you're not the first to shout out some of those people as well, so you're in good company there.
(25:59):
Well, Andrew, this has been really awesome. Thanks so much for your time, for sharing your vision of Claynosaurz. Where can people go to learn more about Claynosaurz?
Andrew Pelekis (26:06):
I would say right now you can go to @Claynosaurz on Twitter, you can go from there into our Discord where a lot of the particular information is, and we've got great mods who will help you out. And lastly, I would continue to go look at www.claynosaurz.com, where we will soon have a great website up and running, with all the information at your fingertips.
Brian Friel (26:28):
Love it. Andrew Pelekis, the CEO of Claynosaurz. Thanks so much for your time.
Andrew Pelekis (26:32):
Thank you, Brian. Thanks for having me.
-
Our guest this week is Austin Federa. Austin is head of strategy and communications at Solana Foundation, responsible for setting the direction of the Solana Foundation and working with projects and developers building in the Solana ecosystem.
Austin discusses Solana's pragmatic engineering culture and the need for developers to focus on building things that are truly only possible on Solana. He also highlights the Foundation's role in supporting infrastructure-level initiatives and turning R&D into stable, standardized solutions. Finally, he stresses the importance for founders to focus on revenue and business models during the bear market and to build outside of the United States.
Show Notes:
0:55 - Starting with Solana
6:42 - Pragmatism at Solana
11:15 - Labs vs. Foundation
17:36 - Exciting new things at Solana
21:52 - Things Austin is personally excited about
26:19 - Contributing to Solana
31:47 - Who is a builder you admire in the Solana ecosystem?
Full Transcript:
Brian Friel (00:00):
Hey everyone, and welcome to the Zeitgeist, the show. We highlight the founders, developers, and designers who are pushing the Web3 space forward. I'm Brian Friel, developer relations at Phantom, and I'm super excited to introduce our guest, Austin Federa, the head of strategy and communications at the Solana Foundation. Austin, welcome to the show.
Austin Federa (00:25):
Hey, thanks for having me.
Brian Friel (00:26):
I'm super excited to talk to you today. As I was saying just before recording, I think this is the first time I'm recording someone who's actually a podcast pro, so I have a lot to learn from you. Thank you for making time. Austin, before we get into everything about Solana today, I'd love to just learn a little bit about you, how you got started at Solana. And I remember when I first joined Solana, you were the head of communications, and I think at the time there wasn't a clear split between labs and foundation. Since then, a lot has changed and maybe you could go in a little bit of that of how your role has evolved as well.
Austin Federa (00:56):
Yeah, definitely. So I originally joined in January of '21 out of Bison Trails. So Bison Trails was getting acquired by Coinbase to become Coinbase Cloud. I'd worked there for a little over a year running a bunch of the product marketing there and those sorts of things. And just with the transition over to Coinbase, it was like, oh, you don't want to go work for Coinbase, do you? And I was like, no, probably not. And so it was one of those things where it was somewhere in between one of the people who didn't make the cut and one of the people who they were like, you're just not going to be successful here. And I was like, that's a fairly accurate read. I got tons of great friends who are still working at Coinbase, but for me it just wasn't really the right spot. So I was talking to a bunch of L1s and L2s about coming over.
(01:41):
And so, one of the big things we'd done at Bison Trails is we had built out almost all of the world's Eth2 staking infrastructure. And I mean almost all the world's Bison Trails infrastructure ran solidly over 50% of the Eth2 network when the Beacon Chain launched, and still at that point in January of '21. Now this didn't matter from a decentralization standpoint because the Beacon Chain wasn't actually a thing. It was just a place you could stake. There wasn't actually user transactions or anything of value on it besides some Eth. But I was pretty heavily in the EVM world at that point. And so I was going around and talking to a bunch of different protocols. I was talking to a bunch of L2s and scaling solutions and these sorts of things, and I was talking to Polkadot as well and some of those type of other L1s.
(02:25):
And a friend of mine who I worked with back at Republic years ago, Ben Sparango was like, "Hey, what are you up to?" And I was like, "Ah, I'm kind of between stuff right now. I'm interviewing a bunch of places. I don't really feel super passionate about it. I was like, maybe I should leave crypto. I kind of like this industry a lot, but I don't know. We'll see." And he is like, "You should talk to Raj and Toly." I was like, "Of Solana?" He goes, "Yeah, yeah, I joined Solana a few months ago. It's great. You should come talk to us." And I was like, "I don't know, man. I worked with 20 different protocols when I was at Bison Trails and none of them were Solana. Solana was the weird thing that was hard to run and no one understood how to build software for it, but we supported it at Bison Trails because there was people who were trying to run infrastructure for it.
(03:04):
And he is like, "No, just come and talk to them." And we just finished up this big project with Masari, which was the state of Eth2 was basically the report that we just helped them write and put out. And I had a lot of questions and I thought the questions were just things that I was getting wrong. I thought it was me who was not understanding the model under which Eth2 was going to work. This is back at the time when you're going to have Parallax, execution shards on the network and all this sorts of thing. And I was like, I don't understand how DeFi is going to work here. The minute you break what now we call the global state, but the minute you start moving data into segregated places, that means the data has to be moved before it can interact.
(03:45):
And if there's one thing we all know about computer science, it's that copying is expensive and takes a lot of time. And so I got on the call with Anatoly, and I was just talking about Eth2 stuff and asking him some questions about what he thought about this stuff. And he's like, "Oh yeah, there's no composability in charting." And I was like, "You're the first person who's told me this. Tell me more." 'Cause I've been talking to a bunch of people who were talking about like, oh, well, it's just harder and it's like... He runs me through the whole thing about like Solana's, a single global state machine, really fast blockchain, what all these advantages were here. And all this stuff, for me, I was like, oh, this makes perfect sense. All of the things that I have been thinking and feeling about the undefined world of what the new state... Now I would sort of call it the cosmofication of Ethereum, what that process was like.
(04:32):
I wasn't an idiot and I wasn't just not smart enough to understand what folks were talking about. Folks just were talking ahead of the problems they'd solved. And this is not to say that we're never going to have composability uncharted ecosystems, but it took video game designers almost a decade to figure out how to program for multi-core processors. And that took a long time to figure. Out for me, this sort of decision to come and join the Solana Labs at that point was really practical. It was like, I don't know if this weird wacky idea is going to work, but I know I'm going to learn a hell of a lot here from these folks who are doing something very different than the rest of the industry. And the very different than the rest of the industry is usually where the cool stuff's happening.
Brian Friel (05:15):
I think that is the most perfect intro for this because it hits on so many themes. I want to dive in with you.
Austin Federa (05:21):
Great.
Brian Friel (05:21):
One theme that you kind of hit on right there, and this is before we even get into what you currently do as your role and everything, which we should definitely hit on, but I think that resonates pretty well with what Phantom saw originally. Because Phantom also coming from EVM background and the founders were all Zero X folks, seeing that, hey, there is this thing, it's maybe the redheaded stepchild of crypto right now, but these people who are marching into their own beat. This is like 2021, very early 2020 at this point. But basically what I would say it was a very non-consensus bet to do things differently and built out its own genuine kernel of developer ecosystem, which has just evolved into all this craziness today we can talk about.
(06:00):
But I think one of the key principles of that that I've noticed in my time in Solana is just the level of pragmatism and the reality of, Hey, these are problems today. We have users today, and how do we ship and iterate on these things and not talk about a problem that might be 10 years from now, which may or may not be solved, but actually addresses the problem today. And I think there's a lot that is going on in Solana about this across just all sorts of stuff. We should dive into all of that.
Austin Federa (06:27):
Oh yeah.
Brian Friel (06:28):
But I love that framing, and I'm curious, is that level of pragmatism... Who do you think that's set by? I feel like that's almost something an Anatoly thing, but is that an explicit choice that Solana Foundation or Solana Labs is choosing to bring into the ecosystem?
Austin Federa (06:42):
So one of the things I think is really important when you're looking at any software system is to look at philosophies that the people building it have. And a lot of the places you see that philosophy is in their background. And so if you look at Anatoly and Stephen Akridge and a bunch of the other early founders of the Solana project, their expertise was all in embedded systems. A bunch of these folks came from Qualcomm or very similar companies to Qualcomm, and they were trying to figure out how you could cram the best user experience possible on a flip phone or a proto smartphone onto a chip. And they had to do all these crazy low level optimizations to get this stuff to work. And Solana's not super, super low level, but one of the major things there was saying, we're going to combine the consensus layer with the virtual machine.
(07:38):
And that's not for some elegant principle of software architecture. That's because it's faster and yes, it's harder. And yes, there's a lot of other problems that come with that, but at the end of the day, the pragmatism comes from the background of folks who actually had to ship chips that companies were going to build software on that would interact in the real world and be the basis of all of this mobile revolution. And so there's other approaches that are very sort of come from the academic computing world where it's as long as we can define the perfect software system, in theory, the problem is just finding the execution place to do it on. And there are some chains that have been more successful than others with that. But I think at the end of the day, the thing Solana has going for it is this sort of ruthless pragmatism. It's a desire to build software in a way that doesn't let perfect [inaudible 00:08:33] of the good, but also keeps its values front and center.
(08:36):
And one of those major values is if you know you have to do the hard thing, do the hard thing first. And that is the thing I will routinely tell people internally is the only way you eat an elephant is one bite at a time. And that is kind of the way we go through all of this stuff. It's so easy to talk yourself into waterfall releases. It's so easy to talk yourself into, well, when this thing comes out, then this and this and this, and this can all come out and then we'll have this end state of this. And it's like you're making assumptions about what the blockchain industry's going to look like 18 months from now. I don't think any human is ever successfully predicted what the blockchain industry would look like six months from now, let alone three times that. So there's all this stuff about not working with entrenched assumptions, picking software architecture systems that feel like they're persistent. I would say that the software philosophy that Solana core engineering builds on is closer to brand philosophy than it is like technical philosophy. It's very interesting.
Brian Friel (09:36):
Yeah, I couldn't agree more. I mean, being [inaudible 00:09:39], I think we have a front seat to that too, as the ecosystem changes as the leadership basically, like you said, just takes the hard challenge first and says, this is something that we have to face. Let's tackle it now. Here's an open proposal, here's how we can do it. I'm looking back at what Solana was even just a year ago, one of the dev advocates on our team on it put out this tweet that said, "Things we didn't have a year ago on Solana Wallet's standard."
Austin Federa (10:02):
Oh, I love it.
Brian Friel (10:03):
Which is like looking at the state of other blockchains trying to be an ejected wallet there, it's a mess. Solana takes that hand on, makes a chain agnostic wallet standard for that version transactions, which like high level, massively refactoring how transactions can be done such that you can just access way more accounts on Solana DeFi doing multi hops exchange. Jupiter, the perfect example of that. Priority fees on the network, I mean elegant state level hotspot fee markets that don't impact the rest. Anyone else on Solana. Programmable NFTs, state compression, quick, stake weighted QoS.
(10:37):
I mean, not to mention Saga, new token programs. There's just so much going on right now. From where you sit, and maybe this can get into a little bit of the labs versus foundation discussion that we want to get into too, is how do all these ideas come to life mean? Some of these are community driven, like Metaplex having their own programmable NFTs. But a lot of these also are Solana engineers who are just on the front lines with their own proposals. Jordan Sexton has an idea he's doing it. How much of that is top down driven? How much of that is bottom up? And how much of this is a labs versus foundation? How do you see all this kind of how it plays out?
Austin Federa (11:16):
So before we even get to that, one of, I think the most interesting examples of pragmatism is how little work wallets have to do on Solana. This is super different. On Ethereum, the wallet has to build the transaction, that is a part of the thing. And on Solana, the DAPs have to build the transactions. Because the DAPs know more about what they're building than the wallet does. So why would the wallet build a transaction? The wallet's role is to verify that the transaction is what the DAP says it is, right? But it's those little tiny things where it's like how do we make it easier for people to build something like Phantom in six months as opposed to nine months?
(11:55):
And that's kind of one component that falls into that. But you were saying these sort of ideas about where do these things come from. A lot of it comes from best practices in other ecosystems about things people are talking about. I think one of the things that Ethereum is far ahead of Solana on is formal verification. And formal verification is not something that we came up with or claimed to have come up with.
(12:20):
It's like, oh, this is a really strong thing in another ecosystem that we should take and bring into this. Proof of history is just time division multiple access. It's TDMA, it's literally what 2G cell phone technology run on. But you've applied that to a blockchain with a leader schedule now and suddenly you have an incredibly fast blockchain. I think one of the best things to think about is Solana is full of out-of-the-box solutions to very conventional problems. And those out-of-the-box solutions will often come from engineers who are working on this stuff. They'll often come from engineers who are not working on this stuff. The number of suggestions that have come from someone's like, oh, I'm trying to build this thing, and someone like over lunch or over a Zoom on something else is like, what if you just do it this way instead? And they're like, okay.
(13:08):
And then they go down that... It's sort of this idea that there's not an intellectual purity test. You don't have to subscribe to a philosophy of how something should be built in order to have an idea here. P NFTs came entirely from community demand for them. That was a direct response to sort of a problem. The wallet standard is again, it's like it's really annoying that developers have to integrate calls for every wallet into their DAP. Wouldn't it be so much easier if there could just be one thing they could call and all the wallets in your Chrome Exchange could be like, hello, here I am. And that was an incredible easy turnkey thing that didn't require creating a whole separate product, a whole separate company to just connect wallets or adapt wallets if we should say it that way. And that's where these kind of things come from.
(13:58):
Now sometimes this leads to suboptimal user experiences too. I would say that we have three excellent explorers on Solana for what you want to do with that explorer. And you don't go to Solscan for the same things you go to Solana FM for and you don't go to the explorer.solana.com for the same things you go to those other ones for. And so there is sometimes this sort of fracturing that occurs because everyone has great ideas and they feel very comfortable building them before we've had a committee meeting or faculty meeting or something to decide what the right path forward is. As much as possible, the goal is to move fast and see what's adopted and the stuff that's adopted then gets tons of resources thrown behind it from the community.
Brian Friel (14:48):
Yeah, I do think that's incredibly refreshing though for crypto. I mean, especially an industry that's still... I think as a whole macro level iterating a lot. The meta is constantly changing. Some pattern that I've noticed is with P NFTs is a lot of times Solana will hit a new meta or figure out a new problem well before other ecosystems because of this rapid iteration and experimentation. And it's almost like, hey, Solana's figured it out. Let's take the learnings from there and tell everyone else and get up to speed on that.
Austin Federa (15:16):
Oh yeah. And tell everyone else we thought of it ourselves. That's also the other thing. And we see this all the time, not in a way that people are like, but all of the tricks that Monad is doing to try and speed up EVM, they're all the things that Solana did. Except they're trying to do it with an underlying architecture that it's a lot harder on because transactions on Solana have to specify their accounts, their instructions, their memory, their compute, before they get accepted and executed. So the work of transaction simulation on Solana is a lot more about just reading what the data says and being like, yes, these things say what they actually say they say, and then you can simulate balance changes and all that sort of stuff. But that is a very different problem than trying to stochastically model what an EVM transaction is going to do.
(16:05):
And if you're trying to do out of order processing of EVM transactions, I'm not going to say it can't work because a lot of people thought Token Ring was the only protocol that could possibly make the internet work. And the idea of just throwing packets randomly at a router and being good luck, well, that sounded insane, and that is exactly how the internet works. You just randomly throw packets at routers and most of them get there somehow. It's pretty astonishing. Like packet collision's super rare nowadays, even though everyone's just screaming at the top of their lungs constantly for bandwidth, and that's wild.
(16:37):
So who knows if the stuff will actually work on that side. But the cool thing I think that's going on in Solana is this lack of ideological purity around how something has to be done, and it's more of a purity around what the outcome has to be. There's so many analogies here, but the United States, we talk about equality of opportunity all the time, and that is actually a much harder thing to do than equality of outcome. And so I think with Solana, it's like if you focus on the outcome that you want and not the process by which you get there, you will find a better way to get there.
Brian Friel (17:12):
I love that. So from where you sit on the foundation side now head of strategy at Foundation, you mentioned that there's all these engineers, some at Solana, some not at Solana, who basically have these problems. They come up with pragmatic solutions. What's the role of the Solana Foundation on all of this? And is there any big bets in particular that you're excited about or you guys are making for this year on Solana?
Austin Federa (17:36):
Yeah, So the Foundation is a Swiss nonprofit foundation that exists to further the adoption and advancement of the Solana blockchain. And so this is the entity that gives grants. This is the entity that if you've ever sort of interacted with a granting apparatus, breakpoint, hacker houses, developer boot camps, those are all run out of the Solana Foundation. That's its role for being in the world. And so the initiatives that we are working on are really infrastructure level. They always have been, and I think they will continue to be throughout this year. So a great example of this are fee markets, like you mentioned, right? Local fee markets. That was technically shipped in September, but I would argue it practically wasn't shipped until December. And that was because there wasn't a method at that point for an RPC, for a wallet, a DAP, anything to hit up an RPC and say, how much do you think I should prioritize a fee if I really want to make sure this transaction gets through?
(18:34):
And without the ability to guesstimate, you don't have anything, right? That is not a functional, usable, shipped thing without developers actually being able to implement it. And that's kind of the difference I would describe between the work that gets done through let's just say Solana Labs and core engineering there and the work the Foundation's supporting. A lot of the work that core engineering does and a bunch of, obviously not all, there's core engineers all over the place, but a number of the core engineers are on Solana Labs' payroll. And those individuals, they're focused on the core engineering, right?
(19:09):
They're like, we shipped fee markets. We're good. At the Foundation, we're like, wait a minute, wait a minute. There's so much work to actually be done to turn this into a standard that every DAP and wallet can use without spending days writing custom code. And so I would say that's kind of the place that the Foundation comes in is it's not directing what work gets done, but it's sort of the process of taking stuff that feels like it's either R&D or it's super hot production engineering. And turning it into something that's more stable, that's more standardized, that's more universally understood, and doing that in a way that there's feedback collected from many people in the ecosystem, in addition to the whole granting apparatus.
Brian Friel (19:47):
So the developer relations team sits at the foundation level no longer at the labs level?
Austin Federa (19:52):
Yes, very much. You were saying earlier like, oh, these things maybe weren't as separate before they actually were just as separate. They were just very few people worked for Foundation. So because most of the work at that point was just sort of kick out as much as you can get out the door. There were folks at Foundation giving grants and stuff like that, but a lot of that sort of work that we do today, it wasn't necessary to do it yet because the thing didn't exist yet, at that stage. When I joined, there were 36 programs on the network that had daily transactions through them.
Brian Friel (20:25):
Wow.
Austin Federa (20:26):
Absolutely nothing. And now we're over like 1200 easily. And I just think that's such an interesting change to see over such a quick period of time.
Brian Friel (20:35):
Oh, for sure. It stood out to me too, that... I think I mentioned the earlier conversation too. It's like this kernel of genuine developer interest that basically no other blockchain ecosystem I think has outside of Ethereum where it's people who are very much specialized, Solana centric as Chase loves to say too in Glass, but really just thinking about what's only possible in Solana? How can I iterate on this and expand on this? That's super invigorating to be a part of, and that's my favorite part of the ecosystem, essentially. Yeah,
Austin Federa (21:04):
We love it.
Brian Friel (21:05):
On that note, there is this meme now, is recording this in April 2023 of only possible on Solana and these things that everything we talked about, this pragmatic engineering culture of basically what's the outcome, what's the end user experience that we really want, and finding ways to ship that. There's a lot going on right now. I mean, I think Saga is an awesome example of this. It's like, how could we take a phone that just is the most kick ass crypto experience you could possibly have on mobile, but there's all sorts of stuff. There's compressed NFTs and state compression, what that means, DPIN is this new thing. There's all existing, DeFi, just normal FTs payments infrastructure. What are you personally most excited about and are any key themes in the year ahead that you think people should look into now that really highlights the strengths of Solana?
Austin Federa (21:52):
So the decentralized physical infrastructure layer is a really interesting story for me personally. And I think there's so much that goes on with that that goes into that, whatever kind of language you want to use to describe that. I am just super excited about what that looks like. And for me personally, the stuff I'm most excited about on Solana is you really don't have a choice to build it anywhere else that you need a fast composable ecosystem that has the capacity to go up to tens of thousands of transactions per second for a base fee of $.000025 and that's rare. You really can't find that in a lot of other places or a lot of other applications. And so for me, that's like some of the coolest stuff on Solana. Now, in terms of what's coming this year, I think we're going to see Fire Dancer rolling out on testnet probably in Q4.
(22:40):
That's going to be really interesting to see how that performs when it's intermingled with the other clients on the network. So that's going to be very interesting. There's a ton of work being done to make custom contracts easier to deploy on Solana. This is a project called Interfaces. This is out of necessity. The Token 22, which is code name, it definitely won't be called that once it's released. Token 22 is this new token program coming to the network. And it brings all sorts of things like interest baresing tokens. You can charge fees to use contracts directly in the contract.
(23:11):
There's a lot of really interesting stuff that comes to it, but it adds a second token program to the network. And that second token program means you need to suddenly have a way that a wallet can instantly say, Hey, which program should I look at for this arbitrary piece of data on chain? And because of that, it means if you've built support for two, you can build support for 20,000. So there's little pieces like that that are coming, but I really think this is going to be another infrastructure year, but instead of it being base level infrastructure, it's going to be something closer to developer tooling. I'm not sure I would call Interface is developer tooling, but it's definitely usability tooling. That means it's easier to develop novel things for the Solana ecosystem.
Brian Friel (23:55):
Yeah, I see that as well. The conversation shift towards interfaces is really exciting too, because Solana's account model and program model has some implicit instruction in that where, okay, this is the canonical token program.
Austin Federa (24:08):
It's perfect. What are you talking about?
Brian Friel (24:09):
Yeah, it's perfect. What are you talking about? And I think that just leans even more into those pragmatic values kind of shipping. And that's like, Hey, if we do have these interfaces where all of a sudden any wallet can take any of these token programs, any NFT exchange you can list on, you can list your NFTs through them. Opening up that design space, a deeper infrastructure level, I think would be really exciting.
Austin Federa (24:31):
Yeah. This will support everything from if you are a... No offense, but if you're a super corporate NFT project and you want to make sure that you have certain protections or certain things or whatever, you might want to deploy your own version of an NFT contract. And right now it's really hard to do that. It's not hard to deploy the contract, it's hard to get the ecosystem on board with the contract you've deployed.
Brian Friel (24:55):
You have to knock on every door to get a custom integration.
Austin Federa (24:59):
And we're seeing this with compression, right? Compression is awesome. It's been picked up by a ton of wallets. There's not an NFT marketplace that supports it yet.
Brian Friel (25:08):
Not yet, but I have heard soon. So maybe, and by the time that this podcast is released.
Austin Federa (25:13):
Who's adding it?
Brian Friel (25:14):
I have heard Tensor.
Austin Federa (25:15):
Interesting.
Brian Friel (25:16):
As an alpha drop.
Austin Federa (25:17):
They've been making moves.
Brian Friel (25:18):
They're making moves, but I would not be surprised if Magic Eden and others would be following suit at some point. But if we can open up an interface, some sort of interface standard where we can get buy-in, do the hard work up front to get all these different companies to buy into some sort of interface together, it's going to unlock a lot of really cool potential on Solana.
Austin Federa (25:38):
Absolutely.
Brian Friel (25:39):
One other thing I want to ask too is, you mentioned a few things kind of implicitly there. One of my questions was going to be like there's all these exciting things happening where we should we be investing now to unlock all this. But I guess there's also... I've noticed on Solana, and particularly Solana Twitter, there's this part of what this pragmatic culture has attracted is a culture of doers and people who show up and they want to contribute and they want to lend their time. And a lot of developers who maybe not even be working in the Solana ecosystem who are just excited and passionate about it. If you could speak to those people, where do you think they should be focusing their time and energy? What is Solana most in need from external contributors at this time?
Austin Federa (26:19):
It's a really good question. I mean, the problem there is I don't think the advice that I would give external contributors is good advice for their project at this point. It's great advice for Solana. The advice for Solana, I'd say is keep building strong open source tooling and foundations so we can make it easier for new developers to get involved. Anything you build that fits into the Lego thesis super strong, please keep doing it. What I would actually give as advice for founders in this space right now is that we're probably in a bear for at least another 12 months, and it's going to be a climb out of this thing. And you should be spending time thinking about revenue. You should be spending time thinking about business models. Not a lot, not enough to go raise a massive series beyond, but enough that you're extending your runway by a few months that if you have to raise a bridge round, you can show, hey, actually we do have revenue.
(27:23):
Here's our revenue numbers. Give us a little bit of money. Because I think this is a really hard time in the capital markets. It's really easy to be like the bear is a great time for building. That's true. The bear is a great time for building. It's a terrible time for payroll though. And that's kind of something they just remember as you kind of go through the process. Now, what does Solana need? I mean, I'm going to tell you my vision of how Solana could not win. And the way Solana doesn't win is if these incremental small scaling solutions for EVM, that 400 transactions per second, you can do an EVM right now if you really try. Maybe we just don't come up with transaction heavy use cases that anyone truly wants for a while. And that's a situation where all this horsepower that's been brought to bear on something like Solana isn't actually needed for what things people want to build on blockchains.
(28:20):
Now, I don't think that's true, but that's the thing to think about. What Solana needs is for people to embrace only possible on Solana and to build more things that are truly only possible to be built on Solana. Because as much as I love NFT projects, very few of them are only possible on Solana. This is the great thing about XNFTs. Those are truly only possible in Solana right now. But let's see teams going out there and saying, okay, a 10,000 drop is cool. What if we do a million, 10 million, a hundred million? Yeah, they're going to be cheaper. Yeah, the dynamics are going to change. Something's going to change, right? But this is the thing that I think is so interesting about this space is everyone has internalized this financialization, Bitcoinification view of all crypto. Like, Bitcoin's value is scarcity, period, end of day.
(29:20):
That's great. Props to Bitcoin, nothing since Bitcoin is Bitcoin. Like Magic The Gathering is not worth less money every time they print a new trading card pack. The Pokemon company is not worth less money every time they sell a new Pikachu plush. There are models here that people just seem emotionally afraid to try. I think Clano is getting pretty close to this and they're doing some very cool stuff with how they're doing some collection expanding. On the NFT side though, I think people need to get away from the idea that their value proposition is scarcity and figure out ways to do like LVMH and Louis Vuitton have done where they have something that is still high end, that is still hard to get but is not fixed cap. And sort of see where that maybe heads from there. On the DeFi side, start building outside of the United States, translate your projects, websites into Vietnamese and Turkish.
(30:18):
Don't think your growth is going to come from the United States in the next year or two because the regulations here are really uncertain right now. And it's a bit of a tricky time for folks to be in the United States. But I went to Turkey and I went to Vietnam, and folks are using crypto, and they're using crypto because in Turkey it's significantly more stable than their actual native currency. And that's a crazy thing to be thinking about, but that's true. So let's embrace that. Let's actually think of this stuff and make sure that the work that's being done truly actually supports this kind of stuff. And I think that's kind of one of the most important things to think about from the perspective of a founder at this point.
Brian Friel (30:57):
Yeah, I think there's been a key theme here throughout this whole conversation of basically going back to first principles and thinking, what's the outcomes that we want? Originally, I think Solana's tagline, even blockchain at Nasdaq speed, we were promised flying cars. We got Twitter, we got the greatest JPEG trading engine in the world on Solana, but how can we continue to iterate on this and what are things we can only do on Solana? All those examples you brought up I think are awesome examples. I really appreciate that you guys are continuing to challenge the ecosystem and to push and to not be afraid to try new things, and that's where the unlocks happen.
Austin Federa (31:30):
Yeah, of course. I think that's incredibly important and powerful here.
Brian Friel (31:34):
Well, Austin, this has been an awesome conversation. Thank you so much. One closing question we ask all our guests. Keeping line with the last question of the things you're excited about is who is a builder that you admire in the Solana ecosystem?
Austin Federa (31:48):
I mean, there's so many, it's hard to pick one. There's the easy answers of Armani and those folks and Mango Max. And I think the truth is that the folks who are doing some of the most interesting work are the ones who are bug fixing, who are going in and saying, ah, I ran into this problem with this tool set that I've seen someone else build. Let me go spend a little time trying to fix this thing up. And I don't have anyone particular to name in that, but it's very easy to be like, holy shit, Armani and X NFTs. Wow. And it's like, that is incredibly important. You know what else is really important? The dude that went in and made RPCs 20% more efficient for certain types of calls. And I think those are equally important things, and I wish we did a little bit more celebrating of the maintenance work in addition to all of our celebrating of the true innovations only possible on Solana.
Brian Friel (32:40):
Mert is going to love that, that you said their call that out, so.
Austin Federa (32:44):
There we go.
Brian Friel (32:44):
Maybe we can put Mert, Triton, all those folks, everyone, all the infrastructure that does the unsexy blocking and tackling that maybe really is the true glass eating on Solana, all of those guys.
Austin Federa (32:56):
Totally. I mean, there's a bunch of devs that work in Mango that are actually part of core engineering now, and they just fix a bunch of stuff because they're just like, we were trying to build our next version of Mango and we kept running into these problems, so we just started fixing stuff.
Brian Friel (33:10):
No one knows it better than them. Yeah.
Austin Federa (33:12):
Exactly. So it's good.
Brian Friel (33:13):
That's amazing. Well, Austin, I'm really excited for the next year Solana, thank you so much for coming on the podcast.
Austin Federa (33:20):
Definitely. Thank you. This is fun.
-
This week's guest is Domingo Valadez, Co-founder & CEO of Homebase, a platform that lets people invest in tokenized residential real estate for as little as $100. As real estate prices continue to get more and more unaffordable for people, Homebase aims to be the destination for US renters to invest in the US residential real estate market via fractionalizing NFTs.
Show Notes:
0:50 - What is Homebase?
2:05 - Why Solana?
4:06 - How does it work?
7:09 - Benefits using web3 and Solana
9:17 - Us vs International
11:11 - How things can evolve for Homebase?
14:18 - Regulatory landscape in the US / next US markets to expand to
17:04 - User journey from first wallet to being a homeowner
20:04 - Voting
21:14 - Retaining people in Crypto
22:57 - Exciting things in on-chain residential real estate.
24:38 - A builder Domingo admires in the Solana ecosystem
Full Transcript:
Brian Friel (00:05):
Hey, everyone, and welcome to The Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web3 space forward. I'm Brian Friel, developer relations at Phantom, and I'm super excited to introduce my guest, Domingo Valadez, the co-founder of Homebase, a digital platform for fractionalizing residential real estate via NFTs. Domingo, welcome to the show.
Domingo Valadez (00:28):
Thanks so much for having me, Brian. Super excited to be here.
Brian Friel (00:30):
Yeah, super excited to have you on as well. You guys are a hotly anticipated recent launch. I've seen you guys on Twitter. It's one of the most, I'd say, unique and more pragmatic applications I've seen most recently launch on Solana. Can you give us a quick overview of what is Homebase and how can users start using it today?
Domingo Valadez (00:51):
Yeah. Homebase is a platform that lets people invest in tokenized residential real estate for as little as $100. The main value property right people is just getting exposure to an actual physical rental property and starting to get some of that passive income, starting to get that appreciation over time in terms of how you can participate and invest, you can just go to our website, make an account, we do force you to put a KYC and that's just to follow us regulations. So right now we're limited to just US investors unfortunately, but have plans to make it international as we continue to grow. But right now it's a matter of KYCing. You also have to set up a 15-minute call with one of my co-founders, Alex, and that's just to make sure that you're a sophisticated investor so you get to know us a little bit. So we're very transparent with our team and what we're doing, but we had 38 people participate in our very first home and now have 1500 that want to participate in our next one.
Brian Friel (01:41):
That's awesome. So residential real estate investing, that's something that I'd say a lot of the demographic with Solana maybe skews potentially on the younger side. This is something that people think is interesting but have historically been left out of this world of investing. What made you guys decide to do something in a purely digital way that's different than traditional residential real estate investing and what made you guys choose to launch this on Solana?
Domingo Valadez (02:05):
I grew up in a family that has always seen real estate as a great way building wealth over time and just growing up I've very quickly seen it become unaffordable for most people in my generation. So I was working at Google for five years, still couldn't afford anything in the Bay Area and I was like, "This is absurd." And so it was like how can we make this affordable for people where they can actually get some skin in the game with the properties they're living in? And so that was really a big culmination for why Homebase and so then I've invested in my own residential property, myself and my hometown of McAllen just going into that flow, so many third parties, how to work with a bank, took literally three months to buy the property and that was just awful as well. So it's kind of like what can we do that's completely digital that just makes the experience really, really easy for people?
(02:49):
And so that's where the idea around Homebase came from. We're making it where people can invest in properties for as little as a hundred dollars. And so real estate's also a industry that loves silo data. You have big players that really hold their data near and dear to their heart and don't want to share it, and that's the complete opposite of public blockchains, right? It's like, "Let's just get data. Everyone should have a fair shot at understanding what's going on and if you know how to utilize that data, you can make some great decisions with it." A big piece of it came from the mission as well of I've been following Bitcoin since 2017, love the decentralization aspect of it and so wanted to see how we could get real estate in a very transparent open source way. That was a big culmination about why even build in a digital space using blockchain to do this.
Brian Friel (03:33):
Love it. I think that story resonates with a lot of listeners potentially I myself in Bay Area. Similar story there, so it's similar frustrations. I guess I'm a little curious how does this at a high level work under the hood? Kind of back to my earlier question, a lot of folks maybe don't know much about real estate investing. There's a lot of paperwork involved. What role is Homebase playing? What parts of this are done on chain? How do I go from, "I'm just a normal crypto user with NFTs." To now, I can say, "I'm a part of this homeownership project." How does that all work under the hood?
Domingo Valadez (04:07):
I'll share the Homebase side, then I'll share the user experience side. So it's actually quite complex to make it work. It took us seven months to build out the legal frameworks to how to do this and then building out the software for tokenization took about two months for us to do. But just to walk you through this first home, how we did it effectively, we found a property that was suitable. We put it under an exclusive buyer seller agreement, so Homebase had full rights to sell the house on behalf of the owner. We then spun up a special purpose vehicle that was sole intent was to purchase that property, and so then we created NFTs that represent ownership in that special purpose vehicle and we had a mint date on that mint date. It was basically like the day we started selling the property.
(04:45):
And so people could literally go to our website, these are people that have already KYC accredited, non-accredited, could then buy tokens with USDC and they would mint them directly on our platform. And so they would get those tokens immediately to their account and then in tandem they would get DocuSign documentation sent to them. So they have to sign a legal LLC operating agreement, they need to sign a security token purchase agreement, all this legal documentation that basically says like I am buying tokens using USDC and I'm now a member of this LLC that was created. So once we acquired all the money that was necessary, we then closed up the SPV and then actually completed the transaction. And so the owner received the amount of money that they were trying to sell on his first property, and then once that was closed, we then filed with the local title companies to basically transition the title from the owner into this new SPV we created.
(05:40):
So the piece that's truly on chain are the NFTs we created to represent ownership, but we're pretty much a Web 2.5 company where we do need to know who exactly owns what tokens, and we only whitelisted wallets can effectively trade them between themselves. So we file these as Reg D 506, security, private placement offerings, and in that regulation you have to hold the investment for at least a year. You can't trade it for that initial year, and then after that you can sell it through our platform either back to us or eventually want to allow for peer-to-peer trading, but we need an alternative trading system license for that, which we don't have yet. So the majority of it's going to be people selling it back to us and then us reselling it to the next person.
Brian Friel (06:23):
That makes a lot of sense. That was going to be one of my follow-up questions because given the permissionless nature of most tokens by default on chains, I was wondering how that works within a legal framework. You mentioned this first home that you guys tokenized from what I saw, it sold out within the first two weeks. It was a great success, but you guys basically just proved a use case that, "Hey, within the legal framework of how this exists today, this actually works." I think we could get into in this podcast talking a lot about where you guys see this going in the future and how this whole process is going to evolve. But can you talk a little bit about even just this first home that you guys tokenized and sold, what were some of the immediate benefits that you saw using Solana or blockchains in particular that might be different than the normal process?
Domingo Valadez (07:09):
I think a lot of the benefits are for users, not for us as the company doing it. So there was still a lot of complexity when it came to structuring all this and every single home we tokenize and sell on the platform has a lot of complexity behind the scenes, but for the end user, people could literally invest in this first home within five minutes. That's how long it took some of our users to purchase these tokens. And then they're just relying on us to do all the paperwork on the backend. Moving forward, we're going to be distributing out all funds using USDC, we're actually partnering with Circle. They're our money transmitter. They're the ones basically sending out all the funds to every single holder and we're going to be doing that monthly.
(07:46):
So as an end user, you just became a fractional owner in this property. You don't need to deal with any sort of property management headaches. You get your passive income and when you're ready to sell, you can just sell it back to us. We're going to be partnering with blockchain home registry to showcase the value of the properties monthly, and so you'll be able to sell it at true fair market value as dictated by five different data points of trusted institutions saying, "This is what the value of that property should be."
Brian Friel (08:11):
That's pretty awesome. One thing I want to hit on too is you mentioned that there's accredited investor checks, but is this also open to non-accredited investors as well?
Domingo Valadez (08:19):
We can have up to 35 non-accredited investors participate per home offering. It's limited to that just by the Reg D 506 B offering that we do, but we can have unlimited accredited. So moving forward, we think the 35 non-accredited spots will be taken pretty quickly because of course that's the main use case for people where they see the main value in what we're doing. But yeah, we plan to switch to Reg A offerings in the future and that'll allow anyone to participate. No limitations whether accredited or non-accredited.
Brian Friel (08:47):
These terms, accredited investor, unaccredited, Reg A, they're very, I would say US-centric. There's a lot of particular nuances to US investing laws that maybe contribute to why folks like us are interested in these kind of products. We can't always afford residential real estate in areas that we live and work. Is Homebase exclusively focused on the US Do you guys also see this problem internationally and can you talk a little bit about maybe how the US differs from some other major markets internationally?
Domingo Valadez (09:17):
The US probably has the toughest regulation when it comes to this. So for us, we very much wanted to tackle one of the hardest markets and also two of the three co-founders are US based, are three co-founders in Canada and both markets so similar, very, very expensive real estate in any sort of big city all feel priced out. So we really all align in the mission behind this. Our initial launch market was in McAllen, Texas, so that's where I'm originally from. So it was very near and dear to my heart to launch there and see properties that I grew up with actually get access to the internet and get tokenized in that capacity. But we'll stay likely in the US for the near medium term, but we do want to allow international investors to participate as well. So we've already been reached out to by a few big players internationally that want to be LPs in our future properties and then they can sell it to some of their customers as well, and that's how we'll open it up and expand the pie to international investors as well.
Brian Friel (10:12):
I love that. So you mentioned when you did the high level overview of how this process works, essentially onboarding people one by one, taking video calls with them, making sure they understand the process, having to give them tokens that there's restrictions on how they can actually be sent to different people if they want to resell. It oftentimes having to go through you guys that whole process and then I'm sure even just the whole process of you setting up these legal entities as Homebase and your Web 2.5 company right now, there's a lot of legwork that you guys are doing on the back end, abstracting this out.
(10:45):
I think listeners of this could imagine a world where one day this is all pushed more to the edges, to the actual token holders and owners themselves. How do you guys think about how this is going to evolve over time? Which pieces of this do you think potentially in the next couple years could be more evolve, looking in areas where you guys maybe at Homebase aren't doing as much legwork and which areas do you think are going to be a little bit slower to evolve over time?
Domingo Valadez (11:12):
US real estate's very locally driven. Not only do you have to follow federal regulation, you also have to follow state regulation. You also have to follow local regulation all the way down to the county level. And so understanding each of those three layers of regulation is really important. And so that drove a lot of where we first launched. So Texas is very pro landlord, they're pro tendency in common, so it was very easy to fractionize the property there and they don't have any sort of transfer taxes. So if I sold my tokens to you, other states or other cities would charge a tax on that, Texas doesn't. So that was a big piece that kind of decided where we even launched on the piece about where we're going and what do I think is going to get better over time. One of the big reasons we even did this on chains, we've had a lot of people say, "Why don't you just fractionize this without blockchain that's so complex, you're making your process harder."
(12:00):
It's really about the secondary financial implications of what it means to have things decentralized and on an open platform. So for example, we're already in discussions with an on chain lender to allow people to collateralize their tokens to actually take on chain debt. No bank, no credit score required, literally just you collateralizing your tokens to take on debt and that to me is a beautiful thing. You cannot own any piece of a home without a mortgage under your name or a bank, someone getting involved and checking out your credit score. So that to me is really, really exciting and something we can already do with the first home moving forward. Another piece would be as regulation gets looser, having more clarity around allowing peer-to-peer trading. So alternative training license is what we're going to be going for relatively soon, and that's going to allow for people to trade within themselves so they don't have to sell it back to Homebase, but actually allow for peer-to-peer trading.
(12:55):
To me, it's really just like all of the applications that then could get built on top of having real estate completely tokenized on chain is what gets me excited about the Web3 space. I think the pieces on the regulation that's going to push back is making sure everyone's KYC, making sure you know who your users are, making sure they didn't launder any of their money. But yeah, I think that's one of the biggest benefits of Web3 and creating liquidity in a market that's historically been pretty illiquid and at a very, very high prices.
Brian Friel (13:23):
Yeah, I think you're right. There's this element of composability that comes with this when this is native to the internet, it's online and there's a token, anyone can [inaudible 00:13:34]. Then like you said, build a lending market around that. And there's a world where one day you guys aren't even involved with that decision, it's just someone can just sole end or another project can say, "Hey, we already have this lending market and we accept these tokens now as collateral." My gut tells me that you guys are doing this by the book. That regulation is going to be the rate limiting step in all of this as it starts to go. How do you guys see the current regulatory landscape in the US and you mentioned that there's some differences not just federally, but on state levels and on county levels. Can you talk a little bit about that and why maybe you guys are choosing to start in Texas and where you guys, I mean maybe foresee the next markets that you guys are expanding to as well?
