#966 Dmitry Shklovsky and Dan van der Merwe On Building Infrastructure In Crypto

Dmitry Shklovsky is the Co-Founder of Quicknode and Dan van der Merwe is the Co-Founder of Icy. Tools In this conversation, I talk to Dmitry and Dan about Quicknode's acquisition of Icy. Tools, the connectivity needed to various blockchains, how Icy. Tools' product helps give people more insight to the NFT market, and how both companies hope to build a stronger infrastructure in the Crypto space. ======================= LMAX Digital - the market-leading solution for institutional crypto trading & custodial services - offers clients a regulated, transparent and secure trading environment, together with the deepest pool of crypto liquidity. LMAX Digital is also a primary price discovery venue, streaming real-time market data to the industry’s leading analytics platforms. LMAX Digital - secure, liquid, trusted. Learn more at LMAXdigital.com/pomp ======================= The Pod Pro Cover by Eight Sleep is the most advanced solution on the market for thermoregulation. It pairs dynamic cooling and heating with biometric tracking. Go to https://www.eightsleep.com/Pomp to check out the Pod Pro Cover and save $150 at checkout. Eight Sleep currently ships within the USA, Canada, and the UK. ======================= The world's 2nd largest crypto exchange, OKEx, has dropped the "E" to become OKX, reflecting its evolution from a traditional crypto exchange to a comprehensive, cross-platform crypto services provider. With OKX's decentralized platform and Web3 wallet, MetaX, you have full custody over your crypto. Explore DeFi, NFTs and play-to-earning gaming with the world's most powerful crypto exchange. Visit OKX.com to learn more. =======================

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. Now let's kick this thing off. Dimitri from QuickNode and Dan from IC Tools joined me in this episode and we had a great time. We talked all about building infrastructure in the crypto industry, the connectivity needed to various blockchains, IC Tools product, helping people better understand what's going on in the NFT market, and the recent acquisition from QuickNode of IC Tools. I really enjoyed this conversation with Dimitri and Dan, and I hope you guys enjoy it as well. Before we get into this episode though, I first want to talk about our sponsors. First up is LMAX Digital, the number one institutional crypto exchange. They offer clients the deepest pool of crypto liquidity on the planet, underscored by 100% uptime

• 0:46Anthony Pompliano?

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• 2:10Anthony Pompliano?

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• 2:54Anthony Pompliano?

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• 3:16Speaker 01

  Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only.

• 3:39Anthony Pompliano?

  To get started, we've got Dimitri and Dan from QuickNode and IcyTools. How are both of you guys doing?

• 3:45Speaker 02

  Doing fantastic, Anthony. How are you?

• 3:47Anthony Pompliano?

  I'm doing great. I'm super excited to talk to you guys. I want to start out first, maybe Dimitri with you, in terms of QuickNode, which I'm an investor in, so I'm cheating here because I do know the answers of my first question. You guys provide a lot of infrastructure and connectivity to various blockchains or different products in the space. Walk us through just like, what are you seeing right now in the industry, given that prices are coming down? Does that mean developers are leaving? Does that mean that activity on these products are going down? Or are you still seeing kind of persistent acceleration across the ecosystem?

• 4:20Speaker 02

  Persistent acceleration and given that we went through these cycles before in like 2017, 2018, this is when the build happens. This is when people stop focusing so much on the price and really get down and start building with all these great tools that have been developed over the past several months, several years. We've seen that transition, you know, from said 17 and 18 and 19 and now you have much more user-friendly apps, richer apps with much more functionality. It just, it's a, it creates a leap in maturity in the space and we're, we're seeing still record high numbers. There's more users than ever. There's more users than ever using our platform and especially in these volatile

• 5:04Speaker 02

  moments, you have the wallets and the DEXs and all the professional traders and the pro users, they're using the services more than ever. Like this is their opportunity. So it's still really, really exciting and continues to be exciting to, to be a part of this scene and to see it accelerate and to help build the future of, of the internet.

• 5:22Anthony Pompliano?

