Simon Yu, CEO & Co-Founder of Storm: The 3 Year Outlook on Crypto

Simon Yu is the CEO & Co-Founder of Storm. In this conversation, Simon and Anthony Pompliano discuss cryptocurrency adoption, incentives, and where crypto is headed over the next few years. ----- Curious about Cryptocurrency but don’t know where to begin? Storm Play is a free and fun way to start earning in exchange for you time. Simply download, register and discover microtasks that meet your interests and be rewarded with Storm Bolts. These Bolts can then be converted and withdrawn into your favorite cryptocurrency, including Storm Token, Ethereum (ETH) and Bitcoin (BTC.). Earn cryptocurrency rewards by playing new games and trying out cool products! Download the app to start earning crypto here! https://bit.ly/30pSxh9 (Available for iOS and Android). ----- If you enjoyed this conversation, share it with your colleagues & friends, rate, review, and subscribe. This podcast is presented by BlockWorks Group. For exclusive content and events that provide insights into the crypto and blockchain space, visit them at:https://www.blockworksgroup.io

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

• 0:01Anthony Pompliano?

  What's up everyone, this is Anthony Pompliano. Most of you know me as Pomp. You're listening to Off the Chain, simply the best podcast in crypto. Let's kick this thing off.

• 0:13Speaker 01

  Simon Yu is the co-founder and CEO of Storm. In this conversation, we discuss cryptocurrency adoption, incentives, and where crypto is headed over the next few years. I really enjoyed this conversation, and I hope you do as well.

• 0:30Anthony Pompliano?

  Are you curious about cryptocurrency, and you don't know where to begin? You can use Storm Play, a free and fun way to start earning in exchange for your time. That's right, you don't necessarily have to make a financial investment to begin. You can simply download, register, and then discover these microtasks that they present you that meet your interest, and then you're rewarded with these Storm Bolts. The Bolts are then converted and can be withdrawn into your favorite cryptocurrency, including the Storm Token, Ethereum, or my favorite Bitcoin. If you go and download the Storm Play app today, you can earn cryptocurrency rewards by playing new games and trying out cool new products. It's worth a try, and it's a great way to get started. Remember, go check out Storm Play in the App Store today.

• 1:10Speaker 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.

• 1:36Anthony Pompliano?

  Alright guys, bang bang. I'm here with Simon. Super excited to have you come on, so thanks for taking the time to do this.

• 1:44Speaker 02

  Yeah, thanks Pomp. I'm really excited to be here.

• 1:46Anthony Pompliano?

  For sure. Alright, let's just jump right into your background. You've got a pretty wild backstory here, so let's start at the beginning and see how you got to StormX.

• 1:55Speaker 02

  Yeah, so we started, you know, Storm formerly known as Tacos back in 2014. So, you know, part of my entrepreneurial journey started when I was 19, when my parents went bankrupt, so I was forced to drop out of college. And I was working full-time as a bank teller, and I didn't have enough money to pay for rent, so I decided to sell Korean tacos. Korean barbecue is pretty good, and make tacos and deliver to students around my college at University of Washington. And it, you know, did well eventually and I was able to go back to school with some scholarships. Uh, graduate and my first job out of college, um, I was an underwriter for a bank and I also started this food truck.

• 2:38Speaker 02

  And so, you know, while I was at the bank, um, a lot of articles started coming out, um, Bitcoin because of Mount Gox and Silk Road. And it's all for the wrong reasons about how it's money laundering or drug smuggling, but, um, you know, I, I, I was really fascinated. So when I looked into it, um, I noticed how it could start disrupting, uh, fees and how we send money and value to people anywhere across the world. And so I, I just needed to get in and I happened to meet my co-founder, um, who's building this app that, you know, paid very small amounts of Bitcoin, uh, to users who watch short video. Uh, so this is around two thousand, you know, fourteen, fifteen. And in the beginning, I, I thought this app was really, uh, you know, ridiculous because you're like, I thought who's gonna use this app

• 3:23Speaker 02

  that, um, pays you two tenths of a penny. Uh, but surprisingly, it was growing really quickly. Um, well, monthly, I, I think growth at the time was like almost in triple digits in certain months. And so I thought there was something there. Um, and one of the things that excited people was that people were really excited about Bitcoin. But not a lot of people had the risk appetite to go and risk their money and buying it from an exchange because it tanks so much after the Mount Gox incident. And so we were one of those ways that rewarded, you know, uh, an easy way for users to try Bitcoin. And I think this time around, especially after the bear market, it's interesting how this cycle came back.

• 4:03Speaker 02

  Um, but that's sort of how we started and we realized that, um, you know, you can send microtransactions to people across the world for essentially, you know, very small fees, which was never possible before. And this is really interesting. And so, you know, we started, um, a bootstrap for a while because, you know, investors didn't really want to, um, touch Bitcoin because they thought it was, you know, like the money laundering, drug smuggling. So we bootstrapped and, and the end of two thousand sixteen, uh, we were able to secure an angel right on from the CEO of Bitrex and several others. And we built this, uh, product that eventually allowed users to directly connect with, uh, different products and services.