Domingo Valadez (14:18):
You're absolutely right. Regulation's going to be the inhibitor on doing a lot of Web3 related transactions for properties. I think Coinbase getting sued by the FCC is going to provide a ton of clarity around... Or that's my hope at least a lot of clarity around how Web3 companies should be operating. I think there's been a lot of confusion around what's legal, what's not legal. So just to keep our users safe, we chose the web2 legal approach where we tried being as closely to the book as we can in case things go wrong or awry. Our users are completely fine and we feel very confident with that. But of course as we continue scaling the company and getting bigger, we love for these secondary applications like a Solend. To just say, "Hey, we just created this lending platform, we actually don't need your permission to do it. We can just trade."
(15:05):
That to me would be amazing because that means we're succeeding in actually bringing homes on chain and tokenizing them and letting people do what they want with their assets. But the regulation's really going to kick in until then. Texas was great because it was very landlord friendly, very easy to fractionize the property and no taxes associated with that. We’ll likely continue to stay in Texas for the near to medium term, we're in McAllen now, plan to go to Austin later this year.
(15:31):
Other markets we'd likely open it in would be Colorado is also pretty open to this. So is Florida, specifically Miami is pretty pro Web3 and pro tokenization. It would be very, very city state dependent on what laws they have in place and how we can make this work. For example, even us opening it up to international investors, that requires us to redo some of the legal structures we have to allow for international investors to even invest. So we're going to very much rely on partners that say... There's a lot of demand in Latin America, for example, specifically from this country, "Okay, that's going to be the first country we allow to invest internationally just because of the regulatory piece of that." And we don't want any of our users to worry about that. So we're trying to remove all that complexity for end users while Homebase deals are all the complexities around that.
Brian Friel (16:19):
That makes a lot of sense. Miami, Florida doesn't sound like the worst place to be a homeowner as well, so that aligns pretty nicely. Taking a step back as an end user who's thinking about this, let's say that somebody has a Phantom wallet, they've experimented with sending some crypto to their friends, they maybe have a few NFTs. What would they need to know to feel confident in taking this next step and being an owner of residential real estate? Is it as simple as just showing up to your guys' website, hitting connect wallet, filling out a couple forms in a Zoom call? Is there anything that they need to do after they've already completed the purchase or other things that they should be aware of? Essentially, could you walk us through the user journey from getting their first wallet to actually being a homeowner?
Domingo Valadez (17:05):
Yeah, absolutely. So funny enough, for our very first property, we actually had a lot of new to Web3 users participate. So plug for you guys, we had Phantom as the preferred wallet for people to create and effectively onboard into the Solana ecosystem. And I think something that was very beautiful about this was people could upload their money into Coinbase, send Solana or USDC and Solana to their Phantom wallet and see it happen in two seconds within the call that we were helping them do it. So I don't think it's the same thing for other chains, but that's something that Solana does really, really well. So once you have a loaded wallet, you as you mentioned, have to make an account on our website, you do need a KYC, you set up a quick call with us, just it's your way of understanding who we are as founders and you can ask us questions directly.
(17:50):
It's really just to build trust with people. But once we have a home that's live, you literally just go to the property page, you connect your wallet that we've already whitelisted preemptively, and then you can just buy however many tokens you like. So every single token is denominated in a hundred dollars, so everything's transacted in USDC and you can just buy however many tokens you like, they immediately get minted to your wallet and then you get sent DocuSign links to sign that'll make you truly a fractional owner of the legal entity we spun up to acquire that property. So once you purchase it and everything closes, you don't need to worry about anything. We know exactly whose wallets hold what tokens, and we just start sending you your proportional amount of net rent every month and then you can decide to sell whenever you'd like.
Brian Friel (18:35):
So there's no upkeep. Part of the joys of being a landlord is things break in houses, there's taxes, property taxes to pay, all this kind of stuff. All of that is abstracted away from an end user.
Domingo Valadez (18:47):
So any home we list on our platform, we charge an extra 5% fee and that's really just to have a capital reserve pool. So if anything breaks, like we as Homebase have a property manager, they'll go out and fix it and then we refill that reserve pool with rent. So the goal is to never ask people that purchased it for money, we can refill it ourselves with the rent we collect, which is what's beautiful about real estate, it's cash generating and in terms of property taxes, we handle everything from that end. We do distribute K1s to everyone at the end of the year because everyone has their own personal income taxes they need to pay. So we can't force you to pay them, but we can give you all the information you need to pay them on your behalf.
Brian Friel (19:25):
That makes a lot of sense. I was also thinking when we talked earlier about the layers of this that could be abstracted away and evolved over time, that's potentially one of them, but I'm not sure if people actually at the end of the day want that. Is there a world where there's Homebase down people are voting on how do we pay for fixing the plumbing leak? I have a feeling that that's a service that all owners here are pretty glad that you guys are handling on behalf of them.
Domingo Valadez (19:50):
Yeah, one thing that is true though is people can vote us out. So we're the default manager of the property, but if you're not happy with the job we're doing, you can absolutely vote us out.
Brian Friel (19:58):
Oh, that's interesting. How does that vote happen? Is that an on chain vote with tokens or how did you guys set that up?
Domingo Valadez (20:05):
Yeah, so not on chain right now, but theoretically you're truly an owner of the LLC and you have voting rights in that LLC. So if people just came together and said like, "Hey, we want to vote them out." There's a meeting set up, people say like, "Yay, we want to remove Homebase." We won't be the manager anymore. It'll be up to the owners to pick a new manager and then that's how they can start facilitating the management of that property.
Brian Friel (20:28):
Wow, that's fascinating.
Domingo Valadez (20:30):
Yeah, we truly want people to be owners.
Brian Friel (20:32):
Oh, that's really cool. So I guess I have a couple questions here to kind of wrap up, but you mentioned that you guys are onboarding a lot of net new users to Web3, essentially people getting their wallet for the first time, maybe they don't fully understand how to use these wallets or the gravity of sending things on chain and the irreversibility of a lot of this. Do you guys have any particular insights from getting on calls with these people and walking them through this process? Do these users stay in crypto in your view? Do they stay engaged with it? Is it a steep learning curve for them? Basically, how as an industry are we doing at onboarding these people who maybe find crypto not because of crypto but because of a use case Homebase where they're just, it's a solution to their problem.
Domingo Valadez (21:15):
So very transparently, I'd say some people do have difficulty and it's a 30-minute call, and other people it's very easy. So I think something a lot of users asked for was like, "How can we abstract the complexities of wallets even further?" We're thinking about potentially having noncustodial wallets on our website where we partner with someone that basically just showcases the wallets directly there and then for an end user, it doesn't matter if it's crypto, you just know you own tokens in a property, you didn't have to create any wallet, it was automatically created for you. But for the people that do know Web3 and have their own Phantom wallets, have their own personal wallet, they can do what they like with those tokens and use on chain, that sort of piece. So I think for the industry to continue to expand, we need to continue to make it easier for people to onboard, abstracting away a lot of the complexity is something that'll continue to be key to keep widening the pie for everyone.
Brian Friel (22:09):
Totally. I can't imagine the call where someone buys a bunch of shares in a residential property and then forgets their seed phrase so, these are things that we're thinking about as well. I mean, I liked that framing of essentially giving users the easy option to start and the optionality to eject from that and really take control if you really know what you're doing. I think that's awesome.
Domingo Valadez (22:31):
Absolutely.
Brian Friel (22:32):
Well, this has been an awesome discussion, Domingo. Before we wrap up with one closing question, I always ask everyone I want to know for you too, what excites you the most right now from where you guys sit in this new field of on chain residential real estate, where are you guys heading next and what do you think is the most exciting next frontier? Is it new markets? Is it improvements in the way this is happening on chain? Is it in regulation? Or maybe it's something completely different that you guys are seeing?
Domingo Valadez (22:57):
I'd say one of the biggest drivers for me for building Homebase, we want to redefine home ownership and what that even means, I think we'll continue to see real estate prices keep getting more and more unaffordable for folks. And I think being a homeowner's going to start being a privilege, which is a really sad reality. Unless we have true government intervention come in and add more housing supply, I think it's going to get worse. And so with that reality, it's like it's up to private markets to figure out how do we actually make more people homeowners? So something we care a lot about at Homebase and something we're very mission driven about is making the tenants that live in these properties, also fractional owners of them. And so getting people comfortable with the idea of only owning 10, 20, 30% of their property, but still feeling like an owner of that property.
(23:42):
And so for this very first home, for example, Homebase bought an extra piece of it so that we can offer it to the tenant to actually buy it from us so that they can also be a fractional owner of the apartment they're living in. And so in 10 years we want Homebase to be the destination for renters. When you're moving to a new city, you use a Homebase platform, you find an apartment, you move in, you buy 30% of the value, and now you're a fractional owner of that property. So that's why Web3 excites me. You can completely do this in an open liquid market and we're trying to facilitate that through Homebase.
Brian Friel (24:14):
Yeah, that's putting skin in the game too, right there, you're a renter and you actually have upside if you treat the place well. That's pretty cool, and I think that's kind of spinning the model on its head in a really crypto native and interesting way. And I love that framing. Well, Domingo, this has been an awesome discussion. One question we ask all of our guests, and I want to know this for you as well, is who is a builder that you admire in the [inaudible 00:24:38]. Ecosystem?
Domingo Valadez (24:38):
Okay, this is going to be a total cop out, so I'll give you two. My first one's [inaudible 00:24:44]. I love that man's Twitter content. I feel like the way he speaks, he's clearly very, very technical, but also very good at bringing things to a high level and explaining things. And it's no secret that Solano ecosystems gotten a lot of heat from a lot of third parties where the day FTX went down, someone from the Binance blockchain basically told me I was dumb to continue building on Solana and was really trying to pull us to build on their chain.
(25:09):
And I was like, "I think the leaders of Solana are taking this very well and are being very, very thoughtful about how they're moving things forward." So that's the first piece really, really like [inaudible 00:25:19]. The second one's [inaudible 00:25:21]. I love his content. He's been a champion for Solana and you can always rely on that guy to call out people that are spewing fake news about the chain and really showcase his technical know-how of how things truly work behind the scenes. So I think those are probably my two biggest, I fanboy over both of them a good amount.
Brian Friel (25:43):
I think those are both great choices. And a sneak peak, you mentioned that the [inaudible 00:25:47]. Recording was just before this, but [inaudible 00:25:49]. Also mentioned [inaudible 00:25:50]. As his choice. So you're in good company there. Part of what [inaudible 00:25:55]. Was saying too is he loves people that are building pragmatic applications that can "Only be done on Solana TM." And I think Homebase is a really awesome shiny example of that. So thank you so much for taking the time to walk us through it. I'm super excited. I'm going to have to check it out, bring my Panama to it. I know nothing about residential real estate, but I think you've given me the confidence to give it a try today. For folks who want to check it out, where can they go to learn more about Homebase?
Domingo Valadez (26:22):
Yeah, you can go directly to our website, which is Homebasedao.io.
Brian Friel (26:26):
I love it.
Domingo Valadez (26:27):
Everything's completely transparent on our website, we even have a white paper that goes into all the technical pieces, whether it's the legal side, whether it's all the technical side on the blockchain component piece. So we're very, very transparent and we also have a discord where we answer questions as people have them.
Brian Friel (26:42):
That sounds great. Domingo the co-founder of Homebase, thank you so much for coming on.
Domingo Valadez (26:48):
Absolutely. Thanks so much, Brian, for having me.
-
Our guest this week is Mert Mumtaz, Co-founder & CEO of Helius, a vertically integrated developer platform offering a suite of tools to help easily build products on Solana. Mert joins Brian Friel to clear up common misconceptions about Solana, shares the latest opportunities for developers, and dives deep into state compression, which reduces the amount of on-chain storage required to store NFTs, resulting in lower costs for creators and buyers by up to 100 times. State compression on Solana is already being leveraged by projects like Dialect, Drip.haus, and Helium to help scale their projects.
Show Notes:
01:10 - Origin Story and background
05:08 - How he started on Solana
07:45 - How Helius began
11:27 - Misconceptions about Solana
18:01 - What is he most excited about on Solana
23:03 - How is Helius working with DePin
25:34 - Opportunities for Developers on Solana
32:15 - A builder he admires
Full Transcript:
Brian (00:06):
Hey everyone and welcome to the Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web3 space forward. I'm Brian Friel, developer relations at Phantom, and I'm super excited to introduce my guest, the man who in Solana needs no introduction. Mert Montaz, the founder and CEO of Helius. Mert, welcome to the show.
Mert (00:25):
Thank you for having me, Brian.
Brian (00:26):
I've been looking forward to having a conversation with you here for a while. I don't know if you remember this, but way back in the day, I was getting my start on Solana by writing articles on Twitter, dev related articles, and you were one of the first people that took my article and said, hey, I'm an engineer at Coinbase. I can actually vouch that this is legitimate. And that actually got me in front of Chase Barker and everything. I don't know if you remember that interaction, but it's been a long time that I've seen you on Twitter.
Mert (00:54):
I do remember it.
Brian (00:55):
Thank you for that because that got me my stardom of three. Maybe that'd be an interesting place to start is I'd love to learn a little bit more about you. I know you were, previously before getting involved with Solana, you were at Coinbase. Can you share a little bit about your journey, what your background is and what led you to Solana?
Mert (01:10):
Yeah, absolutely. First of all, I do remember that interaction. I think it was a medium article about it was either voting or incremental counter, maybe a peanut butter sandwich or something.
Brian (01:21):
Yeah. It was like a simple app.
Mert (01:22):
Yeah, it was actually quite good. I was super impressed with it. I wish people kept producing those. I think we need more brine blog posts. Yeah. I guess maybe a brief intro of how I got started. I majored in math and communications engineering, communications engineering being satellites and signals and stuff like that. And I actually got to work at Blackberry as an intern. And so I got to see some pretty interesting engineering challenges at my earlier years about cloud infrastructure. I was on the team that ran the cloud for BBM, for example, which handled a lot of volume until it died, of course. Yeah, I mean after that I worked at the big banks in Canada, Canada's run by five big banks and I worked at three of those in some weird order where I did cybersecurity, I did payment systems, ATM withdrawals and stuff like that.
(02:11):
And I then joined a startup that got acquired, Shutterstock. It was about digital advertising and stuff like that. I'm sure some people are familiar with Shutterstock. And then I worked at Clear Bank on the treasury team where we were in charge of payment rails and stuff for funding entrepreneurs. And then we had this situation where we needed to send money to Australia and I needed to write the code that would handle doing that. And we met with a bunch of these vendors and stuff and it was all super complex for some reason that I didn't understand, you had to do these hops through various jurisdictions and stuff like that. And I was like, I mean you could probably just use USDC or something. And people just thought that was a scam. And at that point I was like, I wonder what the actual truth is here.
(02:55):
I did some digging and I was like, this is obviously not a scam, not even close. And in fact, it seems super interesting. I did a brief look into crypto in university where I thought I was maybe too academic and you need a PhD or something to do anything meaningful. Obviously quite wrong, but that was my first intro. And then a few weeks after that I was working at Coinbase. Actually it was interesting because I joined them slightly before they went public. And so they still kind of had the startup ethos and it was super fun working there and got to learn and build and talk with a bunch of really bright people. And that's obviously doing research on different blockchains. Obviously Coinbase is very EVM centric. Some times were good, some times we're bad. And somewhere in that line I found Solana and I just started digging around posting stuff, publishing stuff. And I really liked the approach that Solana had taken to be the pragmatic approach. I'm sure you hear this word a lot, but the practicality of the ecosystem as well as the ethos really resonated with me.
(03:52):
And the community was also pretty cool. You actually just mentioned Chase talking to you about something you posted. That was also my experience. Whenever I would posted something, Armani or Chase would hype me up and I was like, okay, that's pretty cool. And yeah, I mean it kind of just took off from there.
Brian (04:07):
Yeah. I love that framing of the pragmatic chain and you actually having that experience at a big bank just saying, why don't we just use USDC? It's settled in 400 milliseconds or whatever. And Solana really, I think, is the best example of that. That's pretty poetic that you found your way there.
Mert (04:23):
Mm-hmm.
Brian (04:23):
I remember a time though when you first were posting on Twitter, it was mostly around trying to help others understand what was happening on chain. And you mentioned Coinbase, very EVM centric. I think a lot of us who worked in crypto at the time, it was just EVMs the only game in town. And if you thought differently, that was just weird or a lot of people it didn't make sense. And I think my experience, one of the biggest barriers to getting people familiar with Solana was just wrapping their head around the mental model of just how stuff works on chain. It's just inherently different. Can you talk a little bit about that, how you got your start? What were you doing when you were writing these articles and helping others understand what was going on on chain? What did you have to build, what were you teaching yourself at that time?
Mert (05:07):
Yeah, that's a good point. Most people actually don't really know that unless they were early like you. At first what I would do, this was kind of during the peak kind of start of NFT season on Solana and basically a lot of influencer types or people who I don't think were very intellectually honest would post some sort of claim about, oh, the price of the NFT is going down because the price of Solana is going up. This is obvious and stuff like that. And I thought to myself, there's no way the markets are that efficient for JPEGs, right. There's other stuff there. If people were botting these NFTs and getting a high concentration on maybe dumping on retail and doing other sketchy stuff. And so I would just write scripts, goal length scripts or JavaScript scripts, whatever, and analyze the data. This is before any data analytics existed, really like Solana FM or I mean, Solana FM was there, but they did regular indexing, Solana floor and stuff.
(06:09):
Flip side, Nance, none of these actually covered Solana. I would just do it and then I would just write my findings in a Twitter thread with some charts and stuff. And I did that pretty regularly. I did it for a bunch of different stuff, including some upcoming projects in terms of gaming and where the potential is. And somewhere along the line after being armed with that knowledge of just doing it for a consistent amount of time, I came across a lot of people on crypto Twitter just really making unsubstantiated claims about Solana and its architecture and its scaling plan and all this stuff. And I guess I was in somewhat of a unique position where I was actually still at Coinbase at the time and somebody would post something and I had relatively okay knowledge of EVM, but also pretty good knowledge of Solana.
(06:56):
And so I'd usually be able to tell, okay, this is just not true what this person posted. Why is nobody correcting them? And it's because nobody actually just really knew both ecosystems that well. And sometimes in internal Coinbase chats, this would come up and people would be like, that is wrong. And I'd be like, yeah, that is wrong. Why aren't we doing something about this? And I kind of just started yelling at the people who were just lying or maybe spreading knowledge that was not grounded in truth, let's say. And I just never stopped doing that. And turns out crypto Twitter is full of these people, and so I never-
Brian (07:29):
Yeah. Your job's never done.
Mert (07:30):
Exactly.
Brian (07:32):
Is it fair to say that you arming yourself with this knowledge, you had to actually build the tools you needed just to understand what's going on-chain. Was this the start of Helius and essentially what you guys now offer? And maybe you can talk a little bit about that, how Helius began.
Mert (07:45):
Yeah, 100%. That's exactly right. The most common problem I ran across was when you're looking at on-chain data, the data is super cryptic, right. The instruction data is bortion coded or something. And unless you knew the schema of how it was encoded or maybe the idea which, especially in NFTs, in DeFi, it's not too bad, but especially in NFTs and other non-DeFi use cases, nobody has any idea what the on chain data looks like. And so I would have to hard code some weird methods, maybe parse logs, but also reverse engineer based on discriminators. Or I would even try to brute force it sometimes, which actually kind of worked. I would go on Magic Eden, and you would know this is before Magic Eden's programs were more readable. This is the first version. I would check the app layer. I would go to magiceden.io and I would see, okay, this NFT is listed for 20 SOL or something.
(08:38):
And then I would try a bunch of different decodings until I got that answer. And then I would do that with a bunch of different ones and I'd be like, okay, this is clearly the discriminator that I need to use. And so I would do that. I also did a bunch, go to the network tab, inspect source, and then dig through the entire minify JavaScript, unminify it, see the schema and try to use that schema when trying to decode the data and stuff. And I was like, this is bananas. This should not be done. And basically that's kind of where Helius came from and the first iteration of Helius was like, okay, we need to make on chain data read about Solana because it's particularly impossible. And then along the way, once we started doing that and talking to customers, it seemed like quite a few people were having other problems, especially around RPCs, which was surprising 'cause I thought RPCs were kind of okay, but after digging into it, it turns out that wasn't really the case.
(09:28):
And then you run into all sorts of other issues like streaming data on chain, at least in an inexpensive and reliable way. Solana has this problem with web sockets where you might lose data. Yeah, I mean just talking to customers just found a bunch of problems. And Helius is essentially now there to be this vertically integrated developer platform on Solana to essentially just help developers succeed on Solana. And we're not necessarily bound to Solana, but basically my philosophy on this is that I want crypto to succeed. I mean obviously we're all here because we're interested in crypto and believe in crypto’s future. If you start from first principles there, I think given the options out there today, Solana's our essentially best shot at executing that vision. Obviously a lot of people disagree with that, but it's something I believe in. And so then my thought process, okay, how do we get more people to build on Solana so that we can have a better crypto future?
Brian (10:19):
No, I totally agree with that. I think that's been our ticket on Phantom as well, where it's like most of Phantom came from EVM folks and I think a lot of us independently kind of had this realization of we want crypto to succeed. Pragmatically thinking, what am I going to get my parents or my friend to use today? How are we realistically going to scale this thing in the next couple years? Solana also right now is the most pragmatic approach to doing that. I think before we jump in a little bit more to Helius in particular, what you guys offer and what you guys are up to, I kind want to take a moment just to talk maybe broadly about Solana because I think you are one of the most well known vocal defenders of Solana where there is a lot out there that's just blatantly wrong and you not only technically know how to rebut it, but you take the time and the energy to be out there and educating people. I want to know a little bit for where you sit at Helius, what you see right now, what would you say are some of the biggest misconceptions today about Solana that folks who maybe already know about crypto, maybe are already well versed in EVM, but maybe they just haven't gotten through to actually hear from somebody's boots on the ground. What would you tell them that they're misunderstanding about Solana?
Mert (11:27):
Maybe I'll take a more broad approach to answering this because it's kind of different segments, but in terms of maybe people from EVM, if you're already familiar with EVM and maybe you want to build on Solana and what are your kind of reservations, right. Some of the ones I've come across are, well, one, Rust is just hard to write. Solana has a diehard kind of fan base of Rust developers, but Rust is not easy. That is just a fact. Solidity, is somebody in high school could learn it easily, but Rust, I mean they'd be able to learn it, but I don't think it'd be easy. The concepts like lifetimes and for example, that stuff is not easy for somebody who wants to just prototype and maybe ship something. And so then you'll say, well, there's Anchor and stuff and Anchor is super helpful and probably my favorite tool on Solana, unless you know Rust, you're still going to be kind of flying blind and you know might need that to build your applications.
(12:17):
And if you're a determined developer, you'll get over that and then learn Rust anyways. But that friction alone is enough to deter a good amount of people is what I found. That's just one thing, and I know Foundation folks and Dev are working on this and there's some other teams, there's the Python seahorse stuff, there's a new type of Script One coming out. I think maybe there's even a Goaline One. It's also just a result of being early. Solana has really been around for two years, whereas EVM almost nine years now. It's hard to compare these things. That's one. And then two, and this is an interesting one, is developer optionality. As a developer, let's say at an entering focus from Coinbase, let's say you want to build a new product and you're deciding between EVM and Solana. Well, the obvious kind of elephant in the room is, okay, if Solana has a problem, you are kind of done, right?
(13:12):
You don't have any other options. You can't port your code base over anywhere else. Whereas if you are the EVM developer and you build on Polygon, you can just use main net Eth, maybe you can, with some effort, use any of the other L2's or maybe another EVM for it, something like that. It's a much easier transition. It's less risky such that on a design doc that you want reviewed by product managers, most engineers are going to take the safe route there.
Brian (13:37):
It reminds me of that “no one gets fired for hiring IBM” phrase that they used to have back in the day, the safe route to get it approved by somebody. Yeah.
Mert (13:45):
100%. And it doesn't help that the Solana PR is so bad that everybody's even mistakenly saying, oh, Solana always goes down or Solana's all these different things. You add these up and then as an engineer, if you're at a big firm and you pick Solana, you have to religiously fight or justify your position. And most people just aren't going to do that even if they believe it. That's a big problem. One of the reasons why I think more SVM roll-ups that sell on other chains might be interesting here to give developers more optionality such that if you build on Solana, but Solana has something bad happen, but it's still settling on these other L1's or other data availabilities or whatever it might be. And then three, is of course, there are actual misconceptions about the reliability of the chain.
(14:33):
People think the chain has gone down 12 times or something, or multiple digits. It's actually gone down four times. People conflate performance degradation with outage. Performance degradation is just when you maybe have, you guys obviously notice at Phantom when you maybe aren't landing transactions on chain or maybe there's latency or something like that, that's the functional equivalent of fees getting higher on EVM. That's performance degradation. But an actual outage is actually relatively rare. In fact, the numbers, I think the last time I looked at them were 99.7% uptime, which isn't perfect, but it's also not bad. It's certainly not as bad as something that would go down every day or regularly. I mean there's a misconception there.
Brian (15:15):
Or reorgs in that matter too.
Mert (15:16):
Yeah, exactly. I mean we can kind of talk about that in maybe another part of this, but people don't realize that especially for an indexed company, maybe Coinbase where you're selling funds, those reorgs actually affect your architecture an insane amount because you need to add new systems to communicate, oh actually this block was not correct or something. Whereas on Solana, you don't really need to do that. I mean no block to my knowledge went back after being confirmed.
Brian (15:40):
Yeah. I was going to say I don't think there ever has been a... It's even, yeah, the optimistic confirmed, not even finalized as there's never been a reorg once it's been that. Yeah.
Mert (15:49):
Exactly. Some people think you need ridiculous hardware requirements to run these nodes and that's actually not true. You can run a node, depending on if you want an RPC node or a validator node for really anything from $200 to $800 a month. People think you need actual data centers to run it, which I don't know where people get that from. And then there's also light clients coming out now, right. I can talk all day about the misconceptions, but I think the first two are probably the most justified reasons from actual engineers that I've heard.
Brian (16:20):
Yeah. No, that's a really good take, I think, because one, there's the FUD, which I think is the back half of what you kind of just talked about, which I think that just comes with time and getting people to experiment with Solana and trying it firsthand and understanding there's no better teacher than that, otherwise you're fighting essentially Twitter algorithms. But I think that's a really nuanced take what you had to start, where you're saying the de-risking almost to get this buy-in because you know what it's like to work at these large companies and kind of proliferating Solana there. I also think what Jump is doing with Fired Answer is also just another benefit to that as well. Essentially just reducing the service area potential bugs that occur. Essentially if you have a bug in just one client implementation, adding a second one greatly reduces the chance it'll happen again.
(17:09):
Maybe one way we can take this is instead of fighting the FUD, because that could take all day, is from where you sit right now in Helius, say that you guys have a really interesting position in the space because one, you're super close to what's actually happening as Solana's roadmap evolves. I'd say part of being the pragmatic change is Solana's not afraid to push the boundaries, take risks, add new token programs, NFT compression, just constantly evolving at a fast pace. You guys are close to that and then you're also close to the developers who are coming into this space for the first time, like you said, the hobby weekend developer who's interested and they don't want to learn Rust and so they need some sort of abstraction layer to this coming in some sort of dead platform that's helping them in some way. What are you personally most excited about right now that's happening on Solana?
Mert (18:02):
Well, I mean Compression, I think, maybe is one that's gaining some steam in and an obvious one that I think most people are aware of at this point. But back when I was trying to show it, most people weren't aware. I think our job here is maybe done so now it can kind of take off, but Compression is super exciting because most people don't realize that Compression, actually, let me just explain what it is first. Data storage or state storage on Solana is quite costly. I don't know the exact cost, I guess I would need to look at that chart, but there's some articles on this and you can look at the Helius blog "shill" for seeing the comparisons for the numbers, but basically state storage on Solana is expensive and with Compression, essentially what you can do is instead of storing the data in state, you can store it on ledger. And that might sound a little abstract, but basically instead of needing it for consensus, you securely log it in transaction logs.
(19:00):
Basically it's what an engineer would call a stateless accumulator. I call them L2 because I like doing random marketing stuff, but Toly really doesn't like it. Do not call it an L2. Call it a stateless accumulator, which isn't very beginning friendly, but that is actually what it is. You just store a reference, it's a pointer by reference kind of thing. You store a reference to the data that's on the ledger on the state now instead of storing all the data on the state. And we do that via Merkel Trees, which I'm not going to go into here, but essentially you're able to get a few orders of magnitude and cost reductions. Now that's useful for digital assets and that's the first use case, NFT compression where you can mince thousands, millions, billions of NFTs. People will say like, oh, why do you need to mint a million NFTs, billion NFTs?
(19:45):
And it's like, that's not the point. The point is that we're not limited by technology anymore, whereas before we were, and we can maximize the design space and explore some things, right. You have Dialect doing sticker packs, Cross Mint using their APIs for all sorts of different cases, including loyalty programs, Helium migrating over to Solana for their hotspots using Compression, driphouse doing airdrops, Render potentially using it for their scene graphs, which is a super cool concepts, high map results even using them. And so it clearly has some use, but the cool thing about it is it's not actually limited to NFTs. Actually you can apply to any account, you can extend it to be fungible tokens and also just general account compression, which I think the guys at Gum are doing for some social graph formatives. It actually has quite a bit of potential there.
(20:28):
That's one of the big ones I'm excited about since my name is Compression Mert on Twitter right now. And then the Solana mobile, the Saga phone is awesome. I had a test unit and I've been an Android user my whole life after Blackberry Force and it's the best Android phone I've used and it's super snappy, very good build quality and it actually has changed my consumer behavior somewhat where actually, before I would explicitly shy away from mobile first or mobile crypto apps, I wouldn't use crypto at mobile at all. But now I'm like, okay, this is actually pretty cool. I can use leverage my secure seed vaults. We do need to work on that naming, but I can use that and have that confidence and that seamless integration. You have apps like Otter, Finance, Tip Link, Get Code or I guess just Code Wallet, which enables super fast kind of P2P payments, something like Venmo. And actually, I have used all of these to make payments to my family members and friends, so I'm super excited about that.
(21:27):
The thing I'm most excited about on Solana is this narrative of decentralized physical infrastructure or deepen taking off with not only do you have Helium now and High Mapper, you also have Render Now, Pollen Network, Genesis Go, Teleport and let's see who else we can get over. But I think this kind of intersection of P2P networks and using crypto to actually enable change in the physical world is super interesting and something that wasn't really possible before.
Brian (21:56):
That's super cool. I should say just for the listeners that we are recording this on April 13th, 2023, which is the official Saga launch day, so it's topical to bring that up. We're super excited about that too. I just think it's awesome that they're not afraid to push the boundaries on that. I mean for us at Phantom to not even have the ability to see a user seed phrase and it's just completely abstracted away at the hardware level, I think is awesome and a glimpse of where this is all heading. Let's talk a little bit about DePin too because I'm not as up to speed on that. I don't know if most of our users are. I think Helius migration is happening soon, TM, like this month in April. What are you guys seeing there? Is there any major changes to what you're doing on the infrastructure layer that's going to have to adapt for this? Do you foresee any major changes to end user behavior?
(22:46):
Part of what's interesting about Solana is the fee markets can adjust on a per piece of state level as opposed to if it was on Eth, you could see all of a sudden all your gas fees are increasing just like it would on a crazy NFT mint day. Can you talk a little bit about how you guys are working with this new DePin movement and what you guys are seeing?
Mert (23:05):
Helium particularly is interested in using Compression, or I mean they are using Compression to represent their hotspots and it would cost them just too much money to work with that kind of stuff on any other chain. And so Solana is what makes the most sense. And like you said, the independence of state, which causes individual account based fees as opposed to chain level fees, which doesn't make the UX horrible for one person here either. It's just you might have to pay extra. And so compression is something that they use the most, both High Mapper and Helium and also Render is, I believe, going to use it. They mentioned this in their GitHub migration paper. And so that's kind of the main driver, but also these teams generally have to subscribe to on chain events. And as a larger engineering firm or maybe independent of size, most people prefer getting data pushed to them instead of setting up some polling system to listen for events because there might be issues there.
(24:02):
They actually use our web hooks and then they kind of configure what events they want to listen to and then they kind of have this ease of mind where, okay, Helius will just stream me these events as they happen and I can just kind of plug, play and then forget. If anything happens, Helius will kind of let me know or maybe I'll get a page or something. The web hooks have actually been, it's interesting. When we first came to Solana, there was no web hook products on Solana and I'm not even sure if there was anything like that on Eth. It was just such an obvious thing and we built it and we shipped it and for example, Discord uses that for their integration into Solana. Their first actually Web3 integration, or actually I don't like the term Web3, their first crypto integration was with Solana and that was enabled with the Web hooks and we have some other big names using them now as well.
(24:47):
I don't think those are announced yet, but it's such a simple primitive, but just web hooks and listening to on chain data really helps some of these bigger firms who don't want to spend the time writing all this complex infrastructure code and they can just plug and play into some existing solution.
Brian (25:02):
Yeah. It's future-proofed, essentially. They can build once and they don't have to constantly be readjusting their implementation.
Mert (25:08):
Exactly.
Brian (25:08):
That's awesome. Turning this back to a developer who is maybe listening to this, familiar with EVM, looking at Solana, you guys do a lot, not just on the infrastructure side, but also on developer education, getting developers involved. We can talk about some of the specific initiatives there, but at a high level, what would you say are some of the biggest opportunities for a developer today who's looking at Solana? Where would you guide them to get started?
Mert (25:35):
Well, one thing I'll say is that Solana has maybe two main things that I would mention that might be interesting for folks coming over. One is that it's much earlier than the other ecosystems. And so there's a lot of low hanging fruit and underdeveloped tooling infrastructure, application layer stuff that exists in other chains in some form, but not on Solana. And so as a developer, let's just try to build something and you'll notice what's missing. You'll notice that the deployment workflows aren't great. You'll notice that maybe the monitoring isn't that great either, or maybe it's easy to shoot yourself in the foot with certain types of smart contractors and stuff. You'll notice a ton of problems and that's just your opportunity to make something cool and fix those maybe as open source, maybe as a public good, maybe as a company. And so there's a lot of potential there.
(26:22):
Another thing is that Solana's architecture is, and so this almost kind of contradicts the first point, but not really if you think about it. The architecture of Solana is so different, right. It's functional based where you have actually a lot of modularity within the layer. You have independent state and logic, you have different accounts, localized fee markets, and so it's much more modular than something like ETH where state and logic are coupled. And also obviously the scalability features of Solana are quite different than anything else. And what that means is there's a lot of things that you can actually build that's only possible on Solana.
Brian (26:57):
I love that catchphrase by the way, only possible on Solana TM.
Mert (27:01):
Yeah. I've been a big fan of that one, let's just say. And it's totally true, right. Order books, for example, you saw it with Serum, you're seeing it now with Phoenix. This is before Fire Dancer and before 200ms block times, which will happen. This is the slowest it will be, it's only going to get faster from here. And so there's a bunch of things that are only possible on Solana. And I would strongly encourage people to think from first principles as a developer, look around, see what problems there are. They don't have to be Solana specific, they can just be problems, right. I don't know, maybe it's too slow to send your dad money or maybe it's too hard to offramp crypto, I don't know, something like that. And then usually if you are trying to look for a solution there for that problem, Solana will be able to handle it much more comfortably than others.
(27:47):
And the other important thing is it'll actually scale, right. You want kind of elasticity as a developer such that if your app takes off, you don't want to have to now migrate to another stack or something. With Solana, it's honestly just plug into a cloud provider, just kind of scales with you. But also a third thing I'll actually mention, which this really should have been number one, but I would encourage you very, very strongly to produce content, especially developer related content. Build something, learn from it and then write about it, make a podcast, produce a video, produce a tutorial, just write content. And not only will that obviously help you connect with other people who are in the ecosystem and like-minded and building other cool stuff, but also when you write stuff and produce content, you have to know what you're talking about, otherwise you won't be able to write it, right. It'll make you connect the dots and it'll point out flaws in your thinking.
Brian (28:44):
Yeah. It's the fastest way to get the right answer on the internet is to publish something that's wrong.
Mert (28:49):
Exactly. And so I guess maybe to go along with that is just have a high tolerance for looking, I don't want to say stupid, but just have a high tolerance for being wrong. You're going to be wrong a lot, but that's not a bad thing unless you're building the infrastructure for handling, I don't know, some critical payments or something. But you're probably not going to be doing that.
Brian (29:10):
Yeah. It's like the pursuit of truth. If you're open to that and you're excited to get told what's right, I couldn't agree more that's 100% the best way to build.
Mert (29:19):
Yeah. Sometimes I'll post something that I think is correct, but it's not apparently actually correct because Toly will comment and he'll gently say something that's slightly unrelated, but it's like, oh, okay, I'm wrong, I guess. I will retract this. And so honestly, it's just a fun way to learn and you do enough cycles of that and you are going to be doing that to other people and that's how we grow.
Brian (29:46):
Yeah, I totally agree. I think this ties in with what you were saying earlier of Solana being the pragmatic chain. I think part of the benefit, there's a knock, we talked about it, about, hey, Solana's new, it's different and you're essentially fighting network effects at that point. But part of the benefit is you get to build your own genuine kernel of a developer ecosystem and start from first principles and start from new and not be afraid to change things new. And I think that's been pretty eye-opening, even just to me personally. As Phantom enters EVM, we're looking at everything that EVM has inherited over the years. Most obvious one being even just how injected wallets play with each other on EVM is so different than Solana because Solana took a very first principles approach and said, we're going to do this in a way that you have a wallet, you can use it anywhere, it's going to scale forever kind of thing. And it's been pretty eye-opening to see the differences there.
(30:36):
That would be my only other thing I'd add to you is if you are a dev and you want to make it high impact on, it's probably the best place for it because you can post publicly about why you're doing what you're doing and you'll get people who are interested in listening and will back you on the basis and the merits of your ideas is what I'd say.
Mert (30:52):
Yeah, absolutely. Me, Chase and other parts of the developer system will help you the best we can. Basically the Helius tagline is actually “Where Solana teams succeed” because our entire goal is to help you succeed. That's essentially why I wake up and that's what I spend my entire day doing. And the Phantom founders, for example, are great example of this, right. They came from EVM and they saw what was possible on Solana and they built the number one wallet in crypto and it had such good UX and such good design and stuff, and you guys absolutely dominated. And then now you're actually transcending the change, right. It's actually becoming a product, it's not just a chain’s product, it's just a product that you can use to onboard people onto crypto. I really like that approach from starting from first principles like you guys. You saw Meta Mask and you're like, okay, well we're going to do it differently. And you did it much better in my view. And so I think that's just an example of what’s possible.
Brian (31:50):
Thanks. Yeah, I mean we love hearing that, but obviously love everything that Solana's doing and Solana's always going to be home. There's a lot to do on Solana. I'm excited to roll up the sleeves this year and get started. I guess, Mert, and as we start to wrap this up, one question we always ask all our guests, I'd love to hear this from you. You mentioned a lot of people on this podcast, a lot of teams, but I'd love to know, is there a particular builder that you admire in the Solana ecosystem?
Mert (32:17):
Oh man. I mean, I do admire my co-founders, to be honest. I don't think they got that much credit because I'm kind of the loud one, but Nick and Liam are super, they're actually the driving force behind Helius and they do all of the engineering, and I do essentially nothing other than just larp on Twitter. Them for sure, but also, I'll give you my general approach on this, actually, maybe this is useful for someone, but my general approach to Twitter is whenever I see a founder on somebody's bio or something like that, or maybe a co-founder or something, I'll immediately follow them because those people are super inspiring to me. I pretty much follow all the founders on Solana at this point, I think. For example, the founder of Squat, Stephan Wright. I saw him, I was like, I'm going to follow this guy.
(33:01):
Turns out amazing dude, we're friends now. That's my general approach. I just respect all the founders in the ecosystem because they're taking big risks and they're trying to build cool stuff, and they're all trying to help the ecosystem. And so I have just huge respect for everyone there. Someones, I would probably point out specifically, would be obviously Armani and Tristan, huge respect for them. The founders of Gito, right, Sec, Fault and Buffaloo, I'll just say their pseudonym names. Co-founders of Squads, right, Margin, Drift, Zeta, for example. All the DeFi protocols. I'm probably just going to end up listing literally every single one. I would say if there's one particular one, it would be, I guess honestly just Toly, right. That's probably a cliche answer, but Toly just always keeps his composure under people just relentlessly slinging mud at his life's work essentially, and in a super unfair way. And he still gets up. And I mean, not only does he engage with the community, but he still builds cool stuff and there's so many different things. I have no idea how he does it, and I have a ton of respect for that.
Brian (34:08):
Well, I think that's the perfect answer. Having listed all the major founders in Solana, and then you go back to the guy who started it all, he sets the tone for the space and I think he makes it that drama free, practical, pragmatic, how do we build practical that's useful today. That's been my answer secretly too, that no one's asked me, but... Well, Mert, this has been awesome. Thanks so much for coming on. We'll have to do this again later once we've shipped all these crazy upgrades to Solana and check in again. But where can folks go to learn more about Helius?
Mert (34:42):
Yeah. Just helius.xyz. You can just go there or you can just @ me on Twitter. That's honestly how most people get in contact with me. Just tag me on Twitter on something and I'll respond.
Brian (34:50):
Awesome. Love it. Mert, the founder and CEO of Helius. Thanks so much for coming on.
Mert (34:54):
Thank you for having me.
-
Often referred to as "the AWS of crypto" Alchemy provides the infrastructure that helps developers build cutting edge web3 applications. Product manager, Rob Boyle shares the latest tools Alchemy is building, the web2 companies that are starting to build in web3, and what it's like building for Multichain in episode 24 of The Zeitgeist.
Show Notes:
00:38 - Origin Story / Starting at Alchemy
03:15 - What is Alchemy?
06:45 - What would Alchemy be analogous to in web2
07:36 - What kind of devs is Alchemy building for?
10:21 - Patterns of Web2 companies coming to Web316:42 - Teaching new incoming devs
19:07 - Keeping up with a Multichain World23:12 - A builder he admires in the Web3 ecosystem
Full Transcript:
Brian Friel (00:06):
Hey everyone and welcome to The Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the web 3.0 space forward. I'm Brian Friel, Developer of Relations at Phantom, and I'm super excited to introduce our guest, Rob Boyle, Product Lead at Alchemy. Rob, welcome to the show.
