#535 Wouter Witvoet on Decentralized Finance

Wouter Witvoet is the CEO at DeFi Technologies (NEO. DEFI) and previously founded SecFi. In this conversation, we discuss decentralized finance, why he launched a public company, investing in Sovryn, NFTs, current adoption cycle, the legacy system, and what happens next. ======================= Polymarket is the world’s leading information markets platform where you can trade on the most pressing global questions. Choose from a variety of markets to trade: Will Trump launch a new social media platform? Will NFT trading volume continue to skyrocket? With over 100 million dollars traded in the last 6 months, Polymarket is the go-to platform to trade on the odds of future events. Think you know more than the market? Trade on your beliefs and earn a return if you’re right. Want tomorrow’s news today? Use Polymarket to see real-time data on what the market thinks will happen. No fake news, no pundits without skin in the game. So, head over to polymarket.com and make an account today with the referral code “Pomp.” Every Monday until May 10th, you can win $500 by participating in the #PolyWhale Twitter giveaway. Click on the link for more info: polymarket.co/PolyWhale ======================= Exodus is an absolute game changer in the crypto wallet space, and we’ve teamed up to offer an exclusive discount for you, as listeners of the podcast. Sign up for Exodus today using my promo code Exodus.com/pomp. This is a no brainer for both newcomers and crypto heavyweights - go sign up today. ======================= With 10M+ users, Crypto.com is the easiest place to buy, and sell 100+ cryptocurrencies. The Crypto.com Visa Card gives you up to 8% back instantly, and 100% back on Spotify and Netflix. Also, Crypto.com lets you earn up to 8.5% p.a. on BTC, and 14% p.a. on stablecoins. Get $25 when you download the Crypto.com App with code "pomp". Download the App now: https://crypto.onelink.me/J9Lg/pomppodcast2021 =======================

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02Anthony Pompliano?

  What's up everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Let's kick this thing off. Wouter Witwer is a CEO at Deepi Technologies and previously co-founded SecFi. In this conversation, we discuss decentralized finance, why he launched a public company, investing in sovereign, NFTs, current adoption cycle, the legacy system, and what happens next. I really enjoyed this conversation with Wouter, and I hope you do as well. Before we get into this episode, though, I want to quickly talk to you about our sponsors. First up is Polymarket, the world's leading information markets platform, where you can trade on the most pressing global questions.

• 0:45Anthony Pompliano?

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• 1:30Anthony Pompliano?

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• 2:54Anthony Pompliano?

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• 3:36Anthony Pompliano?

  You can go in the description, use the code there and go get that Visa card. All right, that's it. Let's get into this episode with Luder. I hope you enjoy this one.

• 3:45Speaker 01

  Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions of Morgan Creek Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only.

• 4:16Anthony Pompliano?

  All right, guys. Bang, bang. I've got Wuder here with me. Thank you so much for doing this.

• 4:20Speaker 02

  Yeah, thank you so much for having me, Anthony. Really excited to be on.

• 4:24Anthony Pompliano?

  All right, so I'm gonna cheat. We're gonna start off with a bang. If all of DeFi and decentralized financial applications, regardless of where they get built, if it all works, what does the world of finance look like? Like, what is the dream of all of this?

• 4:38Speaker 02

  So where I got so excited is, you know, my previous company that I built, SecFi, which some of you will know, which raised a lot of money, $700 million in total, but in a completely centralized, you know, finance environment with all the transaction costs involved, including, you know, Swift wires that cost me 50, 50 bucks to make. I need to wait for Fedwire cutoff dates sometimes when we do options financing, like all these inefficiencies that we see in a centralized finance market. In a future where DeFi just drives a lot of these processes, I see a much more sort of frictionless environment where even, you know, you, me, Anthony, we can, we can trade our shares if we want without a broker intermediary custodian for which we need to pay all these fees and many of these other implications that we see. That just gets me so excited just based on the world that I'm coming from.

• 5:26Speaker 02

  And I think that's really what, you know, what I see as sort of, you know, the real future, future looks like, if you ask me.

• 5:34Anthony Pompliano?

  For sure. And so when we start talking about decentralized applications, is this something where you're thinking, hey, an entirely new world is going to get built and it's going to basically be the challengers and it's going to be exclusive of the legacy players? Or do you see a world where those legacy players eventually are going to come in and they're going to say, hey, we have to adopt the decentralized applications and kind of play in this new world because that's where all the value is going to flow?

