Guru Of Blockchain

He is an investor in the blockchain space. However, he's much more than that. He's a technologist, a futurist. He's an attorney. He's been through the Internet um bubble. He's built companies, sold them off at the peak. He's been there, done that, and he has a unique view in this. In this episode, we're gonna dig into his past. We're gonna talk about how he built inside the Internet stages. We're gonna talk about how he exited at the top,

what he learned from that. We're gonna talk about where he sees the current blockchain space today, where he's looking to focus on investing, and where he sees it in the near future. It's an amazing conversation, one that I really enjoyed, and let's just jump right into it, all right. Welcome everybody. I have a special guest today, Chris from Susthany Capital. He's got a very very interesting UM story

and perspective on the markets. I learned about at a conference at on Chain nineteen about a week or two ago, and I really wanted to bring him on and talk more about that. So UM, Chris from Sustany Capital. Welcome, Hey, Mark, all right, so UM, as I alluded to, UH, I heard you speak at on Chain UM in Newport Beach and and I really liked your perspective on the markets. And what I really liked was your story of how

you've been through these technology cycles before. And I thought, I thought that you had a different perspective that I aligned with. But I don't hear a lot, and uh, I think it's missing, and so I wanted to talk to you more about that. So maybe you can just kind of explain to everybody, UM your background and kind of how you got here. Sure, I'm sort of a

field technologist. I want to become a computer program in the eighties and I was doing the day during those days when there was basically just basic programming and so forth, and everything was pretty slow and mostly for me. The one thing that I remember was very hard on your eyes because the monitors back then we're just not really great.

So I would write my bicycle home for my internship over it seems next of at the time, and I would see stars in the middle of the day because my eyes get really so impacted so badly that I decided, oh, I should be looking for something else that doesn't impact my health as bad. So it became a lawyer instead, which is kind of a unique breed in essence, there's not too many lawyers or vice versa computer scientists, um that have kind of this cross perspective. Yeah, but definitely, definitely,

I definitely I did a good blend. I yes, it's it's usual today maybe yeah, I mean today. And again that's kind of me being biased obviously with my particular background, but it seems to me that a lot of the blockchain implementations that can be had a mix of those two topics and a few others obviously, like mechanics and

economics and whatnot. But there's a lot of what I call legal technology or rec tech involved in that particular space, and it's needless to say, outside of coding, and that's the one topic that comes up all the times, that topic of regulation. All buy it often mostly misguided in my opinion, and again that's me having more international background

and not necessarily being indoctrinated in any particular paradigm. Well, the the international background is very important because this is a global movement, and a lot of times people get stuck in just their view of the local, their local currency or whatever, and they forget about the global movement.

But before we get into that, let's talk about your involved then in there in the Internet days, which a lot of times people draw parallels to, they were both new technologies, if you will, so tell us a little bit about your experience and the Internet days. Sure, I was still in law school. I joined a little startup on another consulting site to help them build what was then UM an idea for the multi um platform voice applications, so kind of a unified messaging system of sorts, and

that was the way ahead of its time. We did this a ninety four, so let's to give you an idea. It's still ahead of its time today. So it's kind of the idea of having a unified messaging system that would you do. It would let you do crossovers between voice and email and voice and text and so force. And we're still still not there, um. But because of that telecomverlation, I got really interested in then a new

regulation at space. So this was closely before the European Union opened up tele communications to alternate carriers, meaning before that, specifically, in Germany, you only had one telephone carrier, which was about to Tailor Comment at the time, UM. But they were about to opening open the markets, and so they were circulating um suggestions for the regulation of that space. And I was one of the very very few nerds who would read those and then sort of also understand them.