  So when you think about Quicknode itself, obviously there's a whole bunch of various kind of end users that you have. Who are the people who are kind of the power users, right? People who want that connectivity. And I always describe Quicknode as kind of exactly what Amazon's AWS does for traditional computing. You guys provide a lot of that same connectivity infrastructure for kind of the Bitcoin crypto ecosystems. Walk me through like who are the power users?

• 5:49Speaker 02

  Yeah, absolutely. So you have, you know, on one side of the spectrum, you have the developers, which are, you know, your one to three person teams, you know, maybe they have some traction. Somewhere in the middle, you have the funded, the funded projects, which have maybe raised the seed round, maybe an A round. And then on the other, on the other spectrum, you have your, your enterprise customers, which are sometimes these, these legacy businesses that are exploring Web three and, and things like NFTs. And then in between, you have these pro users like professional traders.

• 6:25Speaker 02

  People who are running scripts, arbitrage scripts, and most recently, NFT professionals, like NFT purchasing, NFT sniping. So we're seeing kind of what was happening with DeFi like a year, a year and a half ago was happening in the NFT space where it's actually quite lucrative to spot an NFT buy in the mempool and use Quicknode's advanced mempool service for that, and then try to execute a trade with, on the NFT market.

• 6:53Anthony Pompliano?

  So when you start to look at this, walk us through maybe, where are you seeing most of the activity? Are there one or two platforms that are getting kind of outsized activity in this market downturn?

• 7:05Speaker 02

  So, NFTs are definitely front, front and center, and that plays into, you know, our partnership with Icy Tools, is that there's just so much potential with NFTs. First, it was tokens and tokenization, and there are tools for that, but right now, you have companies like Adobe, like Twitter, like G2 Esports, like the biggest names in the space are looking to do stuff in the NFT world. So that's where we're seeing most traffic.

• 7:39Anthony Pompliano?

  Got it. And then Dan, walk us through Icy Tools in terms of what you guys have actually built here.

• 7:45Speaker 03

  Yeah, sure. So with Icy Tools, we have basically two parts of the business. The first and foremost, we have our NFT data analytics platform. So essentially, as Dmitry kind of alluded to, a lot of traders will use our platform to kind of see, like, what are the trending collections? Where's the volume? What are the accurate price floors of certain things? And so, lots of like NFT day traders, just NFT like hodlers as well. Use our platform. And on the second kind of side of it, and this is where we're going to tie in really well with QuickNode is we've also been building on a developer API with our data.

• 8:26Speaker 03

  Basically, trying to surface our data to help people build more in the NFT space, whether it's trading or any other app. That's where we are now.

• 8:35Anthony Pompliano?

  Got it. And one of the things that I find so fascinating, both about infrastructure and also kind of data tools, is that it's for the bulls and the bears, right? One of the things that I've always said to folks is like, there's plenty of people in one community and they're like, oh, those other tools or that other infrastructure is not good or it isn't sustainable. And then they'll use those tools or those data providers to try to make that case. And they'll say, hey, I need to understand whether prices are up or if they're down, if I want to trade or I want to even go short, et cetera. And so it feels like a lot of what you're doing is saying, hey, look, we have the technology to hook into these communities, pull in this data, help to kind of organize it, visualize it, and then allow people to do whatever they want with the data, regardless of kind of their market position, if you will.

• 9:20Speaker 03

  Yeah, exactly. And, you know, we're seeing that a lot right now, obviously, with market downturns, people react differently. NFT space with the trading is, you know, is different from the building spaces. Dimitri said, people are going to keep building right now and our API tools and things like that are going to be super useful. In the trading space, we're seeing like, you know, lots of different behaviors, like there's still lots of volume being traded. It's definitely gone down, but people are certainly using the tools to, you know, to figure out what to do. And obviously, when there's a bear, there's also plenty of new opportunities that people are finding.

• 9:58Anthony Pompliano?

  For sure. And Dan, what's like maybe one or two of the most surprising things that you've seen over the last, you know, call it four months or so? Is there like one or two data points that stick out in your mind of like, you know, most people think the narrative is A, but actually the the data says B?