• 6:02Speaker 02

  So I think you have always two camps, right? You have the, the sort of, the sort of crypto or DeFi purist that say, you know, DeFi will revolutionize the world of finance. It will completely replace the existing system. I'm more of the camp that say, yes, some, some applications, you know, might be sort of completely replaced, but we also have to be realistic, like governments are not. And still you have organizations even such as the SEC that are increasingly looking at like, hey, how can these technology developments be a benefit for us? How can we sort of help the the market sort of regulate this and adopt this? And I would say that, you know, the decentralized technology can actually really also help centralized institutions or institutions that we have today just be more efficient, you know,

• 6:45Speaker 02

  reduce their cost of operating business and therefore in the end reduce the cost that it that it costs consumers to access those products. And I think we will see there therefore like a blend where these technologies can also help, you know, some of the products that we see today in the market.

• 7:01Anthony Pompliano?

  Yeah, and it's fascinating talking to you about this because you've built a very successful kind of centralized financial application, right? And a product and a company. And so talk a little bit just about kind of the cognitive dissonance there, right? You you were very successful building the centralized entity. Now you're spending most of your time in the decentralized world. Is it something where you're basically saying there's a binary winner take all system? Or do you think that actually that centralized world will also still kind of coexist? Maybe it's not as popular, maybe it doesn't kind of die right away. But, you know, there is some value still left there.

• 7:35Speaker 02

  Yeah, absolutely. You know, what we built at SecFi for those that sort of don't know that are tuning in. We we kind of pioneered the concept of providing financing based on private company assets. So we we helped a lot of people in the early days of Huber exercise their stock options, got them to finance and to pay for the taxes and so on and so forth. But what we had to sort of develop from a central, you know, central finance point of view is we need to make sure that, you know, the the shares can't go anywhere where we when we have to finance. And so we need to find sort of a custodian solution. We need to make sure that we have production around in terms of the financing. So at onshore funds, offshore funds, all kinds of legal that sort of had to sort of all address this.

• 8:17Speaker 02

  And the reason I got excited about DeFi is when I was speaking to my co-founder at the time, Olivier Rossi Newton, who co-founded Hive, is like if I had to do SecFi all over again, there would be so many different instances where I could actually leverage. Or or a smart contracts to to make that entire process more more efficient. So I don't think it's a winner takes all market. I think we will, you know, I'm also very excited to see, you know, applications that will live a little bit on the edge of centralized finance and DeFi, because sometimes you it it you still require some kind of authority, even in decentralized applications that, you know, that that brings some governance to the table effectively. And I think, um, yeah, that's where we see we'll see a lot of innovation happening for sure.

• 9:03Anthony Pompliano?

  Yeah. So let's talk about uh DeFi Technologies. I'm an advisor to the company. Uh, you and Olivier came together uh and started this. Let's talk about just the impetus for the idea, right? You're at SecFi, uh, you guys decided you're gonna do this. What is the um uh kind of original idea? Why do it?

• 9:20Speaker 02

  So when Olivier started Hive four years ago, um, he had a very simple uh sort of thesis of why this company would work. You know, now we can go on Coinbase, which went public today and probably see a very uh amazing tribute where people can pretty easily buy Bitcoin. If you look four years ago, there's people still scrambling, where do I go? Which parties do I trust? There was still a lot of hacks at the time. Now a lot of these platforms have matured. But what he, in the end, and this is the genius behind what he did with Hive, he said to people, okay, look, you want to get exposure to crypto, exposure to Bitcoin, Ethereum, just buy my stock. Now we're in an environment where we've had Bitcoin, we've had Ethereum, smart contracts. We had a little bit of the ICO rage, uh cra- craziness that had that happened.

• 10:04Speaker 02

  But now we have an evolution of technologies that, you know, um are all around DeFi and have all these new sort of opportunities with them, whether you're talking about yield farming, staking, liquidity pools, et cetera, um, that have all been developed, but increasingly complicated. Like I have a computer science degree. It take me, it takes even me a long time to make some of these trades. So coming back to what Olivier did, what DeFi Technologies really is, is like, look, you want to get exposure to DeFi in a diversified fashion? Just buy our stock. So we're giving retail investors basically exposure and also institutions to what I think is the next wave of financial innovation that is happening, um, and bringing that to the public markets.

• 10:45Anthony Pompliano?

  For sure. And walk through a little bit in terms of just the way that you get a company like this into the public market and then how you capitalize it.