And I had my eyes set on one particular part of the regulation which would hopefully be used to guide the regulation in the space that we were interested in of this particular communications tool. And they're at the regulation and the suggestion didn't fit my my idea of how

that should work at all. So, like the stupid mid twenty year old that I was at the time, I just sat down and rewrote the entire thing and send it into the Federal Communications Commission, and lo and behold, they called me back and invited me to work with them on that particular legislation, and so long story short, they ended up using what I wrote that weekend. But

they're more interesting, he really is. UM. That made me kind of an expert, one of the very few in a particular space, because initially internet and telecommunication was into

very entwined. Right. You probably remember you had to pay for a minute for your dial up services and number was the case for much longer and back in Europe than it was year and so I ended up becoming general counsel for one of the very early internet service providers, and we grew the company very rapidly, mostly by having a lot of people running around physically installing those dial upe models and configuring people's dialogue cards to our dial

in numbers. So we were able to gobble up like I want to say, three and sixty thousand subscribers women like eighteen months and what what what? What time period

was this? That was between night? So ninety eight if you're number was the first fifty six kme more thin funny enough and so over fifty well, but I say two thousand and then at the beginning of two thousand, Um, I was preparing for an initial public offering and at the time we were valued at a billion dollars based on r L subscriber valuations, so we were kind of the e L of Germany at the time, and um,

we gotta takeover offer. And yeah, long, long story short, I convinced the rest of the management team we should take it because I simply couldn't see how we could ever make that much money out of our subscriber base. So we saw the company at the height of the dot com essentially to what's now the largest internet service provider in Europe Discolleague, and yeah, we couldn't have time

did better or buy it. At the time when we sold, everybody around us told us we were dummies because we were selling for like thirty five cents on the dollar forty six and a half to be precise. But it worked out really, really well, and more importantly, I retired from the law that day when we sold the company and moved to southern California. Basically, you know that's great now, Um,

for those that aren't aware, I'm sure everybody is. And at you know, in two thousand was the height of that dot com bubble, which then we saw a massive draw down, similar to what we saw in the crypto space draw down. However, that wasn't the end of the

Internet technology, and of course it went on in some companies. Amazon, for example, went to surpass it's all time high and hit two thousand from eighty at its peaked down to a dollar up or five dollars and up to two thousand, But not all companies did, so you got out of the peak. Um if you would have got out of Amazon at the peak, maybe that wouldn't have looked so good in hindsight, but in your case it was yeah,

well for us. But then also another similarity, if you want to call it that, if you're looking back, a lot of companies beg them that considered themselves Internet companies because they had a website wouldn't be considered Internet company.

Needs to give right. It's a lot of these um entities that were formed with that idea we're doing quote unquote something on the web never ended up doing anything of its you on the web because they didn't necessarily need the World Wide Web for what they were doing, and or it didn't help with customerquisition costs, specifically because so few people still were on the World Wide Web, right, so you have to still convert all of those people.

That was a lot of friction. Like we talked before the recording, it's like a lot of people are super reluctant to put in the credit card information, and so that has obviously a lot of analogies with our current scenario. There's a lot of entities out there and projects out there that they think they do anything blockchain related and they really don't. And some of them that specifically are very prominent in that space really have nothing to do

with blockchain whatsoever. If you look at some of those retail things, not that they're necessarily bad, but like a coin base doesn't use the blockchain for anything obviously, right, so they don't need the blockchain really for for anything that they do in the daily business, and they sell pull on quo currencies, but they're really not fostering, uh, the innovation in that space in any shape or form, right, and Internet Like I think when you look back through

different technology cycles, you'll see the same patterns. And so typically in the new technology, you have like existing um things that are done try to find a new home on the new technology, and then it's not until later that there's new things that were never done before. So you know, for example, you had a company advertising in the Yellow Pages and now they're advertising on the they have a web page, right, Um, but today we have applications like Uber that would have never been possible that

that technology. Yeah, and it's always important to get the vocabulary right there. And that's one thing that it always

takes issue with. Specifically, looking back at the early days of the Internet, people still equate Internet and Worldwide Web as being one thing and that's not the case, right, So, I mean, the world Web is build based on Internet technologies, but it's mostly HTML that lets you experience the World Wide Web, and that was the introduction of tim berners, leews most of the underlying protocols, and that's more important paradigm to understand, mostly for the topic that we are

looking and now created by wind Surf and other people in that space. But unfortunately what didn't happen is that we kept working on creating these protocols. So my understanding moving on to the um, the thematic of blockchain is that blockchains are the building block to build new protocols.