• 4:45Speaker 02

  So think like, you know, you wanna try out Uber for the first time. Um, right now Uber is paying. You know, Google or Facebook for someone clicking on their advertisement, but it's more valuable for them to actually have users that actually try the product. And so, you know, a part of blockchain is connecting two parties together, and we were able to do so. And once we built this feature out in February 2017, we had this huge growth in terms of, you know, both revenue and user base. And in the summer of 2017, we were able to build, we were able to raise a seed round from Ari Paul, Anthony, and a couple of others, and continue this momentum. But we ultimately decided to tokenize because Bitcoin and Ethereum,

• 5:30Speaker 02

  we just had so much trouble with scaling. And this because, you know, right now, we have, I think, over two and a half million people that have downloaded and earned through our app.

• 5:41Speaker 02

  But, you know, Ethereum transactions can only process about, you know, 20 per second, and that's just very limiting. So when Bitcoin transactions went from zero to 50 cents, all of a sudden, you know, to send out $7,000 worth of payments a week, it would have cost us $10,000. And so we ran into this really dire situation. And then so we had to pivot to Ethereum. But then Ethereum also had the same issue when, all of a sudden, it went up from 10 to $430, and the gas fees just became really expensive. And so to facilitate microtransactions, it just, it was just very difficult with the current status of the blockchain. And so we decided to create our own hybrid solution.

• 6:24Speaker 02

  So we use a combination of what we call Bolts and Storm Token. And we have this batching solution that we reward users once a week. And because of this, we're able to send very small amounts of people just really efficiently. And, you know, the next step, what we're really looking at right now is, you know, people really enjoy earning through our app. It's easy, and cryptocurrency allows you to be able to just set up an account without having a bank account. You can just set up a wallet to earn. And so we can essentially target almost every country in the world. And that to us is really fascinating. And our goal is to try to expand the number of offers or jobs or tasks in our platform

• 7:09Speaker 02

  so that users can earn more and make it more impactful towards their daily life in terms of, you know, how much money that it can provide for them.

• 7:20Speaker 03

  So let's go back for a second, right? When you first started looking at the cryptocurrency space, like what was the original idea that you wanted to go after?

• 7:30Speaker 02

  Yeah, I mean, for us was, we really saw this huge opportunity in really the payment space. So you know, you have like companies like Ripple trying to disrupt the banking industry. But for us was, you know, look at how people are earning money right now. And, you know, when I look at some of these sites like TaskRabbit, it's very fascinating because personally, having struggled financially during college, I was online trying to find like side gigs that I can do while I was going to school. Because like, one of the reasons I started the food truck business was because, you know, I just didn't have enough money from my day job. And the bank teller job just didn't pay me enough.

• 8:16Speaker 02

  And it was also very hard to be a part-time student while working because they wouldn't let me take times off or, you know, taking a final or going to classes. And so I need something more flexible. But at that time, you know, like Uber and Airbnb or some of these side gigs didn't exist. But then if you look at TaskRabbit, right? So like, somebody can stand in a line for like two hours and earn $25 to $30 an hour. And, you know, there's people, especially in Seattle, there's a lot of people working at Amazon warehouses. And some of these guys can be better off working on these specialized jobs as long as there's enough demand on them. And there's public school teachers here as well that are tutoring in more of the wealthier areas

• 9:01Speaker 02

  that are making a better living, working fewer hours and more flexible times than they are with their day jobs just because that's just how the industry is. But, you know, Like when um I you know, so part of being a Korean American immigrant, we used like phone cards uh back in the nineties to call our relatives over there. It used to cost like twenty dollars for a prepaid card. I think it would last like fifty or sixty minutes. Um but then as you know, voice over internet protocol came out and things like MSN and AOL allowed you to call people for free. And now we have Facebook and WhatsApp and all these different channels. Um calling internationally just became uh just no fees.

• 9:47Speaker 02

  Right, and so we thought this is gonna happen the same way for banking. Uh but not just for, you know, having a store of value, but how we send money and how we receive value in general. And one of the reasons that we thought this uh, you know, the way that we work and the freelance opportunities weren't able to expand to the potential was because of these barriers right now with uh the financial cost it is to send, you know, someone like five dollars to someone in India or China. It would cost you fifty or a hundred dollars because of wire transfer fees and etcetera. So but with blockchain, um you know, th- this was going to zero, which was the next step.

• 10:31Speaker 02

  And this is where we valued, uh we started with microtransactions, but the earning opportunity was really what we wanted to start disrupting and how people earn.