• 10:54Speaker 02

  Yeah, so we, um, so the way that we sort of got it into the market is we started DeFi as a private company. We found like a really good public company to, uh, to work with in the Canadian market. So we, we kind of like took, took over that company, um, uh, with, with our, with our company, DeFi Holdings, and then effectively did an uplisting to the NEO, which is tier one exchange in Canada as a, as a sort of superior, uh, corporate governance, where especially if you want to sort of attract institutions. And, and how you capitalize it is we, we really focused on, you know, we have had a couple of different assets already that we, that we know we wanted to build out. So one of them is, uh, we have an ETN business, you know, where we create, uh, where we basically allow people to, to, to buy

• 11:39Speaker 02

  exposure to DeFi in, in their brokerage accounts, you know, just like you have a great scale Bitcoin Trust and Ethereum Trust. We effectively have now, uh, developed the first Bitcoin Zero, Ethereum Zero, coming out with some of the, uh, some of the protocols that, uh, that are on DeFi, such as Ave, Synthetic Curve, and et cetera. And for that, of course, you need, you need, you need capital to sort of run that. So we did a private placement, uh, in, in, in the quarter one of this year of a $10 million Canadian, and we'll expect to sort of, uh, you know, capitalize a bit of business going forward as well.

• 12:11Anthony Pompliano?

  For sure. And as you kind of think through this, uh, this is a whole new sector, right? I think a lot of people don't understand that.

• 12:17Speaker 02

  Right.

• 12:17Anthony Pompliano?

  Uh, just because you understand finance doesn't mean you necessarily understand decentralized finance and a lot of what's happening there.

• 12:22Speaker 02

  That's right.

• 12:23Anthony Pompliano?

  Uh, talk to us about just what you're seeing kind of on the ground and in the trenches, right? So, uh, there's lots of activity. People are really excited, but what are you actually seeing being built and where is the adoption occurring of these products?

• 12:35Speaker 02

  Yeah, I think, I think a really big adoption also when I, just empirically, like, if I just look at my network and stuff and how people sort of transact, you see a real, really big adoption happening, for example, on stablecoins, right? So you have, of course, we have USDC, we have USDT, but you also have new protocols such as Frax, which are sort of more sort of algorithmic stablecoins. And you just see Now that those things are becoming more stable, the SEC came out with some with some really positive guidance around stable coins. You you see that people are now increasingly more just accepting that they can wire USDC to each other rather than making a bank wire. And I think that that's frictionless payment sort of system system that is happening on the blockchain. I think that's one of the things I am super excited about.

• 13:19Speaker 02

  And where you see a lot of, I think, you know, good innovation happening is, for example, the price discovery on Coinbase that is happening. Was already public on FTX, for example, right? So Coinbase shares were already traded, I think, for about three to three to six months on, for example, FTX, where people were, you know, doing price discovery and it seems to be pretty close to where it's going to open open today. I think other areas where we see a lot of like innovation, of course, happening is is in a is is one of the key use cases is lending, right? So you have anywhere from Aveda Curve, there's there's a lot of stuff, stuff happening there. And it's it's kind of very interesting to follow sort of where that where that will go.

• 13:59Speaker 02

  But these are kind of the three sort of main areas that I that I that I'm tracking and that sort of I'm following and I'm excited about.

• 14:06Anthony Pompliano?

  For sure. And so when you think about the team, walk us through kind of who makes up the team today? And then how you guys are thinking about adding people in the future?

• 14:15Speaker 02

  Yeah, we have, we have a pretty distributed diverse team. So maybe just talking around like what what we do. So so we have, of course, our our ETN business. So we acquired an asset that Olivia and I also built the last three years called Velor Structured Products. We have, we have an amazing CEO in place that called Diana Bix, who used to head up HSBC Innovation. And also their their sort of crypto crypto division and a lot of the the things that HSBC did in that market. So she is she's running that business for us together with Yoan Buttonstrom, which is the one of the founders of CoinShares, which also went public recently. So has the wealth of knowledge on the on the kind of the trading side.

• 14:57Speaker 02

  We have another trading desk in Tzuk, Switzerland, where we had most of our trading happen, some some seasoned professionals from from. And the likes and and who sort of oversee that business. Then on our our venture side, so as you may have seen, we invested, of course, in Sovereign, which we're super happy to sort of join. And we have an entire team in on the West Coast that kind of sources all those deals. And that's really great, right? Because for public markets investors, especially retail investors, they're just not going to have exposure to this kind of deal flow, right? You know, you also know probably it's really concentrated in the 1% of the 1% that kind of sees the best deals and is able to evaluate them. And we do that for users, for our customers, so that, you know,

• 15:40Speaker 02

  we provide them early access to this, to this. And then we have, you know, of course, my co-founder Olivier Rossi Newton, who is who founded High Blockchain Technologies, is one of the most traded companies in in Canada, pretty much every day, one of the most liquid. So he has a lot of wealth, wealth of experience in kind of the Canadian capital markets and kind of also growing a public company. And that's kind of the sort of, I would say, like, the main, the main team. And then we have also an amazing guy Curtis on board, who does all of our marketing and kind of helps to sort of build the brand. And, you know, we're just launching a new website and and oversees all of that. So that's, that's kind of like how everything comes together. And you ask about hiring, yeah, we're definitely looking to hire on the ETM business, you know?

