The Future of Blockchain, with Anthony Di Iorio (Co-founder of Ethereum)

Welcome to the Founder Insights podcast from the Founder Institute. I'm Jonathan Grecian, co-founder of the Founder Institute, and on these podcasts we try to bring you useful startup insights from our global network of entrepreneurs and mentors. In this episode, you're going to hear from Anthony Di Iorio, an entrepreneur who has helped launch some of the most influential blockchain services in the world, including Ethereum, Jaxx, and Decentral. The interview you're about to hear was done by Adeo Arasi, who's the CEO of the Founder Institute, and is part of our How to Create an Impactful Company webinar series. Enjoy!

Good morning, good afternoon, and good evening everyone. I'm excited today for a webinar to be exploring the intricacies of blockchain. We're going to be talking with one of the preeminent leaders in the blockchain world, and it's going to be an exciting hour. Hour of content. Now, uh, before we get started, let me introduce myself. My name is Adeo Ressi. I'm CEO of the Founder Institute, and I'm excited to help entrepreneurs all around the world launch their businesses. The Founder Institute has chapters in over 200 cities that help people who have an idea and often a day job to start a company, form a team, build a product, and start to get some customers and early traction. We do that in about 3.5 months. We probably have a location in your city. So if you're interested in learning more, you can go to fi.co. If you're interested in applying, you can go to fi.co/join. And in the off chance we don't have a chapter in your city, You can learn more about opening a chapter at fi.cl/lead. But we're not here to talk about me today. We're here to talk about, uh, really an amazing guy, uh, I would consider a friend, uh, Anthony Di Iorio. He's one of the founders in many ways of the modern blockchain and crypto movements with his work on Ethereum. He's gone further now with his new company Jackson Decentral, and no better person to explain all the things that he's working on than Anthony himself. So let me call Anthony on screen to introduce himself. Anthony, um, tell us a little bit about your background in blockchain and what brings you here today. Anthony, I think your mic may be muted. Is that possible?

Terribly sorry. How's that?

That's way better. I love the fish. Thank you.

I had to get the nicest background I could find. So thanks. And thanks for having me here. And it's been great getting to know you over the last number of months and visiting me up here in Toronto and going down and seeing you. So yeah, definitely consider you a friend. And I think it's just great putting something like this together. And I really appreciate it. So my background in the crypto space began in 2012. I was coming off of a few years of learning about economics and the issues with the housing crisis and the financial crisis in the US. I'm from Canada. I live in Toronto, born and raised here. And I kind of put together a few decades of my life. I was born in '75 and I really got into computers very early on in the early '80s. I was building computers when I was like 8 years old. And then was on BBS boards in the '80s before the internet, and then when the internet came out, I really understood what was happening there and the disruption that the world of information was going to be radically changed by the ability and democratization of information and flow across borders and really open up and see what would happen there. I went to school for business in Toronto, and I've been an entrepreneur since very early on. I worked in the family business from 2000 to 2008, which was sliding patio door manufacturing, always been in the computer space and tech space in my spare time. And growing up, I did sports— hockey, baseball, soccer— but computers was really my thing. In 2012, when I heard about Bitcoin, and coming off studying the Austrian School of Economics, kind of the alternative economic thinking that is practiced in the world today, the Austrian School really opened my eyes to another way of thinking about money and really learning about about sound money and really what money is and how inflation and things that the government do with the way the money works right now really leads to a lot of the issues that we have in our world. So when I heard about Bitcoin, I took my tech background, I took the economics, I took my entrepreneurship, and I understood right away that what we're seeing and what we're going to see is going to be the democratization of value, and it's going to be the ability for people to be in control and be able to to be in control of their lives and become their own banks and not have to rely on a lot of intermediaries and third parties. And so I grasped it right away and I started the Toronto Bitcoin Meetup Group in 2012, looking for a community of like-minded people. And then from there, just things really, really snowballed and a lot of ideas came at me and I ended up meeting Vitalik Buterin, one of my co-founders of Ethereum and the inventor of the idea of Ethereum. At my very first meetup, he showed up and there was about 8 people there. This was in 2012 and started building wallets in 2013. Then we launched Ethereum and did that whole crowdraise and launched that. And since then I've just been continuing on to build interfaces and wallets for the whole ecosystem. Because the wallet I really think is the browser for this technology. It's in tune to what the browser was for the internet. The vault is for the blockchain and decentralized tech movement. So what I do is I build interfaces that empower people to be in control of their lives, to learn that it's possible now to own your identity, to own your communications, to own your information, and that the technologies behind blockchain and cryptocurrencies enable us to and empower us to be in control of our lives. And that's what I'm doing, is trying to build the connections and the interfaces for the everyday people to be able to be in control of their lives.

And that, that's Jaxx, right? That, like, the parent company?

That's Jaxx. My company's called Decentral, and our product is called Jaxx. And Jaxx is that interface that is the wallets for 85 different cryptocurrencies right now. And you've got news in there and portfolios and markets. Kind of like the— we want to be the Chrome of the space. We want to be the browser, but then everything in one space so that my dad has a single place to go to, to start realizing the power of these new decentralized technologies.

So you're doing like 100 Days of Jaxx right now, right? Which is essentially— maybe you could, as part of what you're doing now, tell us what that is because I think it exemplifies a lot of your philosophy and approach.

Definitely. We started off when we launched Jaxx in 2016, the first rendition. We did a thing called 7 Days of Jaxx, which is basically every day there's an announcement. And when you talk about press releases, people say, "Yeah, you shouldn't do more than one every 2 weeks or 3." I'm like, "No, screw that. Let's keep pushing new things every day and showing people that we're going to keep it." And then when it gets to 7 days, we're going to extend it to 14 days. So then we did one that was 30 days, and then we did a 40-day. And now when we launched the new version of Jaxx called Jaxx Liberty, which is something that we just put out over the last few weeks, and it's been something we've been working on the last 3 years. It's like, hey, let's do the 100 days of Jaxx. Let's do 100 days of announcements. So every weekday for the next 100 days, we're either adding a new coin, we're adding a new feature, we're putting out our new desktop version. It's basically every day. And it's not just that, we're also putting out these really cool animated videos as well every day to kind of showcase our partners, showcase all of the different projects that we support. Because we support the entire ecosystem. We're not here to say we're just about Bitcoin or just about Ethereum. Ethereum. We support 85 different projects, all that are looking to disrupt different sectors that blockchain is going to be able to do. So we're supporting the entire ecosystem, looking to find ways to create wins for everybody. We have a network of a couple hundred partnerships that are waiting to get integrated in Jaxx. So it's really bringing people together, unite people, and provide the tools to empower people.