• 10:12Speaker 03

  It's a good question. I think in general, the NFT trading market is still. Trying to solidify, you see lots of ups and downs, like December was really good. January was really good, then it dips back down. The start of May was really good and then it dipped back down. So I think it's starting, it's still maturing to find, you know, the actual proper patterns. I think one interesting thing is, is we've seen a lot of the NFT market perform really well when the general crypto market performs poorly. And that's like an interesting insight. It's gone a little bit, not so much in this current market.

• 10:53Speaker 03

  I think a lot of, in the beginning, actually, as things were happening last week, the NFT market was actually holding quite well. But I think as people started to get, you know, pretty scared, the NFT market also took a hit. So that's an interesting one that's played through. Not so much through like the worst of this current market, though.

• 11:15Anthony Pompliano?

  Got it. And then, Demetrius, talk to me a little bit about in terms of buying and partnering with IC Tools as part of this acquisition. How exactly do these two products fit together and how do you see this improving the user experience for your customers?

• 11:29Speaker 02

  Yeah, awesome. So we did a Twitter Spaces last week where we talked with Dan and Blake and Jose. And so like the story started out where, you know, IC Tools was a customer of Quicknode and we did a case study on them. And we kept in touch closely as we do with all our customers because we have a build with us mentality. You know, we're always looking at, you know, what are the use cases? How are you using our platform and what can we build for you? And so we started this conversation and we realized our roadmaps were very, very similar. And so, you know, we, some of our team members knew each other from before, like years before. And so we started exploring this world where, you know, IC and Quicknode joined forces into building a, you know,

• 12:14Speaker 02

  the most powerful NFT API and developer tools platform in the world. And so this is where it's going right now, where we, you know, we, we basically, we get nine web three, super sharp, hyper-focused developers and marketers and the IC team who can help, you know,

• 12:35Speaker 02

  Build these these next generation tools, bringing their NFT experience, bringing their expertise in in the NFT space, and also being like super, super talented developers and just helping accelerate NFT tool building. And and our stories are are quite similar, where we first build our products to solve a problem for ourselves, then we made a customer facing so that other people were were loving the product, started building. And then kind of not now just like iterating on top on top of one thing and another. But it's it's just about combining forces and building the best possible products to help

• 13:18Speaker 02

  grow the the web three ecosystem and and the blockchain ecosystem.

• 13:22Anthony Pompliano?

  Got it. And so when you see this, how much of kind of the QuickNode, you know, product roadmap, if you will, is to continue to either build or partner with various products to build kind of an all in one solution for many of these developers, where it's infrastructure and data all in one place? Or is this just kind of a more of a one off thing in the NFT space, but it's not necessarily a strategy that you'll pursue in other parts of the industry?

• 13:45Speaker 02

  Oh, we definitely, we definitely see it going more more in this direction, whereas, you know, once you have super, super powerful base layer, which is this infrastructure, you can you can extract the data and then you can manipulate that data like with GraphQL and write your own queries. There's an unlimited unlimited possibilities there, like what what if what if you can build like build your own wallet and have provide API tools on top of that, or or build and any variety of tools which which are being built on on top of QuickNode today. But but often make that customer facing with really, really powerful tools and and APIs, so they can build even better versions.

• 14:27Speaker 02

  Because we know we can't build absolutely everything. But if we offer the tools and put it out there, there are some very, very talented people that will be able to to build something really, really great.

• 14:38Anthony Pompliano?

  Got it. And then, Dan, when you start to think of kind of the product that you all have built, what are some of the features that you're thinking about that can really kind of help your customers or help build out kind of the the ability for them to be informed about the market or various kind of nuances or turns in the market?

• 14:54Speaker 03

  Yeah, I think there's a lot of places that we want to go. One interesting one that Dimitri actually pointed out that Partnership with Quicknode can help with is like Mempool. Like they already do a lot of stuff in Mempool. IC doesn't do anything with Mempool right now. Once we integrate that, that will provide some excellent insight for our users. In addition to that, we're trying to go like a lot deeper into portfolio stuff, like looking into insights into what you have, your portfolio over time. Also alerting, trying to get, you know, that ties into the Mempool as well. Let people know exactly when things are happening down to the second. And also our partnership with Quicknode helps with that as well in terms of having the

• 15:37Speaker 03

  absolute fastest nodes to get this information as quick as possible. Yeah, I really just sort of delve down, also maybe get into some ML, machine learning kind of stuff to really pick apart the data even more.