• 16:25Speaker 02

  So if I can plug that, I will plug that any day, you know, traders or or on the tech side always need help there. So so that's kind of where we're really looking to expand coming coming a few months.

• 16:36Anthony Pompliano?

  For sure. And so talk a little bit about this idea of, hey, there's one stock somebody can buy, they can get exposure to kind of multiple businesses within this kind of subsector, really, of the crypto industry. When you talk to investors, what's kind of the pros of having that single stock to buy? And then what are the risks or the downside?

• 16:57Speaker 02

  Yeah, I think the pros, I would really compare it to like investing in Coinbase, right? So if you're investing in Coinbase, even though of course we're not a hundred billion dollar market cap company yet. But if you could just compare it on sort of the investment thesis is, you know, Coinbase will make money. Whether it's really Bitcoin that's going up or whether it's AVE or something else. They just, if you invest in Coinbase, you're probably taking a long-term, a long-term, long position on actually where crypto is going and how that company is performing. So I think for, for investors, we're really good in, in that kind of concept, right? Whether people buy our ETNs in AVE or in Synthetix or Curve or, or any kind of other, it doesn't really matter. Like we make money of course on, on kind of the products that we offer. And same thing goes for some, for the other products that I mentioned before.

• 17:42Speaker 02

  So that's really the advantage that you can take a more sort of diversified view. And that's really good for people that don't want to, that don't fully understand maybe like what kind of exposure to buy in DeFi. And the downside is of course, is that you probably, if you really understand, let's say Frax or you really understand Synthetix or AVE. And, and you know, you could of course have superior returns by simply buying that one, you know, that one token or that one protocol that you, that you really like. So that's kind of one of the downsides, right? A more diversified approach also means that you have, you know, a sort of dampened return on some of the outliers. That's kind of like what I would say.

• 18:25Anthony Pompliano?

  Yeah, it makes a ton of sense. It also, I think part of this like holding company strategy, if you, if I can call it that, is you get both investments plus operating businesses as well, right? And I think that's part of, you know, I first started talking to you guys about it. What becomes really interesting for somebody like me is like, one, I get to learn a bunch that's going on. But two is you have the, the direct capital exposure, but also even in a bull or bear market, you've got these operating businesses that, that should perform as well. And so it's a, it's a kind of a very unique, unique structure. Let's talk a little bit about NFTs. It seems like everyone is talking about that every day right now. What are you guys doing there? What are you personally interested in? And then kind of how do you see that industry as it continues to evolve?

• 19:10Speaker 02

  Yeah, so so personally, like, I'm super bullish on the entire space. I think that when you when you look at, so I'm I'm actually by, you know, when I was sixteen, I was actually a professional professional gamer, and I still remember that, you know, you have, you know, what always made the rounds is like, who had the coolest wallpapers, right? And it's always being showed around. And it's all these people that do the onimes. And and there is a real market for these type of digital assets. And I think it is beyond what people believe there to exist, right? There, I think there that market is actually bigger than people that people think. But there, you know, up until now, there's not really a way to, you know, reward these reward these creators, right? We've also seen the entire sort of meme wave where there is a real, there's a real like want of people like, I want to have that meme because that's the coolest meme.

• 19:55Speaker 02

  And there's this entire community, which I think people are overlooking, that that creates value. And this is not really so different if you compare it to maybe, and I mean that not without disrespect, with disrespect or something, old money that wants to have this fan go in their house, you know, or wants to have a certain Monet or something else. It's just a different way of doing things. And a new sort of the new millennials and stuff, the new generation is much more, you know, open to how art is being created. And I think that is a fluid concept. So from that perspective, I'm super bullish on the industry. I think it will have this natural, this is a market that will naturally have its like sort of ups, and then it will cut people will kind of see where it settles.

• 20:37Speaker 02

  I think that will definitely happen. Like, I tried to, you know, I tried to be funny and tried to buy an NFT for a friend of mine, and I couldn't find something under like eighteen hundred dollars or something. So and so that was kind of something that I cut very short. And it's something from a DeFi perspective that we're looking at as well. So we're we're not really in the in the in the business of of trading, you know, these NFTs. I don't think that's our expertise, but we would be looking at like interesting assets that we can, you know, potentially collaborate with, fund, take a minority or majority position in, in order to, you know, grow the sort of, yeah, exposure that we can give our users to what is what is essentially also a decentralized market. So yeah, that's how we're looking at it.