And the bit White people introduced mainly three new concepts if you will, and inventions, So the most obvious one being this digital bearer instruments so bit common blog case B. Then secondarily, if you will, the smart contract systems, and every quote unquote cryptocurrency is a smart contract, whereas not every smart contract is a cryptocurrency, and that's very hard for most people to understand that why the constantly intermixing

those two things. Um. And Then lastly, and that's probably the most important development that we have not talked about a lot as of late anymore, is that of a central as autonomous organization, which is the reason really why bitcoin is still around, right, because it creates an alignments of alignment of interest within the system that makes the system super resilient. And that's actually actually necessary prerequisite for

the digital bearer instrument. Yeah, in order to create quote unquote immuneability of the transfer of anything that's moving on the box chain. Yeah. Those are three, Um, those are three really good use cases. I think the first two could almost be like improvement offers. Um, so bare instruments now we have digit of our instruments, contracts, now we

have digital smart contracts. But the DOW as you mentioned, is a very interesting piece because it takes away the human element, which is very easy to be manipulated and corrupted, and puts it into math or code. Right, So is that what you're kind of talking about. UM, Well, let's bring this on a higher level, maybe for for a second year. So the largest UM problem, if you will, that we face right now, as humans are mostly relatable to our organizational principles i e. Most obviously UM, the

for profit corporation. If you look at companies that now standing on top of the food chain, they standing there. Let's use Google as an example, because they implemented their

particular algorithm most perfectly into this for profit algorithm. Because as much as they will tell you well, UM, our uh mission statement is to organize the world's information and make it more accessible and useful and whatnot, that's obviously not true because the as with every corporate for profit organization, especially the ones that are publicly traded, their model is basically in law means their main objective is to increase

shareholder value. If they didn't do this, the management team would be held accountable for that. If they all of the sudden decided in Google it's case, or we're going to yank all the stupid edwards and AdSense stuff out of our index, because that that's not very useful to find information which to say what they say they do, I don't think that their shareholders what we um very happy about the outcome of what profit to bottom line.

So my point here is so this for profit motive is actually then UM infiltrating any other algorithm you implement after words, But unfortunately, the better you are in implementing your own algorithms or the Google Search algorithm, mainly implementing UM searches around what makes up you you and serving you the right ads is what drives this particular technology, which obviously will never create an optimal result for the user.

It can't so with a dour though, if you then can take something that anybody in the system has the most interesting participating from the actual result, not from the profit modelf, but for this entity creating the best results for anybody involved, then in this case you could strip

ads out right and it wouldn't matter. And more importantly, anybody right now could set up a doubt and create a matter filter, as far as I'm concerned, create a matter search and filter any commercial intent out of Google is all of a sudden had a search engine, actual search engine that would be better in terms of its results by several orders of magnitude simply by doing that, and simply by essentially removing, um, this for profit modem

which excuse the incentive system between users, advertisers, and corporate owners. And then if you want to go further down, there's all so misalignment of interests of managers, shareholders, employees, suppliers, and so forth. Whereas in the example of any of the block chains with the correct and now implementation, everybody

is basically pulling the same direction because they would hurt themselves. Right. Um, there's always this kind of rumor that at one percent attack could essentially swipe away Bitcoin or any of the other block chains. Um. The catch here is that anybody that would amass this form of either stake in the system or computing power, but mostly erode his own holdings, right, So it would not. So that's kind of the catch

they have that prevents this from happening. Um. But by skewing incentive system using a four product profit motive that doesn't care about align and shareholder interests with user interest, you can never achieve an optimal outcome from users. Yeah. Interesting, I think that's that's interesting the conversation to have, which we won't spend too much time into. But UM, I think maybe maybe I'm maybe I'm just a little bit too optimistic. But I think maybe when those businesses start out,

they do have a more pure motive. But as you say, right, as they grow, and especially as they get shareholders, they have a findiciary duty to those shareholders to increase profits, and as that grows, it gets more and more distorted. Almost so, UM, maybe it starts a little more pure. Maybe I'm optimistic, but then I can definitely see what you're saying where when everything excuse to profits, it changes

really the mission or the problem they're trying to solve. Um. So it's interesting one of the many ways that I think blockchain technology will change the world. Um. I think when you look at Internet technology, the technology itself allows us to share information. Right, I can upload a file, you can download a file. UM. With blockchain technology, it allows us to share value. I can upload value, you can download value. But also it creates other things like