• 10:43Speaker 03

  Got it. And and so that first product that you built, right? How how has it evolved over time? Because Storm today, you know, when I look at it, it essentially allows you to uh try new things um or or or play with products. Uh and as you're, you know, basically spending your time, your energy, your your mental capacity uh in in your eyeballs and engagement, you're getting rewarded for that, right? So it it's kind of the reverse of what we see in most social media platforms, where they're taking our time, energy, eyeballs, and they're monetizing it. We don't see that money, they get it. In this situation, the user is actually getting paid to do this stuff. Wh- what does that product look like, you know, in the beginning? Um and how's it evolved to today?

• 11:26Speaker 02

  Yeah, and so, you know, as I mentioned before, i- in the beginning, it was just watch a short thirty second video and you get two tenths of a penny in Bitcoin. So it's a very uh small rewards app, but we continue to evolve and. Um, you know, where we're at currently is more of you engage with these products and services.

• 11:46Speaker 02

  And so you get paid for trying out, you know, the Ubers or the Hulus or the different products that are on the application. But what we're trying to accomplish is trying to allow people to earn money. So this is where we started, um, sort of more of an ad tech company. And this is because this is where there's just demand from the supplier side. That can help fill ways that users can earn money. So we're just reallocating their marketing budgets to, you know, directly to users and allowing the users to get paid for their time. Instead of having all these, you know, busts or banner ads getting paid instead. So, um, this is what we're starting.

• 12:27Speaker 02

  But what we noticed from the users in our application is people come to us because they want to earn money. You know, checking out products and services is more of a subset and it's just a secondary task of what they have to do in order to get money. And so for us is, you know, how can we constantly increase more ways that people can earn? Um, and so to scale, uh, definitely having people create their own tasks is one of the better ways for us to be able to expand. But that, that also has its limitations as well. And as a US company, we're also seeing difficulties in that in terms of, you know, like whether you need a money transmission license or not.

• 13:08Speaker 02

  Even if it's on a smart contract, um, there's different opinions that that we get from, you know, legal and compliance. And so, you know, we're trying to work with third party partners who have all that set up before we can even start this and things like that, so.

• 13:23Speaker 03

  Got it. That, uh, that makes sense. And so, you know, before we were talking, I was asking you about challenges. And you said two challenges that you guys have faced as you've built, uh, the product and the company are regulations and user experience. Let's start with the user experience side. Like, explain what you mean when you said that user experience is a challenge.

• 13:43Speaker 02

  Yeah, definitely. So, um, you know, we've been fortunate to have, I think, like two and a half million people earn so far using the application. But a lot of these guys are, you know, very technical and they're willing to go in and understand how to set up a. A crypto wallet, for example, and learn how to withdraw and everything. But we, one of our biggest challenges right now is just the user experience of blockchain in general. It's, it's too hard for the average person to really be able to dive deep because, and I can give you an example. So I have a chiropractor who's in her late forties and I, I explained to her what I did and she was very fascinated. And she said, okay, you know, I want to try out your app.

• 14:28Speaker 02

  And so she started earning some bolts and she completed a couple of tasks. And by the time that she was ready to withdraw her crypto, she asked me, how do I do it? Uh, and so I explained to her, there's, you know, two good ways to do it. So one is you have to convert the storm that you get to an exchange like Binance or Bitrix. And you have to convert it from storm to Bitcoin and, or ETH. And then you have to send it to one that supports fiat like Coinbase or Gemini. And then you have to withdraw to your bank account. And so that user experience was really difficult because uh, she had to essentially go through KYC on two exchanges twice in order to just get a few bucks. Uh, and then the second option I told her was, you know, you can open a wallet like my crypto. Um, and then she's like, okay, cool.

• 15:12Speaker 02

  And then, so if you withdraw it, like, how do I withdraw it later again? And she meant, you know, I, I tell her, you have to buy this other cryptocurrency called Ether. And, and that's, that's when I lost her and she's just like, what? You know, I, I don't want to do that. And This is super complex. Yeah. It's just, uh, it's too much, there's too much friction in between. So, you know, this year though, I, I have seen a lot of products coming out where it's allowing, you know, like people to be able to spend a lot easier. And I think, you know, Gemini is working with Spend, um, that's how you pronounce it. And a couple of the other, I think AT&T just announced that they're going to allow crypto spending. WhatsApp is allowing spending. So there's more partners that are coming out and that's what I've really enjoyed the past few years is

• 15:58Speaker 02

  there is these guys that are helping make, making that friction uh, a lot easier for normal people to be able to engage with crypto. But until now, our biggest challenge has been there, just to get average people on boarded. It's, it's pretty difficult.

• 16:17Speaker 02

  And so, on the plus side though, because there are so many intelligent people working on cool products in this space, things are evolving so quickly and we're starting to integrate with these partners as well to try to remove that friction.

• 16:29Speaker 03

  Absolutely. And so, what do you think the solutions are on like an industry basis, right? So, obviously you guys are facing some of these issues that you're not the only ones. What can happen? Is it just we need more time and it kind of gets better over a certain time period? Or there's specific things that you think you can identify and say, if we can solve X, then the overall user experience of using this stuff will drastically improve?