Well, I want to— before we go on to the main agenda, let me do some housekeeping rules because there's a ton of people. Chatting right now. It's like speeding by at the bottom. Okay, so everyone who's here, we're gonna try and get to your questions, and I've seen questions zip by. I have a team that will read your questions, try and pick the ones that we fit in the agenda, slot them in the agenda. So if you have a question, you can demark it as a question or just put question colon and my team will try to get to it, you know, assuming it fits within the agenda. So again, there's a chat area, click on the chat button, type your question, we'll try and get to it. Don't be shy. And I can tell you people are not shy right now. So, uh, we'll be all right.

Now, I just want to mention one thing, Adelio, is if there are people looking to download JAX right now, there's two versions. One, JAX Liberty, and that's the one you're going to want to get right now. That's the newest thing that just came out. So the old one would still show up, but in case you're looking to download it, and it's free, uh, no charge, it's free for anybody to use. And, uh, Jackson 3 is what you would want to download on the App Store, the iOS Store, um, either way. So I just want to make that clear.

So there are hundreds of people here today. My guess is they range from, just given what I know, some people are thinking to go in this space, some people are already in the space, some people who might even be jaded by this space, given some of the questions that I've seen. One thing though, if they have something that they wanted to do a relationship with JAXX, what's the process there? And then we'll go into the agenda. The first topic will be reality versus hype. But how might someone interface with JAXX today who has an offering?

Sure. So we've got our users, so we're, you know, we're We have also partners. So we have integration partners. So partners that provide services that our users would want to use. So examples is we're— we've partnered with a number of exchanges. We've got partnerships with companies like BitPay that does paying invoices with different cryptocurrencies, Coinbase. So we want to create almost an integration marketplace for all the different services that our users would want to be using. And right now a lot of things are on exchanges. We want to provide a a model to broker different exchanges to provide the ability for our users to not have to sign into different exchanges on different sites, but basically right inside of JAXX be able to manage and trade their different cryptocurrencies, but not using us, using our third-party partners. That way we're not dealing with a lot of the regulatory stuff. We pass it all off to our partners. We don't hold on to customer funds, so it's always held by the user. The keys are held by the end user, not us. There's no database that's storing all the different keys. So think of us as a browser, and integration partners that offer services to our users would be the things that we would be working with, the networks of our partners that have different products out there that our users would want to use in the cryptocurrency space.

And they go to your website and request to be integrated, essentially, if they wanted?

Yeah, the best place to go would be Jaxx.io, J-A-X-X dot I-O, and then there's a lot of contact information there to get a hold of us.

The admin can put that in there. Okay, let's go to the agenda here. So reality versus hype, there's been a lot of questions. I mean, these questions are speeding by, but you know, what do you think the biggest misconceptions are today relating to blockchain and crypto? And I know there's some, maybe not everyone understands the subtle differences between the two, but what are some of the big misconceptions that you're seeing?

I think what we're— it's a very technology-focused area. It's very difficult to understand. There's new terms that people have to learn. There's new definitions that have been created over the years that makes things challenging. But what I like to say is that we're moving in from an age of information to an age of value and the ability to move value without needing intermediaries or third parties. So when the internet came along, it radically changed everything with information. The ability for the individual to be able to disseminate information globally, very fast, across borders. Now it's moving into the ability to move value without needing a lot of intermediaries and third parties that we generally have had to trust in every area of our lives, from banks to insurance companies. All these things are going to be radically changed and empower the individual to take more control of their lives. And the emergence of Bitcoin really solved the problem in 2009. And before that, everything digital could be copied. And that's really what was a major breakthrough that I've seen, is that before Bitcoin, any attempts for a digital currency failed due to the fact that you could copy digital things, and you're losing the scarcity and the value and properties of things like money if you can create copies of it. So to have digital assets being able to use for money really wasn't possible before Bitcoin, and that was a major problem. That's opened the doors to a lot of things— the ability to to have something digital, prove ownership of it, be able to send it from one person to another without needing intermediaries or third parties taking cuts or owning it or having it in a centralized way. And the amount of change that's going to create in not just information departments and sectors, but in financial institutions and legal firms and insurance companies. And it really opened the doors to financial disruption with the invention of Bitcoin. And then when we did Ethereum, It even expanded on that to create something called smart contracts that give the ability to have code that executes based on rules and what's been coded to be able to self-execute without needing a lot of the middle layers and a lot of the middlemen and a lot of intermediaries that make things costly, that make things really expensive. So we're going to see a radical disruption similar to the way that the internet disrupted information. These technologies, from blockchain to smart contracts, are going to radically change many, many other sectors that couldn't be done with just the internet alone. So we're starting to see projects emerge that are taking their aim at things like the gaming sector, the real estate market, the insurance market, financial services, all using these new technologies that are opening the doors to amazing new creations and things that will be faster, cheaper, better. Based on technologies that just didn't exist prior to Bitcoin. So I think the biggest misconceptions are that it's going to be something that's going to happen very soon. I think it's things that— it's super— it's difficult to understand and be able to follow what's going on. I have a difficult time. So the thinking that people can just come in and make a ton of money with it is something that generally doesn't happen very easily. But make no mistake, it will radically change everything that you're doing, and it will empower you, and it will lead to things becoming cheaper, better, faster, more choices, empower individuals. So it's going to be the second advent of the internet, I believe, and more important than the internet. And that's something I kind of recognized very early in 2012.

Right, and you were saying that one of the ways that you got into it, because you mentioned earlier that It's confusing. There's all these new terms coming out. So you got into it by starting a meetup, right? And then essentially learning, and that's how you started interfacing with Vitalik and other people in the early Ethereum days. For people that don't know what they're doing in the space, and there are a lot of people that do, but would you recommend they go to meetups and start going to events? Is that a—

Definitely. That's the main thing you can do. If you feel you have a passion for the space and you're really grasping that that's something what's going to come out of this and how you can fit, get your position to be able to utilize what's coming and learn about it. It's really getting out to events and meeting with like-minded passionate people in the space. And you've got to put your time in. You have to really connect, explore, see where potentially you're good at and how you can fit into the space there. And it takes time. And a lot of people think they're just going to come in and they're going to put some money into something that's going to take off. And well, it just, it doesn't quite work that way. A lot of people thought the same thing when the internet started. And if you're not creating value in the space, if you're not doing something that's really going to create better use cases for people, improve people's lives, you got to keep working until you can figure out what that thing is. And I think really getting out to conferences, events, and meetups especially. I think meetups are some of the most powerful things in the world. It's people beyond their 9-to-5 jobs getting out and being passionate and connecting with others. And that's really where ideas flow and things connect and great ideas start from.