Rob Boyle (00:22):
Hey, Brian, great to be here. Thanks for having me on.
Brian Friel (00:24):
It's awesome to talk to you today. Phantom and Alchemy are doing a lot of great work together as it relates to our new multichain project. We got a lot to talk about today, but before we dive into all that I want to learn a little bit about you. Who are you and how did you start working at Alchemy?
Rob Boyle (00:39):
I've pretty much been in tech my whole life. I grew up in the Bay Area, went to school in the Bay Area, and then I graduated about 2006, degree in computer science, was fired up to work in Silicon Valley. A bunch of my friends went and worked for this startup called thefacebook.com, you might've heard of it, it's a bit of a thing now. I did not think that was going to be the most fun startup so I went and worked for another startup in Palo Alto. Turned out in retrospect to be perhaps not the best decision, a lot of those friends who went to Facebook are retired now quite comfortably, but I had a lot of fun, worked for a startup. I met my co-founder with whom I started two startups back to back both of which were a blast.
(01:10):
As with most startups, didn't really have rocketship success but we both did find our way over to Facebook a little bit later in life. But went over there and then had a blast at Facebook. Facebook is cool and that it's big enough that you can work on a ton of different problems and problem spaces within the company so I worked on integrity, finding and fighting badness, I worked on consumer products, and I also worked on Facebook developer platform. About two years ago at this point, I was looking to move on. I really liked working on developer platforms, I was looking for developer platforms in new and exciting spaces that were really innovative.
(01:43):
And I got a cold reach out from Alchemy and they had the fact that Jay-Z was an investor in the subject line. I was like "That's cool enough to respond." Started talking with them. It's so funny I'm like this is maybe bad for branding for myself but I'm the opposite of a lot of crypto folks where I loved Alchemy. I thought Joe and Nikil were brilliant, I thought the team was amazing, I loved the stage that they were at company-wise. And I was like "Guys, convince me that crypto is not a scam." That was the thing I wasn't on board with. I was new to it. And it took me a few months where I just went down the rabbit hole. I started talking to all my advisors and mentors, realized that a lot of them were already in crypto and web 3.0 and I was late to the game. And then over the course, I got completely convinced that this was the most interesting space to work in. And then two years ago I joined Alchemy and the rest is history.
Brian Friel (02:29):
That's awesome. You might be the first guest on this podcast that came into crypto because they thought the company was cool-
Rob Boyle (02:34):
I know.
Brian Friel (02:35):
And not that they got obsessed with the space and then found a company based on that interest. Hey, congratulations, you're the first so that's an award right there.
Rob Boyle (02:43):
I feel very lucky.
Brian Friel (02:44):
That's awesome. So you mentioned that you were working on developer platforms at Facebook, and then that transitions really well to what Alchemy has positioned themselves to be in the crypto space. I'd say for most developers who have been developing crypto some while, the term developer platform might mean something different or might not make total sense in the crypto space. Usually, people think, "I'm building my own DAP and I have this RPC provider, and all I really do is put the URL into my DAP and I go from there." What is Alchemy doing? What makes you guys say that you're a developer platform in web 3.0?
Rob Boyle (03:16):
I think there's three pieces to that. I think we have a very technical audience so they know what an RPC provider is. I'll give the overview just for anyone else who happens to be in the audience. The quick 30 seconds is, modern crypto apps have two components. They have the on-chain component, the smart contracts that run on-chain, which is the really new exciting thing about crypto, and then they have what is more traditional like a user interface like opensea.com where someone goes and interacts with the dapp. What you really need is a bridge between those. The opensea.com needs a way to read data off the chain, what NFTs are for sale, what NFTs do people own, interact with their smart contacts, and right to the chain, actually push transactions through the chain. Same thing is true for Phantom, to use you as an example. The wallet, it needs to understand people's activity, it needs to read and write from the chain. And we are the conduit that allows that.
(04:01):
What we do is provide that platform in which developers can read and write to the blockchain, we're your conduit there. For the more technical folks, that's traditionally you run your own node or you have access to a node, which is a JSON on our RPC provider which allows you to access that interface that you would to read and write from the chain. What I think makes us a developer platform and not just like a node is a couple things. The first one is scale. The way that these things evolved is you run a node and you're like "Oh, that's fine," and then you get more traffic and you're like "Oh, this node is hard it's not handling all traffic let me just spin up a second node and a third and a fourth, and then you're like "Now I need a load balancer, and now the nodes don't totally agree." As soon as you get past one node with a capacity a bunch of really hard problems emerge in managing that scale.
(04:45):
And so the first thing that we do is eliminate all those problems. We've spent a bunch of time on a bunch of proprietary infrastructure. We call this product super node where it gives you the interface that looks like a node interface but there's a bunch of complexity underneath the hood to account for inconsistency across nodes, and reorgs, and node upgrades, and all these different factors. We actually have an architecture diagram and the nodes are this tiny little box at the bottom, and the majority of it is all this infra that we've done to give you the feeling of a node. We've had customers who 10 or 100X their traffic overnight when they get super popular or explode or go viral, and our system just magically scales to handle that. So that's the first one is the scalability, reliability function.
(05:23):
The next one that I'd say is you can do a lot more if you're not just using the node interface. An analogy we like to use is building on the node interface is if all you have is a shovel, and a hand saw, and nails, you don't have a lot of leverage there versus we have a whole suite of enhanced APIs that are using power tools, and bulldozers, and modern construction equipment like our NFT API, or balanced API, transaction API. And all those things provide functionality that you would have to spend a lot of time, which we have spent, getting that functionality out of the node interface but we do it for you by building these APIs. So it really gives you a much more effective set of tools.
(06:00):
And then the third piece is our dashboard and our monitoring tools. In the new web 3.0 world, a lot of apps don't have the tools. The Web 2.0 world has 20, 30 years of services to help you understand the performance of your application, and how it's running, and which users are interacting with you. There's whole companies built around that. There's some startups doing this in the web 3.0 world but we provide a lot of value here where you can understand all the transactions flowing through your application, wh ich users are using it, where they are in the world if errors crop up what's causing those blah, blah. So that's really why we call ourselves a full-stack developer platform.
Brian Friel (06:33):
If we're translating this to the Web 2.0 world, what would you say are some similar analogies? Some company names that come to mind are maybe AWS, Datadog, Event Monitoring. How would you guys pitch that to a Web 2.0 company that's looking at web 3.0?
Rob Boyle (06:46):
AWS is the analogy that we draw the most to. AWS is, obviously, a massive company. You're like "Oh wow, your AWS is crypto." I almost think that undersells it a little bit because we do have aspects of Snowflake, we have aspects of Stripe even and how they help with transaction processing., We have a transaction product that helps you better to the chain. We have aspects of Datadog as you said, and Google Analytics to do some of that. The nice thing about web 3.0 is since it's a brand new industry we can take all those concepts that are really powerful in Web 2.0 and just go build them all for the web 3.0 world. AWS is the closest analogy but we wrap in parts of the other ones as well.
Brian Friel (07:20):
A one stop shop for everything you need too as well.
Rob Boyle (07:23):
Thank you, that's our pitch.
Brian Friel (07:24):
That's awesome. I want to talk a little bit about the devs that you guys are building for, right? So you painted this picture of you guys are everywhere across the developer stack. Who are these developers that you're seeing who are entering the crypto space?
Rob Boyle (07:38):
Every developer's our customer. And our ultimate goal is to have 1000X developers in the space. We think of this flywheel where when you have a new technology like blockchain, as soon as developers start building something in the space that attracts users. The more users are in the space the more developers turn their attention to it and they build more stuff which gets more users, which gets more developers, and you get this flywheel going. Where crypto sands is, development in crypto is really hard compared to Web 2.0. So the flywheel is running in sand or glue right now where it can't get spinning. And we identify it because the development is so hard it's hard to get this thing going, and some other difficulties as well. So we really just want to make development easier for literally anybody.
(08:21):
I'll talk about historic, our current customers. We have big enterprises so OpenSea runs on us, Phantom, to use you guys as an example as a luminary in the space, run on our platform. So we pride ourselves on having the scale and reliability to support the biggest names in the space. A lot of these companies were two people working on it on their own not that long ago so we really want to support new developers of the space. We see a lot of developers coming in who are new to crypto. They're coming from Web 2.0, they're coming from other spaces, and now they get excited about crypto. You can develop a really powerful app on our platform with a bunch of usage and not pay a cent because we have very generous free tier. And we also have education resources. We have Alchemy Ventures, a venture arm for some reason. I'll stop sharing all the stuff we do. I see a bunch of new people, I see traditional enterprises.
(09:02):
What I think is really interesting is increasingly we're seeing Web 2.0 enterprise companies enter the space. This is what excites me. With the most recent bear market, there's a lot of news around oh, a bunch of companies shutting down their web 3.0 efforts, and you saw potentially a pullback, but we're not really seeing that from our perspective as Alchemy. I see a lot of big traditional Web 2.0 enterprises who are still super bullish on experimenting in web 3.0. And have web 3.0 units they're building them out. We work with a ton of them. And they're way more crypto-native than you would think. I won't name the company but I talked to a very big old-school Web 2.0 company and they were complete Degen's who were very excited about a bunch of cool new blockchain technology and were very fluent and very excited about building it. So I think that's really excites me is seeing the Web 2.0 giants really continue to turn attention to the space.
Brian Friel (09:51):
That's super cool. And that's a bit of a narrative violation like you said. I noticed you guys just put out through Developer Report, you guys do this every year. Flipping through some of that, you guys have some pretty awesome numbers in there to show. I'm curious what you guys are seeing, especially as it relates to these Web 2.0 companies coming in? Are there any patterns that are emerging about why they're interested or what they potentially want to be building in the space? Or maybe even what chains they're going to first? Any patterns that you guys are seeing that maybe other people aren't aware of?
Rob Boyle (10:21):
That is a great question. The biggest pattern is that a lot of them are finding ways in which their existing business models and the value that they add to people can be augmented by web 3.0. I think that's the exciting part. If you look at Shopify, has rolled out some stuff around token-gated commerce. And that's an example where Shopify does, they build stores, and they realize oh, loyalty programs, some of these other solutions like exclusive access to key fans is a really exciting prospect, and this gets really empowered through web 3.0. So they're taking existing stuff they want to do, which is exclusive experiences for top customers or the ability for brands to give interesting experiences to people, and then using web 3.0 to go power that. So that's the pattern I see.
(11:07):
It's not like I see all these Web 2.0 companies being fired up about NFTs or DeFi or something, it's more them saying, "Oh, what's the core thing, the value I deliver as a business to people?" And then "Oh, there's all these ways that I can use web 3.0 to deliver more value or make that more exciting." And I think that's what actually makes crypto win. I don't know, some of these guys are like "Oh, I'll do yet another DeFi protocol." There's a lot of those. But it's when they start using web 3.0 to power the existing value chains that they already have.
Brian Friel (11:35):
It reminds me of what Reddit did with their ... They even called it digital collectibles instead of NFTs, but that was one of the most successful by the numbers successful version of that.
Rob Boyle (11:44):
They're a perfect example of this where they take something that they already do and they're like "Oh, this gets way better with crypto."
Brian Friel (11:49):
That's pretty cool. I think that's a world that I get excited about as well where it's a bit more getting mainstream people into it almost by accident or by chance. They see the value and they're like "Why wouldn't it be this way?" And it's a lot easier. Like you did, they can then go down the rabbit hole and learn everything else that's behind the curtain about crypto as well which is pretty cool.
Rob Boyle (12:10):
Our CEO Nikil has a great quote he likes to use that I love which is, "No one ever talks about using an internet application, that would be super awkward. They just talk about apps that add value." It's a little cliche at this point but the same is true of crypto. My mom is never going to talk about this cool blockchain app she used, she's going to talk about this app that allowed her to send money internationally with no fees or something. And then I can be like "Oh, that's built on crypto" and she'd be like "Oh, no way." I'm like that's how we're going to get a billion people under crypto. So the more that those types of apps start to develop the more exciting it is.
Brian Friel (12:38):
That's really cool. We also were chatting just before we hit record on this about another trend that you're seeing which is this migration off of the RPC interface. Back in the day, you're having to deal with these RPC providers directly and there's a lot of problems with scale that comes with that. I know you guys are doing a lot with abstracting stuff away. I also saw very recently you know guys put out Create Web3 dApp and just constantly making it easier and easier for them to build with. But can you talk a little bit about that trend that you guys are seeing as well?
Rob Boyle (13:07):
Completely. To another slightly labored analogy. I think working straight off JSON-RPC is like coding and assembly, or coding a web app without reactor any frameworks at all. It's pretty painful. The original people who came to crypto were super deep into crypto and that felt fine to them. They're like "Oh yeah I code an assembly all day, that's awesome. Just give me a JSON-RPC endpoint I'll go build something." But increasingly as new developers come to the space, especially Web 2.0 ones, they're like "Oh, show me the abstraction layers." Awesome. I understand that this exists, but in the Web 2.0 world I have all these frameworks and services that let me not have to think about a lot of the nuts and bolts and I can work at a higher level of abstraction. If you hit someone who's like "I have a great idea about how to use NFTs to do gated fan experiences." And we're like "That's great, but first spend two days learning how Eth Call works. It's really hard.
(13:54):
A bunch of what we try to do is meet developers where they are. Where they come in and they have cool ideas around NFTs and how to use them, and we're like "Awesome." We have a minting process, we have an allow list product called Spearmint, we have NFT APIs for getting data. And you can just think at the level of NFTs and not at the level of chain primitives, and that really accelerates how fast people can both learn and get up to speed and start building apps that deliver value. And I see a bunch of startups in this space too. There are a ton of startups. I'm not sure an advantage, but something that's really powerful that Alchemy has is our ventures arm Alchemy Ventures that's been super successful. People would be shocked at the number of people who run it, it's very small but they have investments in some of the most exciting companies in the space.
(14:33):
And through Alchemy Ventures we see a bunch of these new startups. And we've seen an explosion of startups building abstractions both in frameworks as well as services that allow people to think at these higher levels. And they're doing that on the read side, how people pull data off-chain, there's a bunch of really interesting data platform startups. As well as the right side. There's a bunch of really interesting startups helping people get data under the chain in a more abstract manner. Right now the majority of development is against the JSON-RPC interface which is more historical. In the future, I see the vast majority of development actually pointing at these higher level of abstractions. I think that's where most developers will be used to working in the future.
Brian Friel (15:07):
That's pretty cool. That's something that I think all devs here would be plenty happy to switch to. There's this meme on solana of chewing glass where the developers are all having to worry about not just finding product market fit with their own app but serializing and deserializing accounts. That context-switching is pretty brutal but it's a rite of passage. And then those devs who go through that process of chewing glass all feel very connected to one another and trial by fire experience.
Rob Boyle (15:33):
I think it's great for a sense of community for sure.
Brian Friel (15:37):
It really is. It's also helpful that you guys are turning glass into bubblegum here a little bit it makes it a lot easier.
Rob Boyle (15:42):
That's a great analogy. I'm going to give that to our solana marketing team they should use that. Glass into bubblegum.
Brian Friel (15:49):
There you go. TM, just add the credit to Zeitgeist podcast for that one.
Rob Boyle (15:54):
No worries. Hat tip all the way.
Brian Friel (15:56):
You mentioned that you guys have a couple different insights here. One, you're working with Web 2.0 companies directly. You have this ventures arm that you're making these investments in on these upcoming developer tools. You guys also have this Alchemy learn and Alchemy University platform as well though I think which captures the more long tail end of the developer. Do you think that the way we're going to be teaching developers, like these long tail devs, coming into web 3.0, do you think that's changing already? Are you guys incorporating that in your curriculum? Or is this still something that this abstraction layer is going to take some time and people still really need to learn Eth Call now or solana account to serialization? How do you guys think about that, trying to teach new incoming devs but also not abstracting too much of what makes crypto crypto?
Rob Boyle (16:43):
That is a great question. I think right now, as much as I get excited about these abstraction layers, none of them are seamless and you still need the fundamentals. If you take a modern CS class these days it's not like they start you with react to these frameworks, they start you with bare code, you're probably learning C or something. I think the same is true in web 3.0. I think our developer courses reflect this. We still teach people the basics. You really have to understand the basics. And I think the best combination is you get really fluent with the core fundamentals, the building blocks, the most basic layers. You really understand how the protocol works, you really understand how the accounts and onboarding works and signing, and then you get access to the more powerful tools. And then you're like "Oh cool, this saves me a bunch of time but I know how to use them effectively because I understand what they're doing under the hood." Our education classes reflect that. We still teach a bunch of basics, we introduce some of our abstractions.
(17:37):
I do think it would be a mistake if we had our education portal just telling you how to use Alchemy NFT API to build something or something. We launched a new project called Create Web3 DApp that gives you a bunch of template code. It basically helps you generate all the code depending on the app you're trying to create. The purpose of that is not necessarily so people can ignore that, it's so you can take all that code, digest it, understand what it's doing but not have to write it yourself and be like "Okay, cool." So you can get up and running fast but you still should definitely understand what it's doing. That's still important. I think it will be for the foreseeable future.
Brian Friel (18:07):
I tend to agree with that as well. That was my experience just learning the code as well. You're always looking for the equivalent of a crate react app but that's just because you want to get your ideas out in the world, but then pretty quickly you're going to need to actually learn what's going on here. I think that's the right approach for sure. So I want to switch gears a little bit and talk about how you guys are operating in a multichain world. Phantom and Alchemy came together because Phantom's expanding. In addition to solana are adding support for VM chains starting with Polygon and with Ethereum layer one. You guys, obviously, have your hands in a number of layer ones. Also, the world's moving to layer twos.
(18:43):
There's all this complexity that's happening in crypto and it feels like there's 1000 flowers blooming and everyone's trying to find what the right way to scale this is. I want to hear from you guys. How do you guys think about all these different L1 ecosystems? Do you believe in this multichain world? Do you focus most of your efforts in certain areas? How do you guys keep up with all these protocol changes? What's that from your guys' perspective?
Rob Boyle (19:07):
Totally. It's complex now. It's going to get worse or better depending on your perspective but I think it's going to get more complex from here. The most precious resource or scarcest resource in the world right now is block space. That is what it all comes down to. And especially if you look at onboarding billions of people onto blockchain, you're going to need so much more block space than we have right now. We don't see a clear path to that that doesn't involve a massively multichain world right now. There's some interesting scaling solutions, there's some L2s that are doing this, but if you just do the math on block space none of them are going to really meet the demand that we foresee for crypto without multichain.
(19:46):
And similarly, I think there's just a lot of different use cases where you can build a chain that's made for that. There are chains that are really good for gaming, there's ones that are really good for DeFi because of how the primitives are put together. So I absolutely think we're going to be in a multichain world. I saw an interesting quote from Optimism that I love. They're leaning into this really heavily. And they said, "Chains are the new smart contracts" where they want spinning up a chain to be as easy as deploying a smart contract is today. And they really think app chains, the first of which is base which, obviously, has gotten some good traction is the first of those.
(20:17):
We think about multichain as the defacto future. The question then is which chains do we support and how do we understand where we put that? A lot of that on our side is bandwidth constrained honestly. There's a bunch of chains I think are super exciting and we just have to be really disciplined around what chains does it make the most sense to support based on what we can provide the best support to. So that's one reason L2s have been straightforward for us but we've had to be more picky around L1s. We really pride ourselves in providing a really top-notch, incredibly reliable, incredibly scalable solution. And it is hard to do that if we're juggling multiple chains at once.
(20:54):
As you talked about, there are protocol releases all the time for these chains, a lot of them are moving targets. One of our requirements to work with a chain is a very, very deep relationship. So we have all of the protocol teams for all of these chains on Slack we talk to them constantly. We are pushing hundreds of fixes. I think at last count to a lot of these client teams we work really hand in hand with them. And it's hard to do that if we had 30, 40, 50 chains. So we form really deep relationships. So we have to be picky from a just how many chains we can support at the level of quality we want. But I absolutely think that we're going to have a ... Be in a multichain world.
(21:29):
In terms of looking into the crystal ball a little bit, I'm really bullish on the Eth ecosystem. I think using Eth as an L1 and then having a bunch of L2s and potentially thousands of app chains is a clear future. I think that's really interesting who's going to be a big player. But there's a lot of super interesting L1s. Like you said we support solana. I think they're doing really interesting stuff and have a very vibrant community. They have a future ahead of them.
(21:51):
And then the last piece that we're trying to think about is interoperability. There's people doing really cool projects in this space. That's going to have to be a core technology is actually being able to interact across chains. Because it's cool to say there's a bunch of chains, but if it's incredibly hard to move liquidity between them it's going to be very hard to use. People shouldn't actually even be thinking about chain necessarily if you're an end user, we have a long way to go for that to be seamless.
Brian Friel (22:15):
I would agree. We're noticing that already with Phantom's multichain betas. We're getting Eth people saying, "Hey, there's Clang source or a big mint happening on salona and I need to swap in but how do I do that? They want that simple one-click button interface. Like you guys are doing, there's a lot of lot of complexity to abstract the way behind the scenes there but it'll be a fun challenge in the year ahead.
Rob Boyle (22:35):
You guys are doing great work on this. That's what people expect, right? If you weren't so desensitized by being in crypto that you're used to all of this hoops you have to jump through you'd be like "Oh, I'm looking at my Phantom wallet, I have Eth, SOL's right there, I need more SOL. I should be able to move it over done and dusted. And instead it's a whole rigamarole. That's just not going to work.
Brian Friel (22:55):
We'll definitely get there. And we've already come a long way from the days of running the coin core full node on your desktop computer. Rob, this has been an awesome conversation. One question we ask all of our guests, and I want to hear this from you as well is, who is a builder that you admire in the web 3.0 ecosystem?
Rob Boyle (23:13):
At the risk of this sounding paid, I actually really love Phantom. I'll bring up someone else to just not to be totally a complete shill. Phantom is just upgrading the level of user experience to Web 2.0 standard. Phantom is obsessive about how good the UI is, the onboarding experience. And when I first used the Phantom wallet I was like "Oh, this feels like a Web 2.0 app, it doesn't feel like a web 3.0 app."
(23:39):
Web 3.0 apps, in general, is rough. It felt like a breath of fresh air. So I think you're doing a fantastic, fantastic job. I also also see it on the back end. As you know we work together on the RPC side. And if our latencies slip by a percent I get a message from a Phantom engineer right away being like "What's going on guys?" You guys are obsessive on the UI side and on the performance side. Anyway, so I really admire that. As much as it sometimes keeps me up at night because I know as soon as we have an issue I'm going to get a message the next day from you, I think you're really good.
(24:08):
I'll name a couple other ones. I think OpenSea is doing a really good job about also doing this multichain thing. I think they do a decent job about abstracting away chains. When you're browsing on there you can sometimes forget what chain something is on and they're trying to make that less of an issue at the front of people's minds. I think that's really the right direction to go. I really admire that. And then on the core tech. I know that's been a little controversial recently but LayerZero I think. We're going to need tech like that to be able to move across chains seamlessly so someone's got to be doing that type of stuff.
Brian Friel (24:36):
Those are all great suggestions. Appreciate the Phantom shout-out. That's definitely not required to be on this show.
Rob Boyle (24:41):
Of course. I'm an avid user so I can't not.
Brian Friel (24:44):
The feedback goes both ways so we obsess about our user's feedback too. If you have anything just let us know as well, we'll constantly try to improve on that. OpenSea and LayerZero too are great ones as well, I'll have to have those guys on the show. Rob, it's been awesome, thanks so much for coming on. Where can people go to learn more about Alchemy?
Rob Boyle (25:01):
Alchemy.com is pretty much your gateway to everything. It's your gateway to our university, learn more about education. That's your gateway to our products to get up and running and building. If you're sitting in a Web 2.0 company getting excited about building something, if your brand new to web 3.0, no matter what alchemy.com you can be directed. You'll find the resources you are looking for to learn more.
Brian Friel (25:21):
Love it. Rob Boyle, Product Lead at Alchemy, thanks so much for coming on.
Rob Boyle (25:24):
Brian, thank you so much this was super fun.
-
Web3 games are taking off and Planet Mojo is one of the premiere titles leading the way. On Ep 23 of The Zeitgeist, CEO Mike Levine shares the web3 opportunity for game publishers, how digital ownership empowers gamers, and the future of community gaming.
About Planet Mojo:
Planet Mojo is an ecosystem of interconnected games built by Mystic Moose and set inside a mysterious alien planet with an evolving narrative. Players compete with customized teams of fantastical creatures in a suite of eSports, PvP games. The long-term goal is to create a sustainable and growing catalog of games for the next generation of gamers, empowering players by allowing them to own their in-game assets and have a say in the project’s future direction.
Show Notes:
01:02 - Background and how he started in Web3?
04:34 - Unique challenges in Web3
07:25 - What is planet Mojo?11:17 - Owning your assets in planet mojo
12:50 - Is Mojo Planet a Play-to-own model?
13:5 - The future of in-game economy in Web319:31 - Why are traditional gamers skeptical of NFTs?
23:15 - Would traditional games benefit from adding a Web3 component?
24:54 - The future of Web3 gaming28:58 - A builder in the Web3 gaming ecosystem he admires?
Full Transcript:
Brian Friel (00:00):
Hey everyone and welcome to the Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the web 3.0 Space forward. I'm Brian Friel, developer relations at Phantom, and I'm super excited to introduce our guest, Mike Levine. Mike is the CEO of Planet Mojo, one of the leading games on Polygon. Mike, welcome to the show.
Mike Levine (00:28):
Hello. Thanks for having me, Brian. Excited to be here.
Brian Friel (00:32):
I'm excited for you to be here as well. We got a lot of really awesome stuff to talk about. Just the time of recording this, I saw you guys sold out your first mint on Magic Eden. You've got this great ecosystem you guys are building out related the web 3.0 gaming. But before we dive into all that, I want to learn a little bit more about you. You have a very interesting background. You're a veteran of the gaming industry and you spent a lot of time at Lucas Arts Entertainment. Can you walk us through what your background is and why you started working in web 3.0?
Mike Levine (01:02):
Yeah, I started working at Lucas Arts in the early 90s, I'm going to make myself sound as old as I am. But I'm from the east coast in Massachusetts where I am now. But went out to California with dreams of, well, really going to grad school. But I needed a job and amazingly Lucas had one in the paper. Lucasfilm games at the time, and I went in and somehow convinced them to hire me, and just really clicked. I never considered it for a career at all. I'd played video games my whole life growing up and Nintendo and all kinds of other games, but I hadn't really played PC games, so I kind of had to lie a little. I remember when I called a friend back east who was like, tell me some PC games that I could tell them about. Little did I know they were about to release their first console game, so it was like, oh, you played console games?
(01:52):
And they're like, so yeah. And I started at the bottom floor I guess doing QA, which is a great place to start in the industry. But I didn't sort of let my dreams of why I moved to California die, and I took an internship, and I was working 90 hours a week at Lucas and this other place and I was learning all about basically the beginning of digital media and video, and started using the computers at Lucas. And next thing I knew I was working in the art department, I was really just using their Macs to practice Photoshop and the art director noticed it and was like, wait, you know Photoshop? But then I started to get more brave and propose ideas because I was just using these cutting edge tools. And I guess anyways, to fast forward, that theme has gone throughout my whole career because I'm always sort of tinkering with what's new and what's next.
(02:40):
And yeah to give you the quick version, worked on some amazing games at Lucas. Went on to sort of create the visual effects department there, and did some great games. And eventually it was a pretty big mass exodus of people that I was at the beginning of. But went on to do a startup with people from ILM because the visual effects department or company that Lucas owns or did. But I had worked with them a lot just because all these techniques we were doing and Skywalker ran, so did a startup with those guys for a couple years, it was more about tools and effects, and wanted to get back to games. I missed games after not being in it. So I moved back to the east coast, started my own companies, and over the years I've just done a mix of our own games but also done service work to survive with Hasbro and Spin Master and other things.
(03:33):
And we had a great run doing augmented reality, and we had Apples game of the day, and worked with Phil Tippett, but also worked with big companies like Niantic and others. And ultimately that disillusioned with mobile AR, at least the short term future of it. And we made a VR game a couple years ago for Sam and Max, which was a game I worked on the original way back at Lucas. So that was a lot of fun. But during that game, that's when I started getting obsessed with first NFTs, and then blockchain and blockchain games, and that's how we got here.
Brian Friel (04:09):
That's awesome. So you painted an awesome story there. I guess starting from the bottom at QA intern, rising up. And you've worked on titles that you didn't mention, but like Jedi Knight, the Force Within, Rebel Assault One and Two, so you've seen what it takes to make really successful video games. Coming into the Web 3.0 space, what have you noticed that's different? What is uniquely challenging about web 3.0?
Mike Levine (04:34):
We could talk for the next half hour just about this, but it's completely different, and it's completely the same. And I think that's what we're seeing now, is each company finding that balance of what is a web 3.0 game right now? You have some that are completely on chain and others that are completely off chain. And then there's things like us, which are in between which some people call Web 2.5 or whatever. But I think we're closer to 3.0 than 2.5. But I say as someone new coming into the space, which I was a year and a half ago at least, it's an overwhelming amount of stuff to learn. People say the rabbit hole for crypto and web 3.0 and blockchain. And as I've talked about here, we've gone down other tech rabbit holes in my career learning all about AR and everything related to it.
(05:23):
That was a pretty deep rabbit hole, but nothing compared to this, right? There's just so much more. And it took at least six months to just sort of get our bearings, get our sea legs basically, where it's like you start to figure out what's important, what's not important. And a big part of that at the beginning, because there was still so much lack of clarity, was making a good game. Making a fun game. We were in the minority I think on that in the beginning when everyone was kind of obsessed with play to earn and we're like, well let's make sure the game's fun. Because everything else kind of stems from that. Or you're really just going to have people there only to earn. And I'm not an Axie slammer, but that's kind of what we saw happen there, right?
Brian Friel (06:10):
Right, that makes sense.
Mike Levine (06:11):
So yeah, I mean there's massive differences, and I think it's really about finding your rudder and then once you do, just going for it basically. And there's just a lot of noise in this space. So it's constantly, is this call important? Should we partner with this company? How many partnerships can we do? Because we're still a relatively small company, you can spread yourself thin in this space. And then you have the whole Web 2.0 side of it, which maybe want to save that for another question if it comes up.
(06:41):
But yeah, just taking that on and trying to bring people over to web 3.0, it's easier when you're just in web 3.0 and these are already the converts, so we don't have to convince them. And I think there are other companies that are content to just sort of stay in this web 3.0 echo chamber right now. But I feel like the reason us and all these companies were able to get funding, the whole idea was games can bring more people into web 3.0. So if we only stay in with the converted, we're not really doing that justice. So that's kind of been our philosophy.
Brian Friel (07:15):
Trying to grow the pie. I totally resonate with that. So I think this might be a good time to talk a little bit about your project Planet Mojo. What is Planet Mojo in your own words?
Mike Levine (07:26):
Yeah, planet Mojo is an ecosystem of interconnected games built by us, Mystic Moose. That's the company. It is set in a mysterious alien planet, which we're going to keep revealing more about over time. We're really just the first chapter now, and we like to say it has an evolving narrative, just like the game has evolving seasons, eventually. Players compete with customized teams in our first game, Mojo Melee of fantastical creatures in a suite of eSport PVP games over time, because we plan to make more games soon.
(07:58):
The long-term goal is to create a sustainable growing catalog of games for the next generation of gamers. Empowering players by allowing them to own their in-game assets and have a say in the project's future direction/ which is a really simple way of saying we believe in decentralization and player ownership, digital property rights and all those fun things.
Brian Friel (08:20):
And so when you first had the idea to go into web 3.0, did you have this vision of what Planet Mojo would be, and was Planet Mojo the catalyst for this? Or was it more that you were interested in web 3.0, you wanted to tinker with new technologies, and Planet Mojo kind of arose out of that curiosity? Which way would you say that evolved?
Mike Levine (08:39):
It was a lot of things coming together. I mean first off, we love creating original IP. We've done that over the years. We created an indie game before the term existed, Colin Insecticide, I think part one is still on Steam and it was on the DS as well. And that was a complete fantasy, amazing fictional world that a lot of us worked on, a lot of friends from Lucas Arts. So creating original worlds and IP is not easy, but it's something we enjoy a lot. And we also just know from history sort of that whenever new platforms are born, new paradigms begin. That's usually when new IP is born, or has a chance to be born before the big licenses and IP. We've seen this over and over Whenever a new console launches. You see it with AxiE and things like this, that just IPS kind of rise. So it seemed like a great opportunity.
(09:40):
But yeah, I mean I guess before that we really had the specific idea, it was just the understanding what web 3.0 was, and we didn't even call it that then, right? Crypto games or game-fi or whatever we were calling it. But just understanding what that was going to mean to the players, to the developers, what it could do to gaming in general. People talk a lot about indie games and that's a big thing in games, but I'm here to break it to you, it's a bit of a fallacy. It's like there's thousands of indie games that don't really succeed, and then we have one or two that sort of propel, it's kind of being a rockstar when I grew up. It was like, good luck, right.
(10:20):
And that doesn't mean you can't do it, but the game is kind of rigged. There's usually outside funding involved, and publishers, and the platform fees. And so web 3.0 was a way to me also it's like wow, we can flip the script here and have more control as indies, and control of our own destiny, and it was like the evolution of community. We've seen community and gaming become a huge thing over the last decade. This is the natural evolution of community to me.
Brian Friel (10:52):
Yeah, that's very well put. So let's dive in a little more then. You've mentioned you paint this great picture here of players owning their assets, the decentralization aspect of it. How exactly does this work in Planet Mojo? So for reference, you guys just had this mint madness NFT moment on Magic Eden, you guys sold out in four seconds. I imagine these NFTs are used in game, is that correct?
Mike Levine (11:17):
Yeah, I mean first and foremost and we really have taken a, we're the tortoise not the hair approach to the blockchain, and we haven't launched our token, and we've always wanted to take a slow and steady approach to it.
(11:30):
So yeah, first and foremost, and we're literally still hooking this up right now. It's about to be done. But if you own the Champion NFTs, you will have them in the game. We're soon, we've kind of spoiled the players up to now by the way, because we've been in alpha, we haven't really worried about the game progression too much, and we've just kind of given everything to players to make tournaments more fun. But we're really only a few weeks away from being an open beta. And that's when we'll be taking everything away from everyone and resetting all stats, and then people will have to play to unlock champions and abilities, and spell stones, and different skins, and eventually arenas when we hook those up, because those could be NFTs as well, maybe. Intent.
(12:16):
So, yeah. When you own them you will automatically unlock them to use in teams and play within the game, and you won't have to worry about the progression, just like free to play. But the difference here of course is you truly own it. You can sell it if you want at any point on open markets or our marketplace when we launch it. And our whole thing is as we launch more games, you're going to get to use that character in our other games as well, only if you own it as a NFT.
Brian Friel (12:44):
And so this model it's kind of like a play to own model, which I've heard about. Is that a correct characterization?
Mike Levine (12:50):
Yes. I mean I love and hate acronyms I guess I'll just go on record of saying that. But we do kind of need them in a way. And I think I can certainly get behind that a lot more than anything with the term earn in it. Because that was just a bad idea. Free to own, I know Gabe really pushes that, but I always was just like, wait a minute. Let's not take play out of this. If we're really going to have an acronym debate now. The word play should be at the center of this. There's just not enough words. So that's why I like play to own.
Brian Friel (13:25):
I like that as well. So then talk to us a little bit about the economy of this game. You guys are building this world, you're going to be adding on a piece arenas over time, this thing's going to continually evolve. Players also own their own assets, but you made a point up front to be like, this isn't something where we're just advertising a quick way to make money in this game. How do you see the in-game economy here evolving over time?
Mike Levine (13:52):
Good question. And back to the last point related too, we do plan to add other features to owning the NFTs. And I didn't even mention by the way that we have what we call a, it's an in-game collection tier basically. And the very easy way to explain it is the more NFTs you own, the more chances for rewards and prizes you're going to get in the game. Because we sort of tally up, look at all of the NFTs you own, there's like a point system, and you'll sort of have a different tier, and then each month you'll get these collection tier points basically that you can put towards our premium quest, which if you didn't own them would take much, much longer to unlock, basically. So that's another thing. And we also want to eventually have some form of sort of holding slash staking with rewards as well.
(14:39):
And then moving to your question just about the economy. So right now we just have a soft currency in the game, it's called Ore, or you're going to earn it through the battles, it's going to help you rank up, level up. There's a whole free battle pass system that you get battle pass points for that unlock assets, champions, currency, all kinds of things. We're going to have a hard currency too. And by the way, just backing up, because I don't even think we really explained or, I jumped over this, my fault.
(15:09):
But so our game is Mojo Melee. It is a next generation strategy auto-chess battler. We've been nominated in a bunch of the web 3.0 award shows, which has been in great. The game's currently still in alpha, it's in the browser base game, so you can play it right in our web browser, and we are planning to take it to mobile very soon as well. So I just want to make sure we explain what the game was-
Brian Friel (15:34):
Cover those bases. Yeah, yeah, yeah.
Mike Levine (15:36):
And you can play, if anyone has played team fight tactics, that's kind of where these games really came from Dota 2, Underlords, but Teamfight Tactics has sort of become the most popular one. But making this for blockchain and why we say we feel it's like the next evolution of these games, even taking the web 3.0 part out of it, is all those games really came from PC downloadable. There are mobile versions, but TFT matches can take easily 30 minutes to play. And we wanted to make something that was faster paced. Even the browser version, when you play it, you'll notice it feels like a mobile game, that's because we designed it that way. So when you're playing it on mobile, the matches can take 5 to 10 minutes, you can play against one-on-one or eight other players at a time. It's like a round-robin tournament format, which is another one of the big reasons we chose the genre to start off with because we did take a lot of time debating what kind of game do we want to make first.
(16:33):
And we just thought this was a great way to introduce the world, the characters, and this is the other big thing we changed with these games is we're like, okay, players are going to own their characters. And normally these games up to now and it's very new genre, but you typically played with a shared deck. So players are playing against each other but they're pulling from the same deck. And what we did was kind of make it more like Hearthstone and other games and we kind of took that out of it, we made it more about collection and team building. Where you have just insane amount, every time we add a champion or a spell stone, which is another element we added, it just gives you insane combinations to try and strategy in terms of how you lay them out and use them.
Brian Friel (17:18):
The theory crafting because endless, yeah.
Mike Levine (17:20):
Yeah. So we sort of made a new paradigm sort of around that, and as we were making it, Supercell started testing their auto-chess game and they actually did something pretty similar so we were like okay, they're pretty smart, we must be onto something. So it just gave us confidence that we were on the right path.
Brian Friel (17:37):
That's good validation.
Mike Levine (17:39):
Yeah. Their game is way more casual. We kind of built something in between TFT and what they built. But yeah, web 3.0 with community we're always listening, and we've taken huge amounts of feedback. I mean we started privately play testing it last August, and so we've definitely listened to the community, we've added tons of features that people have asked for, and we may even add longer form matches eventually, enough people request them. But our sort of goal right now is to get into open beta and test like I was saying the progression and the retention, and all this awards and things like that in the game.
Brian Friel (18:20):
That's great. That's a big overview. Thank you for that. I guess I'm obligated to ask this question for all your fans who are listening, but when beta? Can you share anything about that?
Mike Levine (18:29):
I mean we're real close here. I would tell you within two weeks, but we have this little thing coming up called GDC and a bunch of our team is going there, so we may decide to wait till right after that, just till we're all back. So we're talking hopefully before March is over I'm fairly confident we'll get open beta, knock on wood.
Brian Friel (18:51):
Right on. So I guess switching gears a little bit, at the start of this conversation you talked about the idea of growing the pie and that right now web 3.0 is relatively to all the gaming industries that are out there, it's a small subset of user base. There's people who really resonate with it, but then the vast majority of gamers maybe don't care or don't see the value prop. But I'd say there's also, I've seen a little bit of blow back where anytime the term NFT is mentioned to traditional gamers, a lot of times it elicits this response where people immediately say, no, I don't want it, I don't like it.
Mike Levine (19:26):
It's a trigger word.
Brian Friel (19:27):
It has become a bit of a trigger word. Why do you think that's the case?
Mike Levine (19:31):
Oh, this is very simple actually. And first of all, we don't have NFTs in our game. We have digital collectibles.
Brian Friel (19:39):
Good marketing.
Mike Levine (19:40):
And I've seen a lot more people use this term, especially who are bringing it to the masses or trying to. But I was talking about this for many months ago, just that the web 3.0 gaming space needs to break free of the NFT space. And it hasn't yet. Because there are these rules, many of which are very silly in the NFT space. You've got to sell out, and in terms of pricing, and distribution, and quantity and just all the sort of FOMO around it, and not to mention all the scams and rug pulls and it's like, we've been on tons of calls in the beginning of this where meeting with very DeFi crypto groups on Telegram. And at the beginning we were just sort of surprised at all the questions, it was like, how do we know this isn't a scam and all this stuff?
(20:30):
And we're like, we've been doing this for over 20 years, this is what we do. We make games, we do what we say, but we get it. So I think that's, the mass public, first of all I think it's a myth actually that gamers hate this. I really do. They hate something else. It's all that stuff we were just talking about. And I think we hit the peak hate months ago. I think we've been getting much more people like yeah, I'm interested in this actually, and what's it all about? And I just know from firsthand experience, that's why every time now when I'm doing these spaces or whatever I'm trying to say, everyone on this call, we're in the bubble already. What you have to do is everyone go bring in one friend. Just go talk to your friends about this, because there's nothing more powerful to this day in any media than word of mouth.
(21:23):
I just saw a chart on this, and it's like over 50% the most powerful form of user acquisition. And I just know from firsthand experience, when I talk to gamers young and old, what are you doing now? I'm making a web 3.0 game. What's that? Crypto. And then I say, well, have you ever thought about owning your assets and what that means? And then literally their eyes open up. What are you talking about? Because they're like gamers, they stream, they're watching Fortnite and playing Call of Duty, like wait a minute, that skin that I paid so much for, I could sell it? Yeah. Ooh, tell me more. So this has to be a grassroots campaign really to win over people. See, this is the big difference here is that people like to compare this to free to play, and it's not the greatest analogy. Because free to play had one thing, I don't know if I should say over us, but it was the main point of it.