• 16:58Speaker 02

  Yeah, I think with time, as you mentioned, we're just seeing the progress happening. And that was one of the biggest pain points for us was the direct conversion to V I if users wanted to spend it. And those are coming out. And, you know, essentially even I think when people are looking at blockchain, too often they're expecting instant results just because so much capital has flooded into this industry. But even with the internet era and the dot com bubble, it took so long. I mean, how many years was people relying on AOL and their dial-up internets be disconnected from our phone lines before it even moved

• 17:40Speaker 02

  to DSL and cable when it started really to help us scale? You know, I still remember I was using AOL and I got in trouble for having to disconnect my phone line because my dad tried calling home. And I was stuck with that for about five years from what I remember. But it just takes time. And now we see, you know, internet as a part of everyone's lives across billions of people across the world. But I think with blockchain, the advantage that we do have is we have the internet to actually speed this up. So it'll happen faster than, you know, the adoption for internet did in our generation.

• 18:18Speaker 03

  Absolutely. And so then what about the, on the regulation side, right? So user experience obviously is a huge problem. And then on the regulation side, what do you mean that that's a challenge?

• 18:28Speaker 02

  Yeah, and as a crypto company in the US, this is definitely one of our biggest challenges. So, you know, things are very unclear. And I think there are certain countries like Singapore and Malta that's a little bit more clear in terms of how cryptocurrencies or even utility tokens work in general. But I can give you an example, like several months ago, when the SEC came out with a memo, we contacted six different law firms and each law firm gave us very different advice. It's just because nobody really knows. Everyone's trying to guess what's going to happen. But because there is a lack of legal clarity, we just sort of have to take the most conservative

• 19:10Speaker 02

  approach and try to predict what will be the law in a few years. But that can get very expensive and time consuming. And even if we do all the steps to try to comply in the right direction, it could be wrong if the regulations in six months comes out and says something differently. And this happened multiple times when we're trying to do a token sale. I think we got delayed for three months just because things kept changing so rapidly. And, you know, it's very difficult. You know, when we're trying to just focus on building product and making a good user experience and making it more accessible and things like that, and then we get distracted because certain laws change, you know, we have to spend time with lawyers to make sure that

• 19:53Speaker 02

  we do everything in the correct way and it can get very expensive and just time consuming.

• 19:59Speaker 03

  Absolutely. And so like, as you're going through this process, you're talking to these different law firms, do the law firms necessarily disagree? Like, is it one says, hey, you can do X, and the other law firm says you can do Y? And those two things are actually in direct conflict with each other? Or is it just that they all generally think, you know, head down, option A was route, but there's different variations to it? Like, I guess how much is the dissent between the law firms?

• 20:32Speaker 02

  Yeah, we've had such different opinions from the different law firms that we've talked to, which is really surprising. You would think that it's very similar in a way, but... You know, I I think one of the biggest questions too is like how token companies interact with exchanges. And that's definitely one of the big question marks. And you know, I talked to you know, CEOs and other token related projects as well too. And each person with different law firms has a different opinion. You know, one is as conservative as don't get listed at all. Like one is, you know, it's okay to just completely be on the other side, like work within the exchange. And one is, you know, this the the opinions is too different. And

• 21:16Speaker 02

  you know, lawyer's job is to protect you, which is the right thing to do. But each law firm will have a different opinion on how to protect you. And that can get very expensive.

• 21:27Speaker 03

  Got it. And and then we've seen recently, uh, you know, a lot of conversation from KIC, from Circle, where they're actually making specific changes to their business because of the regulation environment. Have you guys been forced to actually make some changes? Or has this all been more kind of proactive? You've not done something because of it. So you didn't necessarily haven't made changes. You just have made different decisions, understanding that regulatory environment.

• 21:55Speaker 02

  No, both for sure. Um, we've definitely made changes in terms of how you know, things operate uh in the business. And then also on the proactive side, we're definitely always trying to take the more conservative route and making sure that we're compliant.

• 22:12Speaker 02

  And yeah, it's just, it's just one of the barriers to the this industry, I think, with having to deal with the extra work that's involved. And I mean, even like things outside of just the cryptocurrency realm to the GDPR, the implementation that went out in Europe. We had to stop everything and make sure that, you know, we were compliant with that regulation. And that set us back, you know, two or three months just to be able to comply with that. And it's just, yeah, that's just one of the challenges of running the business.

• 22:47Speaker 03

  Absolutely. And so as you guys look at, um, you know, where where you're going now.

• 22:54Speaker 03

  Is this something where you continue to build the product? And you keep an eye on regulation? You're waiting for the user experience to improve? But that core experience of users being incentivized to take certain actions or spend time viewing or using things and they'll get paid will stay the same? Or do you see some kind of major evolutions of the product over the next, let's say, eighteen, twenty-four months?