And I love that point. So you're basically saying, don't just go in it for the quick, quick dollar, go in it to add value and that's where it comes. Now we got a lot of questions. I wanna ask you one sort of preset question and I'm gonna try and get through as many as possible. So try and answer as quickly as you can.

Wow.

And I have a list, so we're getting to your questions. But one of the things we were going to talk about, so maybe what irks you about the mass media perception of blockchain today?

I try not to let things irk me. I don't think there's any sense in really letting things bother me. I generally don't read the news. Being very, very difficult technology to understand, I think a lot of reporters don't grasp really what's happening. They tend to look for the clickbaity things or things that they want to attach themselves to just because they don't know any better. But it doesn't really irk me. I think people should get out there and do their own research and really tend to not believe most of what you read is what I've learned. And I think it's figuring out where you can get the best information. And if you're getting information from close friends that have been in the space for a long time, or again, getting up to events and meeting and things. I would be very cautious with any type of news that I'm, that I'm reading, and I always take things with a grain of salt. So yeah, I've learned to just discount many things.

Yeah, reporters aren't experts, that's for sure. Okay, so asking, uh, it seems cryptos are good at moving value, but what, in your perspective, do you believe the best way to create value and create communities in the digital economy that's more than speculation?

Yeah, I mean, the speculation is really not the most interesting part of this. It's— we've been now been giving— been given a new technology and tools to, to be able to build new business models, be able to look, I think, beyond the way money has generally been created, which is by having third parties providing a service to individuals. Now that you can be more empowered and remove the need for a lot of intermediaries and third parties, I think there's going to be a lot of new ideas and things coming up that's well beyond speculation. Speculation is part of it. If you're getting into it just for that, you probably won't be around for very long because of the way things go up and down. It's really about saying, how do I improve people's lives? How do I find something I enjoy doing? And for me, it was finally settling on this It's empowerment and recognizing the problems that I'm seeing other companies have with collecting user information and not being able to secure stuff in centralized models, which is something that I've known for years doesn't work very well. So with my company, the models we've figured out is how do we empower people with tools, provide interfaces, connect people, provide partnerships, create wins for everybody, and really create value that improves people's lives is what we focus on, and all in a way that is offering free products that doesn't collect user information doesn't store user funds or have access to user funds, doesn't put things in centralized servers. These are all things and principles that we've had that have worked. So I think it's about finding your own thing and it's about saying, I'm not going to just get into this and just look to be a speculator because it's really not going to provide much value. And I think it's a very short-lived mentality.

So Anthony, a ton of people are asking for specific examples in industry. I see it speeding by. Education, retail, construction. Maybe I'll turn it over to you to say, speculation isn't a great business model. You brought up now things like insurance and some clear fintech examples in your speaking. Any other, like education, any other examples that might be of interest to the audience? Because people are asking for specifics left and right.

Sure. I think there's a number of different examples. There's the gaming space I think is really ramping up and the ability for people to own a digital asset that's unique and can't be duplicated. And you can own a sword that is only one in existence. And things like that are really picking up in the gaming space right now. Real estate, being able to own a piece of a property. So tokenizing real estate and being able to say that I can't afford to buy a house in a major city, but I can afford to buy a piece of a house. So that's in the real estate space. Being able to have more efficiencies in insurance with smart contracts whereby policyholders can be paid instantly based on a contract of weather conditions that happen automatically without needing a lot of middle areas and intermediaries or adjusters in between. Other things where developers are creating contracts that would self-execute based on, let's say, wills, or you have a certain will laid out and according to data coming in that you passed away, your digital assets will be automatically dispersed to different parties that you've set up in your contract to do without needing lawyers, costly lawyers, or the time delays and things like that. A number of different things. There's, there's, there's, there's, and a lot of the things are not even sorted out yet and will be figured out. Just like the internet. There's no way we were thinking the radical change in social media back in the day. In the early '90s, let's say. But then we've seen what's happened with the tools of the internet and what companies have been able to achieve through just the things that they didn't know back then that emerged and ideas came out. And that's where we are. We're at the very early stages where the interfaces are being built out, the infrastructure's being built out. And once that's in place and the everyday people are utilizing the technology without even knowing what they're really doing, they're going to start seeing the advantages that are going to be emerging.

The way you're talking, it seems like you're saying that at some point in the not too distant future, you believe that almost all of the things that you hold in paper today or you have some asset ledger for, maybe an email receipt or something like that, will be moved to the blockchain. As you brought up, pretty much your will, your home, your car, so pretty much everything is going to have a blockchain record and be transferable.

Well, isn't it making sense though? Doesn't it make sense that everything is turning digital? We saw the digitization of information, digitization of value, and the digitization of assets. That's amazing.

And email is a terrible storage mechanism for your receipts, right?

Yeah, and again, it's about the ability to have something digital that can't be duplicated. Duplicated. That's the big thing. If I have a deed to a property and there's— you can make a copy of that deed and give it to someone else, it doesn't make any sense. But if I can prove that, that deed is mine, I own it, and it can't be duplicated, and I have the keys, the digital keys via cryptography, to say that I own this, and I can send it to someone else, but now they have it and I don't have it anymore, it really does open the door to things that couldn't possibly be done before. And that's— it's all about digitization and moving and using decentralized technologies and just an ongoing continuation of the movement to digitize everything.

Well, I want to— we'll come back to that, but we have a lot of regulatory questions that are coming in as well. I mean, we can just go on and on. There are a lot of questions. Great, great, great work, guys. We're going to get to your questions. So on the regulatory front, let's go through some of them. Jenny was asking, do you see new regulations on the horizon to tax tokens for use cases where tokens are earned, used, or exchanged with members but not redeemed for fiat currency. So essentially total virtual taxation.