governance models that we're talking about. UM. Do you see it like that? And do you think, um, this will really shift the world much more than what we saw with the Internet technology. Yeah, absolutely, and that's exactly come the right analogy. So the first Internet way if if

you will change the paradigm for information exchange. And so the old publishers that we used to pay for back in the days before the Internet, they barely exists anymore, and most of them on the way out because the business model has been so thoroughly disrupted and there was so slow to adopt that they really, for the most part on have a reason to exist anymore. Um. And there now, yes, blockchains allow you to build the missing what I would call value exchange protocol call its all

buy it. You're still at the very very beginning, and I think that's one of the larger problems in that space because specifically guys like us who have been watching it for the last decade, at this point in time, we're getting really impatient to see the next phase set in. But just like you couldn't build a YouTube with a fifty six came out then and what wasn't very useful user experience, UM, you cannot easily build more complex value

transfer protocols. So what I mean by that is the easiest value transfer protocols is really what we had in the past with descent with distributed ledger technology, because that's kind of another myth in that space. Often times people

are quite d lt so distributed alledger technologies. With blockchain, it's actually the blo chains are disrupting the lt s. Meaning if you look at your bank account, that's a typical example of a of a distributed ledger, right, so you have an entry there that says either the amount that you or the bank or the bank as you and if you send me money then they have to align those two ledgers us with mine and for whatever reason in between, the money disappears into Nirvana for twenty

four hours or longer um. So with a digital barre instrument, it's more less instant, if you will, even if you your bitcoins typically done within ten minutes. And the big difference there though it's settled, right, And there's always these really strange comparisons between the Visa network and the big coin network, and then people keep saying stupid things like that comparison. Yes, it's it's nonsense, right, Visa will never be as fast as bitcoin because you'll never be able

to achieve settlement in ten minutes, it's impossibility. Yeah, and that's really key, right, I mean that's really the value of your traditional barer instument. Right. You can take your printed dollar notes going to a store, you hand it over and it's setted. It's done right. In regards to there's two things. First of all, they say bitcoin or visa. You know there's a thousand transaction to second bitcoin seven or whatever. Well, first of all, visa is a payment

application on top of a settlement layer. So the Visa network could be a payment layer on top of the bitcoin layer if it wanted. Second of all, if you're a merchant, visa doesn't settle, right, it takes days oh yeah to get that money at least. Uh yeah. So maybe I'll remind a little bit so um because the one thing that I wanted to get across in my target you then, well, as um, there's like this major focus on on banks and quote unquote currencies and feat

and whatnot, and ad is a little bit misguided. So what I mean by that, A lot of times what we see startups do they look at banks and feared currencies as um they are the problem. What's really important to understand is that they're actually the competition. So what I mean by that, so bank and any type of money. It's actually addressing one of the fundamental problems in economics,

were just the double coincidence of one's problem. Right, So I need to create an efficient exchange mechanism because you have something you want to trade, which is your time, but I don't want your time because your skills don't apply to whatever I want, which is I don't know,

live somewhere, right. And so in order to facilitate that, humans came up with this idea of currencies, however, um, and there are specifically people that have been indoctrinate it in kind of this old world thinking of what money and currencies are. They don't understand the fundamentals anymore, and they're going back to kind of this eighteenth century definition of money as a medium of exchange and of accounts standard of value in the store of value, whereas that

definition hasn't been useful for decades obviously, right. And I always make the example of that's kind of trying to define a phone by the fact that it's tied to war. Right, Because the same year that Javon wrote down as a definition of money, Um, Alexander Graham Bell got the pattern

for the phone. Well, we don't look at phones at the same way anymore, but for whatever reason, I think, mostly because of indoctrination, we're looking at money and currency in the same way, and unfortunately there's this conflation between those two concepts, which are radically different. Money and currency

are radically different things. Money is simply language, and the very simple example that you can make for that specifically, if you use a digital wallet of cryptocurrencies, whatever you have in holdings, if it's bitcoin, ether Um, ex app or any of the other old coins, you will always see the translation of your language of trade. So in our case it's typically going to be used dollar, but if you in Europe it might be the euro. So