• 23:19Speaker 02

  Yeah, and so we're trying to re-aggregate all the different ways that you can earn money online through a platform. So the Try Products and Services platform that we launched is just the first step of what we're trying to do in the long term, which is, you know, look at like ten best ways to earn money online. And they'll give you upward fiber task rabbit, like machine learning tasks and all these different avenues. And how could we, you know, put all of that into one platform? So let's just say like, hey, I really want to earn forty bucks. Go to our application and then, you know, whether you check our products or whether you want to be a designer for a couple of hours, you can choose. And we've just figured out on our side

• 24:00Speaker 02

  how to really efficiently pay users across the world because of this blockchain application.

• 24:09Speaker 03

  For sure. And so as you're looking at this, why haven't other messaging applications or social media companies done this yet? Do you think it's just a matter of, you know, it's just not a big enough opportunity yet? The technology's hard? Like, you guys have been at this for a while and continue to make progress. Why haven't the big boys stepped in yet?

• 24:29Speaker 02

  Yeah, I think it's, you know, all those reasons plus more that you just mentioned, like, one, technology just isn't there. Two, like, you know, when you have Ethereum that processes less than twenty transactions per second, like, how do you actually get a viral app out there? And then we had to create our own solution and then be creative to figure this problem out. Second is, yeah, dealing with the legal hurdles and all these issues. It's just, it's a lot of work and there's a lot of uncertainty. And it's not easy having to do this. And I think third, too, is the industry is so early that, you know, there's a lot of... It's just like, for example, it's like, you know, being a CEO of a crypto company,

• 25:14Speaker 02

  almost, it's like in the job description to get trolled on Twitter. Um, and it's, it's not an easy task, right? To um, be able to build something that takes a while. But at the same time, you're expected to provide instant results. And um, it's definitely, you know, stressful. And then if I think when entrepreneurs are thinking of like, hey, you know, what do I want to start? There's all these different checkboxes and pros and cons that they go over. And, you know, do they want to go through all the hassle? Um, I, I don't know if that's, you know, really the case. I think Facebook stepping in is, it's a big change. And um, the opportunity is big enough now. And the regulations are getting more clear that, you know, they can step in.

• 25:57Speaker 02

  And now WhatsApp is supporting, you know, cryptocurrencies, et cetera. And now they're allowing advertising on Facebook again. And yeah, we're definitely seeing a momentum change now. But until now, technology's been really bad, you know, regulation uncertainty. And just the difficulty in just running a blockchain company was providing a barrier for a lot of these people.

• 26:17Speaker 03

  Absolutely. And, and so for you, are there certain applications, right? And what I mean by that is like certain games or products that you've seen that, that have really kind of taken fire uh, on, on the platform that get you excited? Like, can you give us an example or two of what people are actually interacting with or doing?

• 26:36Speaker 02

  Yeah, so I, I think we have very different user personas, which is really interesting. Um, so definitely the fastest growing regions for us is in the emerging countries. Like people actually, you know, do the tasks that are on here because it helps them with their daily life. Um, and it's, it's sort of amazing, like even the two tenths of a penny and watching Bitcoin, we still have that. Um. But users are opting into the, uh, doing those tasks on a regular basis. Um, but then we have also the casual, you know, sort of the tier one country user base where, you know, they have income, but this is more of a, a casual way to earn crypto.

• 27:16Speaker 02

  And, you know, these guys play games, uh, and any kind of service that's interesting to them. So it's more of sort of like a free time kind of job, um, that they're just doing just because they can, um, and then we see more engagement with games like, you know, services like Hulu or Uber, um, and things like that. And then, yeah, so it's just, I, I think this is the part that we're really excited about is like, we're, e- even as a small company, we've been able to penetrate over a hundred eighty countries, um, and actually have users. And so the fact that it doesn't limit us to just one type of audience and that everyone can actually

• 27:59Speaker 02

  benefit by using this is, well, it's sort of one of our motivators to, you know, put up with all the difficulties and continue operating as a company.

• 28:08Speaker 03

  For sure. That ma- makes a ton of sense. And then, you know, a- as you've seen this, wha- what's like the one or two themes that, um, you know, four or five years ago, when you first got started, uh, maybe were in existence and, and kind of popular, that have gone away that you think could resurge back, right? So I'm very interested in like this idea. Um, you know, Nathaniel Whitmore on Twitter always talks about, uh, narratives a- and this idea that, um, there's some things that were popular in the past that kind of went away and be, you know, fell out of favor and they come back. Is there anything that jumps to mind for you, um, that, that was a narrative previously, but now, uh, has disappeared and you think can come back?

• 28:49Speaker 02

  Yeah, I think like back then, yeah, like mining companies and wallet companies were the biggest rage. So everyone was trying to. Company does one or two. I think it typically happens during a bull run. Um, as prices of Bitcoin comes up, you you see like how many graphics card are sold. And recently during the bear market, there was certain, there was such an X, uh. You know, there was such a. You know, increased supply of third party uh gra- graphics cards uh that was available in the market. Um, and so I think we'll just see that it's it's like a cyclical thing. Um, you know, I I think wallets, though, it it's interesting because.