(22:25):
It was free. Right in the title. And to the average consumer, to Joe 6-pack, whatever, they don't care about decentralization and blockchain and immutable and any of that stuff. They want to know is this a good deal for me? What's in it for me? And if we just explain to them, yes, you can own it, there's value in it, you can make it better by playing, and when our new games come out, you're going to be able to use it. Maybe you can use it in other games. It's really a lot of value. It just has to be explained to players.
Brian Friel (23:03):
Well put. I guess on that thread then, are there any traditional games that you think should be adding like a web 3.0 component in the short term that you think would be in that benefit?
Mike Levine (23:16):
No, none.
Brian Friel (23:18):
Interesting. You want to expand on that?
Mike Levine (23:19):
I want them to pay out and be ignorant and let us dominate. Usually happens in others game cycles and then they come in and want to acquire companies like us or have to play catch up. I mean Disney, other companies, they're still playing catch up on mobile and things like that.
(23:39):
So look, I can't control what they're going to do. And we're already seeing from Asia, being in North America and Europe, I think we're heavily biased by the sentiment in Asia. From every people I talk to over there, which is a lot and Reid, the sentiment's almost the opposite. They're bullish. So you're seeing, look at Oasis and all the companies that they've brought in from that side of the world. I don't have to even sit here and say what companies should add it because it's happening. Those companies are doing it. Will the big companies from North America and Europe? We'll see. Let's put it this way. If they see those companies making money, you can bet. But there's the legality and all that involved too. And that's where startups can afford to be nimble and take risks. So I don't have a crystal ball, but I know it's going to be an interesting year.
Brian Friel (24:33):
Yeah. Well I know you said you don't have a crystal ball. But I want to know, blockchain is young, especially in the gaming space in particular, everyone's I think still figuring out what the right kind of primordial soup of ideas and gaming talent, trying new things. Where do you think the space goes from here? In the next year or two, how do you think the space unfolds?
Mike Levine (24:55):
I mean, there are a lot of roadblocks for games right now in this space. On the mobile side we have Apple with their guidelines, which is depending on who you talk to a step forward or also very restrictive, or sometimes a deal breaker as we've seen with other companies. And on the PC side, again, we're sort of limited. Epic will allow games. So in some ways this space is back to the 1990s and 2000s where everyone has their own website and come here and make your own account and connect your wallet. But yesterday, the Amazon rumor was in the press again, right, about their marketplace. And you're seeing big Web 2.0 players get into the space. So if I'm going to make wild predictions or my hopes even, is that those are the companies that kind of need to help bring in the masses, and hopefully some of those barriers will come down, or the smart ones will realize the opportunity, the GameStops, who already jumped into it.
(26:05):
And I think those people who have those relationships already, and a lot of those companies like overseas and Japan, China, et cetera where they're so bullish on it, it seems like it's an even easier path. But I think those gateways will sort of lead the way. And of course just more and better games finally coming out. So the public can see, oh wait, there are some cool, actual games here in the web 3.0 space. And I always make the analogy about this space, and I think I've even realized it's bigger than I was making it, because I think it pertains to anything like pro sports, whatever, but I usually make it with gaming. Is that there are ways to earn in Web 2.0 games today. You can go to tournaments, Magic the Gathering, card game, and you can make millions of dollars and travel around there.
(26:56):
But that only applies to a certain percentage of people in gaming. You think about eSports and all this, right? There's like three spheres to this really that intersect, that help all drive each other. There's the professional level, then there's the spectators, the fans, the people who really pay attention, who are watching. And then there's the mass audience who just plays the game. And that's why I'm saying that it's no different than golf. The people who watch golf or NBA like, oh, I want to wear the shoes he's wearing, and I want to get the shirt he wears. Or like my son, I want to get Jason Tatum's high school jersey. I'm like, are you kidding me? And you're going to see that same parallels here. And it's just like in web 3.0, the earning part is going to appeal to some people. And it should be there and all the web 3.0 aspects, but you have to have those three layers.
(27:55):
That's why we think we made a PVP game and eSports are important to this. That's why we did a tournament, and worked with a lot of creators. And that's really important here kind of to take it to the masses, and let everyone kind of choose at what level they want to go down their own rabbit hole. Do I want a wallet? Do I want to own these NFTs? And the idea is going to start to snowball. And the early adopters are going to be like yeah, I want to own these things. And then other people are like, why are they owning them? I should probably own them too. I'm putting all this time in here, maybe I should actually own my assets. And yeah, that's where I think it's going to go. That's my optimistic feel. I ended more optimistic than I started.
Brian Friel (28:36):
That's great. That's a good way to do it. And also on the word of mouth part as well, which you said, the most powerful force of growing, word of mouth.
Mike Levine (28:44):
Totally.
Brian Friel (28:45):
Mike, this has been awesome. I guess on this last topic of getting more games into the space, we always end our podcast with a similar question. I want to ask this for you. Who is a builder in the web 3.0 gaming ecosystem that you admire?
Mike Levine (28:59):
Oh boy. It's easier for me to name projects because we're big fans of multiple people at these projects. So like Trap Knoll, we're very good friends with, and Undead Blocks and Phantom Galaxies, and I mean, I know I'm going to forget people I feel like. I mean, BoomLand were really supportive to us because they did their mint before us. And just Magic Eden, the people there, Matt, Knock, Liz, and Polygon. The people at Polygon are building too, I think. So probably named more than you wanted. But yeah, there's so many projects.
Brian Friel (29:40):
The more the merrier.
Mike Levine (29:41):
Yeah, I mean we're always looking at other projects. At the beginning we were always just, whoa, what are those guys doing? And then you get to the point where it's like, well, maybe they don't know any more than we do. So that's where everyone starts, the creativity comes from. You start seeing cool ideas.
Brian Friel (29:58):
That's awesome. Well, you named a lot of folks there. I guess all potential upcoming podcast guests, we'll have to reach out to them as well. Well Mike, this is a really fantastic discussion. Thanks for sharing a bit about your history and your journey from Lucas all the way to now pioneering web 3.0 gaming. Where can people go more to learn about Planet Mojo and Mojo Melee?
Mike Levine (30:18):
Easiest is this go to planetmojo.io, and then there are links right on the top right to our Discord, that's really where all the action is. Please join our Discord, Twitter, and there's a link to the game. You can play the game right now in alpha. We're actually hoping to push an update up today. Well, I guess my, it'll be last week when this comes out. But that's a play.planetmojo.io.
Brian Friel (30:41):
Awesome. Mike Levine, thank you so much for coming on the show.
Mike Levine (30:44):
Thanks for having me.
-
Launched in 2019, Rarible is one of the leading community-centric multichain NFT marketplaces. As an aggregated multichain marketplace, Rarible is unique in that it supports NFTs on Ethereum, Polygon, Solana, Tezos, and Immutable X. Rarible also offers users the ability to create their own marketplaces in just a couple of clicks.
Co-founder and Chief Strategy Officer Alex Salnikov sits down with Brian Friel to talk about Rarible's rich suite of products and services, his current views on NFTs, and where NFTs are headed next.
About Alex:
Alex Salnikov is the Chief Strategy Officer and co-founder of Rarible, a top-ranked community-centric NFT marketplace. A blockchain trailblazer and an active developer in the crypto space since 2012, Alex previously served as the Chief Technology Officer of CoinOffering, the first company to offer its shares in the form of blockchain assets. With a BA in Computer Science and an MA in Data Science, Alex’s specialties span a variety of sectors including market analysis, decentralized finance, NFTs, and tokenomics.
Show Notes:
01:06 - Who he is and how Rarible started
04:38 - How Rarible differentiated itself from othe marketplaces
06:30 - Community marketplace products10:20 - RARI foundation. What is that? Can you dive a little into what that's all about?
13:39- Rarible DAO and the RARI token
16:10 - Multichain NFT marketplace vs single chain
22:17 - His current view on NFTs. What is exciting?
25:39 - What is limiting NFTs?27:42 - A builder he admires in the ecosystem
Full Transcript:
Brian Friel (00:05):
Hey everyone and welcome to The Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web 3.0 space forward. I'm Brian Friel, Developer Relations at Phantom, and I'm super excited to introduce our guest, Alex Salnikov, the Co-founder and Chief Strategy Officer at Rarible, one of the leading top ranked community centric NFT marketplaces. Alex, welcome to the show.
Alex Salnikov (00:28):
Hello. Hey Brian. Thank you so much for having me today. It's going to be an exciting talk. Thank you to our listeners for connecting and to hearing our chat. I'm excited.
Brian Friel (00:41):
I'm excited as well. This is a great time to be having this conversation. Right about this time, Phantom is gearing up to launch its multi-chain beta out to the public and you guys are super well positioned for this being one of the first NFT marketplaces to take a very multi-chain approach. I want to get into all that today with you, but maybe before we go into all that, let's start with a little bit about you. Who are you and how did you start building Rarible?
Alex Salnikov (01:06):
I have a computer science background. I've been getting my degree in one of the best economic universities in my country before moving to the United States, and that was the most pro-Western liberal part of university. And I guess that laid a big foundation for me to be predisposed to crypto because the crypto is very openness, pro-liberal environment. And even before that, during high school I was trying to earn money online and I had a lot of troubles with just accepting payments. Everybody was like, Hey, give us your passport and KYC," and, "Oh, you're not 18 yet. We can't really work with you." That doesn't make sense at all to me.
(01:49):
So in the first or second year in my university, I discovered crypto, never left the space. It was 2012. I can say that I'm born crypto, never done anything else. Fell down the rabbit hole as soon as I read Bitcoin white paper because of the very fruitful background that I've been growing in. And yeah, started doing startups with my college partner. We did a lot of cool stuff that eventually grow into Rarible. I mean not exactly grown into Rarible, but our experience of doing projects led us to do Rarible because of the following of the natural progression. There was exchanges like DeFi stuff and NFTs. So we tried all of that and NFTs were the most consumer native out of all that. DeFi is for nerds.
(02:42):
And NFTs are for people. We always had been doing something for nerds and we wanted to do something for people. And I'm joking. It's not that I'm disrespectful. We wanted to do something for people and it was just so much fun. We traded a little NFTs and my experience of facing obstacles with online ownership, it made so much sense when you have an item and you can change the wallet. You enter the same 12 words into another wallet and you have all the same NFTs with you, you don't like the marketplace, you connect your wallet to another marketplace. So it feels maybe not that important. Many projects saying, "Okay, we'll do email and password." But this idea when you can change your tools and have all the same environment, this is what sells you that vision because you feel like you are the owner, not someone else is the owner. You feel control and ownership and that is the key part of all the NFT market.
Brian Friel (03:45):
Yeah. No, I totally agree. It's that ability to exit anytime and not requiring the permission of somebody else. That's really cool too your experience early on with online businesses, especially in a foreign country. Where did you grow up, by the way? What country did you grow up in?
Alex Salnikov (03:59):
Russia. One of the most restricted.
Brian Friel (04:02):
Yeah, trying to operate an online business as a teenager in Russia, it's probably one of the best educations for the value of this kind of stuff. That's awesome to hear. So you mentioned you're in university, you start 2012 in crypto, you're going through iterations with your co-founders on DeFi, then you get to NFTs. And I agree, NFTs was really one of the first mainstream consumer applications of crypto that it kind of clicked for everybody. Let's talk a little bit about Rarible. So when you guys started Rarible, what was different about Rarible that you guys decided to do at the time from some of the other marketplaces that were out there?
Alex Salnikov (04:38):
Rarible was probably one of the first five NFT companies that went out there and back then, OpenSea was around, SuperRare was around, a couple other platforms were around and there weren't almost any NFTs. So you had all the wallets, you had all the collectibles, tabs on your wallets, all the infrastructure, on ramp marketplace, but it was almost none NFT. There was a couple copies of CryptoKitties basically. And even if you wanted to create an NFT, you needed to either deploy a smart contract yourself or you needed to go to SuperRare, submit an application to get accepted, wait several weeks and then to create something.
(05:26):
And for us, after spending that much time in the crypto, it was a little contrarian to the openness and all the values that you bring. You're the owner. You don't want to ask anyone before creating an NFT. So we just did a simple experiment. We created a page that allowed you to create an NFT, no verification, no questions, upload your picture, upload your name, description, royalties, and connect the wallet, deploy your own smart contract and deploy your own token and all that just direct access to the chain without any intermediary. This just blew up. Apparently the crypto people resonated with that vision.
Brian Friel (06:10):
That's awesome. I love that. I think that's a good segue into some of the features that you guys have going now as well. So you started that kind of self-serve, create your own NFT marketplace. You guys have continued that same sort of spirit with your community marketplace products. What are some of those? Can you give us an overview of those products that you guys are building for the community?
Alex Salnikov (06:30):
The whole story goes more or less like this. Just a year after Rarible is life, we are taking a look at the market and we understand that the potential of NFTs is just so much more and so much wider than art market, than PFP market. We are very early at this point of even discover of the market what's possible with NFTs. And we understand that the more the market develops, we will need different verticals, like best for gaming, best for tickets, best for art, best for music, best for everything. And just naturally I feel like a big part of our team, the big part of the company DNA is technical. Both our co-founders are technical by background, our CTO, head of product, a lot of technical experience, a lot of just even math and physics background. So when we were deciding, "Oh, let's build a marketplace," without even realizing that we created an indexer that reads all data on chain, stores all NFTs in our database. Because it felt like, "Okay, let's do it."
(07:41):
And turns out that's a big strength that we have as a marketplace and that's one of the hardest part for other marketplaces to go and actually to use. That's why we created product, which is called Rarible Protocol. We wanted to go down the layer of infrastructure and power the next generation of NFT products, be it this platform that you want to build a wallet, like Phantom for example, and you need to have API to access, "Oh, what are even the current users NFTs that he owns? Or what's the market data for these current NFTs? What is the floor prices for the current NFTs that they own? What is the metadata for them?" So this product is called Rarible Protocol and it exists for two years now.
(08:26):
The next thing that we learned is that there's still pretty heavy stack to build on top of that protocol. If you want to create a marketplace, you need that API and moreover, you need to have a great UI on top of this. And a great UI still takes a lot of time to build. That's why we went ahead and created the UI offering too. Here is your protocol, here is your API, and here is your UI to create your own marketplace.
Brian Friel (08:53):
These are all tools that are being used by creators essentially to have their own community centric marketplace that's powered by Rarible in the background.
Alex Salnikov (09:01):
Yes. At this point, we have almost 2,000 marketplaces created with this infrastructure, both UI and protocol. There is not much, maybe 10 projects that is using Protocol directly without the UI, but quite extensively. I think like Coinbase Wallet hits us pretty hard with some API calls and several others. So all this is just all this shared vision that we want to power the next generation of apps, of marketplaces, of protocols. The community marketplace today is a no code tool. A creator can come if they have their own collection and create a marketplace using our UI and UX without actually even writing any code. You can deploy your own marketplace in minutes tomorrow.
Brian Friel (09:48):
That's awesome. I love that. So you have all these tools which for most people who are interested in maybe creating their own NFTs, the infrastructure set up and the software side of things is usually the biggest hurdle. So you guys are eliminating that from people's stack. You guys also have this white glove service. I know that's being used by a number of NFT projects, some even on Solana that shout out to Degenerate Ape Academy who has built their own marketplace with you guys there. And then you guys have this thing called RARI Foundation. What is that? Can you dive into a little bit about what that's all about?
Alex Salnikov (10:20):
Yes. Yes, of course. Wow, we have a lot of things. Shout out to Degenerate Ape Academy, a great partner. They've been actually maybe the second or third project to use our white glove solution, the first on Solana and the biggest on Solana. So we love the partner. The very foundation, so as many of you know the Rarible issued this thing called RARI governance token quite early in the days. And the idea is that this is the governance token for the Protocol. It is fairly standard, as we know, route for the projects to gain security and credibility and neutrality. So why Curve is great, because it is fully on chain, you don't need to trust anyone and it is community owned. You have an exposure to the activity that happens on Curve with Siri.
(11:25):
Usually the companies that do that in order to prevent the conflict of interest, you want these companies to be separate. You want to have a lapse company that is doing software and you want to have a foundation that is overseeing the actual governance and the token, and this is what RARI Foundation is. If you would go to RARI.foundation, you would see everything regarding the token incentives, the fully on chain governance. It's a cutting edge governance that we created. I don't know if our listeners are familiar with the VeToken model. It's vote escrow token. In order to vote in the foundation, you need to log your area for the certain amount of time, and the longer you log them, the more Ve RARI you get because you are committed to be with the project long term you're looking for two years. The votes of people who are known to be committed for two years are much more valuable than votes from people who will not be here tomorrow. I think Curve pioneered with this model and we at RARI Foundation actually created the first solid implementation of the VeToken model.
Brian Friel (12:36):
Oh, no way. I didn't know that. That's awesome.
Alex Salnikov (12:37):
So if you want to launch the VeToken model, you can come to us and we would help you to set up DAO. And it's not easy today. A bunch of projects sit on the tokens that cannot be even used in voting because they don't have the snapshotting mechanism. I know we're getting into the weeds, but if you created your project several years ago and didn't think that you will use it in Adel, it might not be possible. And by adding VeToken, using OpenZeppelin Governor and using Tally as the interface, you can have a full featured, very robust DAO that is fully on chain that can operate budget, that can operate treasury, and that will weigh much more committed votes in favor of those that are not committed. It's great.
Brian Friel (13:24):
That's awesome. So the purpose of the Rarible DAO and the RARI token, as I understand, is that you guys have plans for this over time to take ownership of this Rarible Protocol that we talked about earlier. Can you talk a little bit about the current state of that?
Alex Salnikov (13:39):
It's all started kind of blended together. There is Rarible, there is Rarible Marketplace, there is Rarible Protocol and the governance and ownership of that is blended. So the end state is there is RARI Foundation that has fully robust on chain governance that overtook the Rarible Protocol and governance of the Rarible Protocol. The Rarible is doing laps, it develops the protocol, it develops the code. It submits the proposals to the foundation sometimes like, "Oh there is a new version. Can you please approve that?" And today the RARI Foundation has full control over the undistributed supply of RARI, something like around 40% of the network, and the full control over the governance processes and the branding and IP of the token. That's the step one.
(14:31):
The step two would be establishing participation requirements. There are certain activity requirements at which we can say, "Oh, now the foundation is ready to overtake the Rarible Protocol." And then RARI Foundation will overtake it and Rarible will just operate the front end on top of that. So that's the end state and end goal where we're going. Yeah.
Brian Friel (14:52):
That's super cool. Well, it seems like you guys have been on this track from day one with your community minded perspective here, so it's really cool to see that being laid out in front of everything.
Alex Salnikov (15:03):
Yeah, it is not easy. We had all this community spirits, but this is more or less the duration of the DAO. Even the first was signaling DAO and it was signaling, but there was not much execution done. The second was an onboarding DAO. We've been doing grants to work on protocol and there was a lot of participation, there was a lot of people working at the DAO, but the effectiveness was quite low, just too much coordination. This is the third version. Yeah.
Brian Friel (15:32):
So I want to take a little step back here and talk about how you guys have been multi-chained basically from day one. This has been something that wasn't always the norm, especially coming from Ethereum very much focusing on Ethereum and maybe other EVM chains. You guys were one of the first to recognize Solana, integrating there, then taking a step further, adding Tezos, Immutable X, and this comes at a really interesting time because as we're recording this show, Phantom is gearing up for its multi-chain launch. I want to hear from you, how has it been building a multi-chain NFT marketplace, and what insights have you found in building that that might inform you what you think the future of this multi-chain versus single-chain narrative will play out?
Alex Salnikov (16:11):
Yeah, this is a great question. We started with adding the second chain that was flow as early as Autumn 2021, so quite early. And of course, the narrative behind multi-chain is always easier. There is Ethereum. There is a lot of artists that are unhappy with paying a hundred dollars of gas prices to create their NFT. So what do we do? We adopt a faster chain and the future is going to be bright. Not that fast.
(16:45):
I guess the biggest learning of multi-chain development is that it's quite easy to buy that narrative that we will abstract away the blockchain from the user and the user doesn't even need to know, the same way the user doesn't know that we use HTTP when we run a website or HTTPS, but we're not there yet in terms of the community. A lot of these chains, they are networks. They're networks of communities and these communities have values and these values are sometimes even opposed to each other. Somebody compromised decentralization in favor of speed. Somebody compromised speed in favor of decentralization and it gets even political. There is not much intersection between these blockchains, at least yet.
(17:31):
We're seeing more and more of conformity. Say at some point Ethereum and maybe Cosmos and maybe Arbitrum and maybe Polygon and Solana at this point are almost equal chains in the sense they're commonly accepted as being cool. The more the subset of okay chains are growing, the more we can grow towards the multi-chain vision. But before that, it was like you support the chains, but users of one chain, thinks that the users of other chain is almost like political enemies to you. So this is the biggest learning, bootstrapping the network on the new chain is much more hard than we could have expected. We tried going that route and multiple projects followed that route. I think OpenSea followed that route and struggled to get a meaningful market share from Magic Eden on Solana. Magic Eden added Ethereum and struggled to get meaningful market share from OpenSea on Ethereum. Now everybody's going to Polygon. We'll see how it gets there. It's much more interesting.
(18:43):
But yeah, we're seeing convergence obviously, but it happened two years after we added the first chain. Doodles migrated to Flow. We're seeing some convergence between ease in Flow. But again, this happened two years after we added that. We were a little ahead of time to get there.
Brian Friel (19:03):
Yeah. You guys were early to all that. I am curious though, you mentioned there's this narrative that some people have, definitely not everyone in crypto, but it's like, "Oh, in the future we're going to abstract away what chain you're using." And it's just like you're using a normal website and it doesn't notice anything. Do you buy that narrative? Do you think that is still coming despite all the differences between chains that we have today?
Alex Salnikov (19:27):
I don't know. Honestly and truly, I don't know. It feels like at this point at least EVM chains are all getting abstracted away. If you connect Ethereum Wallet or Rainbow Wallet, they would display the balance across all the chains just like a single shared (wallet). And you'll see, "Oh, here's my Optimism balance, here's my Polygon balance, here is my Ethereum balance." And then the next point would be bridges. MetaMask just added bridges so you can move things across these chains. This is definitely happening among the EVM chains. We haven't seen this happen among... I guess you are very well positioned to make that true for Solana and Polygon and ETH. So that is great. We're seeing this happening for sure. And even OKX Wallet. If you connect OKX Wallet, I loved that innovation and I'm dying to see that innovation among every other wallet. They don't ask you to change the network. I don't know why we need to ask people to change the network. Please don't ask people to change the network. It's impossible for a newcomer to understand.
Brian Friel (20:32):
Well, Alex, you'll be very happy to know that you'll never be asked to change your network in Phantom's multi-chain version. It all happens behind the scene. You just connect once it's considered connected on all chains. So we'll make it happen for Rarible. It will be a great showcase for all of that as well.
Alex Salnikov (20:48):
Thank you. Thank you so much. Let's collectively push MetaMask or the whole market.
Brian Friel (20:54):
Yeah, absolutely. A lot of this stuff is not intuitive. You're already getting people who are maybe coming to crypto because they like an NFT, they have a lot of questions about crypto, they're not sure. And then showing them these network change popups in their face, it's probably the last thing they need. And it's all about making this a safe and intuitive and familiar experience so that we can grow this thing.
Alex Salnikov (21:17):
There are two things that are almost impossible for the newcomer to overcome. It is the stuck or failing transaction. A failing transaction is okay, you can just resubmit it. But a stuck transaction, you need to wait until it goes so you can submit the next one. I've seen countless people just drop on that and this change of the next one.
Brian Friel (21:40):
I couldn't agree more.
Alex Salnikov (21:41):
It's so bad.
Brian Friel (21:41):
Yeah. That's something that we all have to fix, I think, as an industry. And we definitely have our take on those two problems. So we'll share you a beta code after this is done so you can play around and get your feedback on it. But yeah, I'm excited.
(21:54):
I want to switch gears a little bit to talk about how you see the NFT market evolving. You sit in a really interesting spot because as we said, you were very early, not only to NFTs, but to crypto. You're starting this in playing around in crypto in 2012. You've been early to the NFT marketplace scene. What is your current view on the NFT meta per se? What excites you about NFTs today?
Alex Salnikov (22:17):
It's a great question. More or less the whole story of NFT, we had CryptoKitties, which I actually believe is a way more advanced NFT than all that we currently have. It's living things that have DNA that can breed on chain and you can own them. Wow. After that, we take the giant step back. Okay, it's too hard for people to understand. Let it be just pictures. Let it be just art, and that went out. Art has a product market fit, very clear generative art, plain art, one-on-one, open additions. The current meta of open additions is through the roof, but it is all the same category of art. Quite clear. The simplest use case to make you get the idea of NFT.
(23:10):
The second biggest use case is PFP profile picture. Again, great one. It's virtual clothes for your digital identity. I find that the biggest cool thing about NFTs is that your digital you can own digital things that are directly owned by your digital you. And Twitter integrated that. Amazing. Instagram integrated art. I think Reddit integrated but not fully yet. So a PFP digital avatar. Great. And sadly, this is the only two use cases that work for NFT today. Maybe the third small one is memberships. You can have NFT membership. And that's it. Nothing else has yet worked. There are a lot of discussion. People usually think, "Okay, what's next? Or let's connect phygital. Let's do physical and digital at the same time."
Brian Friel (24:05):
I haven't heard that, phygital. That's funny.
Alex Salnikov (24:07):
For me, this is not as exciting. It is definitely what's needed. But the digital world evolves much faster than the physical. And by the time we have this, "Oh, digital, let's do an NFT for the house." So you need to have laws and it would take 10 years to get laws in place and during that 10 years, we'll have metaverses that are far more advanced than it is now. So it's just this part of the market, it's growing. It's faster. So to me, something that excites me a lot is something like CloneX is doing. You have a 3D avatar that you can import into the different metaverses and that would be you. So digital and native virtual use cases that have not been possible before. PFP have not been possible before, the interoperable between platforms PFP. The digital art have not been possible before. So some new use cases that have not been possible before that will utilize NFTs is what excites me. Games makes a lot of sense. But I don't know, CryptoKitties was such a cool project. There have got to be more to NFTs.
Brian Friel (25:21):
We got to get back to that same spirit for sure. I'm curious, do you think there's any one thing, like one bottleneck that's holding the NFT sector back? Is it something on the wallet side? Is it something just on the user education front, technology, or do you think this just takes time to iterate on?
Alex Salnikov (25:40):
I think the main value prop of NFTs is the standard. It is looked at everywhere as the same item. And this is the biggest bottleneck as well. We're coming up with the smart NFTs, so the smart NFT, every wallet should adopt it, every marketplace should adopt it, and some projects ideally should adopt it. So just the cooperation, the intersection of projects to adopt the same idea. I've subscribed to the newsletter that's called This Week in Ethereum, and I think that's one of the best newsletters out there. I read about new developments of NFT standards. Almost every week, there is something. Composable NFT, rentable NFT, this NFT, that NFT. And when I look at this proposal, I understand that several years need to pass before we will actually see any of these new NFT standards adopted.
(26:39):
So we will all need to come up with some addition to NFT standard that we all love and that we will all adopt and that will not be as hard as composable NFT of like ERC 998, or 988. That is very complicated, and very complicated standards do not get adoption. So some small increment, some better standard and a wider adoption of that standard. So complexity. Getting back to your question. Complexity. Yeah, complexity and coordination. Yeah.
Brian Friel (27:10):
Yeah. Complexity and coordination. Coordination across a lot of different people. Yeah. That's awesome. Well, that's a great insight, especially for us as we're gearing up to go multi-chain and supporting NFTs. So we're going to have to take a deep look at a lot of those different standards that are coming online and continue to iterate. So Alex, I just want to thank you. This has been a really great conversation. Thanks so much for coming on the show. One last question that we ask all our guests, and I want to hear this from you as well is who is a builder that you admire in the Web 3.0 Ecosystem?
Alex Salnikov (27:42):
Vitalik. I might come to some better answer, but-
Brian Friel (27:48):
You are the first person to say Vitalik on this show. So the spotlight's yours, you can take it.
Alex Salnikov (27:52):
I'll take Vitalik. He's built so much and his article... I've been recently diving into the article that explains how ZK works. I recommend it to everyone. They say that, "Oh, the next decade is going to be ZK decade." So just try to digest it, understand how it works. It's going to change a lot of lives.
Brian Friel (28:11):
That's a great answer. Well, we all have our homework assignment after this. Alex, thanks so much for coming on. Where can people go to learn more about Rarible?
Alex Salnikov (28:19):
It's always on twitter.com/rarible or twitter.com/insider0x. That's my personal Twitter, if you want to follow me. Rari.foundation is the biggest and exciting part that just started. So there's going to be a lot of development on that end. We're going to be East Denver. Let's meet. It's a great place to catch up.
Brian Friel (28:41):
I love it.
Alex Salnikov (28:44):
Yeah. And I feel like the second part of our talk is better than the first. Let's skip to the second part, guys. Maybe we can put that into-
Brian Friel (28:52):
Yeah, we'll get that in the show notes for sure. Awesome. Alex Salnikov, the Co-Founder and Chief Strategy Officer of Rarible. Thanks so much for coming on.
Alex Salnikov (29:00):
Thank you for having me, Brian. You are a part of an amazing team that built an amazing product that actually have chances to compete with the giants that we all know are really hard to move. Good luck with that. Let's not change networks, please.
Brian Friel (29:15):
Yeah, let's not change networks. I love it. That's all. Awesome. Thanks so much.
Alex Salnikov (29:20):
You're welcome.
-
The Yakuverse is one of the most anticipated cyberpunk metaverse games being built on Solana. PapiChuloGrim, Chief Marketing Officer at Yaku Corp joins Brian Friel to talk about their approach to building open world games that facilitate social interactions and e-commerce, and what the future holds for metaverse games being built in web3.
Show Notes:
00:06 - Intro
01:13 - PapiChuloGrim background
03:57 - Background on Yaku, an open world gaming experience
05:30 - Overview of Yaku API
08:55 - Overview of Yaku App
11:47 - Overview of Yakuverse game
17:49 - What the future looks like for blockchain Metaverse games
21:36 - A builder he admires in the ecosystem
Full Transcript:
Brian Friel (00:06):
Hey, everyone and welcome to The Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web3 space forward. I'm Brian Friel, developer relations at Phantom, and I'm super excited to introduce our guest, Papi, the chief marketing officer of Yaku Corp. Yaku Corp is developing one of the most anticipated cyberpunk metaverse games on Solana. Papi, welcome to the show.
Cole McMillian (00:29):
Glad to be here, Brian, thank you for having me. Excited to dive in a little bit to what we've got going on.
Brian Friel (00:34):
Yeah, likewise. I think you have one of the most unique names of any guest we've had on here on The Zeitgeist so far, so you're already winning an award for that.
Cole McMillian (00:42):
Anything is possible on Web3, right?
Brian Friel (00:45):
Yeah, exactly. You never know who you're talking to on some of these shows, but I'm really excited to talk to you guys. You guys are building a really ambitious game on Solana, which I think has a lot of promise in the gaming space on Solana, and some of the stuff you guys are doing, building foundational pieces of connecting gaming environments to Phantom and Solana wallets, so really excited to dive into all that today. But maybe before we do all that, I would love to learn a little bit about you. Who are you and how did you get involved with Solana and Yaku?
Cole McMillian (01:13):
Absolutely. My real name is Cole. We were actually joking a little before this, at the in-person events, I'll introduce myself as Cole because people feel strange calling me Papi in real life, but then ultimately, they just keep calling me Papi. My background is primarily digital marketing. Before making the dive full-time into Web3, the majority of my career, I was the head of digital strategy and on the side, I had a small digital consultancy that was primarily focused on media production and paid media. Then, I ultimately made a short transition into sales before diving headlong into Web3. The sales pivot really was actually what got me here. I moved from Kansas City, where I'm originally from, to the Oregon Coast and had a lot of free time on my hand making such a big move. During that time I just was able to dig a little deeper into the world of crypto, which had always intrigued me.
(02:13):
Naturally, got involved in Solana, based on some poor experiences on Ethereum and what I thought was not a conducive ecosystem, actually, on the crypto.com Cro coin ecosystem to the sort of things I was interested in and how I wanted to grow in my pursuits in this space. Ultimately, I joined Yaku just by organically finding the project. I was one of the first couple hundred people to join the Discord and when I saw the vision and the scope, I said, "This is awesome. Why is there not more attention on it yet?" Ultimately, I became very close friends with our CEO, Kevin, and we've had a really great rapport and he asked me to join the team in a larger capacity. A few months later, I said, "Web2, we're good for now. I'm going to go chase this Web3 thing full-time" I've been full-time coming up on, I believe, 10 months now. What a crazy time to go full-time, by the way.
Brian Friel (03:10):
Well, 10 months is ancient in crypto, as well. 10 months is about five years experience there in most jobs.
Cole McMillian (03:16):
It's fun to try to explain that to people. In my sales job, I had another regional manager who was a little further south of me down in the California area who said, "I think that guy, Cole, left to do Bitcoin," so we've still got some education to do, right?
Brian Friel (03:31):
Yeah, for sure. Well, let's dive into a little bit of what you were saying. You found this project early on, one of the first people in the Discord, and you were blown away by the scope and the ambition of this project. For those who aren't familiar with Yaku, what is Yaku, what is this concept of a Yakuverse? It sounds like there's more than just a game here, maybe just a whole ecosystem, but can you give us a little high-level understanding of everything that you guys are up to?
Cole McMillian (03:57):
Absolutely. The high-level overview, short pitch of Yaku is I like to refer to it as an interactive open world gaming experience, so a lot of people will sum this up as metaverse. I think that just the word metaverse has had a very strange connotation evolve over the last year or two, because people are confused as to what that really means. There's so many ways you can view a metaverse, there's so many different lenses through which people absorb it, and so to me, I've tried to get a little bit away from that terminology, but I definitely want to stick to the ethos of it.
(04:32):
We're very centered around gaming, online interactions, I'd say that it's, in some ways, the next evolution of social media. Instead of repping a profile picture, you're repping an avatar, you're having these live, in-person chats. I think that you will see a good evolution from things like Twitter spaces to more, quote unquote, in-person digital experiences like that via these virtual worlds. I think for us, the three main things, to sum it up, are we are centered on gaming, facilitating social experiences, and then the third key is we want to elevate the experience of online commerce, of e-commerce.
Brian Friel (05:08):
That's awesome. In addition to the game that you guys have, which I introed it saying that there's some cyberpunk elements to this, but I'll let you describe that in your own words, but you guys have really built out a whole infrastructure side of this, as well. You guys actually have what you call Yaku API. Can you talk a little bit about what is that and how do you envision developers working with this API?
Cole McMillian (05:30):
Absolutely. It's been something we've been working on for quite a while that we haven't really been publicly disclosing, not because it's anything to hide, but just because it's maybe getting a little into the weeds, but now that we're getting close to getting to a first version of these final product layers, as we call them, it's really good for people to, I guess, visualize how do these things all work together? The Yaku API is what we call layer one of our product layer. What we are doing is we are constantly listening to nodes, we're gathering transactions on the blockchain. We're doing that on both Solana and Ethereum, by the way, which we can dive a little bit more into that. We're very much built on Solana, but sticking to that metaverse ethos, we want to do our best to include some of these other communities, because ultimately, the ships will all rise with the tide and there's great communities everywhere. So, built on Solana and we're checking these nodes.
(06:29):
The second part of that is we're also continually scraping social media data. Not only do we have, through the second layer of our products, the capability in our Yaku app at Yaku.ai to connect your social accounts to the profile you build there, but on the API side of things, we're just continually gathering this data. This is data, everything from how many profile pictures are there being worn by users from a particular collection to the size and scope of the ecosystem as a whole, how many generally are there across the board and just trying to track those user data points. I think how we see people being able to use this in the future is being able to utilize it to create their own interactive experiences, because we are really trying to be focused on this gaming and social side of things. We're not necessarily positioning this, I think, as an opportunity to go out and create a DeFi application.
(07:29):
There's been some really cool innovations, actually, on this open API front right now. I believe it was Helios Labs rolled out some really cool innovations recently, as did Hello Moon shortly after. Data's really important. People need it as easy to read, as accessible as possible, for them to make the correct decisions to format it and ultimately, to springboard them to what it is they're trying to build long term. I think for us, the goal for this is to facilitate the gaming side of that thing. For us, what we are using it for, as it feeds into the funnel, is to help create a experience that aligns with users' interests and activities and what it is that they're doing from a day-to-day basis, whether that be the NFTs they are buying, how they are trading with their friends, how they are interacting and representing on social media. That's how we are using it internally and I assume that others will find the data the way that we've collected it and will be distributing it, good for similar use cases.
Brian Friel (08:30):
That's awesome. I like the analogy there of you saying that the API is the layer one and then you hinted at you have this app at Yaku.ai and then you have this game, as well. Maybe before we dive into the game, which is maybe what most people really want to know about, let's talk briefly about that app, as well. What is currently at Yaku.ai? I see you guys have a number of different widgets and applications there. Who's using this and what are they using it for?
Cole McMillian (08:55):
The Yaku.ai application is really viewed as the partner application to the Yakuverse. We're talking about layers, the third layer is the Yakuverse, so the API feeds into the app and the app feeds into the game. The app allows you to create your own profile, you can connect with Phantom and also MetaMask, which is hilarious because initially, when we talk about including these other communities, MetaMask was the one. We're very excited, because we work more frequently with Phantom, that you all have finally onboarded these other communities because it makes our lives a little easier. Not to shill for the audience out there, but I do think Phantom far exceeds the user experience on MetaMask. I'm just waiting for the day that Phantom takes that crown away.
Brian Friel (09:45):
Oh, love that, appreciate that. Hopefully, by the time this episode's out, we'll be very, very close to opening up our beta to the public, but that day is coming soon. I can't wait.
Cole McMillian (09:54):
Yes, absolutely. The app, generally, is a place where you can manage your entire Web3 life, both on the financial side and on the social side. On the social side, we've got Dialect Chat already pulled in there so you can communicate freely with people, we have some base functionality, where you could do things like earn social badges that display on your profile, you can connect with friends. In a soon-to-be-released update, so here's some alpha, I don't know exactly when this is going live, but my guess is it may beat this update, we are introducing communities, so you can actually see how many users there are within the application that also own the NFTs that you do, in hopes that we can facilitate some social congregation within that app amongst holders, in addition to a bunch of other stuff.
(10:42):
We have everything from burning multiple NFTs, multiple NFTs send. Probably the coolest on, I guess, the project management side of things is we've got an automated HR tool, so if you want to go in and set up automatic ACH-style payments for your moderators, alpha hunters, whatever it might be, you could just go in there, set the intervals, what the pay is, and you don't have to think about it, it just does it on its own.
Brian Friel (11:07):
I love that. The alpha drop on the podcast, that's great.
Cole McMillian (11:09):
Got to get it out there a little bit. I'm notorious for having loose lips, so if our community tunes in and they hear that I didn't drop any, I might get skewered in the general chat.
Brian Friel (11:20):
Oh, that's great. Well, that's a great picture you painted of the first layer of the API, the second layer, the app. Now, let's talk about the game. Ostensibly, this is what most people that I see on Twitter, whenever I tweet anything about Yaku, my notifications get flooded with your guys' user base. You've got a lot of rabid fans for this game. Can you talk a little bit about what this game is, how do I play this game, what's the story, and how do you see this game evolving?
Cole McMillian (11:47):
This is, for me, my favorite thing. I am also the marketing guy, so I am biased. The numbers side of things, sometimes, I won't lie, I gloss out just a little, so this for me is my favorite thing, especially being a longtime gamer. The general feel, I would say, for a traditional gamer that we are going for is a cyberpunk-themed futuristic, neon-lit world with a similar general play style to something like Grand Theft Auto. We actually are currently testing our alpha version of the open map internally with the community and letting them poke around and in a few weeks, we will have a much larger public launch, where we'll be able to go in and fix those bugs, as well as add in some added functionality.
(12:36):
On that first public version that we are really trying to get out there, what you'll be able to do is sign in using our Yaku Relay, which is our connection between Phantom and Unreal Engine. It essentially serves as a single signature to read all of your profile data on the app, on Yaku.ai. What that allows us to do is create token-gated experiences. Not only can anyone come in and drive a motorcycle around, race their motorcycle, use proximity chat to hang out with their friends, go hit the shooting range, there's some more fun information for you, we already started impslementing some PVP stuff, so they'll be able to go in and race and shoot and congregate and hang out and explore the open world, which is pretty large actually.
(13:20):
That's been the first feedback we've gotten from in this first alpha test is, "Wow, this is a lot bigger than I thought it would be." But additionally, through this API input through the Yaku Relay, we can do things like create a tower for Monkey Dow, which currently sits in the center of downtown, and create a token-gated experience, where only holders of that NFT can get into that area. That is really able to be extrapolated out to innumerable experiences. If you were interested, you could create a specific minigame that's only accessible to your holders. We could do a special short-time promotional event for Phantom, as an example, if you were wanting to have a virtual conference, to some degree. There's just a lot of ways that this can unfold and create these unique experiences. That's really what we're trying to facilitate, is an open world that's accessible to everyone and based on the communities you take part in and how you interact within that world, you'll be able to elevate the base experience.
Brian Friel (14:24):
That's super cool. This game, you mentioned it briefly, but it's currently in alpha, is that correct?
Cole McMillian (14:29):
It is, yes. It's the first alpha version of the full open map.
Brian Friel (14:33):
That's awesome. I think this is a great use case for crypto gaming. Like you said, you can build these expansive worlds for games we know and love, like Grand Theft Auto, I'm also thinking a World of Warcraft, you're exploring through this world, finding things.
Cole McMillian (14:46):
Absolutely.
Brian Friel (14:48):
But there's so much open public data on crypto already, you can just bring that in and enhance the experiences. I'm interested to hearing from you, too, you mentioned that it probably best resembles a metaverse, but maybe you don't like the term metaverse.