• 21:20Anthony Pompliano?

  Got it. And so when you start thinking about, let's take NFTs as an example, it seems like it's a very global market, right? This is not just a Western finance market. Talk a little bit about just what you're seeing across the globe. If there's specific, you know, maybe geographies that you're really excited about, or if there's conversations that you've had with people around the world. Any kind of learnings or takeaways for people on that like kind of global perspective?

• 21:45Speaker 02

  Well, what I think, what I think is, what I think is interesting from a global perspective is that, you know, I'm a big fan of, you know, some, some, a few Japanese artists, for example. And if I want to buy, you know, on Artsey, for example, I've been looking for a really long time for specific, you know, pieces of art that I would like to, to buy from this artist. And they are like, they're, they're prints, you know, but there's a limited edition prints. And where I'm going with this is that a lot of these prints are being sold in China. You know, and, and the thing is there, you don't really know, like if it's real, you know, or if it's maybe a counterfeit, or there's a lot of things happening there. And I think what makes it so interesting from a global perspective is that NFT can really bring with it sort of a provenance.

• 22:26Speaker 02

  For those who don't know it, that you can kind of like trace, you know, from, from who it owns today, all the way back to its owner. So in a, in a traditional painting, you, you could all go in a Van Gogh, you could go to like the museum that currently holds it, all the way to when Van Gogh actually painted it, for example. That needs to be there, otherwise your, you know, your painting is not considered real or, or genuine in, in most cases. And what is interesting, you know, for the NFTs is that I can just trace what the provenance is. I can see it on the blockchain. So from a global perspective, I think it really broadens your mind in terms of like buying, you know, NFT art from very, for example, China or Japan, or, you know, French art that is owned by a Chinese person, where you may consider like it might be fraud in a traditional world,

• 23:10Speaker 02

  but now I can actually trace it and look at it. So I think that makes this world of art much more global and much more interesting and inclusive. That's why I'm on it.

• 23:19Anthony Pompliano?

  Yeah, no, I think that makes a ton of sense. And so let's go back to this idea of there's a new world and then kind of an old world, right? And those aren't necessarily completely descriptive, but we'll use them just for the conversation. And so if we start thinking about like the analog legacy world, it seems like some of those organizations have woken up, right? The reason why Goldman Sachs has been around for a century is because they navigated every technology trend as it's popped up and become a threat. And they figure out how to how to kind of do it. Are there specific things that you think in D5, regardless of where it's being built, that will naturally be the first entry points for some of these legacy organizations? Is it decentralized lending? Is it no, they're just going to go trade on decentralized exchanges? Like, how do you think they kind of interface with a lot of this new technology first?

• 24:05Speaker 02

  Yeah, it's a very good question. And I think, you know, organizations such as you mentioned, like Goldman Sachs and stuff. And this is not really based on my conversation with Goldman or any of these institutions. But if I if I were to look at this, I would probably look at, okay, what are my operational processes in my own business? And how can I make those more efficient, right? So for example, you know, Ripple, maybe to use them as an example, like in the backend and some of these processes, whether it's Visa or Mastercard, or some of the others that they have in kind of their, you know, sort of network, if you will. They're already using what is essentially blockchain technology to make their own internal processes either more efficient or more transparent or just safer, right? Because everything is sort of built on the blockchain.

• 24:50Speaker 02

  So I think where you see the, you know, sort of low hanging fruit is probably going to be those solutions. I think if you look at really like decentralized lending, I think institutions will will need some time in order to really become the major liquidity providers. I think currently it's still like high net worth, maybe family offices at the maximum that is kind of in this space. It's a lot of individuals. I think we'll, you know, there's there's stuff that needs to be answered around also KYC, right? Who is the other party AML? And I think there's a lot of interesting things happening there. For example, with Shift Network, where we invested, that is kind of addressing some of these things.

• 25:27Speaker 02

  Before that, we would see real adoption there, but that's kind of like how I see maybe some of the paths there to to to to adoption in the more traditional sense.

• 25:35Anthony Pompliano?

  Yeah. And what's so fascinating to me is the conversation and question around like, do we need the legacy institutions, right? If the legacy institutions never come in, can this be successful? And can it kind of stand on its own without any of their support or participation?