• 29:31Speaker 02

  Uh, back in that time, like, people weren't thinking about creating their own exchange. There are only a handful. There's like Bitrix, Polonius and Kraken. But, um. You know, the the wallet was really the way that they thought would be a mass adoption. Because everyone needed a Bitcoin wallet or an Ethereum wallet. But there's so many different options that are really cool, like Trust Wallet and things like that. So. Um, yeah, I mean, we'll we'll see what happens, but I I think mining will definitely come back as as sort of a trend.

• 30:03Speaker 03

  Got it. And then I guess, are there things that you think are narratives today that are gonna go away? Like, things that people are excited about that you're just like, there is no way that that is uh viable or or likely to last?

• 30:15Speaker 02

  I I don't know. I mean, I think it's too early to say. You know, trends are so unpredictable. And so I think that's one of the exciting parts. Uh, I spent a lot of time just checking out other products that constantly come out. And, you know, the idea is that I I think that might not work in two or three years. I seem to get surprised on a lot of these as well, too. So. Uh, I I I really think that depends on how hard the entrepreneur, how hard the teams are willing to work to make this happen. Because, um, you know, each company has a vision and if they can execute it. Um, then, you know, you can make it happen, right? So. Um, you know, like Henry Ford, uh, if he asked, uh, you know, if he asked his users like what they wanted,

• 31:00Speaker 02

  they would have said they wanted faster horses, but he created a car. Yeah, so people didn't even know that they wanted cars until he made it for them. And sort of the teams that can execute, like, people might not realize that they might need this product, but, you know, eventually their minds can be changed if it's, if it's actually really good.

• 31:18Speaker 03

  Absolutely. That, uh, that, that makes a lot of sense. Um, all right. And then, uh, any speculation on what you think, uh, the Facebooks and, uh, uh, other social media sites in the world are going to, uh, to create here? You're kind of probably one of, you know, two or three people who have spent the most time thinking about this. What, uh, what do you think that they're going to, uh, to launch here?

• 31:38Speaker 02

  Yeah, I mean, it seems like a lot of the tech companies are trying to be their own bank, right? So creating their own stable coins and, you know, they're really trying to disrupt the fintech industry. And even Apple with Apple Pay and their credit card, I think it's a big step. If those guys step into the blockchain space, um, it totally makes sense. I think that might be a neat thing. Um, I, I really thought that there was a big opportunity for cloud services to be on the blockchain and be decentralized. And I know Amazon and, uh, IBM and Microsoft are spending a considerable amount of resources on blockchain projects, a lot of them unknown, but I think cloud on blockchain and not having a single point of failure would be one of the biggest disrupted, uh, disruption, uh, disrupting industries.

• 32:21Speaker 02

  Um, so obviously payment is, you know, one of these, which is why, you know, I think banking, you know, these companies, um, building stable coins and things like that are starting to disrupt. And, yeah, we'll, we'll see. I, I do think that, you know, JP Morgan creating their own stable coin is just the first step, but eventually the ones that can create stable coins and have it be.

• 32:45Speaker 02

  You know, actually used on a daily basis is gonna be banks because they already have all the money transmission licenses and all the infrastructure set up and all the demand. And if they flip it on all of a sudden, then eh eh all the people that are already cus- customers will be able to use that right away.

• 33:04Speaker 03

  For sure. I think uh it's gonna be very interesting, right? One of my exciting points of this is they have built-in user bases. So whether it's JP Morgan, Facebook, etc., they have millions, if not billions, of people who they can immediately get um cryptocurrency in the hands of, right? Di- different versions of it. Uh I wish they would do it with Bitcoin, but that's okay. Um on top of that, uh there's also a fear, right? One of the fears I have is this idea that they could launch a stable coin. They say it's backed by some commodity. Uh it sounds like JP Morgan's gonna do it backed by US dollars. Facebook is rumored to do it with a basket of currencies. Uh and the fear there is that at some point in the future, they could break that peg. So they could essentially do exactly what the

• 33:48Speaker 03

  US government did. They broke the gold standard, and when they broke that, they created this fiat currency. Uh that was no longer backed by a commodity, uh and it allows us to print, you know, somewhat at at will. I think very similar here, um you know, i- if all of a sudden JP Morgan or uh or other um, you know, type of cryptocurrency issuer can break that peg at will, imagine if all of a sudden JP Morgan or Facebook became a central bank that could print money at will on a global scale, right? I think that there uh, you know, there's some ramifications there that are probably much more uh serious than um than we give them credit for at the moment.