Yeah, I think right now what we're seeing is governments trying to understand what's happening here. They're trying to understand these are things that have never been made to fit into the general regulatory environments that they created. So, and the technologies are moving so quickly that the regulatory bodies are really having a hard time even defining what these things are. So for example, when Bitcoin came out, a lot of the regulations here in Canada were mentioning Bitcoin. But they didn't— you know, they would call it a digital currency, but they didn't define what a digital currency is. And then Ether came out with Ethereum, and it's not really a digital currency. It's more of a fuel that— it's very— it's moving, it's fluid, and it changes so radically. I think the old models aren't really going to work in the way that governments try to regulate these things. People are doing things more anonymously. They want to do things more privately. And I don't see how the government's going to keep up with the regulatory models that they have in place. I think it requires a new framework or a new way of thinking about it. But until then, they're going to try to tax it the way they've always had and look for opportunities to make even more money based on these. But it's going to be super challenging because, I mean, to even tax things like cash is super difficult. And to be able to do this in a way that they don't even know who's moving what makes it very difficult. So they will try to do it. I'm not sure they're going to be able to.

Well, and then they are trying to block it. So Expedito was asking, how do you think systems will try and block with laws the evolution of blockchain?

So they can try to block it. I don't know how. You can't stop someone from sending a Bitcoin transaction. It's virtually impossible. So I don't know how they're going to try and block these technologies. And if there is a weak point of them being able to do something, innovation is coming that is always one step ahead. So there's coins that are focused just on privacy and creating better privacy because a lot of these ledgers are more transparent. They're visible like Bitcoin and Ethereum. You can see transactions that happen. You don't know necessarily who's behind them. But then there's projects like Monero, there's projects like Zcash that are coming out to solve that problem as they see it. Even creating better privacy that tracking is going to be virtually impossible. So I don't know how that the blocking would be done.

Yeah, I mean, China banned it, right? Uh, but it doesn't seem to have stopped Chinese from participating, though Chinese people are generally afraid of what the government regulates. I mean, did you— do you see that, like, just government saying, hey, don't do it, and people will listen? Or you think it will be largely ignored?

I think on a— only If these governments were independent and they didn't have work in a global system, in a global economy where other countries will embrace and will look to empower their citizens or say, how do we take advantage of these and utilize it in a beneficial way for our, you know, creating new sectors, new jobs, new things? Why don't we embrace instead of maybe trying to be in a fear state or try to control? And places like China that are trying to control, I just think at the end of the day, fear and control doesn't win out. And I think freedom, liberty, uh, choice are all the things that are going to eventually win out down the road. So I'm not— I think they're hurting themselves more than they are helping themselves. And I think over time, the ones that do embrace, recognize that there is opportunities here, are— will be the ones that are eventually going to become global leaders in these technologies, right?

And so governments, um, should probably— I completely agree. I think the governments that are trying to overregulate right now are putting themselves in a long-term disadvantage?

I think they should be— I think that the best thing to do is educate themselves. And I'm always willing to work with government entities and bodies to say, hey, if they want to learn, they want to understand what's really happening here, it can be beneficial. So a lot of times they tend to go to the fear side. It's like, no, this is opportunity here. Just like the internet, this is amazing opportunity here, and you've got to see what potential we have. I don't like the word we, but the potential potentially that country has to to provide better things and utilize these technologies to help and to empower people.

So another question from— I'm going to hopefully get your name right— Yev Henny is talking about regulations. How far do you think privacy can go? Right? Will it be possible to have totally fungible coins? Like, is it Yeah, I mean, the final—

yes, in that sense. How far will privacy go? Well, I think over time, again, it's to me, I look at everything from the lens of freedom. And I think privacy to me is a right. At the end of the day though, some system happens or something, fear is also very powerful. And governments can react a lot of times to fear. So, I think what needs to happen is a tipping point where privacy becomes more important. and we're seeing a movement happening now where people are trying to understand more about, you know, how it's detrimental to give out your information, and it's very difficult to secure information. And we're seeing major companies now that are dealing with the backlash of the models that they're using to monetize and to monetize their users. And I think it's growing, the feeling that, wait a sec, I should be in more control, I should be able to be in control of my information, I should be able to to be in control of my money. And I think the tipping point happening on that, where people realize that's more important than what could potentially happen on the fear side, is something that I hope happens first before any other major events or something that happens where the tipping point hasn't occurred yet. So I'm always hopeful that we'll get to that point first before something happens that could radically slow things down.

Right. Well, I mean, look, Privacy doesn't feel like a right today, right? And I would say, and I'm interested, I mean, it seems like most of the people that I know that are heavily involved in the crypto world take the concept of privacy as a right very seriously. Is that almost like an entry stakes to being in the blockchain and crypto world to take privacy very seriously, or is it kind of you could or could not? I'm interested in your views on that.

So for me, I believe that the most important thing is the individual. I'm not a fan of groups. I'm not a fan of bucketing people together into a thing and saying, hey, there's a we, or that's awesome, we all stand for this. I'm just not a fan of that. I think the individual and uniqueness of individuals is the most important thing. So I really don't like what the people are bucketed into groups. And it's more to me a freedom and mentality of, is what I'm doing here or what we're doing provide more freedom and liberty to me? And to me, privacy is just part of that. And I think and believe that I should be able to have the right to privacy. But I'm also a diplomatic person that sees things on the other side and says, I can understand where there's going to be the double-edged sword as well of the other side of things that say, well, you know, should you have a right to privacy if you're doing X? And I don't think I have a lot of answers to some of these things. And a lot of people do get into the space because of the freedom movement or libertarian movement. And that includes a lot about privacy and being in control of your lives and not saying, I'm going to be part of a cog in the wheel here where I'm going to be told what to do. And I think the mentality of individualism and saying, I'm an individual, I'm going to do great things. I don't want to be put in this bucket of saying I'm a group of people. Is a powerful thing and it does stem, I think, from privacy thinking and freedom thinking.

So Yehuda was asking a question. So we talked about a lot of things that might move to blockchain. Yehuda was asking, what are the limitations of blockchain and maybe examples of any businesses that you don't think would be good to be brought into the world?