Cole McMillian (15:02):
Right.
Brian Friel (15:03):
Do you see a world where the Yaku universe in which you are is blending with other games that are on chain, as well, and you can bring other games' assets into Yaku, you could bring your Yaku character into other games? Do you guys think about that much and how do you see that unfolding?
Cole McMillian (15:18):
That's definitely something that we are using as a cornerstone of our general growth ideology, I would say. We already have, in this alpha version, avatars representing, I think, nine other communities currently live, and in the first public version that goes out, we'll probably have five more, if I had to guess. We'll be starting off with a pretty good representation of several different communities and for us, that serves many benefits. Number one, it really sticks with our company ethos of decentralization, number two, it enhances the experience, both for people who own those assets and are able to utilize them in more ways, but also for people who maybe don't and they are just looking for a broader experience generally. We're definitely going to continue to do that. We've talked to other collections above and beyond the avatars about things like vehicles.
(16:18):
We had a collection that we worked with closely leading up to their mint, we sort of incubated them, called Cha Cha Vans, that their branding is around the digital nomad lifestyle. They have these awesome 3D vans, so those will also be available in that first public version as a drivable vehicle. We don't want to really slow it down there. We've talked for a long time that if we can create something akin to a software platform for other creators to leverage, it will just make the experience that much more grand and ultimately, drive more users to the platforms. At the end of the day, we're a small team. I'm very proud of what we've made, but we are a big bottleneck. If we want to centralize all of it to ourselves, we're really doing the community and ourselves a bit of a disservice.
Brian Friel (17:00):
I totally agree. I love that thinking of it. It's funny, because most games today, the whole story of the game and what you decide to go out in the world to do is often set very top-down by whoever the game publisher is, then you get these MMOs and you can just go out in the world and do your own thing or get creative. It feels like this is the next evolution of that, you are basically giving everyone the tools to bring whatever assets they want into this sandbox world that you've created. Who knows, maybe one day someone else could even drive the storyline? Do you guys see that in the future, someone else coming in and almost co-owning development of this? Do you think that you guys will always be driving the vision of this? That's a pretty far-out there question, but I do wonder what the future for these metaverse game developments, where the vision for it goes.
Cole McMillian (17:49):
I think long term, again, it just makes sense, because when you're working with a world that is so large and so flexible and the attention economy is so fast, people are moving from place to place so quickly, especially in this world, it is lightning fast as compared to the traditional gaming world, I think providing more experiences, providing opportunities for people to build on what you have set out for them, is a win-win across the board. It's driving more traffic to us and ultimately, if they're driving traffic to their particular storyline, their particular experience within our world, we will benefit as a result, because they have to come to our world to experience it. I definitely see that in the future as being part of what we are implementing.
(18:37):
I know from our end, we are very excited to... You talk about, "Oh, I can see the ideas of questing and exploring in this sandbox feel." I think that that's something we've really embraced, because for me, personally, this is a personal opinion, I think, a lot of the, quote unquote, metaverse experiences that are out there now do not have player retention. You get in, there's an open map, there's things to look at, but there's not really much to do. I think that's why we're trying to hammer more on the gaming
side of things rather than just creating, necessarily, this open world, because that's what we want is people who come in and stay and as a result, have all of these benefits around them that they can leverage, in addition to whatever is the core driver for them.
(19:22):
We do have, coming out soon, a new GitBook, what we're calling the YakuWiki, and it includes general information about the project as it sits right now, things like our community. We always get the question what's with the lemons, because there's constantly lemons in our content, and so now, forever and always, I'll be able to send people there and go, "Hey, I, you check out the Wiki, it's in there. You get the full history of it." Part of the Wiki is also the future though, where are we headed? We're waiting to release that, but I will give you a snippet that part of that future is that we want to, I think, change what does a multiverse of game modes look like under a single umbrella and concept.
(20:02):
We're working on a point system that we can implement in the future that is basically as a result of all of these different inputs. It is based on your racing outcomes, when the racing game portion is live, it's based on your completion of quests, as there are quest lines that are created, it's based on your activity in the application, it's based on your activity on socials, all these data points feeding into what is one larger goal that everyone is achieving. I think that that is going to be a really good opportunity for what you're talking about, where you're not siloed to a single style or experience and you're also empowering other people to create their own that can feed into this larger concept.
Brian Friel (20:43):
That's really awesome. I love the vision you're laying out there, that's really cool. I also want to know what's up with the lemons, but we can save that little bit of alpha for the Wiki release. I don't want to steal too much.
Cole McMillian (20:53):
The really short version is we had one member early, early on in the Discord who reacted to every single announcement with a lemon emoji. It just slowly picked up steam until the point where it got to 1,200, 1,300 lemon reactions on a single post. We were like, "You know what? The community is making a stance on this emoji here, so we're just going to adopt it as one of our own."
Brian Friel (21:17):
I love it, that's the best. When stuff like that arises organically, that's 100% the best, one of the best parts of working in this space, as well. Well, Papi, this has been an awesome discussion. One question we ask all of our guests, and given the vision you just laid out, I'd love to hear this answer from you, is who is a builder that you admire in the Web3 ecosystem?
Cole McMillian (21:36):
This one is really easy for me, actually. I saw this question and I said, "I know exactly who it is." It's someone I talk to, I would say regularly, not super frequently, but regularly, we're doing some stuff together. They're, I think, a really good balance between someone who is a heads-down shipper and someone who is an active participant, as well, and is no bullshit, which is maybe my favorite thing, and it's got to be Foxy Dev from the Famous Foxes, man.
Brian Friel (22:05):
Love it.
Cole McMillian (22:05):
He always keeps it like it is, he is a straight shooter. What I think I appreciate most about him is one of the hangups I think we have in the space, in general, is because of that attention economy I was talking about earlier, the question when arises all the time. There's so much pressure, there's announcements for announcements for announcements because you've got to keep the attention here and there's always people moving to do things. He is very, very good at staying active, really reaching out to his community and getting their feedback, but shipping things when they're ready and not trying to play the it's coming, it's coming game. He is a guy who just builds relentlessly and when it's ready, it's ready and if you want it sooner, well, you'd better just chill out and wait for it.
Brian Friel (22:49):
I couldn't agree more. You're not the first to bring him up and we have had the Famous Foxes on the pod before. But I agree, when, when, when is we went mobile all the time back in the day. It's definitely part of the culture, but when you can back it up with shipping quality on your timeline, that's the best place to be.
Cole McMillian (23:06):
100%, man.
Brian Friel (23:07):
Well, Papi, this has been an awesome discussion. Thank you so much for coming on the show. Where can people go to learn more about Yaku?
Cole McMillian (23:13):
If you want to learn some more about Yaku, I would suggest jumping in the Discord, for sure. Custom URL, so just /YakuCorp, and go to the website, check out Yaku.ai. Make a profile, claim your name, and start checking out what's there, because it is about to have a pretty big facelift, as well, and I think that people will be excited for the direction that it's headed.
Brian Friel (23:36):
I love it. Bring your lemons to the Discord, too. Get them ready.
Cole McMillian (23:39):
Yes. We'll make fresh lemonade or limoncello, whatever you prefer.
Brian Friel (23:43):
Beautiful. Papi, the chief marketing officer of Yaku Corp. Thank you so much.
Cole McMillian:
I appreciate it Brian.
-
With over 80% developer growth the past year, the Solana ecosystem has never been stronger. Chase Barker, Head of Developer Ecosystem at The Solana Foundation joins Brian Friel to talk about the current initiatives happening on Solana that excite him the most, along with the biggest opportunities he sees for Developers on Solana in episode 20 of The Zeitgeist.
Show Notes:
00:05 - Intro
01:56 - Background / Start with Solana
11:49 - Highlights from last year with the developer ecosystem
16:13 - Latest exciting initiatives in Solana
20:56 - Opportunities for devs in Solana
25:03 - Opportunities to build a project on Solana
27:36 - Solana plays Pokemon" game30:43 - Where will Solana be in 5 years
32:55 - A builder he admires
Full Transcript:
Brian Friel (00:00):
Hey, everyone and welcome to The Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the web 3.0 space forward. I'm Brian Friel, developer relations at Phantom and I'm super excited to introduce none other than the man, the myth, the legend, Chase Barker of Solana Foundation. Chase, welcome to the show.
Chase barker (00:24):
Hey man, thanks for having me.
Brian Friel (00:26):
This has been a long time coming. For those who don't know, Chase is the head of developer ecosystem at Solana Foundation. He's one of the earliest guys you could have seen if you were a developer coming into Solana. And it's special for me personally because Chase was the first person I reached out to on Solana. We actually did an episode on your old podcast, Chewing Glass at one point. It's great to be on the other side of the mic though, but officially welcome to the show, Chase.
Chase barker (00:49):
Thanks man. Yeah, it was super cool and it's also wild for me to be on this other side because we met in some interesting circumstances, you trying to dive into the whole ecosystem and I had no idea what I was doing and I needed help. And you wrote some really cool shit for me for the Solana Cookbook and here you are, leading Phantom. So anyways, I won't dive into that too much. Maybe we'll talk about it later, but it's super cool to be here, so thanks for having me.
Brian Friel (01:15):
Yeah, thanks for coming on. No, I couldn't agree more. Probably a good place to start, is maybe rewinding time a little bit, going back to some of those early days. Solana's pretty unique from a developer perspective. There was always, having worked in the industry pre-2018, it was always... If you're doing something development wise, solidity is the only game in town you got to be working in EVM. And Solana basically struck it out on its own and completely changed that narrative and you were around to see pretty much that whole evolution. Can you talk a little bit about your journey to finding Solana? Who are you, what were you doing, and what have you seen evolve in Solana since you've been there?
Chase barker (01:56):
Yeah, for sure. So I've told this story a lot and I'm going to keep this one shorter than I normally do, but I was an engineer for 12 years and then started trading crypto in 2017, made a bunch of money, lost it all in 2018, like most people. And then along that journey I found this project, Kin, who now exists on Solana, but they had their own fork of Stellar and I was into crypto and the bear market in 2018 and they had this hackathon thing and I built a tip bot with a group of other people to be able to tip on Reddit, discord, Twitter and Telegram. And I was like, okay, this is really cool. I really sort of hate my web2 job right now. I'm doing this government contracting work working on legacy Spring VC systems. It was miserable and I've talked about this a lot before and I just got everybody's email addresses and started saying, give me a job.
(02:47):
And they told me that all the jobs were based in Tel Aviv, but they have this developer relations role for Kin. And I was like, okay, that sounds great. What the hell is that? I had no idea what developer relations was at the time. So did a little bit of research, ended up taking the role and really just started working. They had an SDK, but documentation tried to grow a community. It's a little bit different. I'll get into this from Solana because Kin was like, this is the ICO days. Nobody really gave a shit about use cases. It was just like how am I going to be the most degenerate thing here. It was way ahead of its time, but eventually flash forward after a couple years of really loving what I was doing, traveling around the world, speaking at conferences, and helping people learn how to build in crypto.
(03:31):
And I heard, and it's March or April 2020 way early, and I'm talking, nobody that I knew, knew about Solana. So they were like, we're going to migrate to Solana this new blockchain. Nobody knows about it, but it's going to be super fast. Our tech team says it's great. So I followed along. Around December, I was involved in the migration process and I had spoken with Dan Albert, who's now the head of the Solana Foundation, and Raj and I engaged with a bunch of these guys but didn't really know them, but I was part of that migration. And then a little bit later into 2021, early 2021, people don't know this, but actually I was leaving Kin and I was looking for another role and I got hired by Circle for one week as a developer advocate. And then I saw Solana had a developer relations role, applied.
(04:21):
So I actually had an awkward situation where I had to tell Circle that “I know I just started, but I'm going to go work at Solana.” But the reason I worked at Solana is because I just DMed the shit out of Raj and Dan until they finally submitted into saying, okay, finally we're we're going to let you take this role. And at that time all that existed was the core documentation and the PaulX Escrow tutorial, aka the Solana Bible. And that was the start. May 5th, the day after my birthday of 2021, I joined Solana as the first sort of developer advocate and that's sort of the entry point.
Brian Friel (05:01):
Wow. So yeah, it's not really that long in calendar days.
Chase barker (05:07):
It's been 20 years. It's been 20 years.
Brian Friel (05:09):
Yeah, exactly. 20 years in crypto years for sure. A lot has changed since then. Maybe the only thing that hasn't changed is the strategy of just spam DMing somebody to try to get a job. I definitely tried to employ that with you back in the day. I know a few other people who have successfully deployed that strategy as well. But yeah, it's been crazy. There's a lot to talk about here. Maybe we just focus on the last year in particular because you mentioned 2021, it's a pretty crazy year. There was just the public tutorial on the docs and then all these people come in, you get anchor that gets built around that time. Solana takes off, a bunch of independent teams.
Chase barker (05:49):
Actually, let's go a little bit before that because I think this is just a really interesting thing and I like telling this part because when I started at Kin I was begging people to build on it because nobody was really building on blockchain except Ethereum at the time. And then I started with Solana and I had the exact opposite problem. You had a ton of people that were like, hell yeah, this sounds really awesome, but how the hell do you build on this thing? What the hell is rust? There's no documentation. You go into the Discord and the cord devs are just “go read the tests, that teaches you how to build on Solana.” And that's literally the world that we lived in at the time. And then started putting together this sort of part-time dev advocate team, if you want to call it that. I just skimmed Discord and looked for people who were helping others and be like, hey, come over here into this private discord with me.
(06:39):
And I'm like, help me scale myself. Because I was starting to write some example code and there was none of that. And then luckily I met Donnie and then Jacob and a couple other guys that are now full-time at Solana Foundation and they were helping in dev support. Jacob was working on the Java STK with Skynet Cap, if any of you guys know him. He was really one of the early OGs there. And then this whole group formed and they were writing content and then you reached out and contributed to the Solana cookbook and this whole thing just came out of nowhere. And I was literally sinking. The demand for Solana was so high because the tech was so new and the sort of hardcore engineers just really wanted to build, and the Dafi’s and the Max’s and the Armani’s just figured the shit out.
(07:28):
But everybody else was like, let me, let me. And I could not do that on my own. I didn't even have the brain big enough to supply the knowledge to all these people. And then long story short, or maybe long story long is that you and I started talking and you wanted to be part of it and you wrote some really important stuff for the Solana Cookbook, I think retries, possibly PDAs and some of these other things. And it's like, thank you. And I do remember you being like, hey, can I work at Solana? And I didn't have any approval of power at the time and you left me and probably a month later I got approval to hire somebody else, but by that time you were at Phantom, but it seems like it worked out. So it is what it is.
Brian Friel (08:12):
I think you're right about the demands being so strong for people to figure it out that you just saw people coming together. A lot of times, you look at people who are evangelizing new tech and they're like, hey, here's this awesome thing. Try to explain it. And the first reaction of everyone is like, okay, cool, but then they just move on. And I feel like Solana was one of the few cases where that was the opposite, where everybody was like, this is incredible. How do I use this thing? How do I build this thing? And it was just this hive mind of people coming out of the woodwork to try to make it happen.
Chase barker (08:43):
Even me leading into Solana, and I say this a lot too because it's true in my mind, and I was like, listen to Anatoli and all this stuff, and I'm one of two things. This is the giant scam, or this is actually really fucking awesome. And luckily my instincts were right on that one and everything sort of worked out. And when I met you and then we started doing this part-time DevRel team that you were a part of for a while, first Solana Foundation.
(09:09):
And the next thing, my Twitter account became this thing where people would create content and I would share it and then somebody else would be like, oh, I want my shit shared. And then they would make content and I would share it. And this was this huge flywheel and that's really what turned into my account was this person who, you do cool shit, I'm going to share it. And then I became this other guy where I'm also, I do stupid shit and then I also share good shit. So it's this perfect mix of this idiot and then this guy who knows where the good stuff is.
Brian Friel (09:46):
You either die a developer or you live long enough to be a Twitter celebrity, I guess in your case?
Chase barker (09:52):
Yeah, I mean I don't necessarily love the celebrity side, but I do love getting DMs from people to say, Hey, all the things that you shared, and you probably hear some of the same like, hey, I got a job here because of this tweet that you made or this thread because I started making threads, who's looking for a job or who's whatever. And in the early days that's all we had, was Twitter. There was no other way to connect. I made a Twitter developer list and I added 300 people to it so that not everybody had to come into Solana Twitter and be like, follow each individual person and these were such manual, weird, really hard... I had no idea what I was doing. Luckily people showed up and were there and then just ran with it. I mean, looking back, dude, it's just awesome to look and see what's happened since then.
Brian Friel (10:40):
Yeah, no, I couldn't agree more. Lots of connections made in those early days, like you said too, where people get jobs, all this kind of stuff happens and it's crazy how little interactions like that go really far.
Chase barker (10:49):
Yeah, exactly.
Brian Friel (10:50):
So I guess taking it now to this past year, so we're recording this January 2023. The past year in particular, if you were just an outside observer looking at crypto, you're like, wow, prices are way down, everything's dead. And there's a report that comes out just the other day, Electric Capitalist Developer Report, which says Solana developers grew over 80% in the year. You and I... I had an intuition for this, I'm sure you did too. It was just developer activity.
Chase barker (11:20):
I didn't have intuition. I actually knew.
Brian Friel (11:23):
Yeah, you knew. But other people I'm sure had intuition if you're around the developer ecosystem, it's not stopping. Developer activities keeps picking up, summarize a little bit in your words over the last year, what has stood up to you? What are some of the highlights? You mentioned you started this thing and it's just you and DMing people on Twitter and getting this thing going. Now it's a serious operation of a developer ecosystem here going. What are some of the things you're most proud of that stood out to you?
Chase barker (11:50):
Yeah, so I think the start of the year in January of 2022, we're all sitting there, and the crypto markets nuke, and the blockchain literally is devastated. And that was any sort of pre any sort of ideas about what is wrong, what is it? Basically it was all these sort of liquidators, spamming to try to liquidate people and that just turned into this thing. And I think by that point in time though, we had some really high conviction developers that were already super invested themselves in Solana. So they stuck around and I think that's very unique for that to happen. Everybody's like, when are you going to fix this? But it literally took two to three months before they even identified what those solutions might be and those solutions to many of you, the devs out there were quick and fee-markets and some of these other things that improved.
(12:45):
But even though these solutions were being built, that shit takes time. So during that same time, Solana NFTs were going through the roof and these bots were spamming the network. Luckily we're flash forward briefly to right now all of those things have been implemented, but the work is never complete. But we've been pretty battle tested and recently, but I think to your original question, what I'm most proud of is being able to keep that morale up, being able to really build out this sticky community and I'm focused on devs, but it's not just the devs. Without that normal diehard community, without the Dev community, without the NFT community, we would've failed miserably like every other blockchain that tried to do what we did failed.
(13:33):
But I think a lot of this really comes down to personal relationships and when you come into Solana and you get involved, people really cheer you on and there's that sort of camaraderie there that kept people here, even in the darkest of times. I'm just really happy. Like I said, I knew that those numbers were high and to be honest, a lot of the reason while I've been memeing about the 75 developer ridiculous reports that have been coming out, I was memeing it so hard in the last couple weeks because we crawled GitHub internally and we know where our dev numbers are and we always make sure that we know where those things are. So it was sort of funny to me to just keep memeing that and then knowing Electric Capital was going to put out a report that sort of reflected... at least they have some pretty strict rules around what they constitute a dev. Our numbers are slightly higher, but their rules are strict. As a full-time dev, you have to commit code X amount of days per month or whatever that is.
(14:32):
I'm sure they have that somewhere and the way that they do it, but yeah man, it takes a village to do this and there's not one person you can point to, but there's obviously some champions out there that really made people inspired to continue building. The proudest thing I can think of is all the shit we took this year and we're still here and now we just have been pretty much named and given the silver medal of the second strongest developer community in crypto and you got to give a shout-out to Eat the Kings, fully open source and putting up numbers for devs, so you got to give them credit.
Brian Friel (15:06):
Yeah, we mentioned a little bit early on about how it was a narrative violation for Solana to have a completely different programming paradigm to not be using Solidity to get into an account model lower level dealing with Rust.
Chase barker (15:20):
There was FUD that was like “Solana's using Rust? Good luck. You guys are basically screwed.” Nobody's ever going to build on Rust. So that was false.
Brian Friel (15:29):
Yeah, most loved GitHub developer language though I'm pretty sure that's another narrative violation for you there. So talking a little bit more about what you guys have been up to you, you mentioned you guys have been crawling the GitHubs and you've seen this dev activity, you now have a full-time team like you said that, that you're working with, but it's not just you guys at Solana Foundation, there's all these other ecosystem teams now. There's people like Super Team Dao who are doing their own thing, coordinating devs and building devs. I'd say there's stuff on the community side getting devs and raising awareness there. There's Lamport DAO, I might be giving you too many answers here, but the community side and the tech side, what are some of the initiatives that are happening right now in Solana that have you most excited?
Chase barker (16:14):
I think one of the most important things to note about Solana Foundation and Labs in general is the headcount stays low. This sounds weird to a lot of people, but our job is to make ourselves irrelevant in the next five to 10 years as an organization, the super team and the Lamort DAOs and Meta Camp and Singapore in these different groups, a lot of them will get grants from the foundation to get themselves up and running. But after that they basically become these sort of miniature Solana foundations where they start growing their community from the inside out and giving out grants and doing all these really cool things. But you think of Solana as this giant bubble and every time one of these new miniature groups spins out, the Solana Foundation bubble gets smaller, and then these other bubbles start getting more and plentiful to eventually you reach a point where Solana Foundation bubble was the size of the rest of these small groups.
(17:08):
This is the antithesis of Web 2.0, hiring as many people in as much headcount as you can and trying to own everything. I don't want to own everything. I want to find Mertz, I want to find Super Teams. I want to find Meta Camps and I don't want to just go find them and ask them. I want to find these guys that just put everything they have into Solana the blockchain and they’re just so passionate about it, that it's like this is the team that we want to put our energy behind. In the beginning it really was a lot of us at Foundation and Labs doing a lot of the talking, but now you have these stronger voices and I'm not going to lie, it makes my life a lot easier to not have to be doing all that talking online anymore, but I still do it.
(17:53):
And I think the important point here is that if we're going to become a decentralized blockchain, we also want to become a decentralized organization itself and that means nobody has to get our permission. I think one of the greatest examples of no permission is Hacker House was kicked off, everybody's like, when my city and MTN DAO was like, fuck this, I'm just going to make my own thing. And they actually built the best thing that's really happened out of our community to date and they produced multiple, clockwork previously, Kronos, mtnPay, all these guys won hackathons.
(18:33):
Because T.J. Littlejohn literally came up with mtnPay at MTN DAO and a food line being like, Solana Pay just came out. Oh shit, maybe I should just build a payment thing with this new thing. And then he set up the system and people were paying with USD right there. So if that trajectory keeps happening through Solana, and I know other blockchains are trying to emulate what we do, but there's no way to emulate this unless you actually do this organically and it's happening. And anytime I just find somebody like a TJ or a MERT or whoever or a Brian or whatever, I'm going to put all my time and energy behind them and that's literally my philosophy and the foundation's philosophy in general, I think.
Brian Friel (19:15):
Yeah, for sure. No, I've seen that too. It feels like there's more... Solana is the only ecosystem I know outside of Ethereum really is there are these factions not the best word, but it's these unofficial groups of people that... Maybe it started as simple as we like to ski in February and we want to get together and hack. MTN DAO, but it's becoming an official collective now. People are identifying with it. And it has influence in the community. I mean I totally see what you're saying too about the Hacker House is I know we had our own last summer, we kind of piloted the Summer Camp Hackathon fan of Sponsor [inaudible 00:19:51]. But I just see that model continuing to go and more and more teams coalescing around certain regions and sponsoring their own thing.
Chase barker (19:57):
And for everybody listening here, don't ask for permission, don't ask when, just literally do it. And if you do it and you do it well, the attention will get drawn onto you and then I'll come find you and I'll knock on your door and ask you how I can help. So that's really the sort of mentality that I personally have.
Brian Friel (20:15):
Yeah, I couldn't agree more with that. That was my approach trying to work in this space, just do it and then ask for help or permission. Someone will find you. That's so much better than trying to ask somebody for permission to do something. So I guess that's a good transition to, let's put ourselves in the shoes of a developer who's looking at Solana right now. There's a lot of devs out there that might see Solana and they still think, oh, Rust and scary. That's probably not true. We can talk about that. But there's also probably a lot of devs who maybe know a little bit about Solana, they're kind of like right on the cusp, because they want to jump in. What do you want to say to these devs? What are some of the biggest opportunities that these devs should be looking at right now in Solana?
Chase barker (20:56):
Yeah, I think there's a couple things here. I think it depends on your demographic and age range. I mostly meant age range. So if you're in college right now, look up solanau.org and it's @SolanaUni on Twitter because Dana is our university relations person who is absolutely crushing it, sponsoring and participating in hackathons, doing workshops, just really bringing in my opinion, the next generation, the most risk averse group of people are students who are still funded by their parents that can make some sort of mistakes early on. So they're the next generation that's going to take this forward and luckily they have some really tech heavy guys out there that are just so dedicated to this, the Solana core engineers and the Jito team and all these different groups that are there to mentor them when they're ready to get in this. But I think SolanaU is probably a really high leverage thing.
(21:54):
We spend a lot of time working with Build Space who's built Solana Build Space Core, which is an amazing program. Things are getting easier. We're still in that place where new things are coming around the corner and I get a lot of shit for this, especially from Rust maxi’s, but there's Seahorse Lang where you can build smart contracts on Python right now, not fully ready for production. There's a version of this in typescript coming. We're doing whatever we can to make it easier because the Chewing Glass thing is true and it's mainly true not because of Rust, not because of Solana, it's because learning Rust and Solana and all those concepts at the same time, is literally painful as hell. But content and all these other things combined put together right now and all of the sort of tooling that different groups are building like indexers and all these things are making the lives easier because as adapt dev you want to deal with “get program accounts and all that stuff”, it's not...
(22:56):
We're getting to a better place and it's coming right now there's a couple places, I mean solana.com/developers we're curating our own list, but I cannot negate what ELO from SOL Dev has done at soldev.app and the whole entire thing that he's built out. So I'm super bullish on a lot of the stuff they're doing. I think there's just too many things to name of how many independent contributors are out there just building shit. I said this the other day on Twitter, I know when things are getting really good when I can't even keep up with the retweets of the things that are being built that I have no idea about. And then you have this other guy that most people don't really know yet. His name's Jonas and I think it's Soul Play Jonas on Twitter,
Brian Friel (23:40):
He's our hackathon winner.
Chase barker (23:41):
Is he?
Brian Friel (23:42):
Yeah. So when we hosted the Summer Camp Hackathon last summer, we had a Deep Links prize and he won as the best use of Deep Links because he was the first to build a Unity game on Solana using it.
Chase barker (23:53):
I'm not going to dox his location, but I'm going to tell you this mfr is legend and really going to try to push the gaming world forward on Solana, which I think is the blockchain that has the best ability to actually scale. And I want to give credit where it's due, zk-Tech is going to be fucking amazing, but Solana as is right now, has the best chance to scale if a big top tier sort of gaming company hits and decides to leverage that tag.
Brian Friel (24:24):
Yeah, let's talk about that a little bit because I had Anatoly on as the first guest and he always talked about how his dream was blockchain at Nasdaq speed and it was like “it's DeFi all the way". Then you and I are both around for the 2021 craze where it was just all of a sudden it's the world's greatest JPEG trading machine, it's all NFTs. Now we're seeing stuff about gaming. Is there a certain type of developers interested in something they should come to Solana? It's just like everybody... It's not necessarily specialization here, but what are some of the biggest opportunities maybe if you're looking to start a company on Solana, build a project on Solana?
Chase barker (25:03):
Yeah, I think we're being honest here. If your use case does not necessarily require high throughput, then the options are pretty unlimited in blockchain. But if you want to be able to have fully on chain games.. And not to say that we both know this, when you're building a game on any blockchain, not everything has to be on chain and it's almost like not necessary to the extent, but DeFi, we need to reignite that on Solana. There's been a series of unfortunate events that–whatever, but I think there's a really strong group of people that are working on this open book DEX and this massive amazing thing that came true. But for me personally, I think that the big unlock comes in gaming and the real original use case of crypto that has never actually been solved, which is payments. I mean it's been solved but not in a usable way. If you're going to bring payments to new and emerging markets, the fees and stuff are important because the fees on some of these different chains is more money than is-
Brian Friel (26:12):
Not feasible. It's a non-starter.
Chase barker (26:13):
It's not feasible. And Solana Pay and a lot of these other payment options are starting to enable that. And I think it honestly just has the potential to change a lot of lives, JPEGs and all these other things. That's cool. And I love that people are having fun on blockchain also. Solana is definitely the funnest chain by the way, but payments, man payments, we have to do it. We have to get payments, remittances done on chain and Solana's the most equipped to do it, especially related to fees.
Brian Friel (26:45):
Yeah, I love you said it too about it being the most fun chain, priding yourselves with that because for a while, and I think you noticed this, with every new blockchain, something that starts, the first thing everyone does is copy what worked before. We're going to have an AMM, we're going to do some DeFi thing, we're going to have an NFT marketplace. But I'm starting to see now on Solana things that are uniquely Solana and just couldn't be done elsewhere. And it definitely feels like there's a unique culture. And I'll shout out too, one, we talked about T.J. Littlejohn and you mentioned payments, the Solana pay spec. Yeah, you can send payments to anyone, but you could send any transaction. So he built that NFT photo booth. You take a photo, scan it, and it mints as an NFT using the payment protocol. It's pretty cool. There's another one though, we just had him on as a guest, which will launch fairly soon on this podcast. Have you seen the “Solana Plays Pokémon” game?
Chase barker (27:37):
Yeah, I have briefly, but I don't know a ton about it.
Brian Friel (27:40):
I don't know. It's a game like that... It's like you said, it doesn't have to be crazy. It's not everything on chain, but it's almost like a new genre of game because here you have this emulator that's sitting off chain, it's playing Pokémon and it's like anyone can permissionlessly show up and just start voting to say, press this button, press up, press down. And Solana's so fast that it's basically processing these very quickly and all of a sudden you have people warring over, should we train a Squirtle? Should we release the Squirtle? Should we fight this gym leader? It's a toy today, but you can kind of see how wow, this could become kind of a new game genre where it's multiplayer and, you don't know who you're even playing with or against and it's all real time. It's all being coordinated. It's pretty wild.
Chase barker (28:22):
I think a lot, and I'm a big advocate of looking at the Web2 world and seeing what is possible on Solana, and also what makes sense because not every use case makes sense, but for example, like I said, I mentioned Shek earlier and Wordcel Club, which is the blogging platform and they're doing some other cool social primitives and it's like they're starting to open source those primitives, but why would you do something on web 3.0 that you could do on Web 2.0? And the answer is sort of incentives. And you look at some of these bigger social platforms that absorb 99.9% of the value and there's a way to distribute that value on web 3.0 that there never was in web 2.0. So I think that's an important one. There might be some disagreement here, but I think the group that really got closest to some sort of web 2.0 success was Stepn, because they went product first instead of... You see a lot of stuff in web 3.0 of it's like, developers first developing for developers, they're developing for things like that.
(29:27):
But Stepn was like, what does everybody do that we could reward them for and get this on chain? And that was working out, this is an incentive mechanism. Obviously it didn't fully work out and I think there's probably... They're working on that, but at the same time, we need to start thinking what in the web 2.0 world is working, how can we do that on web 3.0, and why would that app make sense in web 3.0? And then usually it's incentive mechanisms that give the user a reason to use it, but they're not going to do that with massive delays or lag times or all this stuff. It better work just like web 2.0 if not better if you're going to do that. So really focusing on things that Solana can do that other blockchains can't at this current moment is probably going to be some of the highest rate of success or at least some more of the higher impact things I think.
Brian Friel (30:21):
Yeah, I agree. It's got to be seamless in the background. There's people in crypto who care, but the vast majority of people don't want to sit around and wait for something to load. So we talked a lot about the state of Solana today, what you're excited about all these different people building. You alluded to this a little bit, but paint a picture for us. What do you see the Solana ecosystem five years from now?
Chase barker (30:43):
Five years from now, I see myself not having a job anymore, and I'm okay with that because I've said this since day one. If I do my job the way that I'm supposed to do my job by empowering, enabling others, then there's no need for a me anymore. And any true ecosystem that has a foundation or a labs, whatever, there should be a point that they're looking towards. The North Star is literally being able to walk away and that community in those small groups that you've sort of empowered and sort of distributed out, you can walk away and that shit just runs itself forever.
(31:19):
That's not just the blockchain that's actually distributed community, not just the distributed blockchain. So that's the North Star. Five years, probably not likely, but I do think in the next five years that it's going to be about as easy to build on Solana as it is to build on React. That's what I have in my mind. And we have the firepower in the ecosystem and the dedicated people that I already see completely just trying to push with Seahorse and all these other things. People are just thinking, how can I make this easier for people if we're already there two to three years in from [inaudible 00:31:59] Beta Solana, we're progressing rapidly right now and if we keep that rate in the next five years, it's going to be insane.
Brian Friel (32:09):
Love that. And yeah, the beta tag, I'm sure given all the trials and tribulations, we will be shedding that beta tag soon.
Chase barker (32:17):
I haven't seen the Bernie meme in a while and if anybody listening to this doesn't know, Anatoly said that we're going to drop the beta tag after one year from the Bernie meme that he posts about validators.
Brian Friel (32:27):
Zero days since last Bernie meme. Really? Okay.
Chase barker (32:31):
I mean who knows if that happens, but I haven't seen him post that Bernie meme in a while, so we'll see. We'll see.
Brian Friel (32:36):
Yeah, I'll miss that Bernie meme. We'll put some pit vipers on Bernie again, just for all time sake. Well Chase, this has been an awesome discussion, really great having you on, and it's been a long time coming. One closing question we ask all of our guests, I want to hear it from you, is who is a builder that you admire in the Solana ecosystem?
Chase barker (32:55):
So my initial sort of instinct is to probably mention somebody that's never been really mentioned before, but I can't not just talk about Armani because he was part of the first wallet. He was part of the framework that made Solana better in terms of developer experience with Anchor. And I mean I know he's now building another wallet and it's just the truth. Armani, his whole sort of ethos and what he is trying to do is just trying to make crypto usable and better for a lot of people.
(33:34):
And I think that's just an important thing for me and I really respect that about him. So I truly think that Armani is one of the people that I really respect the most in the space for what he's done and transparently and just like everybody who has a very large voice gets a lot of shit. And for people like that to stick around, it's incredible. We all deal with it. You work at Phantom, I work at Solana Foundation. Armani has worked at various groups or whatever and we have to just continue what we're doing and just deal with all the that shit we get and you just got to respect that, man. So that's pretty much my answer.
Brian Friel (34:17):
That's Awesome. I couldn't agree more. Well, Chase, it has been awesome having you on. Thank you so much for your time. Where can developers go to get started with Solana?
Chase barker (34:27):
Solana.com/developers or I'll also not show our own stuff and you can go to soldev.app as well. We have different offerings like soldev.app has a lot more, solana.com/developers has a little more curated smaller list, but both are very good options. So yeah man, that's the place. So check it out and let's get going.
Brian Friel (34:53):
Love it. Chase Barker, head of developer ecosystem at Solana Foundation. Thank you so much.
-
Security in crypto has never been more important. Blowfish.xyz makes it easy to identify & stop crypto fraud before it happens, and it is the engine that powers Phantom’s Transaction Previews. Blowfish Founder and CEO Fabio Berger joins Brian Friel to talk about some of the recent high profile hacks in crypto, what blowfish is doing to stop them, and how you can stay safe.
Show Notes:
00:55 - Background / How did Blowfish start?
04:14 - What is Blowfish?
05:59 - High Profile Hacks
08:35:08 - Types of Scams, how to avoid them?
17:18 - A builder he admires
Full Transcript:
Brian Friel (00:06):
Hey, everyone, and welcome to the Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web 3.0 space forward. I'm Brian Friel, developer relations at Phantom, and I'm super excited to introduce our guest, Fabio Berger, the founder and CEO of Blowfish.xyz. Blowfish makes it easy to identify and stop crypto fraud before it happens, and it's the engine that powers Phantom's transaction previews.
(00:29):
Fabio, welcome to the show.
Fabio Berger (00:31):
Thanks so much for having me.
Brian Friel (00:32):
I'm really excited to talk to you today. We've been working with you guys for quite a while now, and you guys have been doing great work. We just shared some stats on how many millions of transactions, I think it's 85 million transactions you guys have scanned with us to date in protecting users from wallet drains. But before we get into all that, I'd love to have you introduce yourself and explain a little bit about who you are and how did you start Blowfish?
Fabio Berger (00:55):
Well, I guess I need to start with how I got into crypto. That actually happened in my senior year when I was still studying computer science at Duke and a friend of mine sent me the Bitcoin white paper and I read it. I didn't get it. I read it again and I was like, "Ah, digital scarcity. This is going to be interesting. We can build some interesting stuff with this." So I ended up working full-time in crypto starting at the end of 2016, and I joined 0x Labs as the first hire and was there for three and a half years launching several versions of the protocol. And actually, while I was there, we had launched a way for people to trade assets, peer-to-peer, and there was a subreddit that started and people started to send back and forth these off-chain orders for assets and that was the first time that I came in contact with crypto native scams.
(01:47):
People started to create orders for assets with the same name as USDC or Die, but that were actually counterfeit tokens. And I thought to myself, "Oh, this is problematic. Someone will definitely solve this." And then, I guess, fast forward four years later, the problem was still not solved. And so actually, while I was doing some contract work for Phantom in sort of the space of software supply chain security, I saw again how big of a problem these crypto native scams had become and I decided that I wanted to work on it. So together with my two co-founders, who had also worked at 0x with me, we decided to start Blowfish.
Brian Friel (02:27):
That's awesome. And so just talk a little bit more about that counterfeit token thing because I think to you and I work in this space, we might be very familiar with it, but it sounds almost like an oxymoron where it's like, "Hey, you're in crypto. You're verifying everything you're doing. How can you have counterfeit tokens? How does that actually work?"
Fabio Berger (02:44):
So it all comes down to the fact that the only guaranteed to be unique identifier for a token is the contract address where it is deployed. And so anyone can create a new token, a new asset that has the same symbol and name as a well-known token, let's say, USDC. And so unless you really check very carefully if the contract address is the canonical USDC contract, you could easily get fooled into thinking that someone's trading you real USDC and instead, you're getting a counterfeit token.
(03:18):
And I think that this actually points to this fundamental issue in crypto or fundamental problem that we still have to solve. We have all this amazing math in cryptography to ensure that, Brian, you own this private key and you're the only one who knows it. Therefore, you're the only one who can sign this transaction and authorize the transaction. But, actually knowing what you're signing, that's hard.
Brian Friel (03:41):
Yeah, absolutely. And that might be a good segue to where you guys come into here. As an end-user at Phantom for the past almost a year now, I'd say, it's, what, about eight months or so that we've been working with you guys, it doesn't seem maybe like a whole lot has changed. Hopefully, also if you're using legitimate sites, you see Blowfish too often, but some advanced users might have seen that our simulator has had some pretty big upgrades over the past year in large part due to the work that you guys have been doing. Can you talk a little bit about what Blowfish is and how does this all work under the hood? What are you guys actually doing?
Fabio Berger (04:15):
So at its core, what we are building is a suite of APIs for wallets like Phantom where whenever a user of a wallet is visiting a site and it's asking them to sign something, so it could be a transaction or a message, that wallet can first send it to us and be like, "Hey, is this kosher? Is this doing anything strange, or is this just a vanilla transaction?" And what we are doing under the hood is we're scanning and simulating that transaction and we are looking to see if there are any patterns that we can recognize from previous scams.
(04:50):
We also figure out from the user's perspective, what is this transaction going to do to that user's assets? How is it going to modify their token balances or their NFTs? And we send all of that information back to the wallet and the wallet can then present it to the user. And what's really nice about this is now, instead of going and having to read the smart contract and read a bunch of code to understand what is this transaction going to do, the user can just see, "Okay, this is how my balances are going to change. This is where my assets are moving or not moving." And then they can self-verify if this transaction is doing what they thought it was.
Brian Friel (05:26):
And that's very topical. We're recording this right now in January of 2023, and unfortunately, just earlier this month, there was a very prolific hack where Kevin Rose just lost over $2 million worth of his NFT collection. We've seen many other high profile hacks come in the space as well. Can you talk a little bit about how some of these hacks actually work and maybe, specifically to the Kevin Rose incident, was there anything that he could have done or a similar user who fell into a similar pattern could have done to maybe identify this without having to read the contract code like you're saying?
Fabio Berger (06:00):
Yeah, so it's super unfortunate for Kevin. Every day, hundreds of thousands of people have the same thing occur to them. In this particular case, the attack vector was essentially a OpenSea order. This OpenSea order was crafted such that Kevin was trading his very valuable NFTs in return for nothing. So we call this a trade for nothing OpenSea order. And if you are not using a wallet that sort of shows you what you're about to sign, you could easily fall for this. Had Kevin used Phantom or any other wallet that's powered by Blowfish, he would not have lost his NFTs. We have had a check in place for this exact scam pattern since June of last year. And so this wasn't actually a new attack. This is one that we've known about for a long time and that sort of security-conscious wallets have been protecting their users against. But it turns out that unfortunately, Kevin wasn't using one of those wallets.
Brian Friel (06:59):
And so what would you say to people also who say, "I get it. Signing stuff in crypto is really risky. That's why I have a hardware wallet." What are the strengths and weaknesses of these things? How should people think about using one? Is it like a cure-all solution or maybe, do you have different opinions on that?
Fabio Berger (07:16):
I think a hardware wallet can make sense. It's really designed to protect against malware on your laptop. It's an air-gapped device that has a very minimized interface. All it can do is essentially sign things and you need to physically press a button to authorize that signature. But hardware wallets suffer the same sort of UX challenges and the same scam and hack potential as any other wallet. So there's nothing about a hardware wallet in particular that would've protected, let's say, Kevin, from this attack. What he would need is some sort of an interface that would show him what he's signing and also provide him warnings if he's about to trade, let's say, an OpenSea order where on one side, he's handing off $2 million and in return for that, he's receiving $0.