• 34:27Speaker 02

  Yeah, I think i- i- it's a shift and yeah, if these guys can disrupt banking, I think it'll be a scary thought, but uh at the same time, I I don't know, I I they have to be backed by something, like you said, and uh all these currencies or stable coins are backed by US dollar for the most part. So I think the US dollar will still, you know, remain pretty strong. Um. But yeah, it'll be fascinating. I definitely want these tech companies to be able to disrupt the banking fees and then the world will all of a sudden be more accessible. And we'll be able to hire people from, you know, halfway across the world like India and China and get a lot of talent and be able to just build really quickly because we can now operate 24/7, you know, so let's say we're, you know, we have our eight hours a day here, but somebody

• 35:12Speaker 02

  halfway across the world could be working when we're sleeping and just, you know, right now it's limited to a very handful of companies, but we, that will grow exponentially once the payment barrier is really removed.

• 35:25Speaker 03

  Absolutely. Think, uh, I think that makes a lot of sense. Um, all right, before I finish up, I usually go through a rapid fire questions. What, um, what do you think is the, uh, most important company in crypto?

• 35:35Speaker 02

  Ooh.

• 35:38Speaker 02

  Uh, I mean, I, I have to say Bitcoin, right? So Bitcoin's the foundation, so it's not a company, but.

• 35:43Speaker 03

  I love it. I love it. Why, why?

• 35:47Speaker 02

  I mean, yeah, so Bitcoin has to succeed for everything else to succeed. Um, and there's, I, I think that's one of the key reasons. Um, if it fails or, you know, there's some reports saying that, you know, this person is actually Satoshi or it's actually this criminal, I think Satoshi or whatever, but, um, the whole idea that this can be just from not one entity, but an actual network of people contributing is the whole idea of why I think blockchain will work in the first place.

• 36:22Speaker 03

  I got it. I, I think that, uh, it is hard to find somebody who disagrees with the idea that Bitcoin is, uh, is the most important thing in, in crypto. Um, but they're out there, so we'll, uh, we'll just avoid them for now. What, um, what is the regulation that you would change or improve if you could?

• 36:39Speaker 02

  I would, i- i- if regulations could tell us, you know, do X, Y, Z or don't do A, B, C, uh, that would be very helpful for the US companies that are trying to innovate.

• 36:51Speaker 03

  And, and.

• 36:51Speaker 02

  Very.

• 36:53Speaker 03

  We think it's just actual like clarity. It's not even just a specific regulation as much as just, you know, crystal clear clarity on what you're allowed to do and what you're not.

• 37:03Speaker 02

  Right, so I think there's, you know, certain companies that are doing security tokens. There's certain companies that are, you know, try to do crowd sales, not, you know, distributing tokens to US holders, etc. You know, being very clear, be like, don't allow US people to use your token, you know, don't allow people from this country. Like, we avoided OFAC countries, for example, but that's us being precautious and that's what everyone should be doing. But just being very clear on regulations and companies not having to spend money on legal to try to get, you know, uncertain answers would be very helpful.

• 37:40Speaker 03

  Got it. I think that makes a lot of sense. What do you think your most controversial thought in crypto is? What do you believe that the most, a number of people would disagree with you with?

• 37:50Speaker 02

  Ooh, I mean, I do think there is a use case for utility tokens. Um, yeah, because each company that have built the utility tokens, they're building their own network and essentially, one of these tokens companies are going to be very successful and going to hit mass adoption. And that will change the perception on how we think things. So it's, imagine if Fortnite only allowed you to buy B-bucks using their token, people would actually use it. And I think that's an unpopular opinion that most people would disagree with me on that.

• 38:29Speaker 03

  Yeah, I think that it is, uh, it's almost like the sober view of utility tokens has value, right? Like, I would argue that, and I have in the past, that like, Amazon's AWS credits or Starbucks's get like the stars on the mobile app. Like, those are portions of quote-unquote utility tokens, right? They give you utility to do something, but they're not ICOs that raise hundreds of millions of dollars and people are buying and they're looking at an exchange hoping that the price goes up. So it's kind of more of like a sober view of what those utility tokens could be and what purpose they could serve.

• 39:11Speaker 02

  Yeah.

• 39:12Speaker 03

  All right, what's the most important book you've ever read?

• 39:16Speaker 02

  I really enjoyed Rich Dad Poor Dad. I think that really helped me change my perception on just not working a, you know, typical eight to five job and thinking outside the box on how everything operates. And that was definitely a life-changing event for me.

• 39:33Speaker 03

  Yeah, I uh, it's actually one of uh, one of my favorites as well. And I, it's also uh, people who tend to read it earlier in their life seem to get much more value out of it. Cause the concepts are written in a pretty simple way. Um, but they're profound when, you know, you're still kind of in the formative aspect of uh, of your life, right?

• 39:55Speaker 02

  Yeah, I agree. I definitely recommend everyone to read that book if they have it.

• 40:01Speaker 03

  For sure. Um, all right. Before I let you ask me a question to finish it up, uh, we talked about aliens. What a believer, non-believer, real, not real?

• 40:10Speaker 02

  Definitely a believer. I mean, our Earth is so small compared to the vast amount of galaxy, just the space out there. It's just, there's no way that we're the only living things in existence.