Sure. So I think limitations right now, the biggest thing is scalability. It's— these decentralized systems have a limitation and need information to go around the globe very fast. And the infrastructure is not quite there yet that enables a lot of these systems to be scalable to— for the whole world to use. And that's a limitation right now which has impacted the ability for these technologies to make things faster, cheaper, better at this time. Once those problems are solved, I firmly believe you're going to see the massive changes happening in the different sectors that I mentioned. So right now, you always consider these things as beta, that there's problems that need to be solved still that enable— that would enable growth and enable scaling of the technologies. And this is what's being solved now, and I'm confident it will be solved over the next couple of years. And we see a number of projects emerging that are looking to to work on scalability problems from RSK to EOS to Dash. A number of projects that are saying, hey, there's a problem here, let's try and fix that. So limitations are right now with the infrastructure and scaling. In terms of businesses that would be quite useful in this, I think, I think there's going to create change in pretty much every business out there. We'll have some impact in these technologies. I'd like to say that information was for the internet, now everything else that wasn't changed by information is going to be radically changed through not just blockchain, but let's say with cryptography, with smart contracts, with a number of new things that are coming up that aren't just about blockchain necessarily, but new technologies that are emerging. Right.

So even a corner bakery might accept a payment with a digital currency, so you could argue that it touches a corner bakery.

Yeah. Instead of using— maybe they have their own coin or loyalty system, or maybe they're using Bitcoin to accept payments or other technologies and bypassing payments to payment processors or not accepting it. So yeah, I think there's going to be—

I bought a Starbucks coffee with Litecoin the other day, courtesy of a gentleman you and I both know. So I was like, you know, there you go. Starbucks. Okay, so lots of questions. Oh wow, so many. So a bunch of people were asking, you know, like, I'm a UX designer, or I have some blockchain— what— so Cecil was asking, as a UX designer, how blockchain projects would be effective on the UX process, how these projects affect habits and with digital products. So a lot of people are saying like with their expertise, you know, what might happen. So as a UX designer or designer, what might some blockchain opportunities be?

I think there's huge opportunities because it's the interfaces and the designs that haven't been fully baked out yet with these technologies. It's creating something like a wallet like we do. It's to me, it's all about the user experience and it's about the design because it's it's a super complicated system. And you've got things like mining fees that need to be taken into account for in the user design. You've got key systems which you have to explain to people. And so being able to break things down into an interface that is easy to use is something that comes down the road from the initial stages. So when new technologies emerge, you have the hardcore technology people building things, and they're not usually focused on interfaces and design. They're focused on the technologies and the protocols. So what we're seeing now is companies distinguishing themselves by their UX designs and by the interfaces that they're creating. So I think there's tons of opportunity for great UI and UX designers in this space to solve problems, to bring the masses into the technologies, making it simplified.

Because a lot of it's still very technical. And speaking of which, Steven was asking, I work for a moderately sized software development company in Philly. And we have blockchain development capabilities, what do you see as the best path for a business like ours to leverage the blockchain?

So when we say, when I hear blockchain capabilities, it's what level of blockchain capabilities is that? What does that necessarily mean? How long have you been around in the space? How are you understanding how protocol design is? Is it more being able to work with other people's stuff? There's a lot of questions I would have from something like that. I get a lot of people reaching out saying, you know, we've got a lot of developers in blockchain. Well, I'd have to dig in a lot more about what that exactly means. If you have the skills and you have the team that has been in the space for a number of years and understands how many different protocols work, there's tons of business out there to be working with many different types of businesses that are looking to put their foot into the space. But I would need a little more information about what skills they actually have in blockchain to be able to see if what they're doing could have value. Because you have some guys that are saying, "Well, we do websites for blockchain companies." really not blockchain stuff. And a lot of people try to use the word blockchain to entice new business and opportunities really when they don't have the skills needed to really create game-changing things.

So really what you would— maybe the answer is to assess your competency level relative to can you work on protocol-level stuff, interface-level stuff, marketing stuff, and sort of bucket yourself first, and then, you know, because you're right, like, that's a terrible assessment. I can do blockchain. It's like, okay, yeah, like, what in blockchain? That's a big term.

Yeah, yeah.

Um, okay, so then, uh, Michael was asking, if you're a traditional established company, do you see investing intelligently in blockchain technologies as a smart move? And maybe To further Michael's question, what might an established company do so they don't fall behind the ball?

Yeah, so in 2015, it's when really we saw the advent of large companies starting to investigate blockchain. NASDAQ kind of made the first moves and said, hey, we're investigating these technologies and we're going to start putting some teams together to start seeing if there's use cases for us there. And that really started an avalanche of other large companies getting in. I started consulting in 2015 due to the amount of companies, amount of enterprise banks and things that were starting to look at the technologies. And I started consulting for banks and started consulting for companies like Deloitte and the Toronto Stock Exchange. And so I think the most important thing when you're a traditional system or a large enterprise a company is to find someone that's been in the space a number of years that can really take you down a path where you're not spinning your wheels or doing things that aren't going to benefit you. Because there is a learning curve, and the faster you can expedite your knowledge of the space, the more you're going to be able to keep up with it and really be able to see what things you can achieve and what you can't achieve. So I saw a lot of companies carry out a lot of projects that really didn't go anywhere. And I think a lot of it has to do with they didn't have the expertise and guidance of people that have been around for a long time to help guide them through that. A lot of the top people in the space aren't too keen to work with older, with the more traditional companies.

Because they're disrupting them, right?

Well, yeah, I think, I think they, yeah, they're focused on their own things and it's exciting what they do. And you'd have very rare case where you have someone that would want to work for one of these guys and help them along. I'm a little bit different. I did work for them and I felt if people want to see how they can still provide value and move from a traditional business into more of a leaner startup mentality, then I'm all for helping them do that. I was the Chief Digital Officer of the Toronto Stock Exchange on a part-time basis for a number of months, helping guiding them through while I was still focused on my business. So I'm for creating wins and bringing along people that want to learn. So I think the most important thing is education. And trying to see how you can do that at a faster basis and see what projects might emerge and what ideas that might come up. And again, it's also getting out to the meetups, getting out to events, getting your staff up with this stuff because you're already at a disadvantage being such a large entity trying to create change internally. That's super hard to change. But if you don't, you're going to be in a lot of trouble, I believe, down the road.