that part is just language. Money is just language. Currency is simply technology that's supposed to solve the cored incidence of one's problem. And as far as the medium of exchange is concerned, for all feared currencies, for decades already has been digital rights. There's a once in a database,

so that part you can check off. As far as store values concerned, that's even a fire because no one for any lengths of time would hold any feared currency in their checking account, at least not in large quantities, right, because it's inherently inflationary because of its really uninteresting incentive system that would obviously have the issuer create more and more of it if you give them the power of which we do so UM and recently have been using

the example of hey, if you created a white people that would describe a feared currency the US dollar, and like how its government system is installed, everybody would call it a ship coin, and no one would partake in your I C or no one by right, right, and so to that extent, once you understand that this is UM like a misguided definition that you need to let go off, and then more importantly, what is currency actually trying to solve, which is a nouble currency of one's problem,

then you immediately jump to the conclusion we don't need more currencies, like we don't need another bitcoin, ether or any of the other outcoins. That's not the point, because any fear currency is also digital and for the most part, if you're doing a transaction, it's also a cryptographically secured so there's no difference there. The only difference there is in communication for the most part, as in now I have to explain to you what a bitcoin is and

why it's more important and whatnot. And we probably reached the point already where where most people that wanted to own any of those cryptocurrencies owns them, right, and there has nothing to do restore or value or utility because there's very little utility to be had as far as

using it in daily business. I mean, it was just yesterday that I got it email from UH, an Italian restaurant that said, hey, we are now accepting bitcoin, Like that's great, but yeah, I'm really not interested in paying you with bitcoin. I don't think most people were. You pay with an inflationary currency now with a deflationary cuarrency back. So yeah, I mean the thing is as an investor in anybody who who's dealing with money, we have been

treating this like that all the time. Right. If if you want to store value, you buy a house or something that's increasing, that's your store of value. You don't think of your fear that's a store of value. So so there's the fear created monster. Right. There hasn't been money since ninety one when we severed its relationship to a commodity, and since then it's simply that instrument. And so part of this is education that this is the case.

And the next part of this is, so how do you solve um not only the fundamental problem, the coincidence of one's problem, which you solved on the protocol level, and then the secondary problems that come with the fact that people still want to use or need to use

intermittently FIAT currencies. And to me, the solution is right in front of everybody, and I keep proselytizing that because we want to invest into that, we want to invest into what I call money of I P. And in a simple example, that could be your digital wallet which only holds any type of yet currency for that split second when someone's asking for that, and then moves it

into an actual store of value. And the actual store of value depends on the eye of the beholder, right, So it could be a bond, it could be a partial piece of real estate, could be a basket, it could be totally algorithmically created. And to that extent, we don't need quote unquote stable coins. I mean the stable compared to what, right exactly I mean, it's again, it's in the eyes of the beholding. At the end of

the day. Most of these are actually PAGs, right, most of them packed to a fiat, which is to say, the inflationary. But yeah, yeah, anyhow, so, um, I wanted to ask you deleting to that. So that's kind of where you went. So the solution is right in front of us, which is uh, is uh the moy I've heard it called money over I p or really it's a transfer value, right, blockchain transferring value, I think. Um. Even to add on, I love the conversation that you're having.

This is I could this is what I talked about on my YouTube channel. I could talk about all day, um, But really it's this. It's the shift where we used to look at it as information is what I got in the newspaper, the nightly news, but today information has changed. And you mentioned YouTube. Right now everybody's creating news, everyone's creating information. But even um, somebody on the beach across the world is putting a picture. And then I know what the weather is like, I know what the waves

are like. Right, So I'm getting all this information and I look at value Today most people, because of education, look at value as like money, but really there's so much more to value. And if we go to a tokenized economy, everything becomes tokenized and we use blockching technology constantly transfer value um and over over I P. Right,