• 25:50Speaker 02

  Yeah, I think again, it's like, it's like, you know, it's a gun. Where's sort of the real future and what's sort of the middle, you know, where are we, where are we today? And I think, you know, DeFi went, of course, from about 500 million two years ago to now 52 billion dollar market cap. But the same thing is, is like, which is amazing if, you know, that's your market cap of maybe Uber when it went public or something. But if you look at the global financial market, I mean, we're talking about a different animal, right? We're talking about trillions and trillions, trillions of dollar. If you just look at the, you know, the US, their stimulus, latest stimulus package, that's 1.9 billion. But it's still like a drop in the water if you look at like what the global financial system is. So the answer there is kind of like, will we need those institutions?

• 26:33Speaker 02

  Well, those institutions are funded typically also a lot by LPs that will have their own cash, right? So maybe it's, it's part of the institutions, maybe part of LP money that will kind of move into this space. But yeah, I do think you need the big, you know, some of the big institutions to also come in. And then we're not talking about 52 billion anymore, which could be a single fund, right? We're looking at multiples of that and seeing that grow like that. And then DeFi needs liquidity, right? That's where a lot of the yield is coming from at the moment. So there's lots of opportunity there.

• 27:03Anthony Pompliano?

  Yeah. One of the most interesting aspects of just all the on-chain applications is this whole idea of transparency of data, right? And the fact that, you know, Coinbase first, let's say Uniswap. Coinbase, we all wait for the financial kind of reveal, right? We wait for the conference call. We're all trying to figure out, you know, what are they doing? And then we basically get this periodic check-in on a quarterly basis. But with a decentralized exchange, we get to see it every day, minute by minute, and we know exactly what's going on. And so it's like, as, as an investor, which one is actually better? Well, I would love the real-time data rather than the kind of static periodic data. And so it just feels like, you know, some of the centralized companies aren't ever going to be able to get there just because of the way that they're built.

• 27:48Anthony Pompliano?

  But the new kind of era or the new industry is going to eventually become the default and the standard.

• 27:54Speaker 02

  That's right. And even if you look at today, right? I mean Coinbase, I mean, the markets were open, I think nine, nine thirty AM. Um, you know Coinbase is, is, you know, supposed to be public, right? But it, it's still at two fifty, at least before, uh, uh, I checked before the call. And that's because it takes some time for these systems to work and the shares to list and, you know, which, and it's, it's, you know, at the end of the day, it's, it, the system works. But if you look at like, you know, let's say that you want to list, uh, you know, you want to list sovereign, you know, which is what we did today. You can do that probably on FTX and it will, it will be listed like, you know, the next second, right? If you, you prepare it properly. So I think, you know, there's a real, and, and that's, I think, what people love in the end. And that's what people get also sometimes, I wouldn't say addicted, but they get addicted to the sort of screens and like playing with the, it's, it's,

• 28:37Speaker 02

  it is, um, it's creating a lot of value for people and, and the information is very helpful for people to, uh, yeah, to, to kind of trade and, and make up their own minds. And so that's, I definitely agree with that.

• 28:47Anthony Pompliano?

  Yeah, I, I, I think it's absolutely fascinating and you can see people, obviously, trading is one thing, uh, but also it just feels like, um, you know, when you have more information, people come with all kinds of crazy stuff to, uh, to participate in. The last thing I want to talk about before we get into rapid fire questions is, uh, virtual worlds. And so, uh, it seems like this is tangentially related, uh, to a lot of the decentralized financial applications that are being built. Uh, but there's concepts like, uh, identity and pseudonymity. Uh, there's things like, hey, I'm going to go and hang out in the metaverse with my avatar. Uh, anything there that you guys are seeing that has kind of caught your eye or that you're paying attention to? Uh, or is it something that you think while tangentially related is just completely outside of the circle of competence? And so you guys focus more on the financial applications?

• 29:31Speaker 02

  Yeah, I mean, I think it's, it's, it's, it's definitely interesting. And also, you know, I have, like I said, I was a gamer before I've lived most of my teenage years there on a virtual world, whether it's World of Warcraft or some of the other things that have played out there. So, to that extent, I can completely relate and see the market there. I think it's less something that we focus on in DeFi, but you do see, for example, um, you just give you one example, an investment we made is in, for example, maps. Right? Which is kind of trying to bridge like where I am right now in the world. So it's a very virtual world, but it's, you know, it's giving you all kinds of information of where you are at the moment and trying to. You know, lay layer on top of that, like augmented reality and those kind of things. But also now DeFi, so they're launching like, for example, um, uh, DeFi applications within maps.