[Speaker:MICHAEL KRIGSMAN] So that's an opposite to the way they normally work because they normally are like, "We're going to do this," and they're like, "Have a project." Release a new brand, buy, or whatever. And you're saying, no, don't jump headfirst in. Start learning, start discovering, and then go from there. Just out of curiosity, what do you think? Is there any hope? And this relates to another question from Jay, which I'll get to in a second. But is there any hope that these big companies might buy a blockchain or crypto and have a success? Or do you think it's like oil and water and you're never going to get a—

No, I think what these entities have is they have capital. I think what they're lacking is probably the skilled developers and teams that have been in the blockchain space for a while. And what I've seen is a lot of hires or a lot of teams that form inside of the large entities have trouble holding on to their teams and they leave for more startup-focused projects. And it's a big challenge and I've seen it with a number of large, large computer companies. Banks where they just can't hold on to their staff because they're so enticed to work in a more fast-paced environment. And this blockchain is like their way of saying, "This is the last try. This is so much exciting going on here. I can't work for something that's moving so slow." So I think they're going to face some really difficult challenges. And it's being able to purchase companies, I think it would make sense, but you may lose the teams coming in if you're not adapting to the way that they want to operate and work. But I think a lot of companies could be targets for enterprise and financial services and things like that. Yeah.

Yeah, well, that's great. I think it might help legitimize the space, which leads to a question coming up again from Yevgeny, which I hope I pronounce your name right. But Jay's question was, in the blockchain world, is there room for intermediaries to profit? If not, do we see investment Because it's almost ironic, right, that in the traditional tech space, people are like, I'm disintermediating people by becoming an intermediary. And re-intermediate, you know, it's like everyone who's disintermediating people is re-intermediating them.

Yeah, I think it's a slow process. I think you can't go from A to Z very fast. I think you need to gradually work with the models that exist today, which are the third-party models of providing a service. But what I think happens over time is that you get more intermediaries, but things get down to a race towards zero. What I mean by that is, as things become more and more done by technology and replacing a lot of the human factor with things, you're going to start to see a reduction in cost over time. And eventually, the models of making money are going to disintegrate down to zero. I really think that's gonna happen. I think it's gonna be more pure connected things, individual to individual, and you'll be monetizing still based on the way that you're able to have a platform that brings it over, but your costs will be reduced. And eventually you're gonna have razor-thin margins where people are gonna need to think outside the box of how they're gonna make money or how they're gonna still provide value. And an example I saw with those in the gambling space, in cryptocurrencies, in the start, which, you know, I dabbled in 2012, and saw that now within the gaming space, you could prove that the house isn't cheating the player. And once you can prove that, and you know what the house edge is, you have competitors making a better house edge. So if it's going like, let's say, 3 spins out of 100, you get a 3% house edge. Well, the next guy's going to come in with a product of 2.9. Next guy's going to come in with 2.5. Then it's going to get— and it literally gets down to zero. And you start having to think, well, if the ways of making money have always been based on this spread here, and there's no margins now. Well, how do I make money and how do I provide value? And that's where you start thinking outside the box.

Wow.

So I think the way of making money is going to, going to get down to the point where the intermediaries are no longer there. There's no money to be made in that space, but there'll be a lot of choice and value and cheaper for the user. But how else can I compete and what value can I create outside of making money? And that's where we got to really think differently.

That's, that's one of the best I just want everyone to let that sink in for a moment. Imagine a gambling establishment where the house has no edge, and then what models emerge for value creation? That's fascinating. Frankly, just holding the money in an arbitrage, like a bank, right?

I got to the point of trying to solving that. So you could have an insurance model where every time you play, you have to put in a type of insurance. And basically, there's a way for you to— if you lose a lot, you're going to be collecting money on the insurance. But the insurance could be a token that you need to play. So the token, when you put a bet, you're also putting in a value of insurance on a token. So a token also has to be included with every bet. So as you're losing, you're getting this token still. The token has value and the house will buy it back at a discounted rate because you still need the token in order to play. So there's things that you start thinking about beyond the— of providing a fee for charging for a service. So it's when you don't start thinking outside the box, I found, or start thinking this is where it's heading. Well, if that's heading that way, we need to start thinking differently because maybe the way that we make money these days and providing a trust element for individuals is wrong, or it's not going to be around. And how do we still create value and still live? And that's where I think—

Wow, you might have just destroyed the casino industry with like an alternative gambling model where the house has no edge. You know, Vegas, Macau, goodbye.

You've—

Yevgeny's question, hopefully I'm pronouncing your name right. When do you think this early adoption stage will end where, you know, kind of all these things we're talking about are classic early adoption stuff? Is it in the short term or how many years do we have left in this love?

There's a number of factors which could derail things. I talked about the fear of governments and could there be some type of terrorist activity that happens when potentially Bitcoin is used for transactions? Something like this that could happen that could derail it. At least the speed of it happening, but it's going to happen. These technologies can't be put back in the bag. They will radically change everything. So I don't know when it's going to happen. I think the user experiences have to get better. I think the scalability problems need to be solved. I think the movement we're seeing with people questioning why their private information could potentially be leaked and how they're going to control that information, and questioning the business models of companies that collect user information and sell it, and expect that information not to get out there and to be compromised. I think that's just a failed model that's never worked that well, but it's what those companies know, and they haven't necessarily been forced yet to think of other ways to create value, but we're starting to see the heat coming on a lot of these companies. So I think people are pushing, right? Yeah, it's happening. Yeah.

But it's not days or months. The things you talk about like infrastructure speed, collapse of sort of centralized models, this is probably measured in years, but not many years.

But well, look at where we got, how long it's taken to get to where the internet is to where we are today. I mean, the early '90s when it started, it takes time and we're at the equivalent very early on stages, I still believe.

Okay, well, let me— but things are speeding up. I've been asked a question about existential risks.

I move—

we have an ordering of questions here, so I'm moving them around, which was what will happen when quantum computers are able to decrypt our and calculate the keys?

I think we'd have more problems to work on if that was the case, because that would also radically impact every other financial system that also works on very similar key-based systems. So I think it's going beyond what's going to happen with Bitcoin if that were to happen. But I also believe there's technologies that are working on quantum-resistant systems. And I think there's people that say that might be a problem and they're working to try to fix that.

Okay. And then Carlos was asking— so I'm just trying to get as many of these in as possible— and agreed that like there are bigger problems if all the keys are decrypted. Carlos is asking, can blockchain be the backbone of the future digital ID, and what are your thoughts of that?

Digital ID, definitely. I mean, your keys that you have and the ability for you to own those keys— no one else has them, there's no server storing them— could be your identity keys, it could be your, your money, your keys for all your, your assets, it could be the keys for your communications. So yes, these technologies I think will enable people to be their own banks, own their own identities, and own their own communications. And that's what we do with Jaxx. With Jaxx, you get your keys, and those keys and the ability to sign something with those keys that only you have proves who you are. So there's a lot of companies focused on identity systems right now, and yeah, it is, I believe, the future of being able to prove your identity without necessarily needing to expose other personal information.