• 15:52Anthony Pompliano?

  Talk to that a little bit more in terms of how would you use machine learning? And maybe walk people through in the audience in terms of how machine learning can be either predictive or you can uncover maybe some of the insights that that just the human eye would would miss. And I see you smirking, so that must mean that that's a good, that's a good thing that you're working on.

• 16:12Speaker 03

  Yeah, well, the smirk is a lot like I'm, I'm not a machine learning expert. But yeah, I think, you know, we're, we're trying to find, basically, we have all this data that we've collected and it's like large amounts of data. And essentially, we want to draw, you know, pick data points and figure out conclusions based on those of like, you know, for example, is X collection going to pop off based on what it's doing? And and kind of that's what ML allows you to do is essentially find these correlations and connections in the data that the human eye ordinarily couldn't. And basically help people have an edge with that over anyone else who's just looking at charts.

• 16:55Anthony Pompliano?

  Got it. And then Dmitry, how do you think about using some of that technology? Is it something where you can actually kind of port it over between the products? Or is it more of a kind of vertically contained use of machine learning?

• 17:07Speaker 02

  I'm not an ML expert myself. And any way that we can help developers and businesses make sense of data and make actionable data available quickly, that is, that is kind of.

• 17:23Speaker 02

  Our mission there is to provide the tools and the base layer foundation to allow anyone really, whether like you said, bedroom developer or Fortune 1000 business to build high quality web three applications.

• 17:40Anthony Pompliano?

  Got it. And what I want to do is I also want to throw out a couple of topics and either one of you guys can take it and kind of walk us through how you're thinking about it. So the first is infrastructure. Obviously, we've seen the liquid prices of various assets across the industry draw down significantly as we get kind of macro, you know, challenges. We also see risk assets, stocks, et cetera, all going down. What are you seeing when it comes to equity based companies in the private market and then also infrastructure type companies? Are you feeling any of kind of that market change or does it still pretty strong and not as much of an impact?

• 18:15Speaker 02

  Yeah, I can take this one. You know, with Quicknode being more of a technology business, not so much like a crypto, so we're not strongly tied to the price action. As I mentioned earlier, the price action actually causes more activity on our network and being as our business model is request based. So we charge a subscription and we also count usage. So more people are using our platform during these volatile times than ever. And a lot of times, these lower prices incentivizes people to get into the market. So when they see these lower prices, it actually creates a really good buying opportunity for those

• 18:57Speaker 02

  who may be who are priced out earlier and allows them to get into the market, get, start playing around with web three technologies. Or perhaps, you know, the pattern we've been seeing is making a jump from quote unquote like a web two company into a web three company and apply all their knowledge and experience to build something new that hasn't been done before and hasn't really been possible before because blockchain technology has never progressed this far.

• 19:27Anthony Pompliano?

  Got it. And then when you guys think of the NFT market, where are we? Are we in like inning one? Are we, okay, now we've got some, some ways that this stuff works and like there's a playbook that people can go and implement. Are we at the finish line? Like, how do you think about kind of where we are in the development of a vertical within this larger industry?

• 19:45Speaker 03

  Yeah, I can, I can take that one. I think, I would say, yeah, inning one, inning two, like, super early days. I think currently, the biggest use case we see is the JPEG art market, right? That's where most of the volume's around. That's where most of the talk is around. But everyone in the industry knows that NFTs are a lot more useful in other areas like, you know, as ticketing systems for deeds, titles, all these kinds of things, like authentication. And I think, you know, what we're trying to do with IC and Quicknode as well, together, is build the infrastructure that allows these second, third, fourth, fifth innings to, to come faster.

• 20:28Speaker 03

  And I think that's what's super exciting. And, you know, as Demetrius said, I think we're gonna see a lot of people building, especially people transitioning from Web 2 to Web 3. And we want to be there for them and allow these future use cases that everyone, you know, pretty much agrees are gonna happen, to happen a little bit faster.

• 20:47Anthony Pompliano?