• 30:14Speaker 02

  So depending on where you are, it will offer you decentralized applications that you can interact with. So I think that's a really interesting bridge, like a pure virtual, like when you look at like second life or like the, uh, don't those kind of things we haven't, I haven't really seen. But yeah, if it, if you know, if it comes your way, Anthony, we'd always, you know, look at it, of course, to see if it's interesting for DeFi technologies for sure.

• 30:35Anthony Pompliano?

  I love it. I love it. Um, all right. Uh, what is the number one thing that you've learned? What's your biggest takeaway or lesson over the last couple of months as you guys have gotten this up running and started to scale it?

• 30:46Speaker 02

  Yeah, I think the, the biggest thing is, um, you know, I always learn about how little I know, uh, about DeFi and how mu- how much of the road there's still ahead. And it's just about like, you know, for me also, I tried to learn and I, we, I try a lot of the strategies that my traders recommend. I try them personally and I do them, you know, through uni swap and, and, you know, through some of these other platforms. And I think we're just so at the forefront of, uh, you know, uh, you know, I, I think me sort of fully understanding it and then sort of getting on that, on that learning curve. And I think there's so much still, still ahead and the, the developments go so fast, so quickly. Um, that I think that's what's really exciting and that makes, that makes it also an intellectual challenge for me. So I am, I'm very, uh, much driven by intellectual challenges.

• 31:30Speaker 02

  And I think DeFi is offering that, just like SecFi gave me an intellectual challenge of like, how can I lend against private assets? That, you know, that, that I cannot value on a day by day intra-market trading basis, like how do I do that? And I think the, the DeFi has the same sort of interesting, sort of steep learning curve that I'm fascinated by and that I'm still learning about every day.

• 31:51Anthony Pompliano?

  Yeah, I love it. It makes, uh, makes a ton of sense. Uh, I got three questions, rapid fire, and then you'll get to ask me one to wrap this up. Uh, the first is what is the most important book that you've ever read?

• 32:02Speaker 02

  Wow, that's a very, that's a very good question. So I am like, I am not really like a book reader, but I read a lot. I am, I'm a massive fan of documentaries. And there is, there is a documentary on, on Masterclass, actually, which is one of the best that it's by, it's a Canadian astronaut that talks about like what it takes to get into space. And what he really taught me is that like in space and in space travel, nothing is done by chance. So he's never nervous and he goes and explains like why that's the case. It's because every, every single outcome they have sort of predefined and they know about. And they have sort of, they've, they've thought about and he's done it in his head.

• 32:42Speaker 02

  And what makes me so fascinating is about how calm he can be and how sort of a methodological he can be about here, like his thinking process and how he does that. And I take a lot of learnings, learning from that also when you have complicated problems in, you know, in business or whether it's like, I'm a computer science major when it's, whether it's about like programming sort of problems to really think, apply that methodology to kind of see how you can get to an answer. And that's one of the most fascinating like series that I've seen in a, in a very long time.

• 33:11Anthony Pompliano?

  Yeah, I haven't seen it. I'll have to watch it. It sounds very, very interesting. And I love that you like documentaries because I'm the, the same way. I was just watching White Boy Rick on Netflix, which is the whole Detroit drug dealer that maybe wasn't as big of a deal as they thought he was. Uh, second question comes from our friends over at Eight Sleep. They've got this thermo-regulated bed and essentially I sleep on like an ice cube. And I used to sleep like six of an hours or really five or six hours. Uh, and now I sleep like eight hours a night, completely changed my life and, and makes me much more well rested. What's your sleep schedule? How much do you sleep? How has that changed over the years?

• 33:51Speaker 02

  My, my sleep schedule is terrible. So I have this, I have this brain that I can't shut off. So when I go to bed, the reason I watch so many documentaries is I look for those that, you know, and it's like David Attenborough or Brian Cox or like some of these more intellectual sort of stimulating documentaries. Because at some point they'll make me go to sleep. Um, and I've actually, it's, it's funny you mention it because a friend of mine actually recommended something the same. He has like this sort of, it's like a water bed or it's something that, that makes it cooler. That apparently makes you sleep better. Um, so that's, that's, and he's apparently for my birthday, which is tomorrow. He's apparently sending me one of those, one of those to my hotel. So we'll see.

• 34:29Anthony Pompliano?

  Oh, that's amazing. All right.

• 34:30Speaker 02

  I'll let you know on our next episode.

• 34:34Anthony Pompliano?

  I love it. Last question is aliens. Are you a believer or a non believer?