Brian Friel (08:07):
That's tough when you don't have much of an interface on a hardware wallet to be able to see that for yourself.
(08:12):
Well, let's talk a little bit more about some of these scams because you mentioned the OpenSea scam and that didn't even necessarily seem like it was anything that was wrong with OpenSea, per se. It was just that there was an end user didn't really even know what they were signing, and they were, unfortunately, led to a situation where they thought they were interacting with a trusted party and they weren't. What are some of the other types of scams that you guys see in the wild?
Fabio Berger (08:35):
So there's obviously many different ways that sort of scammers try to lure their victims into signing something. I could kind of talk at length about that, but everyone's seen sort of the scammy NFT AirDrops or the Discord messages promising you huge rewards. But the attack vector, essentially, how do they actually remove the funds out of your wallet? A lot of the times, they're not actually exploiting a weakness in a smart contract. They're either crafting a smart contract that is made to steal your funds or they are crafting a transaction or an order or a message that is made for that purpose. So in the very early days, they weren't doing anything fancy at all. They were literally just asking you to approve them to withdraw your assets and that was kind of enough.
(09:27):
But now that wallets like Phantom are actually showing users these simulation results, it's become a little bit harder. They have to get more creative. So a lot of the attack vectors that we're seeing are actually attempts to circumvent or fool or take down the simulator. These scammers really don't like the simulator because if the user sees that they're about to lose all of their assets, they're much less likely to click Confirm.
(09:54):
I guess the more sophisticated attacks that we're seeing are ways in which the scammer can steal the user's funds, but indirectly. And so in the solana ecosystem, I can give you an example, which is every token that you own, you own in a separate token account. This token account has an authority. This authority is essentially the person who's allowed, authorized to withdraw funds from that account. And so in the early days, the scammers would literally just ask you to sign a transfer that would transfer them your funds. But now, they'll try and be a bit more sophisticated and they'll actually just ask you to change the authority of the account. So the assets haven't moved, but now, the scammer is authorized to move them on your behalf. And so these are some of the scams that we're seeing right now.
Brian Friel (10:43):
So those are things where if you just simulated what's the pre-balance and the post-balance of me signing this transaction, in that case of transferring an authority, you might just say, "Oh." If you're doing this simulation yourself, you're saying, "Well, no coins are going to move," but then come tomorrow evening when you're asleep, the scammer could wake up and say, "Oh, I have authority of all these accounts" and sweep everything.
Fabio Berger (11:06):
This sort of delayed sweep of your accounts obviously gets a lot of people and then makes it really hard for people to actually even know what happened. So a lot of people are then confused and they're like, "Hey, my funds just moved out of my account and I didn't even sign a transaction" and actually, they signed one yesterday.
Brian Friel (11:22):
Yeah, we've heard that. We've seen that in the wild where people post the Twitter and say, "Oh, I was hacked, but I swear I didn't touch anything this week. My phone was off." And that's really unfortunate when that happens.
Fabio Berger (11:33):
When I think really deeply about this problem, I just realized that a lot of this technology was built with some trust assumptions, especially around the dApps that people are using. People kind of assume, "Oh, well, the dApp, you went to this website. You trust this website. We can trust this website and this dApp." And because of that sort of trust assumption, there's essentially a lot of room for scammers to mess with things. And I think that we really need, actually, to rethink this whole dApp to wallet interface and we need to reanalyze it and maybe patch it with this understanding that, actually, users can't trust every dApp, and so we should maybe try and minimize the trust in that interaction.
Brian Friel (12:16):
I keep thinking back to email like how when the early email providers, you would set up your own email server and then anything could come in and now, we take for granted all the amazing spam prevention that's out there. That obviously comes with its own trade-offs and costs as well, but it seems like we're in a similar moment right now in the crypto space trying to figure that out.
(12:34):
Do you think it's fair to say, too, that you mentioned earlier that a lot of these hacks, maybe we hear a lot when they happen, which is not that frequent, but you hear about the smart contract vulnerabilities that occasionally happen. But is it fair to say that more often than not, it's really social engineering more than anything else that gets the common user, getting them to, like you said, click on a scam link or a bad NFT drop that sends them to a website where they input their seed phrase, those kind of things. Is that what you would think is the bigger issue that we need to face?
Fabio Berger (13:02):
I mean, they're both problems. And that's the interesting thing is we can find stats online for, okay, how much money has been lost to hacks, but there aren't any good stats of knowing how many people have gotten scammed and how much money has been lost to scams. And my hunch is that the number is either equally big and ginormous or maybe even bigger. And yeah, there's definitely sort of an element of it, that social engineering, but it's not only social engineering. Honestly, they kind of prey a lot on people's desire for easy money or a reward or to get in on a really hot NFT mint. These sorts of economic incentives is how they sort of lure people into engaging with them and you could sort of consider that social engineering, but I think it's more a psychological engineering or manipulation.
Brian Friel (13:54):
The sense of urgency that's required with a lot of these things too, potentially.
Fabio Berger (13:58):
Yeah, absolutely. Absolutely.
Brian Friel (14:00):
That makes a lot of sense. So I guess putting yourselves in the shoes of an average Phantom user, not reading the smart contract code for themselves, are there any best practices that you would impart on maybe any crypto user? How should they go about thinking about interacting with dApps and signing transactions?
Fabio Berger (14:20):
I mean, so first of all, always triple-check the domain that you're on. A large portion of the scams that we're seeing are on domains that are pretending to be a legitimate project that that user might trust. In the same way as with emails, you always have to check the email that you're looking at and make sure that it's actually coming from eBay or whatever. You have to do the same thing in crypto when you're dealing with these dApps.
(14:45):
On top of that, I would say, yeah, always look at the simulation results, always sort of double check and make sure that it's doing what you'd expect. Another good piece of advice is to really think similarly to the way you do about your money in the traditional financial system. You have a bank account or a savings account or you have the majority of your funds and then you have a wallet that you carry around in your pocket where you do day-to-day expenses.
(15:14):
And I think that's a good model to have where if you're going to ape into mints, do it from a wallet that doesn't have all of your NFTs in it, right, and that'll already limit the maximum downside that you have. But obviously, it could still hurt to lose all of that money and so you still need to be vigilant and definitely make sure that you're using a wallet that takes security seriously. Obviously, Phantom is a great example of that, but if you're very, very stubborn about sticking with one that doesn't, and I'm not going to name any names, then at least look to see if you can maybe augment the security offered by the wallet with an extension or something like that.
Brian Friel (15:52):
That makes a lot of sense. Yeah, you and I were talking just before we started recording about how Anatoly always recommends people have one wallet that only sends to another wallet, never interacts with the smart contract, and that's where you keep most of your funds. Augmenting that with a hardware wallet is great as well. But then, when you are signing things, just using really just the balance that you really need and making sure that you're checking the domain and checking the simulation results.
(16:18):
The domain front, that is hard and that's definitely something that we're definitely thinking a lot about. We have that block list that I know that you guys are big drivers to takedowns on that site or on block list as well. That won't always catch everything. Often, it is reactionary, but it is a wild world out there for users.
Fabio Berger (16:37):
Yeah, I guess one thing that we are working on is copycat detection. We actually want to be able to show users a warning if they're on a site that looks like it's impersonating a well-known site and this is something we can do with machine learning. We've already released it out in a limited sense, but in a broader sense, it's coming to Phantom soon.
Brian Friel (16:59):
Oh, I love that. Dropping the Alpha on the podcast.
Fabio Berger (17:03):
Just a little bit. Just a little bit.
Brian Friel (17:05):
That's great. Yeah, Alpha that keeps us all safe.
(17:07):
Well, Fabio, this has been really awesome discussion. One closing question that we ask all of our guests and I want to hear your opinion on is who is a builder that you admire in the Web 3.0 ecosystem?
Fabio Berger (17:20):
Oh man. I mean, there's many people doing a lot of really awesome stuff. One thing that I have been digging into more recently is a new Permit2 specification or standard that was released by Uniswap. I think it is a really big improvement over the way that sort of token approvals were done previously. And yeah, I think I really give that team kudos for constantly trying to improve every layer of the stack, even things that aren't part of their core product. And yeah, I'm excited to see how this is going to improve the UX experience on Ethereum.
(17:58):
And yeah, I think it's funny even there, it's a great step forward and everything, but it's clear that they haven't been thinking about it as much from how can this be abused by scammers? One thing that we want to do at Blowfish is actually help them improve on that front. But I keep saying this, and I'm going to keep saying it, "We're still early." I said it back in 2016. I said in 2014, and I'm saying it now, "We're still early." And so there's a lot to build and yeah, I'm just excited to be a part of it, part the solution and try and make this space a bit safer.
Brian Friel (18:33):
That's great. Well, we're very grateful to have you on board as well and thank you so much for all that you do in keeping users safe. I just saw and confirmed the stats that it was 85 million transactions scanned with you guys since last April 2022. We're recording this in January '23. During that time, over 18,000 wallet-draining transactions prevented through Blowfish alone. So, thank you guys. We view that as 18,000 users who would've left crypto altogether but are now here to stay. So Fabio, thank you so much for coming on the show. Where can people go to learn more about Blowfish?
Fabio Berger (19:07):
Yeah, thanks so much for having me. Honestly, it was really great. Yeah, if they want to learn more, check out Blowfish.xyz. That's our webpage. You'll find all the information there and you can play around with the API yourself if you're curious and yeah, follow what we're up to.
Brian Friel (19:23):
Fabio Berger, founder and CEO of Blowfish. Thank you so much.
Fabio Berger (19:25):
Thanks.
-
@sol_idity, developer and creator of Solana Plays Pokemon joins Brian Friel to talk about how he created a community-controlled game of Pokemon where users can vote to press buttons in a turn-by-turn game via transactions on Solana.
Show Notes:
00:44 - What is Solana Plays Pokemon?
02:23 - Who he is / Why build on Solana?
05:55 - Surprises or challenges while building on Solana?
08:12 - Strategy for building new features
12:41 - How to improve games on Solana? What’s missing
15:47 - What environments for crypto games?
17:06 - Future goals for the game
19:08 - Expanding the team?20:02 - Advice for people starting to work in Solana
20:55 - A builder he admires in the Web3 space
22:00 - Contact info
Full Transcript:
Brian (00:05):
Hey everyone and welcome to the Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web3 space forward. I'm Brian Friel, developer relations at Phantom, and I'm super excited to introduce our guest today, Solidity, the creator of a new on-chain game called Solana Plays Pokemon. sol_idity. Welcome to the show.
Solidity (00:26):
Hi, GM. GM, everybody.
Brian (00:28):
GM, it's great to have you here. Solidity, Solana Plays Pokemon. Those are some words that people have probably heard in their life, but maybe not in the same sentence. Can you describe for our listeners who haven't played this game before, what is “Solana Plays Pokemon”?
Solidity (00:44):
Solana Plays Pokemon generally is an on-chain game where players will vote on the blockchain to play the game together. So every button press is collaborative and everyone on Solana is playing a single game of Pokemon collaboratively together on the blockchain.
Brian (00:59):
In real time. Yeah. So this is a new game. How long ago did this launch?
Solidity (01:03):
January. I think about a week-plus ago. Yes.
Brian (01:05):
Wow. So 10 days ago, you launched this game on Solana and essentially it's a website where there's a Pokemon emulator in there and then there's ability to connect your wallet and anyone else who's on the site at the same time can all vote for what button you press to continue playing the game and then every 10 seconds, Solana is just tallying these up and putting these inputs into the game. And in 10 days, this thing, in my world and Twitter world, has taken Solana Twitter by storm. I believe at the time of this recording, which is January 17th, we've officially beaten the game. Is that correct? Solana has beaten Pokemon?
Solidity (01:38):
Yeah, but I think we've beaten it for quite a few days really. I mean, for three or four days. Yeah, we've been around for I think 15 days, so I think it took about a week or 10 days to complete the game. So the game is kind of a bit done. Yes.
Brian (01:50):
Yeah. This is super cool. So basically you put this thing out there, Twitter catches it, all of a sudden, you have all these people who are connecting their wallets, playing this game collectively. It's chaos. Then there's trying to have organization, you've made some changes to the game. I want to get into all the kind of details and how you've built it and what the game is and all that. I would categorize this as potentially a new genre of game. Before we dive into everything that you've built, can you tell us a little bit about who you are? You go by the name Solidity, how did you decide to build this and why did you decide to build this on Solana?
Solidity (02:24):
Personally, I've been in Solana since, I think, September of 2021. In the beginning, I was just doing NFTs, minting stuff in general, just doing the usual Degen stuff. I was a web2 developer already, so I got more curious about developing on Solana. In a sense, I started with Solana because it was one of the blockchains that had the best experience in a sense in that the transactions were very fast, gas fees were low. It's like, why do people not start doing NFTs on other chains? Why is Solana a lot of people's first chain? It is because the gas fees are very low, so even minting an NFT back then, even at all-time highs, it cost like what? Two USD to mint an NFT, which was unheard of in the whole space back then, and that's why in a sense, I kind of stuck to Solana and continue doing Solana even after I stopped being a Degen, I continue developing for the chain.
(03:11):
I was trying to learn smart contract development for the longest time. In a sense, it's kind of hard to learn something new when, in a sense, you have other stuff in your life like working a full-time job. So over the Christmas holidays, that was when I was like, "Okay, this is when I'm going to really do something to learn how to develop smart contracts." And I feel like the best way to learn how to develop something new, you have to write a program and deploy to the main net to successfully learn how to write these kind of smart contracts properly.
(03:42):
So why do I want to make a Pokemon game that is playable on-chain? So the reason is kinda interesting because I was very interested in the concept of the blockchain oracle, how do we get external sources of data onto the blockchain? Some important sources of information would be maybe a set price of a coin. So, DeFi exchanges all need information off chain, and I was very curious about how the blockchain gets this data? That's why I was like, if I'm going to write a smart contract program, it has to have something to do with oracles, I want to in a sense make my own oracle and implement it. And that in a sense, the Solana Plays Pokemon idea was kind of born because one of the first few ideas of an oracle I thought of would be maybe a game control. So what if I could have an oracle that gives me output from a, let's say, a Game Boy emulator?
(04:31):
And that was something that I was like, "Hey, I could actually work with that." So I would say that it is kind of inaccurate to say that the game runs on the blockchain. It starts all the states on the blockchain, but it does not really run on the blockchain. The game runs off-chain and then data is transmitted onto the chain, so it is sort of an oracle, just that it's not decentralized. That was kind of my inspiration for making the game and now I felt that it was a pretty interesting idea and I worked on it over the Christmas holidays. Then everything subsequently happened, I guess. Yes.
Brian (05:03):
Yeah, no, that's awesome and there's a lot to unpack there, but just to tease that out a little more, so you were a Web2 dev before all this. You said you had a full-time job and essentially just over the Christmas break, you decided, "Hey, I'm going to finally learn how to do Solana program development." And I assume, did you build this in Anchor or did you build this in native Rust Solana programs?
Solidity (05:25):
I used Anchor, yeah. Native Rust is a bit too much, I guess.
Brian (05:29):
Yeah, but that's still pretty incredible that in a couple weeks, you build this thing from zero to one. You deploy in the wild and it's battle tested. Like you said, you learn best by deploying the main net. You have all these people actually using this program. I want to ask, before we get into talking about the game, just a little bit more on the development journey. Were there any big surprises or challenges that you faced as you built this and as you learned the ins and outs of Solana?
Solidity (05:54):
I'm actually a software engineer working in the Solana space. My full-time job, I'm working for more on the DeFi protocols on Solana.
Brian (06:01):
Okay.
Solidity (06:02):
But I'm more of a front-end developer, so that's why I was very curious to learn more about the back-end aspects. I would say that for the learning journey of bridging from the front-end to the back-end, smart contracts in a sense, what was very interesting about Solana compared to other blockchain languages, maybe Solidity on the EVM chains is the concept of PDAs. I feel that PDA is a very elegant concept and if you use them right, they're actually very powerful and that was the most interesting thing that I, in a sense, learned about Solana as I was doing this.
Brian (06:35):
No, I couldn't agree more. That was one of my first entry points as well, was writing an early PDA guide. Definitely something elegant, Solana's architecture there. So that's a story I've heard a lot though too, is people work full-time in the Solana space and it's essentially Web2 development skills translated over to a Web3 world. You're probably building something in React, definitely something in TypeScript, but from the front-end you're using Web3 JS and there's some intricacies to awaiting certain actions on a blockchain, but you don't really get into the program side of things. It's super cool that you're able to pick this up and deploy basically a full app in just a couple weeks.
(07:10):
I want to talk a little bit more about the game holistically, what this means, because a lot of people see, "Okay, yeah, you're playing Pokemon, that's cool. People do that all the time." But there's something unique here and you did say, the game's not being run on the blockchain, this is a Pokemon emulator that's being run like any other emulator. But the unique thing is there's this social coordination aspect of it that the blockchain is coordinating, where anyone can kind of show up on this site.
(07:38):
It's not like you're making a team match where some server is organizing players together. There doesn't necessarily have to be a concept of a chat. You could just have random actors doing their own thing. You did decide to build a chat as you went. Talk a little bit about the genre of this game. This seems to be something new where it's kind of multiplayer in real time, but you don't know who's on your team, who isn't. You decide to build features also as you go. How did you decide to build these features? Were some of these planned? Were some of these reacting to what you saw in the wild and how did you experience this as you built it?
Solidity (08:12):
I would say that it's an interesting genre because I expected there to be a lot more chaos. I didn't expect everyone to complete the game so early on, so that was surprising. I expected more bad actors in a sense. There was a bad actor, he or she released our starter Pokemon.
Brian (08:27):
Yeah, I want to go in on that. So you get a starter Pokemon when you start any version of the gen one. I played yellow growing up and I think it was red or blue that you guys were playing and a lot of people get emotionally attached to this thing. You get a little Squirtle or a Charmander, you're supposed to grow it into this great thing and classic internet, it's like you guys kick this off and you beat the first gym leader and someone just goes and releases the Pokemon in the wild and you can never get it back. Was that surprising to you? Did you expect to see more of that troll behavior?
Solidity (08:55):
Yeah, it wasn't that surprising. I expected to see a lot more of those troll behaviors. Even some of my friends in real life who are in the Solana space, they're like, "Oh, you have this thing. People are going to come in to release Pokemon and stuff." And I'm like, "That's the fun part. That's why it's decentralized. Anyone can do anything they want to. Just connect their wallet." I mean, the wallet address will be on-chain, but that's all there is to it. And I'm kind of disappointed there was not much more drama, but that was attributed to the strong community who were defending the game. So it's like when they see anyone taking steps to go and release or do anything funny, then they'll outvote the bad actor.
Brian (09:30):
Yeah, it's like you had a time delay because you can only make one move every, what was it, 10 seconds, is that right?
Solidity (09:36):
Yeah, 10 seconds.
Brian (09:37):
So yeah, you could see somebody walking to the computer in the game to release the Pokemon. That's how you did it. And Twitter, it was kicking a beehive. People could just rally and log in and overvote this person. I think that's also kind of a wild component where the players of the game maybe aren't always playing the game, they're reacting to the state of things. Like, it's a game that could potentially run 24/7 and things are updating and more players pile in to add cooks to the kitchen at the last minute. I've never seen something like that before in a game. I think that's pretty wild.
Solidity (10:06):
Yeah, it was kind of what I was expecting in a sense, the changes that I subsequently made to the game, there were actually quite a few changes. Most of the changes, I actually did not really plan for them. I was like, "Okay, this thing is kind of done. I'm not going to touch it anymore. I'm just going to watch people play." That was my initial point of view. But then once enter main net and people started playing, then some of the flaws were kind of clear. It's like, maybe sometimes the game runs a bit too slowly and, in a sense, it's gaming, so you want the immediate feedback to what you press.
(10:34):
So there's a lot of work on optimizing, how am I going to make the game faster? So for example, Solana is very fast already. So in a sense, there was really nothing much I had to do on the underlying technology. But for some of the other small things, maybe let's say, for example, on the game state, I actually started on IPFS. They're not started directly on the blockchain. They're started on IPFS and the IPFS ID is referenced on the blockchain. So what I did is that I ran my own IPFS node, so that uploads for the safety and the image is faster and that probably cut down about three seconds per execution. And some other things, like maybe a turbo mode to allow people to vote for multiple buttons at once.
(11:15):
So in a sense, a lot of my iterations were really geared on, how do I make this game, in a sense, more responsive and faster? Because that's what keeps people's attention. The problem might have been I made the game a bit too fast because I expected a lot more chaos. So the problem with some of those, in a sense, enhancements with that, it made it easier to complete the game. It made it harder for bad actors to come in, in a sense, I guess at the end, if I make a V2, then I'll be looking at some of the other decisions to make.
Brian (11:48):
V2, I love it. That's a hint at what's to come, but yeah. You mentioned that your kind of North Star I guess is making the game more engaging, basically cutting out these downtimes between feedback. Is there anything that you think in particular is needed in either the development ecosystem or maybe something that wallets can implement or some feature in the gaming, tooling world that would help make games on Solana this more and more frictionless, kind of like you were just using a normal website? Because right now there is a lot of friction. You connect the wallet, every action, you get a simulation, you send that and you have to wait and coordinate and all this, but you can kind of get glimpses of a world where you're like, "Wow, this could work just a normal game I'm playing on a web browser one day." What do you think are some of the biggest pieces that are missing, having developed a game now on your own?
Solidity (12:42):
For me, for this game, people have feedback when we do that, the wallet approvers are kind of cumbersome, but the fact is that I feel that for security, it is very important for people to understand every transaction they are submitting to the blockchain. Because real money is involved. There was this guy who asked me to provide a box to put in his private key so that he can play the game without approval and I would kind of put it out there. Right now that is not a very good security practice, so that is something we shouldn't do.
(13:08):
I would say that since Solana is a very fast blockchain, so there is really not much to complain about, in the sense, the back-end side of things, the transaction settlements and stuff like that. They're fast enough for online games in a sense. Now the question we should grapple with is more of the wallet approvers. What is a good balance between security and speed? How integrated a wallet is into an application?
(13:30):
So for me, actually Solana Plays Pokemon is supported on mobile too. That's a primary way I've personally been playing it. I'm playing it on the Phantom mobile app. And the thing about Solana is that there's this mobile wallet adapter, which is pretty cool. If you were on an Android phone and if you were to open the website, the Solana Plays Pokemon website on any web browser, you'll be able to connect your wallet on the web browser itself and then you open your native wallet app.
(14:00):
So it's these kinds of integrations that make gaming, or not even gaming, but everything you do in the Web3 space more frictionless for the user. I remember the first time I used the mobile wallet adapter, I was also shocked. I was doing a jigsaw and I was like, "I just saw money on my Chrome, on my phone." And I felt like, "Oh, that's like the future." Yeah, it was very interesting.
Brian (14:22):
Yeah, it just works. You don't have to go through the in-app browser anymore, it just works. We would love to get that on iOS too, believe me, we're proud to support that on Android. iOS is another battle, but that's a little bit out of our control right now. But I agree that's totally where this is heading. I also totally resonate with the auto approve. Sounds like you've been around Solana a long time. You probably were there for when Phantom used to have a semblance of auto-approve in the wallet, which was a pretty wild, wild West days. And I think there's something that, having had that feature once, we definitely understand how awesome it can be. It's just like you said, it's very, very important that you do that safely. So that's definitely something that we're thinking about too. I think there could be a balance there. That's something we're actively kind of researching right now.
(15:09):
One question too is, you hear a lot from games that I see are oftentimes, "Hey, we're building in Unity or we're building in Unreal. We're building these really intensive environments that give this great sense of realism in a game." But they're development cycles could be pretty long. I mean, you built this thing in a couple weeks in a browser. It seems like that might be the first frontier of this kind of crypto gaming that a lot of people talk about. Do you feel strongly about that? Do you think games in a browser is a pretty viable path for a while? Or how do you think about the different environments in which a crypto game could live?
Solidity (15:47):
In a sense, it could live off the web browser, it could be the desired state where it is like you download some game on Steam and it has all the Web3 components you need. Personally, I feel that we are still very far from it. There's a lot of ideological pressure. Traditional gaming communities, they absolutely hate NFTs and stuff like that. So I do feel that we are still quite some time away from one day where that's the norm. I do feel that in the short term, web browser games will be the entry point to gaming on Web3 because there's less friction now, just visit a website, approve a transaction, you don't need to sign in or create an account, just approve for transaction or see some actions and be like, "Oh, that's cool." But in this current time, I guess society is still not ready for that yet.
Brian (16:31):
Yeah, no, I agree. I think it's something that everyone can see coming, but it's a question of what's the path to get there, what happens in between? Things are always changing in this space and so it's good to be reactive like that. Just to circle back on the game. So despite all odds, despite the trolls, people completed the game. We might have released our starter Pokemon, but we got the Nido Chad, the Nido King and basically breeze through the game. Where do you go from here with the game? I've seen a couple things that you've kicked around on Twitter, but what's the current state of the game development? Does this project live on? How far are you trying to take this thing?
Solidity (17:06):
Currently, I'm just letting people mint NFT of whatever rounds they have voted in. So they'll be able to go to a page where they can just mint the NFT of the frames that they voted in. So it's like a small little memory of their game playing.
Brian (17:18):
Oh, that's cool. Because all the game states on-chain, each action was recorded on-chain. So you can mint an NFT based on that action?
Solidity (17:26):
Yeah. After this, I'm going to deploy the code and probably just check the security of stuff and be like, "Oh, okay, I will deploy it." Yeah, but I'm still checking the security of stuff to make sure that it's secure. For medium-term goals, I've been reaching out to a few DAOs to try to get together a competitive version of the game and we will see how that goes. I'm currently in talks with a few DAOs who try to get it set up.
Brian (17:50):
And the thinking being that each DAO has their own game. Is it just DAO members that could play or would it be like you could attack another DAO's game and try to troll them?
Solidity (18:02):
You could attack another DAO, I guess. Yeah, they'll just all have different websites to play the game on, but they'll be playing the same game and we just see who is the best DAO in a sense.
Brian (18:11):
But it's permissionless, so it's not like I need to be part of MonkeDAO to play MonkeDAO's game. I could go in and release their Charmander. Not saying I would do that, but yeah.
Solidity (18:20):
Yeah, that's the current plan, yeah.
Brian (18:22):
That's cool. So that adds another layer of, you gotta watch your back. Someone's always got to be awake. No, you can't always be sleeping when you're playing this game.
Solidity (18:31):
Yes, there’s more at stake in round two. Yep.
Brian (18:32):
Wow, okay. That's pretty wild. Yeah, I could definitely see a world too, because it's on Solana, it's on a blockchain where there's a token at stake here or something that really aligns incentives and then all of a sudden, you have a pretty wild scenario. This is kind of like taking eSports to the next level. I could see some long Twitch streams about this one day. That's super exciting. So it's just you working on this, correct? You said, you learned this over Christmas, you built it yourself. It sounds like this is something that could potentially have legs, you could continue this. Do you have plans to bring more people on or do you think it's just going to be you for the foreseeable future?
Solidity (19:08):
For the foreseeable future, I'll be supporting this on my own. In a sense, I'm just having fun along the way. It's like, "Oh, I'm learning new things." I'm writing code that I've never written before, so I haven't really thought beyond having fun. Yeah, so we'll see about that I guess. Yeah.
Brian (19:24):
Well I'd say that's a good guiding North Star just to have fun. So far it's worked out pretty well for you. As we begin to bring this to a close, one question I have, you mentioned, "Hey, I'm just having fun. I've just been learning this on my own." You've done this in a couple weeks. If there's another developer that's listening to this podcast, let's say, they're kind of like the standard Solana front-end dev. They know their way around, what 3JS, they know some Solana terms. Having gone through this, what would you recommend as their process for getting involved with building their first Solana program, deploying to main net? Are there any gotchas that got you caught up? Is there anything that you would impart on them as they begin that journey?
Solidity (20:02):
Yeah, I would say that generally, there's nothing really surprising, I guess. Anchor has been around for quite some time. What I hope is that old Anchor, there are a bit more gotchas with old Anchor. The new Anchor is pretty well documented. If there's really something they can't really understand, you can just look at the source code. So it is still kind of fine for me to get started. I use this resource code, SolDev, S-O-L-D-E-V.
Brian (20:31):
That's Italo's app. Italo Casas.
Solidity (20:32):
Yeah. So there's a course on it that was really amazing. Probably you'll be able to write your first full on-chain program after you run through the whole course. So yeah, if I had to recommend resources, that's what I would recommend. Yes.
Brian (20:44):
That's awesome. Well, Solidity, this has been a great conversation. One question that we always ask our guests in closing, want to hear from you is, who is a builder that you admire in the Web3 ecosystem?
Solidity (20:56):
Okay, so that is a very interesting question. I kind of knew that you were going to be asking that and I tried to kind of think about it. But the fact is that I haven't been on crypto Twitter for very long. Know who I kind of want to build with. I mean the people I work with, they're very talented. I work for different protocols, so I love working with them. In the larger space itself, probably maybe people from the Solana Foundation, maybe even the Metaplex team. Sometimes I do look at the source code for stuff because sometimes I want to understand how they do certain things. I want to understand the intricacies of things and in a sense, when I look at the source code, it's like it's elegant, it's very well written. And the interesting thing about this is that they're always iterating and these are the kind of values that I kind of write with and these are the kind of people that I want to work with.
Brian (21:40):
Yeah, no, I couldn't agree more. Those are two great examples and nothing's ever finished. I would say. Everyone's always iterating and looking to improve and everything can always be improved, so it's a really great value to uphold. Well, Solidity, this has been awesome. Thank you so much for coming on and telling your story. Where can people go to learn more about Solana Plays Pokemon?
Solidity (22:00):
They can go to solana.playspokemon.xyz
Brian (22:07):
Awesome. Solana.playspokemon.xyz – That's great. Well, I'm proud to say that I played for a couple turns. I one-shotted a Zubat with Thunderbolt from our Nido King. So I look forward to minting that NFT that commemorates that. And I also look forward to seeing, what I believe, is potentially a new game genre. Where this goes from here, like you said, it will keep it fun, keep developing and keep changing things and improving and I really look forward to seeing where this goes. Thank you so much for coming on the show.
Solidity (22:32):
Thank you, sir.
-
Rea Dulcetta and Anton Restuta - Co-Founders of Sharky.fi join Brian Friel on the latest episode of The Zeitgeist. Sharky.fi is the first escrow-less, decentralized NFT lending protocol on Solana that brings DeFi liquidity to NFTs. Are you NFT-rich but SOL-poor? Sharky.fi allows you to instantly borrow SOL by using the NFTs in your wallet as collateral. For lenders who want to earn yield on their SOL, Sharky.fi allows users to offer loans for specific NFTs in a collection and earn yield in return.
In this episode, Rea and Anton share their journey into web3, how Sharky.fi works, their views on NFT royalties, and their vision for the future of NFT-backed lending.
Show Notes:
01:10 - Background / Origin Story
02:57 - Why Solana and NFTs?
06:54 - What is Sharky? How does it work?
09:55 - Transition from web 2.0 to Web 3.0?15:18 - NFT collection
20:03 - State of royalties on Solana
26:24 - Sharky’s roadmap and vision for the future
31:44 - A builder they admire in the Web3 ecosystem34:10 - Learn more about Sharky
Full Transcript:
Brian (00:06):
Hey everyone and welcome to the zeitgeist, the show where we highlight founders, developers, and designers who are pushing the Web 3.0 Space forward. I'm Brian Friel, developer relations at Phantom and I'm super excited to have on today the founders of SharkyFi, Rea and Anton Sharky is the leading NFT lending protocol on Solana. Rea and Anton, welcome to the show.
Rea (00:29):
Hi, so excited to be here.
Anton (00:31):
Hey everyone. Thank you for having us.
Brian (00:33):
I'm super excited to have you guys on, I think we actually first met way back last summer. We were all working out at the Solana Labs office in San Francisco. For those who have never been there, it's a really cool environment where a bunch of ecosystem teams are huddled together, iterating on ideas. You guys were very early to this concept of NFT lending and since then you guys have just exploded in success. Before we dive into all things Sharky, I'd love to know a little bit about you guys in particular. Who are you guys, and how did you come to start working on this idea of Sharky in the Solana Labs office in San Francisco?
Rea (01:10):
Oh, yeah. Well, that's a pretty long journey, but yeah, I've always been a fan of startups. I think I started engaging in startups even when I was in college. I started hacking using my college student manual labor to really hack for free back then. And I really fell in love with the idea of being able to have so much impact. And I think that you can have impact anywhere if you're passionate about what you're doing. But there's something that's really intrinsically beautiful about being able to touch something so closely, be able to talk to someone about the problems they're having and then actually solve that. Do all parts of that. Being more than just a full-stack developer, being a full-desk founder where you do the design, you have to walk through the customer stories. So I found that entire thing really exciting.
(01:59):
So I've been bouncing around startups since and Anton and I actually co-founded a startup before this for engineers because we really like the idea of giving back. And Sharky is another way that we're giving back to another community. We're really, really proud to be part of the NFT Degen crowd and this is some way that we can actually give NFTs lasting power. We can give NFTs this sort of financial backbone that it needs to really be this asset that people don't have to take so lightly and think of as just JPEGs. So I'm really excited to be contributing to that cause.
Brian (02:33):
That's awesome. So Rea, you graduated from CalTech, I see you were the former founder of Slack community and then as you mentioned, you co-founded a startup with Anton. Both of you guys do have an engineering background. Anton, I'd love to know from you what brought you guys over from working in Web 2.0 Together? What was it about Solana and NFTs that made you guys think this is a problem we're solving?
Anton (02:56):
Yeah, so I had also pretty long journey before I came to Solana. I’m originally from Ukraine. I started way back when as just an engineer working there. I remember pretty well how board startup was pretty scary for me. It felt like, "Oh, it's a whole different world. I don't know if I'll ever be ready to help my own startup and things like that." Then I moved to the United States, moved to Bay Area and Silicon Valley and all of this became way easier and way more tangible. And I started working at a lot of early-stage startups, kind of preparing myself for the journey. Then co-founded my first company and then I met Rea after work we were working on again one of the startups and we met just engineers and we faced some problems in that company as engineers that we were unsolved and we thought, well how about we just hacked something over weekend and also had another common friend, mutual friend and was like, "Well, let's hack it together. It seems fun. Maybe we can solve this problem."
(03:59):
Most of the stories like that, it grew slowly, we got our first customer, we sold our own problem, and somebody wanted to pay us for it. Then we started thinking, "Well, maybe it's going to be a business." And we grew it to a pretty substantial profitable company. Our goal was to try building a company, try running a startup, try working together, but keep it small, keep the company small in all the separations. And I think we succeeded on that. And since then, I kind of worked a little bit on other Web 2.0 companies, worked on education, passionate about education, and we've been in crypto as an investor for quite some time. And I think last year in August, I think that's where I first heard about Solana, maybe in July.
(04:48):
But August when I seriously read about it, I listened to podcast with Anatoly (Yakovenko), was impressed with just general intelligence and thinking behind how conceptualization of ideas and the grand vision I get similar wipes, how that I got from Steve Jobs when I first listened to his presentations, and I wanted to build here and try how it feels. And I think I pitched Solana in kind of this whole space to be at, and we came to Miami for Solana's second hacker house, kind of met a bunch of people in the ecosystem, fell in love with all the people we met and the energy around. And that's where a decision was made to, well, how about we found the company here. And by that time, we already were passionate about NFTs and saw them as the future, if anything would bring crypto to the real world. I think the first theme of concept that is likely to do it is NFTs.
(05:47):
And it felt good to be early in that journey. It felt good to kind of try and build something fundamental. And I think financial products are very fundamental for NFTs and that's kind of how we got to it. And we were not sure at first, we were all very confused kind of how things work in general and not how technology works I guess how dynamics of building Web 3.0 companies works. That was definitely a new and very, very interesting journey. But yeah, that's how we met and that's how we started.
Brian (06:18):
Yeah, I love that. And so you guys had this key early insight that Solana was unique. You mentioned listening to Natoli, getting those Steve Job vibes, but then also that NFTs were really what was bringing it into the mainstream a little bit more. At the time that I met you guys, pursuing this financialization of NFTs was basically unheard of in Solana. I'd definitely say that was a contrarian bet and then now that's worked out pretty well. Could you walk through for the uninitiated, what is Sharky? What is it that you guys are doing for people? How does all of this work under the hood?
Rea (06:54):
So what we do is allow you to take all these JPEGs in your wallet and basically use it as a credit card. If you're willing to put the JPEG on the line, then you get access to a lot more of that liquidity. So anytime people say, "I'm rich in JPEGs, but illiquid AF." This is what Sharky comes into play, you can take those NFTs that you have and actually put them as collateral in a loan and then you can take out that money and do whatever you want with it and then you pay back that loan and then you get an NFT back.
(07:32):
Now, traditionally this requires you to actually put your whatever, if you're using a physical object, your grandmother's heirloom ring, you would have to put it in a safe box somewhere and not have access to that during the time that you have access to the money. But what we actually have done is allowed you to be able to do this in wallet. So you keep your NFTs in your wallet, you don't actually have to send them away somewhere and never see them again. You hold onto the NFT during the loan, and you just can't move it around, so it's locked in your wallet. So the escrow is effectively staying in your wallet and then when you pay back the loan, then the NFT gets unfrozen and you can do whatever you want with it.
Anton (08:11):
Yeah, and I guess the second side of what Sharky is about is we also allow you to be a lender. We'll allow you to lend money versus borrowing them. So in the traditional world, it's either you go to a bank and bank lends your money or maybe you go to some pawn shop and that small pawn shop lends your money. There is not really a lot of opportunity to be a lender just as an individual. And that's what Sharky also allows and that's one of the most talked about features I would say. You hear lots of stories on Twitter, Twitter threads, basically how to make money in the bear market, and usually Sharky comes up. So as a lender you can lend money. I would say you need to be somewhat knowledgeable about the space. You don't have to be an expert, but at least be aware of what's going on. And you can make a pretty substantial yield with Sharky in the current volatile market. But yeah, so that's that we're kind of creating this two-sided market in a sense.
Rea (09:09):
Brian, aren't you a lender?
Brian (09:11):
I have tried it out. It is a pretty interesting novel phenomenon. We have a few folks at Phantom who I would say are, I don't know if the term whale is right because it's Sharky, but giant sharks, I guess. But...
Rea (09:23):
Whale sharks.
Brian (09:25):
I am curious because to build all this, you mentioned that building a Web 3.0 company is pretty different from your previous Web 2.0 ventures. It's not just a consumer app that you guys are building, which is already hard enough trying to build a two-sided marketplace, get these consumers. You guys also had to build the plumbing and the protocol for all this to happen as well. Talk a little bit about that, the difference between your guys' success and Web 2.0 and what lessons you guys had to learn to bring that knowledge into Web 3.0.
Rea (09:56):
I think one of the biggest shockers when we came to Web 3.0 is seeing the amount of traction that people were having with no product or even the semblance of one people were raising from community and raising from VCs with, “I have a plan”, and sometimes that plan isn't even very well thought out, but I mean I attribute that to the infancy of the space at the time. I think at the beginning of any bubble that's still inflating, there's just sort of dumping money in and it's exciting. Everyone's euphoric on that whole experience. And now I would say this ecosystem, it's been only a few years, but for most people in this space, it's only been one year. And it's already mature to the point where I see lots of founders that were famous, no longer around, or lots of products that were literally the epitome of – that was your role model when you grew up on Solana.
(10:55):
And that's also not no longer around. And I think what you see is some of the lasting teams who are continuously building and that's something that I have to hats off to everyone who sort of stuck through the storms on this. But even beyond that, something that I'm noticing is all of that hype and that big rush of raising before pre-product and all of that. That is no longer the extreme meta that we're seeing. We're seeing people having to prove yourself a little bit more, but what I think is also I guess coming to some of the pros I see in Web 3.0 is it's so much more of a community atmosphere to build in. I think previously there was a lot more in Web 2.0 we see more under isolation or you kind of go heads down until you either make it or break it.
(11:38):
Whereas in Web 3.0 there's a lot more of this open communication. I would say it's almost more similar to if you ever participated in a kickstarter campaign for everyone out there who's Web 2.0 and doesn't understand Web 3.0 yet, you see this continuous discourse while they're sort of raising from the community and having this conversation back and forth. And there's a little log of how the founders are going about this. "Oh, today we had production issues, so sorry about that." But we really nailed a prototype on this other thing. We finally got some of our supply line issues figured out. And that open communication, that transparency is so important, and I dare say a lot of times we kind of idolize some of these tech founders whether Web 2.0 or Web 3.0, but they're human, and their teams are also human and they're really worth learning from.
(12:27):
So a lot of times you have these stories and you hear and the more transparent a team is, the more you actually get to be a part of that process and it builds so much compassion within the ecosystem because a lot of times I think it can become you're building this thing you promised this time and you said you're going to do the deliver this exact thing, what's up with that? And I think this discourse. One, makes it much more fun to build it. And two, allows the community to be much more excited because a lot of times if you only get the finished product every quarter or whatever, you're not able to really stay continually engaged. So I think a lot of these things makes this much more of a more welcoming atmosphere to build in both for the people we're building it for and for the builders.
Anton (13:10):
Yeah, I would say it's hard to separate Web 3.0 building from just building and crypto space and I think this space is just very volatile. So I think another side of the story of what Web 3.0 is describing. There's a lot of apps, but there's also lots of downs. There's like market downturns or just space volatility. There's always things that are hard to predict. You wake up every morning and you kind of read the news, Twitter and all kinds of things can happen positive and negative.
(13:44):
And unlike Web 2.0 companies that move much slower, everything moves faster and if everyone moves faster, it doesn't mean everything is just better. It just means in the condensed time you'll experience these ups and downs. And to me, it's definitely a more challenging aspect I guess as a founder I feel like I needed to step up in terms of mental health and mental stability even more than usual and don't let myself to be too high or too down and try to be more even here that less reactive and more strategic and it's sounds generic but it's real. This pain is real, and the hardship is real.