Isn't that also a vulnerability though?

Yes and no. I think that with these decentralized open systems, the amount of technology and innovation is going to emerge to still enable people to be in full control, but be able to offer services that help further secure things like your money, things like your identity and your communication. So there's things like multisig systems where you could own a You could have 2 out of 3 of the keys. Now, if you lose one, it could be a third party that has one key or one part of your key. He can't do anything with that one key himself, but a combination of him plus your other key enables you to still be in control to get your second key. So there's innovations and there's problems that will be solved to give more choice. And because these systems are open and anybody can build on them, this innovation will happen rather than more of the controlled systems that we see either with government identity systems or financial services.

Well, in theory, you know, biomarkers could be used as keys to that, right? Okay, there's a lot— wow, a lot of good questions here. So I'm like trying to order them, but they're all really good. So Huntington was asking, you know, and again, these are going to be a little random because we're running out of time. What would a company— why would a company spend the time and money to move away from functioning legacy systems that have proven and effective results to one built on blockchain?

So I think that each company would have to make their own investigations. I think not at least learning and trying to get ahead of where things might be in the future would probably be a mistake. I think that when we see hacks happening on centralized systems and we see companies not being able to stop attacks on their data because centralized systems have weaknesses. I think we'll start investigating, you know, ways to avoid— hmm, we could be fined heavily if this information gets out. This information is on centralized servers and maybe decentralized approach could be better whereby we're not going to be fined a lot or we don't have to be at risk of trying to protect something that people want. And instead, we can create a system where you're incentivized to— it would cost— you know, you're incentivized to not just secure it, but you're incentivized to make it in a way that there's no central attack vector point. So a lot of the systems right now are centralized. Yes, they work very well. But with decentralized systems, and I think most of the attack vectors, I think that in the future you will get efficiencies from these technologies that you can't have right now, and you'll see a reduction of the workforce. You're going to start seeing technology making things cheaper for your customers. You're going to have to get on board with these things. If not, you're going to be at a disadvantage.

Disrupted, right? Parul was another good one here. They get better. Some of them are a little dark, but Parul was asking, how do you see venture capital being impacted blockchain? What parameters would they need to consider for evaluating or investing in a blockchain startup? Yeah, I mean, I don't even know, like, yeah, I'll let you take that one.

I have some thoughts. You're the expert. We're seeing the democratization of venture capital. We're seeing the average everyday person being able to put something into these ICOs or put something into a project, crowdsourcing the projects. And I think we saw the democratization of information. Now it's democratization of venture capital. When we started Ethereum, we were able to collect $18 million from 9,000 participants all around the world who funded the launch of Ethereum, which we did a year later. And they were able to have a piece of that. So it's something that you wouldn't traditionally be able to see. So it democratized the amount of ability for an everyday person to be able to say, I believe in this and I'm going to take the risk and I'm going to be able to potentially get the gains from this. So I think it's going to radically change, and we're seeing a number of VCs getting into token sales, and so it's going to create a radical change, I believe.

So I mean, in many ways, you know, venture capital's being disrupted. So thinking of the role of the venture capital and taking the fees and everything like that, it's inverting the model because it's letting the sort of quote-unquote LPs run the shop. A little dark here, Gabriella was asking, if I die, what happens to my cryptocurrency?

Well, it depends. If you set things up that potentially you've got a loved one that you can also give a set of the keys to, or write down your keys and have it in a safety deposit box, and then maybe your executor under your will, would have access to the box and you could set it up like that. So it's about how you prepare and how you plan for it. And it would be up to you to ensure that someone that you would love would have access should something happen to yourself.

Is that the best practice though? Like put it in a safety deposit box and give that—

People have different, different ways. People, some people say they don't trust the banks. Put it somewhere safe, put it somewhere safe. Potentially give a copy of your keys to someone that you, that you really trust. and maybe that's the way to do it. You have to trust— I would say you'd have to trust somebody in that aspect. You could also potentially have a smart contract that's moving the funds automatically to a loved one once— but then it's who executes that. So the best thing I think right now would be able to write down your 12 words or write down your keys and have it somewhere that— or give it to someone else that you would trust. You would then need that trust element.

Right. But a lot of the whole blockchain world and crypto world is based on trust, right? At the end of the day.

A lot of it's still trusting mathematics and not necessarily trusting individuals. So, example with the gambling thing, the reason why provably fair gaming came about and the ability to prove the house isn't cheating is because there was a recognition that you don't know what the house is doing. You don't know if they're cheating. So it said that's not good enough for the blockchain space, for the cryptocurrency. We need things that are provable. We need things that we don't have to trust individuals. We want to trust math. We want to trust technology instead. So yes, there's an element of trust. You're trusting code. You're trusting the ability to see what the code does, and you're trusting what other people believe in and have trust in it rather than the whims of individuals. It's really what that movement's about.

Wow. So I want to let you go where you want to go here. We got all different kinds of questions about businesses or tech.

Stuff.

Do you have a preference on which?

No, I just keep firing away. Happy to get into it.

All right, I'll keep firing away. I find this one interesting. You know, what are the challenges and opportunities for blockchain in developing countries at the moment? Because I know with hundreds of people online, they're coming from all around the world. What are your thoughts there?

There's like billions of people don't have access to the financial services that we take for granted every day. And I think the ability for developing countries to recognize they have an opportunity to bypass a lot of traditional legacy systems and go directly into these new technologies without having to worry about the fight or pushback from a lot of the incumbents. So like was done with mobile phones and the bypassing of landlines in a lot of Africa and other areas, I think the ability now to go straight into these new systems without the fight of powerful entities that don't exist in the financial services because they're just not offered right now in a lot of developing countries. So I think they have the ability to understand, educate, and then create new systems without dealing with a lot of the backlash that might be happening from the incumbents.

Right, so that's called leapfrogging, right? Where they could have installed landlines, but instead they did mobile.

Exactly.

So here's a pretty technical question from Nick, which is: The rub on blockchain is the amount of time it may take to validate the block. For systems that have a time-critical element, what is your vision on improving performance for block validation?