• 34:41Speaker 02

  That's a very good question. So I think if aliens is around like extraterrestrial life, right? I think you have like what is called like, is it called the Drax equation or something like that, which sort of calculates the probability of there to be, you know, extraterrestrial life. And for me, it's very hard to think that there's nothing out there, you know, especially most of my documentaries are about space, right? So just mathematically, it's very hard to think that there's nothing there. But the problem is, is the mathematical probability that we haven't found anything is also not really helping us, right? We should have by now maybe found something. So there's this constant, you know, it's not going to be a complete answer to your question, but there's constant two voices in my head where one says, you know, there's nothing, but the other says, but there must be something. And I'm still

• 35:26Speaker 02

  struggling to see which one, you know, which one is going to win. It might require some more hours of documentaries.

• 35:31Anthony Pompliano?

  Well, I'm in the camp of like, it's there, we just aren't going to come in contact because it's too far away, right? It's like, like the galaxy is just so big and the technology that we have, it just is nearly impossible to go ahead and come in contact. So we'll see. What one question you have for me?

• 35:50Speaker 02

  Well, I think the one question I would have for you is, you know, you see DeFi, right? I'm gonna stick it to sort of DeFi. You see so many of these different areas developing, right? So we, at DeFi, we, DeFi Technologies, rather, we track, of course, prediction markets like lending, stablecoins and stuff. And you asked me that question, kind of where I see that market. But I would be interested to get your perspective, like where do you really see the applications developing, right? So really like adoption from users, right? Because there's one thing about like sort of a token going up because there's price dynamics and etc. But where do you really get most excited about real sort of DeFi adoption when we look at real world applications?

• 36:29Anthony Pompliano?

  Yeah, I mean, look, I think that every single thing that is analog is going to become digital, right? The digital versus will be bigger than the analog. And I also think all the decentralized versions of these products can be bigger than the centralized versions. And so it's pretty incredible when you start to think about, you know, just kind of where where the world is headed is like digital decentralized products end up being the most valuable things. And so obviously decentralized financial applications are going to accrue tons of value. And so, you know, I'm probably less tribal about like, where do they get built, right? If you kind of think about sovereign being built on Bitcoin, if you think about like a Uniswap or Aave or whatever being built elsewhere, like it it just ends up being this really interesting thing of like, I think the the technology

• 37:14Anthony Pompliano?

  community is arguing over and debating where exactly this stuff all happens. But to the average user, like, they're never going to know or care, right? Like, in the final version, it's just going to be, hey, does this work or not? Can I do what I want to do or not? And so I tend to spend more time thinking about that more so than like, you know, what's the transaction speed of a specific blockchain or anything like that?

• 37:38Speaker 02

  Right. And maybe the one follow up question, if I may, is then because you have this natural thing where I'm still struggling to see how it will evolve. Like, let's say, for example, you need a mortgage for your house, right? A house is not something we can ever make digital, right? But do you do you foresee that we, you know, that that eventually will also happen in a decentralized fashion? Or do you think we are far away from those kind of like bridges between us, you know, centralized world effectively and a decentralized world? How do you how do you see that kind of timeframe?

• 38:07Anthony Pompliano?

  I think that decentralization is going to be the default. And so there will be bridges, there will be kind of this transition over time. I don't think that you kill the centralized version in totality, right? Like, it will still exist. And there'll be kind of this coexistence. But I do think that it's almost like a weighing machine. Right now, it's like, you know, 99% importance and adoption of centralization and 1% decentralization. Eventually, that'll go to like 80/20, then 50/50, then it'll flip, and it'll go, you know, 75/20, and 25. And then maybe at some point, it gets to like 90/10, right? In favor of decentralization or centralization. But I think that just, you know, the world's not black and white. It's much more gray. And that's kind of how we're transitioning here.

• 38:49Speaker 02

  Yeah, no, I would I would agree with that. Yeah.

• 38:52Anthony Pompliano?

  All right. Where can we send people to find you on the Internet or find out more about DeFi Technologies?

• 38:58Speaker 02

  Yeah, we just launched our our new website. It was completely cleaned up and and kind of up to date. So it's DeFi dot tech. So it's very easy, easy domain name. So that's kind of where you can find more. And then we have a we have a ticker on the Neo exchange in Canada, which is just a ticker DeFi. So that's that's really easy. And in the US, we're on the OTC as RDNAF if people I want to look for it. So those are the two main, I think, for your audiences, the two main tickers. DeFi on the Neo and an RDNAF on the OTC in the US.

• 39:31Anthony Pompliano?

  Awesome, man. You guys did a fantastic job. I'm excited to to be along with the ride.

• 39:37Speaker 02

  Glad to have you work.

• 39:38Anthony Pompliano?

  And we will we'll have to continue to to talk as as you guys continue to belt business.

• 39:44Speaker 02

  Awesome. Thanks for having me, Anthony.