Brian (14:27):
Yeah, one year in the crypto ecosystem is living 10 or 20-years in traditional markets, just compressing those ups and downs not only in the market but also as a founder, journey, and all of that as well. I definitely resonate with that. One other thing just on this topic of differences between Web 2.0, Web 3.0 is that you mentioned the community buy-in aspect, you have this community that's rabid. If you haven't seen Sharky's Discord, you go in there at any time you guys have a product update, it's like there's a stadium in there that's going crazy. But in addition to all that, you guys made a pretty interesting decision. You guys, not only are you this protocol for lending NFTs, you also created your own NFT collection. Talk a little bit about that. What is this NFT collection? Why did you guys decide to launch this?
Rea (15:18):
We are an NFT centric company, so it only made more sense to completely Degen-ify ourselves. I mean there are also business aspects to which I'll let Anton dive into the more boring parts, but I think that has just been just so fun. I mean our entire team is really creative and for me, I've been a part of many NFT projects, whether as a consultant on the team or just help with some of the strategy there, but never taken something that's really fully our own. And we considered hiring other artists, but since we had people that actually are artistic and on our own team, like myself included or championing that effort, it was just really fun to actually take something, give back to the community in a wholly different way than we have in the past with our tech without products. But now actually being able to take our art to the next level and to put it out there with the Sharky standard, that was really, really fun.
Anton (16:14):
So there are several aspects of why. One, we planned this from the beginning when we started the company. We thought we would do an NFT sale sometime around August and we did this in October. So we were not even that far in our estimation in obviously this aspect of fundraising, kind of public fundraising and you get extra funds for company runway operations, all of that. But it is also what we thought would be useful, but we didn't realize how useful. It’s one of the best growth mechanisms for the company because you build in so many incentives for people to promote your company without you doing this. It's kind of like this network snowball effect and that's very powerful. I think all of our metrics pretty much doubled within just two weeks of intense... I wouldn't say promotions because we didn't do promotions of us announcing that we’re going to have an NFT collection and how it's all going to work and just trying to sell that vision, pretty much within two weeks we got more customers than we ever had gotten.
(17:20):
So that's just a very powerful growth strategy. And a lot of companies run NFT projects as a fundraiser before they have a product. I think it's also super useful and nice, but it accelerates growth basically if you do have a product. And third aspect, we want to embrace building in Web 3.0, and I think building in Web 3.0, the major difference from Web 2.0 is building together with your users, users/ investors and that social building is impossible without aligning incentives and alignment of incentives. It basically allows everybody to be part of the journey, allowing everybody to invest, to be holder, to get benefits from platform growth. And that's what we ultimately wanted to do, and experience how it feels to truly build Web 3.0 company, truly build community and succeed with community together.
(18:09):
So yeah, I guess NFT is not the only way to do it. Realizing and talking through the ideal process would feel somewhat similar but not exactly. I think the NFT community is unique in that it is formed by more, I guess, demanding investors, some smaller, less experienced, but also much more focused on being involved, versus just basically observing the company. So those are the reasons why I would say.
Rea (18:37):
I would just add that beyond all of the very reasonable or good reasons that we've already said, the community every single day was like when NFT. So I think that was also a pretty big driver for us.
Brian (18:49):
Fair, definitely fair. It's pretty wild when you go on Twitter, and you just see someone that you've never interacted with before wearing your NFT as a profile picture. In your guys' case you have these cute little baby sharks that are going to power up as the protocol evolves. They're definitely pretty cool. But yeah, I agree it's a pretty wild and unexplored lever for growth when you have users who just are continually showing their allegiance and buying in with displaying these NFTs month, after month, after month. It's pretty wild to see.
(19:21):
Now that you guys have your own NFT collection, I have to ask you guys, the hard-hitting question that the Solana ecosystem is pondering right now is, what is your take on the state of royalties on Solana? So for those who don't know, every NFT sale traditionally has paid out a percent royalty to the creator, it's baked into the tokens metadata, but this was not enforced programmatically. It required some sort of social buy-in by the marketplace or whoever was selling it. And now months into this NFT journey that's coming under fire, what have you guys seen in Sharky that informs your opinion on what's the state of royalties on Solana?
Anton (20:03):
Yeah, I think we're in this state where we're trying to figure out how to make it work. So clearly, how it was working before is not sustainable. So right now, it's kind of like everything is broken and with really building and rebuilding, I think incentive systems and also technology, how to make it all possible. I think Sharky’s stance is that there needs to be a choice at the time of creating a collection allowing holders to decide whether they want to invest into something where they have to pay royalties or not. I think it's not great to do it retroactively, kind of remove royalties from project creators or introduce royalties to holders when they didn't agree to them, and the choice wasn't possible before. And right now, we have quite a few approaches that make it possible. None of the technical solutions are perfect. So unfortunately, we will have to choose some trade-offs.
(21:00):
Whatever we choose, we have to support two things. One, we should allow existing collections to migrate all at once without making it to be a holder's decision. So basically, the choice that I described before, allowing holders to decide what projects they want to invest in. Unfortunately, we'll have to kind of reinstate this and make everybody re-decide that if... Let's say as Sharky, we want royalties because it's part of our benefits for holders, part of benefits for the team as well. But maybe some holders don't want royalties, so they would have to exit the project at that point in time and that would be a decision. But what I don't want to happen, what I think would be really bad for the space, if all holders would have to decide one by one whether they want to upgrade their NFT to be royalties enforced or not. I think that should be a choice for creators, for collection owners.
(21:52):
So that's one aspect of it. Otherwise, it'll be a fractured ecosystem. It'll be kind of like, oh, within the same collection, some sharks from our collection support royalties, some don't. And there'll be confusion all over the place. And second, there is this debate right now. So basically, for context, all of the solutions involve some kind of whitelisting and blacklisting protocols that NFTs allow you to interact with in some sense. In my worldview, the approach with blacklisting is much more forgiving. Imagine if we go with a whitelisting approach, I think there will be a negative consequence for the ecosystem. Let's say Solana Hackathons. I want to experiment and build a new protocol and deploy it to main net and demonstrate how it works. If that protocol is not whitelisted, I cannot demonstrate this using any popular NFTs that use this royalty enforcement because I need to go through approval, I need to get some DAO or some authority or somebody to get my protocol approved.
(22:48):
And I think that extra hoop, that extra step, just would stagnate innovation and would create a lot of roadblocks, but it'll be in the sense, some kind of perfect solution excluding that because then we can only trade on these whitelisted marketplaces or at least the protocols and everything is great. But I think the trade-off is very significant. Versus if we go with a blacklisting approach, then we can just say, "Hey, you're not allowed to trade with these protocols that are not respecting royalties and the trade-off there will be like, there would be a lot of attempts and protocols (created) to work around royalties short-term and as a space we would have to play the catch up game. We'll have to keep blacklisting them, and keep kind of finding solutions for that. But I think it's better, I think it's better than the alternative because we're still open for innovation. We are kind of permissionless by default, if that makes sense, and require less authority, less authority on decisions. So not a lot of solutions allow for those two. And I don't know where we land in this space, but that's our viewpoint, I guess, on this year.
Rea (23:50):
I was also going to add that with royalties, you also kind of have this free rider problem if you allow everyone to pick and choose what they want to pay. Because whether it's a team that's not really doing anything and then they're just collecting royalties and you kind of feel bad, they're like, "Oh man, we're all paying and they're just sitting on their asses, that's so messed up." Versus a team that's really actively putting out content or new ways for you to earn or whatever it is that the team is doing. And then you have a bunch of people that don't pay for that and then a bunch of people who think it's worthwhile. So they pay for that. The creators aren't really getting paid for their work and the people that aren't paying for that anyway are also receiving the benefits. So what is the incentive to be a good actor in this case?
(24:37):
So I think that there are some ways that we've thought about within Sharky about how we incentivize, and people who are not caring about these benefits don't need to have these benefits and they don't want to pay for these benefits. But the people who do care about these benefits can actually be a part of the contributing community. So I think this is a problem that really requires a tailored approach according to what your company or project is doing. And I think I would just like to see more people put more intent towards this, whether you're just a part of the ecosystem, someone who's buying and selling flipping NFTs or a team.
Brian (25:08):
I think that's a great-nuanced take, which we don't always hear on the crypto Twitter side of things, but I agree it's definitely in this state right now whereas you said, Anton, we kind of have a way to just wipe a clean slate and rebuild this. And there are a lot of benefits to this Web 3.0 ecosystem where it is permission lists by default and people like you guys can come in and build a protocol idea without having to ask anybody's permission and keeping that spirit alive, I think is pretty important.
(25:37):
So I want to look ahead a little bit, what do you guys see as the future for Sharky? So today, Rea, we started this podcast, you said if you have JPEGs and you're JPEG rich but cash poor, you can lend these things out, you risk losing the NFT, but you can get immediate liquidity on the flip side of that. There's some speculators who think that they'll be able to make a pretty good ROI, assuming that the market holds up. Obviously not financial advice, very, very risky, but that's the current state of things today. As you guys look out about the long-term potential for what NFTs could be, what financialization of NFTs could be lending of these things, what excites you guys? What's on the roadmap and on the vision for Sharky?
Anton (26:24):
Yeah, it's a good question. So I think we'll be releasing a series of new products next year. So that's one exciting thing. Basically, applying our learnings to make the product better. One of the big ones is mortgages, or Buy Now, Pay Later. We've already been seeing experiments in this space with that. And yeah, basically the overall goal is to allow you to finance JPEGs on the entire spectrum of that. Whether you hold this JPEG or maybe you don't yet hold this JPEG, maybe you just want to get it, but you don't have enough funds to get it or maybe you want to just buy with leverage and buy several. So we want to release that product to the market, allowing you to basically pay a down payment and get an effect. You pay the full price of the NFT later, but still start being a holder immediately. Imagine you can join MonkeDAO and only pay 20% of the price and kind of see what's it about.
(27:24):
And maybe if you don't like it, you can sell it back but you only invested a fraction, or for any other benefits, you can look at the community or you can just trade. There's two different aspects. Deciding whether you want to be a holder or just trade in with leverage, which we believe will be a pretty popular use case as well. Obviously, there's a lot of nuance with our existing product and we are adding more features to that, but I think one of the things that I'm excited about is not directly a Sharky product feature, but it's more experimenting with user experience in this space. And we've been trying to pioneer at least some approaches and try to see how we can establish new norms. Right now, every interaction with a DeFi protocol on Solana on other chains, I call it click approve UX.
(28:12):
Basically, you do some meaningful action and then you need to approve a transaction in your wallet. What we want to experiment with is to build a different kind of experience that allows you to interact with protocol and look ahead, do actions, several of them, and then approve it all at once. Basically, making this experience more smooth and fluent. And that's kind of a UX pattern that we are developing. I'm personally very excited about releasing it and seeing how users will accept it, and see whether other protocols and other products will also try to do something similar. And on the NFT side of things, we are releasing our gamified revenue share program. It's not a passive revenue share, it's kind of requires users to actively contribute to the platform, engage with our product and with our NFTs and with that we will share some portion of upside with them. So that's coming pretty soon. And for the next year there's a lot of secret strategies and secret features for our holders that we will release over time. Did I miss anything, Rea, do you think? Like anything major?
Brian (29:20):
Anything for the clamoring Discord channel that is asking when, when, when any hidden nugget you can drop in here.
Rea (29:28):
I was like, "Are we going to drop some alpha?" Yeah, I mean I think that there's probably some other further development. I should probably check with the marketing team before I say anything crazy. But there's further development on the NFT that I think the community already knows about and that involves more goodies for the people who are really excited about sharks and love the art style. So there's a lot there. And yeah, I think that's it.
Anton (29:54):
Yeah. And like you mentioned something about the future of NFTs, how we see that. I think it's very interesting to see the first attempts to bring NFTs to real world assets and tie them together in some ways. And we're already talking to teams who are trying to do that. So our vision is to stay in the space of JPEGs, but also branch into the space of where NFTs start representing assets that could be your car or any collectibles and stuff like that, and provide financial infrastructure there. It'll be a pretty different product because the market is different, volatility is different, but fundamentally it's kind of the same type of incentive systems.
(30:36):
Fundamentally it's like lenders. Some people could be lenders, people could be borrowers, with just a different structure and maybe different terms of loans. So we definitely want to be in that space as well. And that also requires us to not just build a protocol, but requires us to gain expertise in those specific domains. Because lending is not created equal. What works for NFTs, and JPEGs may not work for collectibles, may not work for houses or cars. It requires different risk models and probably slightly different products. So yeah, that's kind of the vision for the next three to five years is expanding to those areas as well.
Brian (31:13):
Yeah, that's exciting. I think we can all kind of picture a world where one day those assets are represented on-chain. Obviously, the frictionless nature of transferring those makes a lot of sense. But as you noted, it's important to stay in-the-now and be realistic that right now there's a lot of JPEGs, and I'd say that you guys are handling that use case pretty well. This has been an awesome discussion. One closing question we always love to ask our users, and I want to hear this take from both of you is who is a builder that you admire in the Web 3.0 ecosystem?
Anton (31:45):
Yeah, it's really hard to pick one. I would say top of mind is the Tensor team, Tensor founders. So I think both of them are pretty amazing builders. It's impressive to me how just two of them, how much they built and how quickly in this space. And not just with Tensor. I was following their journey before, and they built lots of cool things for the ecosystem and they also just have a good intent. Things they built, they try to align those incentives with just like what's good for the space. Not just like, "Oh, let’s build a cool product." There's plenty of really good builders in Solana that just like to build things, but the reason I'm highlighting that team, I think they have a combination of both. They're really good builders but also built things that are very, very important and useful for the space and make the space better. So that's my take. It's Richard and Ilmoi from Tensor Trade.
Brian (32:42):
Yeah, Tensor Trade, the real-time NFT trading platform. Rea, your take.
Rea (32:48):
Yeah, like Anton said, it's pretty hard to pick one. I think if I had to hat tip to my origins, I learned a lot of my early technical knowledge on Solana from Brett, who's now at Star Atlas. And he’s done a lot of, I think, open-source work that is just a lot of the necessary work that goes into making the ecosystem something, who builds for the builders, is kind of how I think about him.
(33:16):
And so he is also been really fun to talk to about the different, if you want to look sort of long and far at what's going to happen to the technology down the line and what are some of the upcoming scalability issues, roadblocks that Solana faces, if you want to just get a pulse on that to be able to build with that in mind so you're not constantly building to catch up. You always have really good conversations with Brett, and I just really like that he's also someone who you can tell is genuinely passionate about the space. He's working on his own time to learn more and also to contribute more. And a lot of times when something happens in the ecosystem, if no one knows what's going on, you can still go talk to him about it. And he always, we can always theory craft and it's always a good time.
Brian (34:02):
Oh, that's great. Well, Rea and Anton, this has been an awesome conversation. Thank you so much for your time. Where can people go to learn more about Sharky?
Rea (34:12):
Well, the Sharky.fi is a really good place to start. You can look at the beautiful order books. We've recently rolled out some performance improvements, so that's going to be really fun. And I think nothing creates a better impression than making money. So go and make some money. Not financial advice.
Anton (34:31):
You can read over white paper on the homepage. Kind of gives you a high-level overview. Otherwise, if you just type “Sharky lend Twitter” in Google, you'll see threats that are written by the community. At this point we've seen more than 10 just not even sponsored by us in any way. Just some lender supporters describe how to use Sharky. And I think those are the best to learn because it's through the eyes of real users and there are even YouTube walkthroughs of how to open Sharky. Yeah, it's a pretty rich ecosystem already.
Brian (35:05):
Awesome, thank you so much. Anton and Rea, founders of SharkyFi.
Anton (35:09):
Yeah, thank you for having us. It was a pleasure.
-
Nader Dabit, Director of Developer Relations at Aave and Lens ProtocoI talks with Brian Friel about his journey moving from developing in web2 to web3. From creating educational content and authoring one of the first "Intro to Solana" programming articles, to founding Developer DAO and building the infrastructure for the next generation of web3 social apps.
Show Notes:
00:49 - Intro
02:43 - Origin story / Background
06:13 - AHA moment in Web 3.0 ?
10:49 - Lens and Aave
18:30 - Composability between blockchains
21:45 - Advice to newcomers
24:15 - A builder he admires in the Web3 ecosystem
Full Transcript:
Brian (00:00):
Hey, everyone, and welcome to The Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web3 space forward. I'm Brian Friel, developer relations at Phantom. And I'm super excited to introduce our guest, Nader Dabit, the director of developer relations at Aave & Lens Protocol. Nader, welcome to the show.
Nader (00:25):
Hey, thank you for having me. Good to be here.
Brian (00:27):
I'm really excited to talk to you today. A lot of folks may know you from Crypto Twitter. You've been around a lot of different places in the Web3 ecosystem. But for some folks who might not know, you actually wrote one of the earliest intro to Solana programming articles that there were at the time, back in, I believe, summer 2021. And it's special to me, because this is actually the first article that I found on Solana that got me working at Phantom full time. So, before we dive into everything, I want to say thank you and welcome, and it's great to be talking to you today.
Nader (00:58):
Yeah, I remember very clearly when I wrote that article, because at the time I was trying to learn how to build on Solana. And I had a hard time finding all of the pieces that I needed to build out the types of application that I was used to building, just for a hello world type of thing. And I was actually traveling at the time from Croatia, and also Mexico during that week. And I remember just staying up sometimes all night, just trying to figure out what I thought was some basic stuff. And I was like, I have to document this stuff. It has to be documented somewhere, in a way that I would want it.
(01:32):
Because it's probably documented in other ways, like bits and pieces. But putting it all together, I was like, okay, this is going to be what I wanted to find. And I remember when I tweeted it out, it was one of the most popular tweets that I maybe have ever had, in the top five. That tutorial, the reception was just enormous. So, there was a lot of interest in Solana for developers, and I think that this was one of the things that enabled a lot of developers at the time to just get up and running, and see how it felt to build a full-stack application on Solana.
Brian (02:02):
No, I couldn't agree more. It was a time where there was a ton of demand, and just not enough resources or infrastructure. And it's been really cool, to just see all the derivative pieces that have come from that. A ton of folks have taken that article, built their own version, extended it in some ways. And view that and the initial paulx escrow tutorial as the two sparks that kicked off Solana development, and DevRel and all that. But before we get into everything today, you have a really interesting background. You were early to Solana, but then you worked across a number of different protocols already in the Web3 ecosystem. And before that, you were deeply involved in React and Web2 land. Could you walk us through a little bit about who you are and your background?
Nader (02:43):
Yes, so I've been a developer for about 10 years now, a little over 10 years. And I've specialized in, I would say four main areas of specialization during that time. I started off as a front end and single page application developer, I would call it, working with stuff from just plain JavaScript and HTML, to Angular, to React. And then, I moved into mobile development for a little over three years, specializing in cross platform application development with React native.
(03:16):
One of those years I was running a company called React Native Training, where I would train teams of engineers, where they had these siloed teams that were focused on either iOS or Android, and I would introduce them to React Native. And there was quite a bit of demand for that. So, a lot of the clients that I had, were large companies that had a lot of overhead with their developer budgets, and they were trying to find ways to not only have less resources needed to build out applications, but also to be able to build faster, and also to have a better singular code base, so we don't have to have two separate code bases.
(03:54):
So yeah, I had clients like Amazon and Teams at Microsoft, or individual engineers from Microsoft that would come to my training. Teams like Warner Brothers, and banks and stuff, were also my clients. So, that was really fun for about a year. And then, the next thing that I did is, I got interested in cloud computing. So, I ended up moving and working at AWS for a little over three years. And during that time I was doing developer relations there, which is what I'm doing now as well. And after a little over three years there, I got interested in the blockchain space. And I thought that while the work that we were doing at AWS was super important and very real world, there was a lot of applications and companies using it. I thought that the blockchain space was a little more exciting, just because it was newer. I thought the opportunities that were available for this technology, once it became mature enough to actually be usable for the ideas that we had, were really powerful and stuff.
(04:50):
And I felt like it was so early that there was a lot of room for growth, because a lot of these ideas were there and the technology... The primitives were there, but the maturity of those primitives weren't quite there. So, being part of that growth and stuff, to me it seemed really exciting. So yeah, I moved into blockchain space.
Brian (05:07):
And what year was that, Nader, real quick before you jumped in?
Nader (05:11):
So, I joined the blockchain world in April of 2021. So, a year and eight months ago, I guess, seven months ago.
Brian (05:22):
You made a huge impact in just that little time. I would've put you back at least a couple years on that, but that's really cool.
Nader (05:28):
Yeah, definitely the first time I got into this from the perspective of a developer was then, I had dabbled in crypto as an investor before that, but knew nothing about anything actually until then. And then, in that time, in the last 18 months, I've worked at the graph protocol, I've worked with Celestia, which is the first modular blockchain. And now, I'm working with Aave and Lens Protocol.
Brian (05:48):
That's great. And was there anything at that time, you had this great job at AWS, you've written a number of books, React Native in Action, all of these great resources that are used across a number of traditional companies. But was there anything about Web3 in particular that was an aha moment for you, or just made you just say, "I have to work in this space"? Or do you think it was more of a culmination of just years of watching it off to the side?
Nader (06:13):
Yeah, there was a few things. I'll look at this technology as a new way to build certain applications that wasn't possible in the past. I don't look at it as, oh, Web3 is going to replace everything that we had before. Instead, I think I look at it as it's going to probably disrupt certain types of industries, but it also just opens the door for new types of applications that are really exciting to me. And I think the one thing that stood out the most to me, is that we had public immutable and permanent infrastructure that developers could share, and use, and build on top of, almost like the way that we have code that is open source, that everyone can share, and use it, and clone it, and fork it, and do whatever. If we applied those same principles to actual software infrastructure, that was instead of the... We're kind of used to brittle infrastructure.
(07:02):
Most of the time when you're building on top of someone else's API, you don't know if it's going to be there tomorrow or even later today. You also have no control over the access of that. Someone can shut you off, someone can prevent you from using it at any time. So, you can't really share backend infrastructure. So, everyone's out there building out their own backend infrastructure for their own ideas, which is great if you need something custom. But there's a lot of things, I think, that would be very valuable for other people to share and not have to rebuild themselves. But it's just not possible through the traditional software infrastructure primitives that we have. Because a database can go down, someone can go and delete things from a database. You can't depend on that data being there, but with blockchain infrastructure you actually have those properties.
(07:49):
And that's really exciting to me, because what we're seeing exactly I think with Lens, is that if you provide a really high quality backend, and you bring a really high quality API that enables developers to build on top of it, you've done away with a large majority of the work that's needed to build an app, building out the backend. Just imagine if you only had to build out the front end, and you didn't have to worry about this, and everyone could share that backend infrastructure.
(08:16):
And that's what excited me the most. There weren't really a lot of real world implementations of this though at the time. There was NFTs and DeFi stuff, which is great, but I don't think the coming to market use case is going to be that. I think that will be things that are used a lot in the future, but not that.
(08:32):
And then, the other thing that excited me about this stuff, it's payments. And I think that also stablecoins, this idea of stablecoins, and offering stability to currencies around the world that don't have that, was pretty exciting to me. And also, just being able to permissionlessly access and send payments was revolutionary, as someone who has a lot of family in the Middle East and stuff, and is also familiar with what's going on in different parts of the world. I think one thing that was an aha moment for me, was someone was a cryptocurrency is very volatile. And I realized that some people in parts of the world, like the United States and Europe, they don't realize that everyone else's currencies are also volatile. If they think that everyone's currency is the US dollar, just is always... But they don't realize that the majority of the world lives in places that where their currency is just as volatile as cryptocurrency.
(09:20):
So, realizing that so many people just don't understand that, and there's so much privilege in the world that there's opportunities to build out these things, that bring equality around the world for stuff, just having stability in their currencies. So, stable coins to me, are really exciting. And that's again, one of the things that excites me actually about working at Aave is, we're going to be launching a stable coin. So, being able to be part of something like that, is pretty cool.
Brian (09:44):
Yeah, no, I couldn't agree more. And for folks who might be based in the US, or don't have the privilege, not having to worry about their own currency not being stable, even just having to go through the pain of sending a bank wire somewhere across different countries, it's like pulling teeth. And once you send something over crypto rails, and it's near instant, you're paying near nothing, and you realize it's on this public infrastructure that you just talked about. It's like an aha moment, where it's like how could we not use this in some capacity? It's pretty incredible.
(10:15):
So, you hit on a couple different things there. You hinted at Lens Protocol and Aave, both of which you are the director of DevRel at. Could you talk us through a little bit about what each of those two protocols are? For folks who have been in crypto for a little while, they probably know Aave, it's a household name. Darling of the DeFi Summer days. But it's quite interesting that then Lens is also under the same house as Aave, two very different protocols. Could you walk us through a little bit about what each of those are doing, and maybe why the similar teams are building both of them?
Nader (10:50):
Yeah, basically I'm working a lot more closely with Lens. Just the first couple of months that I've been here to get a lot of the ideas that I personally had off the ground, as someone who's been building on Lens. And I think we're going to be doing a lot of work in Aave though, starting at the beginning of next year. A lot of work actually is happening right now in Aave, but from the DevRel perspective, we're launching some stuff. So, we're going to use DevRel power to help bring that to market. But yeah, Aave is basically a Defi protocol, and allows people to lend and borrow crypto and real world assets, without having to go through a centralized intermediary. So, that's the main value prop of Aave. And then, Lens is a Web3... Or I wouldn't even bucket in that. It's essentially a social media protocol and social media application API, that allows developers to build social graph applications.
(11:41):
And with Lens, you can have a lot of this backend infrastructure, like I mentioned, already there, ready for you to use to build out applications. And I think that when we think of the five billion or so people on the internet today, we might say there isn't maybe a single thread that ties everyone online together. But if you do look at the most widely used applications in the world today, you could almost probably assume that a high nineties percent of those five billion people around the world, have used a social application so far. So TikTok, YouTube, Instagram, Facebook, Twitter, all of these applications, are social graph applications. And they have very similar characteristics. You go to the app, and you have to create a profile. So you do that, you have a profile. You then have the opportunity to create content. You then have the opportunity to follow people. You're then given a feed of content based on who you follow, and then people that are following you, your content is put into their feed.
(12:39):
So, if you think about an application from that perspective, you can actually bucket a large majority of internet traffic into social graph applications. And they all literally copy, and have these exact same characteristics. So, what if we could abstract some of that away, and make it to where people could actually have those features in their application, without having to build all of that from scratch. And that's what Lens is doing. And I think that from the sheer user adoption perspective, it's the first real world use case to me, that actually appeals to people without having to teach them anything off the bat.
(13:15):
And that's just one thing, but making that accessible, is another story, because historically blockchain applications are very not approachable by the average person. In fact, the UX is terrible for most blockchain applications. And I don't think people understand how much friction is involved in most web three applications, for the average person I know at AWS, we would literally spend weeks and months with customers. Sometimes those customers would spend millions of dollars just to remove a couple of hundred milliseconds of latency from one of their APIs, because that latency was costing them millions of dollars in revenue, because they would drop customers or whatever.
(13:56):
So, when you think about a few hundred milliseconds of latency being a huge issue for a real world application. Imagine telling a new customer that they have to first download this wallet that's going to give them these private keys and these seed phrases, and they have to understand how that works. Then, they're going to have to go and find this token somewhere on the internet, and they're going to have to find out how to purchase that token. Then they're going to have to learn which network that token is on, and they're going to have to transfer that token from the place that they bought it, into that new wallet, on the right network that they bought.
(14:30):
Then they're going to have to pay for every transaction that they make on the network. It's crazy to think that the average person is going to be interested in this stuff. And down the road, when people start using DeFi, and stuff like that, they might understand the value that you do probably want to have that security for paying for a transaction, and understanding how all that stuff works. But for onboarding new people, it's just crazy to think that we're going to onboard millions of people this way.
(14:54):
So, the approach beyond having an actual use case that makes sense for the average person, also lowering the barrier to entry for that UX, is a huge thing that we're trying to solve as well. And we have some stuff rolling out next year, that's going to address that. But we've already done some stuff. Or when I say we, I'm really speaking of the Aave engineering team, and the Lens engineering team, who is just really, really incredible. They've already done a lot of stuff. I think that lowers the barrier to entry for users. Gasless transactions, meaning that the user doesn't have to pay for the transaction on the network. Low cost networks like Solana, like Polygon, others out there, make this possible for the first time where you can actually subsidize transactions the same way you can subsidize software infrastructure like AWS.
(15:38):
When you use an app by Twitter, you're incurring cost on their backend, but it's so small that the company eats that, and pays for that software infrastructure themselves. You don't expect to pay for a tweet. When you tweet, you don't expect to have to pay them to do that. It's like that would be crazy. So, that's where we're getting, I think, with more scalable blockchain infrastructure. And that's one of the things that they implemented into Lens. And then, the other thing is that they implemented, is a dispatcher that allows you to delegate your signing to an abstraction that allows you to do certain things on chain, but not everything. So, you don't want to be able to send money without having to sign a transaction. That would be a security concern. But posting something to a social network that's delegated without you having to sign, makes a lot of sense. Because you could always go back.
(16:24):
And obviously, we've never even really, that I know I've had any issues with this, but let's say that you did something wrong and then posted a post that you didn't like. We have a soft delete feature in the API, you can go and delete something. But I guess my general point is that being able to post, and comment, and stuff, you shouldn't have to sign for all of these different interactions. And that's what the delegator allows you to do. You just have the same user experience that you would in a traditional Web2 app.
Brian (16:49):
Yeah, totally. You touched earlier on just a couple milliseconds, a hundred milliseconds of latency, makes the difference in user attention spans. Imagine having to go find that browser extension pop up. It's going to make you not want to tweet as much, second guess some of your actions. And then I agree as well, even we've seen this from a wallet side, a lot of... I think this is definitely where the space is going. Having some permissioned system right now, if you think of permissions with wallets, pretty much all of them just, it's a connect. And then by default, you could have any permissions, but it requires manual approval. And I think we're almost training users negatively in that sense, when everything's a pop-up action, they start to not take pop-ups as seriously.
(17:31):
But if we could make a system where we know certain actions are safe, we don't even have to alert you about this. But then, there is a transaction that potentially you'll be exchanging funds in this transaction, you should review this manually before sending it, that's definitely moving in the right direction. So, that's really cool to see that you guys are already building on that front.
(17:49):
You touched a little bit too about just how these blockchain ecosystems, up until now, have been largely inaccessible. And I would argue, also largely siloed from one another. There's a lot of different ecosystems out there. You've spent time at other projects that touch multiple different blockchains, multiple different layers. You're at the graph, you're at Celestia. Now you're at Aave and Lens, which is all over the EVM ecosystem. Can you speak a little bit to how you see everything that we're building in Web3, all these different blockchains, how some of these might compose over time? What is your worldview when you're working across all these different siloed ecosystems today?
Nader (18:31):
The thing that really turned me off a little bit when I started really understanding the ecosystem in general, was this Maximalism that you see. And I thought it was really toxic and stuff. And I didn't really like that at all. And so, that was one of the reasons I went to work with Celestia. I really liked their approach to technology, and I like the solution that they're bringing to the table and stuff. But I also really liked the founders, I would say anti-maximalist approach to their communications and stuff like that. And I just think that being so bought into a single idea, prevents you from seeing and understanding everything else that's out there. So, I don't know... Not only think it's just toxic in general, but I also think it's very limiting for your own career and your own understanding of the whole landscape.
(19:18):
Because if you box yourself in, you're preventing yourself from doing any research or understanding everything else out there in the world. So, my take has always been to really try to do due diligence on all of the different technologies that are out there, and try to truly understand them, and not have any bias to the way I look at something new. And really try to get to the bottom of it. But it's hard, because there's just so many different things that are happening at a given time. And there's also so many people that are shilling their own thing, without being very honest about what are the trade-offs sometimes. So, it is challenging to understand everything that's going out there. But yeah, my take is to always try to say, "Okay, this thing is here. I'm going to do some research." And once I understand it, I want to know the trade-offs, and I want to speak honestly about those trade-offs in the future.
(20:10):
Because nothing is perfect, and very rarely is something legitimate actually not worth anything at all. You'll see people that try to talk about certain technologies, as if they're completely worthless. When in reality, there's a trade-off there, that's actually being made, and they're just trying to make their thing look better by talking negatively about the other thing. But I think most of the technologies... Not all, but most of the technologies that make it into the mainstream, do have a good value proposition. The question is whether or not that is the right long term trade off to make. Those are the questions that I think that we don't always know the answer to.
Brian (20:47):
No, couldn't agree more. And I think it times up really well with what we're doing over here at Phantom. I think by the time this episode is live, we'll be taking the first few people off our beta wait list, for a multi chain Phantom, where it's all going to be one aggregated view of switching chains, and we agree that we want to get past the maximalism front. There's a lot of really awesome work being done across the VM ecosystem, across the Solana space, and everything in between. And I think it's a really cool time for the industry to be bringing this all together. I couldn't be more excited.
(21:17):
So, a few more questions here for you as we wrap up. You've hit on a lot across your journey through Web2 to Web3, everything that's going on now in Web3, across Lens and Aave. If you were a new dev coming in here, let's say you have TypeScript experience, your classic what you would need for some Web3 JS work, how would you point new developers who are interested in the space and coming into the space, and wanting to potentially contribute, and end up working full-time in this industry?
Nader (21:46):
Yeah, I think front end developers are just very uniquely suited, but also they are in a great position, and huge opportunities lie to them without having to learn a lot of new stuff, which is really cool, and really exciting. At least for me, as someone who is for the most part, just a front end or a mobile developer. I thought that it was very approachable to get into this space, because every application still needs a front end. The only difference is that instead of sending an HTTP or GraphQL request, a traditional HTTP request, you're sending an RPC request for the most part, to transact with these different networks and stuff. And I think that's the main thing that you would have to just try to dive into a little bit, and understand. And then, you probably would be ready to start doing some interviews.
(22:29):
And I think if you're a good front end engineer, even with the market as it is today, there's still a very good demand for that. I think the challenge has always been for junior engineers to get their foot in the door, unfortunately. I think it is still somewhat of a challenge if you're a junior, to land that first role. But beyond that, I think that if you have some skillset on the front end, you can get started with... Most companies that are hiring will probably give you a shot. If you've done just even the slightest amount of due diligence, to understand what are these client side libraries. So, you have things like Ethers.js, you have things like Solana.js. I believe we have WalletConnect, Rainbow Wallet. And then, I think that you probably know some of the more Solana specific wallet adapters, and stuff for JavaScript.
(23:14):
Anyway. So experiment, figure out which ecosystem you want to be in. Look at all the different client side libraries and stuff that are there. Just build out a couple of apps over the week, literally just building out two or three apps, and throwing on your GitHub, will probably set you apart from 99% of the people out there. And yeah, it's really not rocket science, I don't think, to get hired in this industry if you're a friend and developer. So, that would be my take, is just to realize that 95% of your skills are transferable. The other 5% is just understanding these blockchain specific interactions with RPCs, and the wallet stuff as well, which is the web3 blockchain version of identity.
Brian (23:50):
I couldn't agree more. Building in public, building out that resume, is such a stronger signal than anything else in this space. And it can be done. It's just a couple of weeks. If you put the hard work into it, you already have the skillset. It's just about showing your work at that point. Well Nader, this has been awesome. One closing question we ask all our guests, and I'd love to hear this from you, is who is a builder that you admire in the Web3 ecosystem?
Nader (24:16):
Wow, that's a good question. I think that there's not just a single one, there's just really so many. I would say that if I had to point out maybe a couple of people, one of them would definitely be the team I have here, that I've met here at Lance and Ave. They're not really that active, or as active on social media, I would say. But I want to give a shout-out to Josh, who is the main backend engineer on Lens. He's just incredible. He'll come up with a solution for what is a problem that maybe has never been solved before, an idea. And then, he'll actually have implemented that in sometimes days or weeks. And just seeing that done on a consistent basis, is just really wild. There's a lot of developers from within developer DAO, that I would shout out. I think that engineers over at Celestia, like Mustafa Al-Bassam, and the rest of the folks over there, are really incredible. There's a lot of high quality people that are building right now. It's hard to say anyone without feeling like I'm leaving a bunch of people out, to be honest.
Brian (25:17):
That's a good sign though.
Nader (25:18):
But yeah, but Armani Ferrante. Armani is in this salon ecosystem. He's definitely one of my favorites as well.
Brian (25:24):
Oh, that's awesome. Well, I couldn't agree more. Lots of great names all through that list. No shortage of folks in this industry, who are working hard every day to push this space forward. Nader, thanks so much for coming on the show. Where can folks go to learn more about what you're up to at Lens?
Nader (25:39):
Yeah, I would just say, you can go to my Lens profile. It's nader.lens, on any of the lens front ends, like Lenster, on Twitter, on DaBa3. And then, I have my personal webpage set up on RWE, that's my links to my YouTube and stuff. And that's on nader.rwe.dev.
Brian (25:58):
Awesome. Nader Dabit, thanks for coming on the Zeitgeist.
Nader (25:59):
Thank you for having me.
-
What do Nike, Starbucks, reddit, and AAA gaming studio 12am have in common?
They all use Polygon to build in web3.
Polygon Studios CEO Ryan Wyatt joined Brian Friel to discuss crypto's mainstream adoption and the future of web3 gaming on Episode 15 of The Zeitgeist.
Show Notes:
01:36 - Background / How he started working at Polygon?
05:09 - Why Polygon and web 3.0 gaming?
11:29 - Partnerships
16:58 - The state of web 3.0 gaming today
20:28 The future of web 3.0 gaming
22:29 How will wallets evolve in the space24:35 - A builder he admires
Full Transcript:
Brian (00:06):
Hey everyone, and welcome to the Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the Web 3.0 space forward. I'm Brian Friel, developer relationship fan, and I'm thrilled to announce my guest, Ryan Wyatt, the CEO of Polygon Studios. Polygon is a platform for scaling and building decentralized blockchain apps on Ethereum. Polygon Studios specifically is the business team working to help advance the Polygon ecosystem across its various products. Ryan, welcome to the show.
Ryan (00:35):
Dude, you've got a perfect podcast voice. Let me tell you, man.
Brian (00:39):
Thank you. It's a good thing no one can see my face. It's a voice for podcasting, but we'll keep it at that.
Ryan (00:44):
Yeah, that's fair. That's all that matters. That's all that matters. Thanks for having me.
Brian (00:48):
Yeah. Hey, we're really excited. By the time that this episode's live, the announcement will be out that Phantom and Polygon are joining forces and bringing the Phantom experience to the EVM ecosystem. We couldn't be more thrilled to be working with you guys.
Ryan (01:01):
Yeah, we're super excited. Long time coming. Glad the day has finally arrived. We can share it with everybody. You can't see it, but I'm wearing my Phantom shirt, so I'm fully celebrating the moment.
Brian (01:12):
I love it. And we definitely got some more of those Phantom shirts in stock. We can be giving it out to all the Polygon community.
Ryan (01:19):
That's right, man.
Brian (01:19):
Getting the merch going.
Ryan (01:20):
Send them my way.
Brian (01:20):
Hey, well, you know, you have a really interesting background. I really want to dig into that before we get started on everything that's in what we can be teaming up together across Polygon and Phantom. But for the uninitiated, can you tell us a little bit about yourself and how you became to be working at Polygon?
Ryan (01:36):
Yeah, so my whole background was really in the creator economy all the way back to my days in college. So I played games competitively. I commentated tournaments for Major League Gaming. I ran the online tournament infrastructure for Major League Gaming, 2008, 2009. Ultimately went to Machinima, which was a really early gaming company on YouTube, and then went to YouTube to start the gaming vertical where I was the head of gaming for almost eight years at YouTube. And gaming is the second largest vertical for YouTube. It's got 350 million logged in users. It generates billions of dollars for the platform. So a really fun time that I had of 12, 13, 14 years in the creator economy. Last year in 2021, I really started getting into angel investing of Web 3.0 projects. And the way that I actually got connected into Web 3.0 projects was just really game developers that I really believed in that had a high degree of talent that were going over and they were making at the time, calling blockchain based games.
(02:33):
And I just became very enamored and fascinated with the concept of what can you do when you really own your digital items and how big of a business that's becoming. And so as I spent more time in that space while still at YouTube, I got really excited about what can I do to jump in full time. And I came to Polygon and I thought I really like Polygon for a couple key reasons. First and foremost, I was already sold on Ethereum where that was going to be a base layer for developers and users, and not to say that other alt ones don't have a place in the world. Ethereum had kind of already checked that box that they'd been able to gravitate a lot of users and developers. And clearly there was this conundrum that existed at Ethereum of the inability to let it scale.
(03:12):
And so I started focusing on protocols and companies that were really looking at this idea of how do you scale Ethereum? And landed on Polygon because I had liked their ZK tech acquisitions that they had done. They spent about a billion dollars acquiring three different ZK companies. I looked at that as like, okay, that's a real scaling L2 future for this platform.
(03:35):
And I thought I could come in given that I worked at a platform like YouTube, saw a lot of verticals, saw what it's like to scale a company, and knew Web 3.0 and Web 2.0 really. Well, I thought I was in a unique position to come into the company and help out. And so I joined Polygon Studios in January of this year. I lead our whole business team. So if you can think of Polygon as there's a product and engineering team that's focusing on ID and our different ZK solutions, our POS chain, avail, our super nets, a lot of work going into our product efforts across the board over there. Everything else kind of sits under my camp of everything from BD to partnerships to marketing, finance, legal, compliance, a lot of these different other business areas. And so it's been an awesome opportunity. I've really enjoyed being here and Polygon had such a tremendous year. It's been fun to be on the ride, that's for sure.
Brian (04:24):
Yeah, I couldn't agree more. I think Polygon is a bit of a meme that you guys have the most legendary BD team in the Web 3.0 space.
Ryan (04:31):
I love that meme too. I won't lie to you.
Brian (04:33):
Yeah, I want to get into all that and what you guys have cooking over at Polygon, but just to quickly go back a little bit on your background, you mentioned you were the head of gaming at YouTube, and that's at a time when it really wasn't popular opinion that it would be a popular thing to watch people play video games on the internet. I think you were very early to that movement and now you see that movement potentially heading to the blockchain space, you know, mentioned that your interest in Polygon really peaked from seeing game developers move over. For you, what was the aha moment for you that made you leave a job like YouTube to come into the Web 3.0 space?