We've seen a lot of improvements. We've seen Bitcoin that takes, you know, it's 10 minutes there roughly. And then we've seen things like Ethereum that every 15 seconds you're getting a value. So over the years, the technologies have improved and generally we're getting much shorter times and those problems are being solved by a number of different projects.

So you see innovation happening there. And then, you know, obviously Kind of a basic question from Cynthia, which is, what are some of the resources that you recommend to start learning about blockchain? So earlier we had discussed going to meetups, going to events. We have a Founder Institute chapter starting in Toronto with a blockchain track. What are some other things you would say to read?

There's a couple good books that I recommend. There's Blockchain Revolution, The Business Blockchain. Those are good starting points, I think, for the average person to want to grasp in a non-technical fashion. For those that are a little more advanced, maybe there's Mastering Bitcoin, Mastering Ethereum that Andreas Antonopoulos has put out. There's not a plethora of good holistic resources for the entire space. A lot of focus on specific individual projects, and you'll see a lot of stuff on Bitcoin. I do think getting out to events and really connecting with individuals is probably the best way to do it. You have the organizers of meetups that are generally great resources if you have one in your area. And getting out there and really just connecting with and networking with people I find the best way.

And I love your earlier point, like, don't come in it with this speculative mindset per se. Come in it with a sense of how you can add value. Which I thought was a great insight earlier. We'll get through a couple more questions here. Xanthi was at— again, I hope I pronounced your name right— what the impact of blockchain will be to the 1%-99% wealth divide. Will it have any impact, and if so, how might that be positive?

I'll go back again to the empowerment and being able to empower and provide things to individuals. No matter where you are, there's no permission systems in things like Bitcoin and Ethereum. Anybody can participate. You don't have to be onboarded. You don't need to have something in your local area that you need to register to do. You basically are saying it's a permissionless system that anybody can take and participate in. And I think that's super important for a lot of the 99% that don't have access to these things. And I think it's going to force maybe a lot of the 1%ers who aren't creating a lot of value and aren't recognizing that these technologies will radically change businesses that they're in. So they've got opportunities to adjust, but at the end of the day, I think it's a very democratizing, powerful technology that will lead to more empowerment and more individual rights and freedoms.

And before the last question, Pete was saying, like, so if I'm an entrepreneur and I'm looking for opportunities, right, for blockchain disruption, what might I do? And we talked about one of the reasons we did this Founder Institute track in Toronto was because entrepreneurs often pick kind of dumb things to do first in the blockchain space. So what might be some guidance for someone like Pete to not do those dumb things?

Yeah, it's really— there's a learning curve, and the faster you can expedite that learning curve and recognize why maybe doing an ATM business, Bitcoin ATM, it doesn't make sense. Or why people have tried these things and they haven't worked. Or why the low-hanging fruit of maybe getting merchants to start accepting Bitcoin, which a lot of people do off the bat, it doesn't make any sense because it's difficult to set up equipment inside. There's a lot of these things which you can expedite and not waste time doing that others have done. So this is where it's important, I think, getting out to events and seeing what others have done and just just immersing yourself in these and, and teaming up with people or being able to connect with people that have been there for years. I've been in the space 6 years and I can pretty easily identify what's, what works, what doesn't work, why they don't work. And I've seen pretty much everything that's happened in the space of— and, and if you could help a new person get through that hurdle and get to a point where they can create true value in what they're planning to do, I think is, is something to shoot for.

So I, you know, Candidly, I came in pretty bullish on blockchain already because I've— for a variety of reasons, and I'm leaving the talk today more bullish than before. So I think that's good. And a couple of things. Your casino analogy really blew my mind of like the house has no vig. I was like, whoa, that's interesting. But also when I saw all the different things, you're right that all these digital assets are going to be moving. To decentralized formats. That's also a no-brainer because it's stupid to keep receipts, receipts in a file cabinet, right? That's also vulnerable and dumb. But, you know, so I'm coming out pretty enthused. So any final closing tips for aspiring entrepreneurs or others to take advantage of this upcoming decentralization that's happening?

Again, I think I pretty much covered the What you should do if you're really into this space, you're passionate about it, it's going to take a lot of time and effort and you got a lot of learning to do. So think about what you can utilize of your own skills and how they might translate to this new technology. If you're really good at math, you're really good at finance, look for ways there that you can take those skills and translate it into an interest into how they will impact blockchain and see what other people are doing in that space. So I think it's about translating what you're good at and trying to find a way that you can create value in doing so that's going to improve people's lives.

And can I just take that and clarify one thing there? So a lot of these companies working in blockchain today have essentially decentralized teams. So it might be one way after you go out to the events, etc., is raise your hand and say, can I help somehow to an up-and-coming startup? And participate. I mean, would you recommend that as a possible step?

Yeah, I mean, if you're at events and you've got something to connect with other people, you're going to find someone with a good idea and you're going to say, "Hey, well, I've got the option. I can do this." And it's about then you're forming teams and you're moving forward with an idea. So yeah, as much as you can do to network, as much as you can do to come forward and connect with people. That's how I did it. I mean, when I— my initial partner when I started building wallets back in the day, it was basically came in through Reddit. And he was a developer that really appreciated the space and he was looking for someone with business ideas and that was me and we connected and this has led to a lot of the great things that I've done through that networking connection. And then same thing with the meetups and meeting Vitalik and others in there. It's just, if you can form a community, if it's not there, or you can join a community if there's one already there, you're gonna just, the ideas flowing and the passion and getting people together and create some cool things.

Well, listen, this was lovely, Anthony. So for everyone out there, Number one, if you haven't done so and you, and you need a wallet app or you want to see what Anthony's working on, uh, there are multiple versions, but he's recommended to look at Jaxx, J-A-X-X, Liberty, uh, in iOS and Android, as well as you can look at it online. And for anyone interested in starting a blockchain-based technology business, you can go to fi.co /Join/Blockchain. All those links are in the chat. And this was great, man. Thank you very much for your time. And we had many hundreds of people. So, and I'm sorry if we didn't get to your question. Maybe we can do this again and get to everyone's question next time. So this was awesome.

Thanks for having me on. Thanks for all the great questions. I really enjoyed it. Yeah.

Thanks, everyone. Take care and have a lovely, lovely morning, afternoon, and evening.

Bye, everyone. Thanks for listening to the Founder Insights Podcast. If you want to learn more, check out fi.co/podcast or sign up for our newsletter at fi.co/subscribe. Thanks.