• 40:23Speaker 03

  And, and do you think it's something where we'll eventually come in contact with or coexist? Or it's just, hey, the probability is high that there's other intelligent sentient life out there and we, we're unlikely to ever discover it?

• 40:39Speaker 02

  No, I think it'll definitely happen. Maybe not, not in our lifetime, cause most planets that have some sort of life might be light years away, but it's like Christopher Columbus. Uh, nobody knew what was on the other side of the ocean, but he ventured out and it took a long time to make that happen, but now it's just the norm and that will eventually happen, I think, as well.

• 41:02Speaker 03

  Yeah, it'll be interesting to see who the Christopher Columbus of space is, right?

• 41:06Speaker 02

  Maybe, maybe you.

• 41:08Speaker 03

  Uh, I'm not smart enough. You gotta be, you gotta be pretty damn smart to, uh, what's the movie? Um, I, I think it's uh, Is it Matt Damon, I think, goes to Mars and he's like, eventually figures out how to like grow plants on Mars or something?

• 41:24Speaker 02

  Oh, yeah. That was a great movie.

• 41:26Speaker 03

  Yeah, so like you, you gotta be pretty smart to, uh, to survive. I, I would be, uh, dead immediately.

• 41:33Speaker 03

  Um, all right. What, uh, what one question you have for me?

• 41:36Speaker 02

  Yeah. I mean, where do you see this industry going in the next five years? And I think that people are really curious to see what the next steps are. And you're one of the top influencers in this space.

• 41:47Speaker 03

  Yeah, to me, it's, um, I, I, I essentially have, you know, three core beliefs in crypto, well, two core beliefs. Uh, and then some, some, uh, applications of them, but the two core beliefs are just Bitcoin is sound money, right? It, it literally is just better money. Um, and, uh, and I think that we are going to see, um, this kind of new explosion of, uh, of, of what happens with this asset. And, uh, if adoption and the market goes the way that I think it's gonna go, things are gonna catch a lot of people off guard. And so it's scary to think that Bitcoin is actually being underestimated, not overestimated, right? Expect for us that are so, uh, ingrained in the community.

• 42:29Speaker 03

  And then the second thing is that, uh, every stock, bond, currency, commodity will be tokenized at some point in the future. And so it, you know, there, there's definitely things that, um, are not digitized today that are much more financial assets that will be. I think that's a kind of foregone conclusion at this point. Uh, but then even things that you're talking about, right? This idea of, um, kind of platform or company specific value. Um, you know, for mediums, mediums of exchange or stores of value. Uh, I think all of that's coming and, uh, and I just look towards the, you know, the younger generations. I'm, I'm thirty years old, uh, and most people I know kind of thirty-five and younger. They grew up with a phone in their hand. Everything that they do with money is digital. Um, and, uh, you know, it's just a very, very different world.

• 43:14Speaker 03

  Um, and so that technology adoption is gonna look different. That, uh, that type of technology gets applied to, um, other aspects of, of, uh, our lives. I think it's gonna be a pretty big, uh, disruption that, uh, you know, a lot of companies just aren't gonna, they're just gonna miss the boat, right? That, you know, just classic innovator's dilemma.

• 43:31Speaker 02

  Yeah. But you, but you don't think, uh, they'll buy their way in and, you know, buy some of the early investors?

• 43:39Speaker 03

  I think they'll try. You know, a lot of people forget, just because a large incumbent buys somebody, doesn't mean that there's great integration, right? And, you know, the other thing too is, for a lot of entrepreneurs in crypto, there is, there's this really unique, there's a really unique component here of one of, if there's an opportunity to go build companies right now, you don't want to build a company, sell it to a large incumbent, get stuck there for three years and miss out on three years of building. So I think I see a lot of founders sell their companies, not go with the companies, or they're going to negotiate really short golden handcuffs to stay, you know, 12 months,

• 44:22Speaker 03

  and then on the six month and one day, or 12 months and one day, they're going to leave. And so, you know, that's an interesting development that I don't think a lot of people have thought through yet, but it gets entrepreneurs back in the game, right? And so if entrepreneurs want to spend their time building, I'm all for it, and I encourage them to do that.

• 44:41Speaker 02

  Well said.

• 44:43Speaker 03

  Well, we're all learning together, having some fun. So, listen, I really appreciate you doing this, Simon. Super cool what you guys are doing over at StormX, and we'll have to do this again in the future as you guys continue to progress.

• 44:57Speaker 02

  Yeah, thanks so much for having me. I really enjoyed it.

• 45:00Anthony Pompliano?

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• 45:42Anthony Pompliano?

  Hey everyone, Pop here. If you liked this episode of Off the Chain and want to help us take crypto to the top of the Apple, Spotify, and other podcast charts, please do us a favor and rate, review, and subscribe. To review, simply go to the Off the Chain homepage, scroll down until you see the five blank stars. Taking 15 seconds to fill those stars in and leave a quick review goes a long way in helping us take the entire crypto ecosystem to the top of the charts. I appreciate you listening and see you next time on Off the Chain.