Ryan (05:08):
Yeah, no, I love the question. I think the funny thing too is, so, taking a step back at the first part of hey, you know, you got involved before the creator economy was even a thing. And the reason I got involved was I really was such a gamer and it was fun to watch gaming highlights and clips from other cool moments in games. And what got me into it was simply, I think there's other people like me that might enjoy this, other gamers that are watching these videos and stuff. And so it started just with something as innocent and simple as that and kind of kept building off of it. Okay, how do you introduce this to more people? What barriers do you break down in order to get it into more people's hands and so forth? And so some of it you control, some of it you don't.
(05:54):
So a good example was really where you started to see scaling of more gaming videos being uploaded was when the Dazzle capture card came out, it was like a 50 or $60 capture card you plugged into your Xbox or PlayStation very simply captured to a hard drive. You had this raw footage output that you could just clip up and then upload, right? Then also software got better with Final Cut and Premier and all these different things. And so you started to see a lot of these things happen that other companies were contributing to and really what you don't ever sit there. And at the time I was never like, oh, some of the biggest celebrities in the world one day are going to be people that upload videos on YouTube. You don't start with such an insane point of view that I wouldn't have believed it at the time.
(06:38):
You didn't need to sell this huge idea and you just believe, hey, there's people that are interested in it and this is going to keep getting bigger as more people progress. I say all of that because clearly the outcome was, again, 350 million logged-in people watch gaming video on YouTube every day. Some of the biggest celebrities in the world now come from YouTube. Mr. Beast was uploading gaming videos, Dream, all these different people, right? And so I saw a bunch of similarities in Web 3.0. I love this idea of decentralization. I really did believe that, hey, there is a power dynamic that negatively impacts users. You see it in gaming, a lot of this is anchored around gaming and that as people are spending more money on digital goods, there's going to be this desire and push for more genuine ownership over it. So I started to see something where I was like, hey, this is interesting to me and I think it will be interesting to other people.
(07:27):
And now I also saw a lot of capital in the space, and by that I mean there is so many different people focusing on so many different problems like Phantom with the wallet, us with a protocol, Magic Eden who we just partnered with on the marketplace. You saw all these great talented people contributing their part in advancing the overall ecosystem. And so I had this perspective of, well, the creator economy took about 15, 16 years to really hit its stride in a meaningful way. I think that Web 3.0, if you think about where we're at, can really cut that timeline in half because of the type of people, the capital and resources that are in this space. And I felt that there was already a really good product market fit as far as people wanting this. And so for me, it actually was a really easy jump.
(08:11):
I had no issue leaving. I did awesome. I loved my job at YouTube, running gaming YouTube was so fun. Great people love Susan, our CEO. Really enjoyed who I worked with. But even saying all that, it was actually really easy to come make the jump here because I was like, oh, this is going to be so fun over the next decade, there's going to be so many different learning opportunities, things to build. There's this blank canvas of creativity and yeah, it's littered with a bunch of issues. That was no different than YouTube in these early days with people uploading porn or videos that had copyright or music. You're dealing with a bunch of abuse factors in crypto right now. We're seeing it play out, but that's okay. It's a lot of what you expect in first movers and early adopters of a new product. And so I'm really optimistic about how this stuff shakes out and what the future looks like and how even on a personal level I can contribute to shaping that in some way.
Brian (09:01):
Yeah, no, I agree. There's nothing quite working on the frontier attack. It's really exciting.
Ryan (09:07):
Frontier indeed it is. Yes. We're reminded of that every two months at this rate.
Brian (09:13):
Absolutely. So let's turn a little bit to Polygon specifically. And you mentioned that you just jumped in with two feet into this space. What is it about Polygon that piqued your interest and why do you think it's particularly well suited for this movement into Web 3.0 gaming?
Ryan (09:29):
So going back to Ethereum, I was betting on Ethereum, so I was like, I want to be associated with a protocol that's focused on scaling Ethereum. And so there's some great companies, Immutables out there and so forth. I just really liked Polygon because I love the founders, so I got to spend some time with Sandeep. I mean these guys have the heart and spirit, JD, Milo, Onarog. It's really inspirational. I kind of like an underdog story too. And if you think about even where YouTube was relative to Twitch and some of these other things in the gaming category, we had to overcome some of these battles to stay being the largest video platform. Facebook, Mixer with Microsoft, it was just fun to kind of compete. And so I just really like the heart that they had of one, they were really well intended about how much they believed in the future of decentralization and polygons' role in it.
(10:20):
And two, that passion, you can't recreate that stuff. And so I just very easily gravitated towards them. I also, again, well capitalized the product and engineering team, brilliant people on the ZK side. We have some of the best engineers, mathematicians, PhDs when it relates to cryptography and ZK work in the world on Polygon. So it was, it shot up. I don't think we're an underdog anymore, obviously I think we've arrived, right? We have all this great talent across the organization. We've got a really clear vision of what we think it's going to look like. And so it's just fun. It's just fun to be on a team when you work with people that are really talented, it makes you want to work harder, it makes you get excited to get up every day to work. And so we've just got one of those teams and organizations and I love it.
Brian (11:13):
That's awesome. So you have a great team that you guys have here at Polygon. We mentioned a little bit earlier that you guys are at the legendary BD team in the Web 3.0 space. Let's talk a little bit about some of those partnerships that you guys have landed recently. What partnerships are you particularly excited about?
Ryan (11:29):
Well, I mean honestly, selfishly, the Magic Eden and Phantom partnerships are pretty fun. Seeing these, a great marketplace, a great wallet go multichain is so good for the space. I think multi chain is a good thing for the space. Oftentimes too, I say it's just like we're so small and so early to be super competitive. And so I think multi chain is just a great way for all companies to look. Even games and things that are building on Polygon. So that's been really fun. We've also had a lot on the gaming side this past year. We partnered with Tilting Point, we partnered with Midnight Society, which is Dr. Disrespect’s game. I mean obviously we had just a heyday on the enterprise side. We had Nike and Starbucks and Reddit and Meta. I mean, honestly, that list gets crazy. Super proud of all the team's work there.
(12:19):
DeFi, we had a really fun year too. I really feel good about what we've done with DeFi, Robinhood, who was a really exciting announcement. So there's just been great momentum. The teams really, it's a mix of Web 2.0 background folks from big tech with Web 3.0 native gurus, and they just really work well as far as learning from each other. It doesn't come without its hiccups, but it really has been a great collaborative effort. So we've just had a lot of fun partnerships this year. It's great to be able to announce Phantom as we come to the end too as well. I think that's going to be exciting as we go into the new year, especially with all the projects we announced and so many of them we haven't even launched yet. If you think about Starbucks and some of these other ones, we haven't even debuted them yet. So 23 is going to be a fun year. I'm really excited. I know people right now are pessimistic bears because that's the season when the highs are high, they're really high and the lows, they're really low. I'm kind of pretty excited going into 2023 with all this momentum we have. Then our ZK tech coming out, we're going to be able to do a bunch more and the DeFi space with our ZK tech as well. Vibes are high on IM my man.
Brian (13:27):
I love it. That's great. You mentioned a ton there that hits across a bunch of different sectors. When you talk to these teams, especially, I'm curious, the ones who maybe aren't as Web 3.0 native, are there any commonalities between all them about what they're particularly excited about or maybe some specific areas that they think are most fruitful for growth in the Web 3.0 space?
Ryan (13:46):
It varies so much from each one. Think about a Magic Eden or a Phantom opportunity versus a Starbucks versus Meta. I do think a lot of folks are really interested in these ideas of these decentralized, let's say peer-to-peer networks, if you will, in layman's kind of Web 2.0 terms and kind of what you can do with it. So yeah, I think from that perspective, there's a lot of intrigue and appetite in the space. I would say it's not necessarily a growth vector for them. I think it's a lot of it is, hey, this is really interesting, new tech, what can we do? How do we participate in it? How do we learn in it? How do we trial? How do we try projects in it? And then there's varying degrees. I mean if you look at Instagram, they went really in, you mint on Polygon. You can sell directly from Instagram as they build on that. That's a really just valuable tool from a creator product feature set.
(14:37):
And people don't really need to worry about the Polygon aspect. I mean, it's fun if you're in the space, Polygon, but at the end of the day, it's like it's a great product feature they unlocked via Polygon, Reddit and what they're doing with Starbucks Odyssey. And basically they're going to allow this rewards program to be on chain, and the NFT part will be really passive as it should be with users that are going to use it. Same with Reddit, digital collectibles. So I just think you're really hitting a stride in how people are figuring it out. And there's going to be learning and iterative work here for all of them. But yeah, I think everybody's looking for something different when they come to the table. And I feel like what we have that's pretty unique is a bunch of people that can look at all these different perspectives from institutions, to finance, to big tech, to DeFi, to being a NFT, degen trader, all these different users that matter in our communities that matter. We've got good representation of it internally.
Brian (15:32):
Yeah, no, that's great. And it's great to see so much enthusiasm from these orgs actually putting their money where their mouth is and learning by doing and shipping and iterating, doing all that. It's a really cool time to see. Just a couple years ago that would've been basically unheard of in the crypto space. So it's really awesome to see that changing.
Ryan (15:48):
It's fun that crypto's ... look, dude, I would never call myself a crypto native. I didn't read a Bitcoin white paper and it changed my life back in the day. So you are seeing this new wave of people. This is good for the space. People that come in-
Brian (16:02):
Totally.
Ryan (16:03):
That got really interested in some of the ethos of Web 3.0 that is entering the space. And so this is why I feel good about these cycles that we'll have of people coming in. And it will be an ebb and flow. We'll have these big breakthroughs. We'll have moments we've been going through the past couple months on pulling back, and that's a natural part of the course that we're on. And I think what you continue to see with each stride will be more talent, more innovation, more use cases, more people each time.
Brian (16:29):
Yeah, no, I agree. And each new wave of users has their own perspective. As you said, it's no longer the hardcore cyberpunks and crypto maxes coming in, and that's how the space grows. It's really exciting to see. Totally. I want to bring it back just a little bit to gaming in particular too. Given your background, everything. We talked about how excited you were moving into the Web 3.0 space from head of gaming at YouTube. Talk a little bit about how you see the state of gaming, Web 3.0 gaming today and how that might change in the coming years.
Ryan (16:58):
So if you think about Web 3.0, the first version of it was, they were rudimentary Ponzi-esque type games. Some games I don't think operated with malice. I think some did, right? No doubt. I think that it was a great learning experience of what can you do with all these different things? You have a token, you've got decentralization, you've got ownership. You're trying to balance game mechanics. You're just doing a lot. Making a game is really difficult. You start adding all these different elements, it becomes very complex. So I'm pretty empathetic to, let's call it generation one of Web 3.0 games, none of them, which would be anything that I'd be interested in playing. I think Axie even playing that was like, okay, at least it's like there's something here. But these are all kind of base level games. A lot of great talent though coming from that space as far as generation one Web 3.0 games as far as learning and iterating.
(17:50):
And that's not super uncommon if you look at some of the early gatcha games and what mobile first offered up and some of the pay games that mobile ad were pretty atrocious as well. And so mobile went through a very kind of similar era of how do you iterate on these things? How do you improve? And so Web 3.0 games now, it's like you're starting to see some really good. One, it's like if you think about really great games take years to make. So you could have been last year been like, I'm going to make a Web 3.0 game and I have this really good studio and I've got a great background. And you're not seeing that game next year. You're seeing it in like 2024. So it's going to take a while and it's not going to happen fast in gaming. You're going to keep seeing new things come out in Web 3.0 gaming that will continue to pique people's interest and be like, okay, that's cool.
(18:41):
Or oh, what they just did with memberships and NFT, that's cool. Or what they just did with governance, that's cool. And games are just going to keep getting better and better and better. It'll be beyond just digital marketplaces and things that you own items in and all of that. So anyway, I say all that is, I think really the reality of where games are, where you start to see mass adoption of Web 3.0 games is years away. I think I feel very confident Web 3.0 gaming will be a pretty sizable subsection of games revenue in 2026, 27, and then you'll just keep seeing it go up to the right over time as far as users revenue, how many wallets, all of this. So yeah, I'm excited. I say it in a little more tempered way because it's more of a long term bet. We've been placing a lot of them now though.
(19:25):
You got to place those bets now. Those trees take a long time to grow. They're really impactful when they do, but you have to plant these seeds now. So we spent a lot of time this past year investing in different gaming projects out of our ecosystem fund, partnering with really large game developers, some of which we haven't even announced yet. So yeah, we've got some cool stuff that's coming up. And I definitely think things that's going to show what gen two of Gaming and Web 3.0 looks like. Again, I think where you see a meaningful breakthrough is more likely in this gen three era in four years or so.
Brian (19:59):
Yeah, for sure. No, it takes a lot of cycles to make something that's kind of a generational game like that. You know, mentioned some of these early investments, planting the seeds on this. If you had a crystal ball and you looked out, do you see that most of the games people are playing three, five years out from now? Are these being made from the existing AAA game studios that are coming into Web 3.0? Is it these web one game developers who are more crypto native iterating and finding something special? Is it some sort of blended between the two of them? What do you think there?
Ryan (20:29):
It's probably a blend. I actually think of more of it a regional thing. I think APAC game developers, largely in APAC will be the ones Web 3.0 native or Web 2.0 will be the ones that really do really interesting things in Web 3.0 gaming that will then spew towards the West. And so I think of it more as a geo-specific thing than anything else.
(20:50):
I do think you will have a massive Web 3.0 game hit the equivalent of Minecraft. The thing about Web 2.0 gaming is it wouldn't be incredibly difficult to pivot when they need to. And then when they do pivot, they would be very successful. So if you could imagine a world, just take any AAA game that is a platform, a Valorant, a Call of Duty, any of these different ones that are allowing people to buy cosmetics and skins, and people are spending boatloads of money doing that, they could very easily start to think about how do you flip on something where there's governance, how do you, true ownership, scarcity of items, and even just put membership passes, stuff like that where they could play in a very low level way of playing in Web 3.0 versus there's going to be other games where people are going to go off and create all kind of different mods and versions of it and communities around it and could start from it being a PFP NFT project that evolves like a Board Apes-esque kind of path.
(21:51):
And so I think it's going to show itself in a lot of different ways. But generally speaking, if I had to make a bet, I would say game developers largely in Asia will set the tone for how Web 3.0 gaming will look in a couple years.
Brian (22:04):
That's pretty exciting. I'm very interested to see what comes out of that region. And just to bring it back, one thing that I, selfishly here at Phantom were curious about is how do you see the role of wallets evolving in this space? Wallets right now touch a lot of different aspects of Web 3.0. I think the gaming space is relatively unexplored right now. Is there anything in your mind that you're particularly excited to see about from wallets and from Phantom in particular as it relates to this?
Ryan (22:30):
The user journeys are tough on wallets. Wallets bear the brunt of it. When you think about bridging and making entities really accessible and displayable all in a wallet, you know, have all these on ramps, it's just very digestible. It's clean. Maybe you start to have specific vertical specific features across DeFi gaming or music as you own these things. Like wallets can then go vertically deep, I think, which would be really interesting. But right now, so many of them are just dealing with this onboarding issue. It's complicated. It really is. It's not easy to set these things up for a lot of folks. So as wallets can go deep and then be really seamlessly integrated into all these different consumer experiences, which it's like, well, on its way, that is an already accelerated timeline. You guys have done great work there. This is what I would like to see for wallets.
(23:18):
I want it to be, my mom can set up a wallet and use it really easily and be like, oh yeah, I mean, here's how I add money to it. Here's how I buy an item. Here's where I can look at it in my inventory. Here's how I easily send it to Brian. That's like when we get there. And I think that's everyone's North Star. And so who's going to do it the best and who's going to do it fastest, I think is what we're going to find out. But look at, you guys have hit a really great narrative in the Solana ecosystem of having this very clean, simple, easy to use wallet. And so you've got a huge leg up already on that because that's what people are looking for and what is needed first.
Brian (23:56):
Yeah, no, I agree. We always saw that this was one of the bottlenecks in the space of getting things easier, getting it so easy a kindergartner could use it. So we're really excited to bring that to Polygon as well.
Ryan (24:06):
I love working with you guys because that's good for us. We want to make it easy to come on a polygon and use all these things and have no problem immediately setting up. And as we continue to onboard big games and different enterprise companies and so forth, this is going to be really important to do. So I think it'll be awesome.
Brian (24:23):
Yeah, I love it. Well, Ryan, this has been an awesome discussion. One closing question we always ask all our guests, and I want to hear your take on this, is who is a builder that you admire in the Web 3.0 ecosystem?
Ryan (24:35):
Man, I've plugged so many of them here. This is a tough one. Gosh. I'd say right now I think I'm going to go back to Midnight Society. It's a little bit of a curve ball, but the reason why is, that team has a bunch of ex Gears of War, Call of Duty developers that are really from prestigious game development. And they've been a builder that's focusing on how they introduce Web 3.0 to the masses, which I think is obviously, I'm personally fascinated by that. And the way that they've done kind of the membership pass and so forth with NFTs, all these anti NFT like, oh, I hate NFTs, blah, blah, blah. Gaming communities really served it up in a way for them to think about it differently. So I read it too, but sticking to this, and I think as we just touched on how we see gaming start to evolve, I look at them as going to be someone that's going to crack what Reddit started to do with the idea of owning out of a PFP NFT, right?
(25:37):
They're going to start doing this with gaming, with general gamers that don't really care about this crypto NFT, blockchain, or decentralization bit. They're not interested in that, but they'll be interested in this concept of having genuine ownership of items and memberships and so forth. And they're going to get introduced to it in a way that is different from an NFT perspective than they ever have. And so I like them as a builder because they're Web 3.0 builders, but they're targeting the crypto naive in a way that's really interesting. But honestly, dude, it's an impossible question. There's so many bad asses working in this space right now. This is why it's fun to be in it. So yeah, you guys and some others fall into that category for sure.
Brian (26:16):
Yeah, no, it's a bit of a selfish question too, so that we can get our next guest lined up for the podcast. I think Midnight Society would be a great guest there.
Ryan (26:24):
We got to get them out, man. I think. There it is. Yeah, I think they're really, really fascinating group to talk to and dive in about gaming.
Brian (26:31):
Awesome. And I know there's no shortage of people we could all list on this, but that's great to hear. Well, Ryan, this has been an awesome conversation. Really appreciate your time. Super excited to see what we can do together to push Web 3.0 forward. Where can people go to learn more about Polygon?
Ryan (26:45):
Yeah, I mean just polygon.technology, right? Honestly, that's probably the best. It's where our blog posts are and all of our updates you can follow then all of our socials that you're interested in. If you want to go deeper on our tech stack, whether you're a developer or just interested, we have all the engineering and technical documents that you would want to look into as well as social and what we've been up to, partner announcements. So I'd head there for all things Polygon.
Brian (27:10):
I love it. Thank you so much, Ryan Wyatt.
Ryan (27:13):
Take care, man. Thanks for having me, Brian.
-
Helium is the first people-powered decentralized wireless network.
In episode 14 of The Zeitgeist, Boris Renski, GM of Wireless at Nova Labs sits down with Brian Friel to discuss how crypto is enabling new ways to deploy wireless infrastructure.
Show Notes:
00:52 - Who is Boris Renski / Background
03:23 - What is Helium?
06:44 - Catalyst behind creating a network
11:20 - People's network built by the people
14:50 - Is Web3 essential to this network?
17:08 - Partnerships
20:20 - How do Saga users benefit from Helium?
24:41 - Building in a bear market / Roadmap
29:05 - Things Boris is excited about
33:30 - A Solana builder Boris admires
Full Transcript:
Brian (00:05):
Hey everyone and welcome to the Zeitgeist, the show where we highlight the founders, developers, and designers who are pushing the web through the space forward. I'm Brian Friel, Developer Relations at Phantom, and I'm super excited to have with me today, Boris Renski.
(00:20):
Boris is the General Manager of Cellular Wireless at Nova Labs. At Nova, Boris is responsible for leading the charge of all things related to Helium Mobile, the world's first people's carrier. Boris, welcome to the show.
Boris (00:33):
Thank you. Great to be here.
Brian (00:35):
Great to have you here as well. I'm really excited about what you guys are building. For those who were at BreakPoint, you might have seen a little bit about how you guys are going to be powering some of the upcoming Saga phones. But before we get into all that, I'd love to learn a little bit more about you. Who are you, and how did you come to start working at Nova Labs?
Boris (00:52):
Yeah so, this happened fairly recently. I, what the people in the cryptosphere refer to as the normie, not a Degen, so to speak. Most of my career, I spent in open source cloud infrastructure. Prior to my [inaudible 00:01:11] to Web3, I've helped build and co-found a company called Mirantis, which to this day remains one of the bigger players packaging this cloud, open source cloud operating system, so to speak.
(01:29):
My journey towards crypto was the extension of the work that I did in the open source cloud infrastructure, in that when I was still working for Mirantis, one of the open source projects at that time my team was focusing on, was this project called Magma that is can think of it as the open source software that allows anybody to build a cellular network.
(01:58):
And I, about three years ago, left Mirantis with the idea of taking this open source Magma project and creating a very simple way for people to basically take advantage of it such that anybody can just click a few buttons, get a small hardware appliance and have a small cellular network that they can operate.
(02:25):
And the original focus was very much towards the private LT and private 5G space. There was no even thinking of crypto at the origination of this company, FreedomFi that I've started, but then midway for our journey with come across Helium and some of the folks of the Helium team and they've pitched to us to look into this other use case which is a distributed wireless.
(02:52):
And we did a couple of pilots and basically the rest is history, and the whole thing culminated, and Nova acquiring FreedomFi, and my joining the team and now working on Helium Mobile.
Brian (03:05):
That's awesome. Yeah, I definitely think you have a unique path towards coming towards crypto building, very practical open source everyday solutions, and then finding your way into this industry.
(03:17):
For those who maybe aren't familiar with Helium, how would you describe what is Helium and what do they do?
Boris (03:22):
So Helium is a people-powered decentralized wireless network. In a nutshell, it's from the standpoint of a builder. It's a new way to build a wireless network where anybody, be it an individual or a company, can buy a piece of hardware, click a few buttons to enable it, and then this piece of hardware effectively becomes a node on a wireless network. And then the Helium blockchain aggregates all of its individual nodes into a single macro network that is usable effectively by anybody.
(04:04):
And I think that Helium started this with the idea to build a global worldwide network for sensors using this IOT protocol called Laura, but it ultimately has become so successful and was built out so quickly, there's over a million nodes on the network now, that it's almost like it's become a beacon for a new way to deploy wireless infrastructure. Not so much just specifically for Laura, but for almost any use case.
(04:40):
So that drove the community to explore, okay, well we've built out this global worldwide network for sensors, but the model, this bottoms up model of building the wireless coverage is so powerful where else can we apply that model? And that led to this concept of introducing the network of networks of which I think the cellular network for not the sensors, but the phones which Helium Mobile is all about, is the first instantiation.
Brian (05:16):
Yeah, and when you say sensors specifically, what type of sensors are you talking about?
Boris (05:20):
So any sensors that use this protocol called Laura, which is a particular protocol with a couple of aspects to it that make it useful for situations where you would have very low bandwidth and very low power usage. So if you have for example, a sensor to see if there's termites in the ground, you will have that sensor of a battery buried in the ground that'll just live there forever, and it needs access to some global network to transmit something once a day, whether or not there's termites eating something.
(05:57):
So there's basically a huge ecosystem of these types of Laura sensors, and any Laura sensor can work with the Helium network. So I come from a cellular side, so I'm a little bit less in the weeds with the types of lower sensors specifically, but at a high level that's what it is.
Brian (06:19):
That's great. Well then let's jump into the cellular side of things. So, you described this network of networks essentially that Helium now is, and one of the initiatives though as you've pointed out is this Helium Mobile.
(06:31):
You talked a little bit about how "Hey, we have this network that's growing very fast and is very popular and worldwide," but what specifically was the catalyst for starting a mobile network and then what does this mobile network look like today?
Boris (06:44):
Yeah, so let me see if I can give you a little bit of history and that will also share, provide the bigger context. So at FreedomFi prior to my joining Nova, like I said, what we have built is a very straightforward way for anybody to deploy a mini cell tower. You can think of it like a cellular wireless node, which was our technical know-how and the core differentiation for FreedomFi as a company.
(07:17):
And at that time, Helium was already fairly far down their path of creating global coverage for Laura. And when they saw what we did with respect to simplifying the cellular deployments, I got that pinned literally by a buy who was chief product officer at Helium, and he said, "Hey, look at the stuff that we have built with Laura and what you guys have done with the simplification of deploying cellular infrastructure at FreedomFi is amazing. How about we marry these two concepts? We enable people to deploy mini cellular towers or small cells and basically compensate them in crypto depending on whether or not the placement of the small cell is useful or not."
(08:10):
So it was like, "okay, that's very interesting." And we did some pilots, and we did then a bunch of work to actually productize that and we launched that to the general public just some months ago. And obviously the community just took that up and started building all of a sudden. So in the matter of, I think, now three or four months, we have close to 7,000 small cells around the US that people have deployed and that are operational.
(08:43):
And in parallel with doing this work to marry a Helium way of building networks with our know-how, making it very simple to deploy, we started talking to a whole bunch of operators, the mobile network operators as they call them in the US, about saying, "Hey, look at this network that we are building. How about you guys partner with us and integrate this network that we're building with your macro network?"
(09:17):
And we got to some degree of success there. We've announced a couple of partners, but at the same time it's also become clear that the carriers in general are very conservative and very importantly slow moving entities. So in our thinking of how we can further accelerate this? We've decided that an important pillar to doing this would be us actually eating our own dog food and launching our own people's carrier as we call it, which is Helium Mobile.
(09:54):
So this was the catalyst to the partnership with T-Mobile and the people's carrier announcement that we did recently.
Brian (10:01):
That's awesome. And so this people's carrier, this is essentially what people would expect from their normal iPhone or Android phone carrier 5G connectivity being able to make calls throughout the US. Is that right?
Boris (10:15):
Yes, that is absolutely correct. So it's basically a US nationwide network for cell phones that provides connectivity for data and voice globally. And what makes it unique is that unlike almost any other carrier, we are not exclusively using one macro network, but we're using the macro network of our partner, T-Mobile, which we've talked about, and we compliment that with the people built network that is basically being built by the Helium community using this very model that I have described.
(10:55):
So the back end to the service that the people yet to take advantage of is actually very much also built by the community.
Brian (11:06):
I see. So The Peoples Network quite literally means the network built by people who go in and they take the effort themselves to put up these infrastructure and then they're compensated in crypto for the effectiveness of that?
Boris (11:20):
Yes. That is correct. And that's the whole notion behind this concept of the people's carrier. And I think that the unique and interesting thing about it is that if you look at the mobile wireless industry at large, if you look, peek under the hood of how a mobile operator functions, there are always dozens of different entities that are collaborating under the hood to make a carrier. So if a consumer, you go to AT&T, you buy a cell phone, you buy a subscription, and then you just start using it.
(11:57):
But if you peek under the hood, it's not really almost one company. Any carrier is an entity that has assets in the form of wireless spectrum and there are subscribers. And then under the hood there is dozens of different organizations that actually do work to comprise a carrier.
(12:22):
So most carriers, they don't build their own radios, they don't build their own wireless software, they don't install or operate their own towers. Most of the time, don't even own and operate their own stores. So many different companies aggregated under one umbrella.
(12:40):
And I think that this notion of a people's carrier that we're trying to pioneer with Helium Mobile is all about using blockchain and crypto economics to dramatically improve the efficiencies of the value chain that is basically the modern day carrier. So instead of having dozens of different independent entities all shuffle paperwork between each other, but ultimately roll into this one umbrella of whatever, like AT&T, or Verizon, or whatever it is, you actually simplify a lot of this overhead by actually having the blockchain take care of it.
(13:25):
And probably the most capital intensive part of any carrier and the most complicated is actually building the network. So finding a location for deploying a radio, contracting with somebody who either builds a tower there or who maintains a building, then actually deploying it, maintaining, et cetera. So this is all very capital intensive, complicated process that usually involves a lot of entities that we are making significantly more efficient.
Brian (13:56):
Let's talk a little bit about that crypto element. I mean you yourself said that you consider yourself a normie and that you found yourself into this crypto environment. I think this is pretty unique because we, as a wallet, we see a lot of different players in the crypto space so much or just inherently digital. It's either DeFi or NFTs is the vast mass 95% of the use cases we see. This is very different. This is taking something that's very much real world cellular infrastructure and trying to incentivize a network around that.
(14:29):
I think also everything you described too, it seems other carriers may be more potentially top down, whereas this is almost a bottoms up movement of getting individuals to go out and create this network. To you, what is the importance of this Web3 element? Do you actually think this could be made without Web3? Or is Web3 really a vital ingredient to all of this?
Boris (14:54):
I mean, I think that this is next to maybe solving some of the problems in the financial space, probably the second biggest opportunity for the Web3, because from my standpoint, Web3 is really the key enabler, is the new way to coordinate economic activity. That's when various parties, I would argue. This is what the crux of where Web3 can unlock the most value.
(15:18):
And if you look at various industries, the mobile network industry is one where you have a tremendous number of different parties that are collaborating with each other with a tremendous amount of inefficiencies in between. So if you could, instead of having a company that is building and operating cellular towers, and a company that is building the radios, and a separate company that is operating the stores, and a separate company that is doing the RF planning, combine all of that using blockchain and coordinate the economic activity between these parties using blockchain and radically distribute the value that is created by this collaboration using crypto economics, you will cut out a tremendous amount of inefficiency from the value chain, and then consequently you can transfer this value to the end user, meaning the subscriber of the user of the cellular network.
(16:28):
So there's a few industries I think that they're like that, and I would argue that the cellular wireless space is up there and to the extent that you can apply this concept that Web3 allows more efficient collaboration and then better and more creativity around the economic activity between the different parties, can apply that to that space. There's an enormous amount of opportunity to unlock value.
Brian (16:54):
Yeah, I love that. I couldn't agree more. Let's switch gears a little bit and talk about some of the partnerships that you've been mentioning, so.
(17:00):
The first one that you brought up is T-Mobile. What specifically does that partnership entail and what made them get involved with Helium Mobile?
Boris (17:08):
The network that we're building uses a particular type of wireless spectrum called CBRS. And this is a shared spectrum, which is a new innovative model that allows basically anybody in the US with just a little bit of money to get access to clean wireless spectrum that is usable for the cellular use case. That spectrum and the radios that are built to operate in that spectrum, the physical properties of it are such that the reach of the wireless radio is limited to a couple of city blocks. And because of that, using that technology, it's very challenging to build a network that would be contiguous and will provide contiguous coverage around the entirety of the US.
(18:00):
And obviously if you're building a wireless network and if we as Helium Mobile want to provide a service to our end users, nobody's going to be using a service where you only have it working around your house and then you leave and all of a sudden there is no service, and then maybe you traveled half a mile and then your friend has a cell, and then you have a service again, and then there's no service.
(18:23):
So you need to have contiguous coverage.
Brian (18:26):
Right.
Boris (18:26):
So no matter where you go, you always have access to your voice and data. And to make that happen, it's important for us to partner with a macro network operator with somebody who has the service throughout the US. So T-Mobile is that macro network operator that we partnered with. And the way that, as I mentioned, Helium Mobile works is that whenever there is Helium CBRS cell in range, the subscriber would use that cell, but whenever there is no cell it would use the T-Mobile service, so that's going to be the technical underpinning behind the partnership.
(19:07):
The business logic here is that for T-Mo, I think we are effectively another MV&O customer. So it's not uncommon for an operator carrier to resell their network to other wholesale customers. So the relationship between us and T-Mo is that we basically procure macro network capacity from them. We augmented with the Helium 5G coverage to create this hybrid network with The Peoples Network component in it, and we sell service to the end users as Helium Mobile.
Brian (19:48):
That makes a lot of sense. Yeah, I could definitely see that being an important and necessary piece for when you're launching this network to have a reliable fallback in the cracks there for continuous coverage.
(19:59):
One additional partnership you guys mentioned more recently was actually a breakpoint that you guys are going to be powering the Saga phone when it launches. So, Solana Labs initiative to showcase what they call SMS, the Solana Mobile Stack, where they're trying to push Web3 mobile. Why is this a big deal and how might Saga phone users benefit from something like Helium Mobile?
Boris (20:20):
So first of all, we are quite excited about the Saga partnership. The specific thing that I think is going to be the direct benefits to any Saga users is that all the Saga phones that are sold in the US will come with the 30 days of free Helium Mobile service. So people will get to actually experience the people's carrier on their Saga phones. But I think that there's also a tremendous benefit from the technical side.
(20:54):
So Saga phones, unlike any devices in a cellular space, have been designed top down to support everything required from a security standpoint for people to basically use them for performing different crypto-related operations, starting with the basic ones such as having a wallet on the phone that is also secure.
(21:21):
Now the concept of the people's carrier, like I said, around multiple parties collaborating to build this new type of carrier does not exclusively involve folks deploying small cells contributing to the network.
(21:37):
It also, equally importantly, involves the users of the network as the important building pillars. So I've explained how we have this concept of the macro network that is T-Mobile and The People's Network that is providing this non-contiguous supplemental coverage to the macro network.
(21:59):
Now, for this network to continue growing, it's extremely important for the builders to understand where it's important to deploy additional coverage. Because in some locations you might already have three people, like maybe your neighbor and your neighbor's neighbor already has a Helium 5G cell deployed, so there isn't additional value from you deploying yet another cell. But that information needs to be continuously fed into the blockchain and everybody needs to be aware of that information. So to that effect, the users of the people's carrier, they are not just exclusively the users, they're also contributors of that information of where is it that the coverage is needed.
(22:47):
And our approach to making it happen is basically the users are able, on an opt-in basis, to effectively share the information, share information about the experience on the network, share information about where they're using, what type of coverage, and then we use that information to ultimately feed into the community and have them build the network around it.
(23:12):
Now for sharing this information as a user of Helium Mobile, I get rewarded via mobile tokens, but this makes your cellular phone effectively into a cryptocurrency miner. And with that, it creates all of the same challenges around securing, making sure that people don't game it, et cetera, that you would see with any typical mining situation. So being able to securely store your keys to be able to perform these operations with the blockchain using a phone, so that we can know exactly based on your specific phone, how many tokens you should receive based on what information, et cetera. All of the security around that requires a different type of device.
(24:06):
And Saga and the work that has been done on the Saga phones is actually unique in that it's basically one of the few, if not the only device on the market that enables one to do it today.
Brian (24:18):
That's awesome. Well I pre-ordered Saga phones, so I look forward to playing around with the network on day one when it launches.
(24:24):
You hit on how essentially the phone becomes a bit of a cryptocurrency miner. Right now at the time of this recording, it's quite obvious the cryptocurrency market isn't a bit of a bear market. How has it been for Helium to be building during a bear, and what is on your guys' roadmap upcoming?
Boris (24:41):
Well, I mean this bear cycle is fairly recent, but I think that all of the Helium community historically was born out of a bear market. So the Laura based IOT network, that the Helium community has successfully built, originally was launched immediately after the recent downturn. And all of the building happened during the bear market.
(25:10):
At the time when the original Helium miner was launched, nobody wanted to touch crypto at all. That was a completely toxic concept. But then ultimately the team has focused on building through the bear market and then on another upswing, this is where Helium became the popular Helium that everybody knows it today.
(25:30):
Now, today we're just going for this other cycle again and we're just following the company culture mantra of just continuing to build through it and not focusing on the macro environment. And that's really the only way to do it.
(25:48):
So this is not like anything magically new, but it's actually oftentimes harder to do than to say. I think that in our case it's a little bit easier in that just the whole community culture and the culture of the folks at Nova is such that it's nothing new and people are just basically used to building through the bear cycles.
(26:13):
As far as the roadmap, I think I touched a little bit on it, but when it comes to Helium Mobile, what's extremely important to us is building the tooling to enable the community to actually create useful coverage. And it's particularly relevant to the cellular network versus a little bit less so for the lower network because of the properties of how the cellular network works, because the signal doesn't propagate very far, it's very hard to build a network that'll just blanket Earth using cellular small cells.
(26:54):
You can only sort of augment the existing network such as that of T-Mobile. And for that, you need to have intelligence in the system and tooling for the community to be able to understand where to place the radios, and you need to have the proper tuning within the reward mechanisms such that only useful coverage is rewarded. And I think that there's a whole bunch of work that needs to be done beyond what has already been created for the lower network to make that work for the cellular space. And I think that a lot of this is what we're focusing on.
(27:37):
Another pillar is about making wireless coverage hotspots more affordable for the community. So the CBRS space, the CBRS spectrum is relatively new. The CBRS small cells are relatively new. I would argue that the Helium CBRS network today is probably one of the biggest in the US, so we are leading the way, but because it's new, it's still fairly complicated and clunky and expensive to deploy a CBRS cell. So it's a lot easier than it was two years ago where it was near impossible.
(28:15):
But it's still a long way away from the simplicity of what you'd experience with, for instance, a wifi access point. And truly making a very large people-powered network requires that there's a lot more simplification for deploying the cellular hotspot, so that's another vector of engineering investment I think that we are spending our cycles on.
Brian (28:42):
Yeah, no, that makes a lot of sense. I guess as this network continues to improve, and you guys get feedback coming back, and you're fine tuning the crypto economic rewards, how do you see this whole space playing out? I guess both the crypto side of things, but also just how does this as The Peoples Network play out and challenge existing carriers, and what are you personally most excited about seeing?
Boris (29:05):
I am excited about the work that we are doing with other carriers that we have announced actually culminating in them formally joining via mobile DAO and becoming another operator on the network. So I think it's an interesting trend in that if you look at mobile space at large, there's been this push towards disaggregation and decentralization in the mobile carrier space in general. So when cellular communication became first possible, everything revolved around basically a carrier that sells you a phone that only works on that carrier and you have a cell number that only works on that phone on that carrier. And that was V1 of cellular communication, the complete lock end around a single entity. And over time, I think during the last, what, 25 years, 30 years of the industry existing, there's been this continuous push towards disaggregation.
(30:15):
So V2 was that you could have different phones and then you have different phones working on different networks and then people said, "Hey, my phone number is my property, and I want to be able to switch my phone number and carry it with me if I switch carriers." And the new thing now is, that's particularly becoming pronounced is carriers using multiple networks under the hood. So instead of just having one set of radios that work on the spectrum assets that you as a carrier have purchased, you also have relationships maybe with some of the other operators or some of the people that have built infill coverage certain locations, or maybe you operate with the wifi networks, Boingo that people have probably have seen. So this concept of carrier becoming less of the monolithic one macro network, but carrier becoming more of an aggregator of many networks.
(31:15):
And this is this next wave that we're seeing, and this is not related to specific layer crypto, blockchain, or Helium Mobile. This is just a thing that's happening by itself. And the reason why it's happening is because as more and more data finds its way onto your phone, you need to build networks that have bigger and bigger capacity. And the physics of it is such that the only way to do that is that you need to build networks that operate on higher frequency bands. And the higher the frequency band, the worst this band goes for walls and trees, so be short of the range. And because of that you need to have a lot of density. So if 20 years ago you could put one tower and cover a whole city of it, today you need to have many towers. And the more and more data is on the cellular network, the more and more of the cells you need.
(32:09):
And because of that, it's no longer economically viable to have a network where just one entity is basically building it. And because of that you need to have multiple networks working together. So I think that what we're doing with people's carrier and applying the blockchain to coordinating economic activity between many network creators and aggregating that into one network is a natural extension of where the entire cellular industry is headed.
(32:41):
So obviously we are super excited about eating our own dog food and launching the first people's carrier in the form of Helium Mobile, but I feel that we are just leading the way, and we're hopeful that additional carriers in the context of this trend that's already happening will start joining in the freight.
Brian (33:03):
That's great. Yeah, I mean there's a lot of tailwinds there that you described it. It's a really exciting time to be where you guys are in bailing this network to the world. Well Boris, this has been a really awesome discussion. I really look forward to using The Peoples Network on my Saga phone when it arrives.
(33:18):
One closing question that we asked to all our guests here on this podcast, and I'd love to hear it from you as well. Having been a normie entering the Web3 space is, who is a builder that you admire in the Solana ecosystem?
Boris (33:31):
Yeah, it's a good question. As a normie. So as a normie, I really liked the StepIn app to be honest, that I still continue to play with. And I don't even care so much about the rewards or making tokens with it, but just the fact that it's really well built and it allows me to, it just almost forces me to get off the chair and walk around. Doesn't matter if I make money for it or not, but the user experience is quite amazing.
(34:03):
And this is just an everyday example of it, but at large what really makes me excited about the Solana ecosystem is the really quality of talent and the dedication of the different groups building on Solana at large. And one important thing that we haven't really discussed much about today is that all of Helium community is moving to Solana.
(34:35):
And I think that's part of the reason why that move's happening is because we are seeing tremendous amount of support from the Solana builder ecosystem and have gotten to interact with a lot of folks that are building for Solana. Even trying to do POCs, figuring out what it is like, what would the incarnation of Helium look like on the Solana L1 gave us a peek into what the quality of the talent and the passion of the community of top Solano looks like.
(35:08):
So I think that it's exciting to see. It's exciting to see so many smart people building and whenever you have a congregation of smart, passionate people building, there's always good things that come out on the other end. So maybe, I'll conclude on that note.
Brian (35:26):
Yeah, no, I couldn't agree more from where I sit, develop a relationship. It's invigorating energy here. Anyone who is at Break Point, you probably didn't even sleep, because there's just so many people who are just in the builder mentality who love this space. And it's really awesome to see you guys leading the charge on the mobile front in this space as well.
(35:45):
Well Boris, this is really great. Thank you so much for coming on the show. Where can people go to learn more about The Peoples Network?
Boris (35:52):
HelloHelium.com
Brian (35:53):
HelloHelium.com. All right. Well thanks again for coming on. Boris Renski, the GM of Cellular Wireless at Nova Labs.
Boris (36:00):
Thanks Brian.
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