  Got it. And then when you guys think about talent in the industry, where are you seeing people join your companies? Are they coming from other crypto companies? Are they brand new graduates? Are they coming from Wall Street and finance? Are they coming from the large tech companies? Like, where is the talent coming from?

• 21:04Speaker 02

  Absolutely, across the board. I mean, we've had engineers from, from AWS, from the top cloud companies. We even have a Golang engineer from Lockheed Martin. It's, it's incredible how many people got inspired and want to be a part of this journey.

• 21:25Speaker 02

  You know, it's, it's something, you know, it's one of those opportunities that comes around every decade or two, where you can build something brand, brand new and something that has massive upside and momentum. And so it's, it's not any one particular spot. It's really all, all across all industries that are, that are making the jump into Web 3.

• 21:46Anthony Pompliano?

  Got it. And then I guess I'll ask each of you, what is your view or vision for the next three to five years in the industry? Like, what does this look like, let's say, five years from now?

• 21:56Speaker 02

  So we've seen the cycle. Like, if you look back at 2017, 2018, there was this massive call a bubble, but, you know, things were, there were token drops happening every single day, and some of them weren't exactly legit. But it does take, you know, this maturity, let's call it a correction. But we do see maturity in the market. We're going to see applications become more

• 22:22Speaker 02

  with better user experiences, with more mainstream adoption, you know, as you have bigger players coming in and the mainstream companies applying their methods and leveraging their resources and experience into building super, super high-quality applications. And, you know, with the tools provided by companies like Quicknode and IC, you are really able to build stuff today that you weren't able to build three or four years ago. So it's just this progression, and it's a flywheel that we're enabling, and other people, other tools, and other companies in the space are enabling to really just drive the entire industry forward.

• 23:03Anthony Pompliano?

  And then Dan, what about you?

• 23:05Speaker 03

  Yeah, I pretty much agree with that. I think every time that we have a market correction, we're left with more than we had the previous time, right? And so, you know, the last two years or so, we've had all these new things get built. We've had T5 Summer, we've had the Summer of NFTs, and a lot of great products have come out of that, you know. Through all these corrections, some are going to fail, but the ones that are strong are going to remain. And I think as we get closer to three, four, or five years from now, sure, there might be more corrections, but I think every single time, we're going to have more good stuff and more technology infrastructure that's been built that allows, I think, those corrections to get smaller and smaller as the industry matures.

• 23:48Anthony Pompliano?

  Where can we send people to find you guys on the internet? If they want to find out more about QuickNote or IC tools, where should we send them?

• 23:54Speaker 02

  Sure, quicknote.com or twitter.com/quicknote.

• 23:59Speaker 02

  We have an excellent guide section. So if you're just looking to get into Web 3, or you just want to learn more, it's quickno.com/guides, which is an excellent resource for anyone looking to get into Web 3.

• 24:13Anthony Pompliano?

  Dan?

• 24:14Speaker 03

  Yeah, likewise ic-tools and our Twitter is ic underscore tools. You can find us in both places, or you can also hop in our Discord, which the link is on our website.

• 24:26Anthony Pompliano?

  Awesome. I appreciate.

• 24:27Speaker 02

  Discord.

• 24:30Anthony Pompliano?

  I appreciate both of you guys coming on. And as you guys continue to build out various products for developers, both on the data side and the infrastructure side, I think that you will have a front row seat to seeing, you know, what's working, what's not working, and where value is accruing. So I appreciate you guys coming on, and we'll definitely have to do it again in the future.

• 24:47Speaker 03

  Yeah.

• 24:47Speaker 02

  Thank you, Anthony. Always a pleasure.

• 24:49Anthony Pompliano?

  All right. Talk soon, guys. Thanks so much for listening to today's episode. I really hope you guys enjoyed this one. Make sure you subscribe on Apple, Spotify, or your favorite podcast player. And if you're looking to try to transition to get a new job in the Bitcoin or crypto industry, we've got you covered. Head over to pompscryptocourse.com. We've developed a curriculum with the top teams across the industry. It's a three-week intensive training program with over 50 events packed into that three-week time period. Go to pompscryptocourse.com to learn more, and I'll meet you guys for the next episode.