I guess kind of what you're saying. Yeah, And unfortunately a lot of people have been throwing this top money over by p around without actually explaining and then probably for the most part, not thinking it through what it means in terms of what you actually need to build. I mean, it comes down to the fact it was this initial misguided idea of the fat protocol and kind of creating value in in the quote unquote token or coin. Obviously there's not value in the token or coin ever, right,

because it's part of the protocol. It's the pre to p element of the protocol, and to that extent um there's always a misapplication of that term token for the most but there's a very few options where you can create an actual token because understanding token and the context of blockchain is understanding that this is a pure to per instrument. So a blockchain, let's to create two things. One thing I call the digital vending machine, so the smart contracts or or a bottle of smart contracts. It

spits out what you need. And the other one is the token either can use the too in combination. But the thing is if you need both, then the first element of the at that the token doesn't actually have that digital better function anymore because with that digital bearer function, if I can send it to your peer here, you should have all the prerequisites that let you either own the asset and or have the right. And most of the time what we're actually talking about is why it's transfers,

not as it transfers. And there's a lot of conflation of these terms. Like as a law student, that's one of the first concepts you learn in civil law in Europe to to create these nuances between what is ownership, what is possession, what is governance and su course there all exist on different levels, and only if and when you can combine these in one instrument you can refer to as a token, because otherwise you will still need this other element. The typical example for that is the

very vanted security tokens. Security tokens are years of the way at best. So what I mean by that is I mean with with any given evinance context, you will need to look for certainry requisites in your person. Is this person able to buy that right and we're simply very far away from having these identity protocols on main net. But right now, also the value transfer protocols on main

net are super simple. Right, we really can only deal with assets and then to a very small degree with with I wanted to say, with fungible, so i e. Your your typical talking your typical feats pungible, and to a very small degree with with non fungibles, and they're mostly just recording the ownership entry and all of those assets. Take your typical crypto kitties, they actually don't exist on main net, right They they exist on the collapse UM

system and their servers. Meaning if that entity deplaps and maintains the crypto kitty environment, were was to cease operations, which it is a startup, and most start ups feel right,

so they're gonna be wrong. But the thing is, if you think this through, what you want to attach your security to any of those startups creating the side, I would not invest into that, and I wouldn't recommend that anybody's creating a quote unquote security this way, right, I think I I think there's no doubt that UM the way that securities are kind of created and owned and traded today could be improved. Um. You know, if I buy my share of whatever Tesla on eBay, I don't

really have custody of that share Ebata. You know, e trade doesn't have custody right, and and and it it creates all these problems. So it'd be simpler. But that to me isn't super exciting. Um. But I as much as I love the technology side and I'd love to talk to you more about that, I wanted to shift gears a little bit because I know we're gonna run out of time now. Um. You have this interesting background, and you obviously get the technology side and the future

vision side. Um. But you have a company, saysdy Capital. Um, that is your You're an investment firm of some sort, and you're actively investing in the technology. And I'm curious how somebody with your background in your future vision is looking at investing in the space. Maybe you can tell me a little bit about that. Yeah, I mean, as I mentioned, I'm a technologist at heart, and so we've been deeply integrated in the technology development environment here for

a number of years. We've been running the Theorem meetups since day one, Since Abul two thousand fifteen, so far more than four years. Now. We typically two monthly events and we'll we'll try to theme them to a particular topic. Like our last one last week was all around decentralized exchanges, so that more equity should be called on because totally exchanges.

So we're so be excited about UM particular angles in that space and the way we work, as I mentioned, it's using the scientific method to investing, which means we formulate the investment thesis. And in our case right now, we're working roughly of three large topics, the first one being UM what we talked about money very p and within money of IP will look for smart remittance systems, point of sales systems, at M solutions, smart wallet systems

and so far. So there's a lot of utility to we had, but it comes down to identifying the solutions and UM the actual operators that realized that because nine out of ten times or more, UM, we just realized that they're still stuck at trying to fix a meta problem, not the core problem. But they're trying to fix the bank.

You don't need to fix the bank, I mean as far as the as far as the payment go, I mean I see a lot of people trying to solve like take take traditional POS systems like point of sales systems and trying to help merchants take credit card or take take cryptocurrencies for example. I don't I don't really understand that. Yeah, it seems like, well, cryptocurrency was designed to be peer to peer and it's supposed to cut

that whole person out. So it's almost like they're trying to introduce a technology that actually puts them out of business, right, Yeah, exactly, that's exactly right. I mean, it's it's it comes back to they're expecting people to adopt the technology rather than adopt their technology to people that it's it's the basic

entrepreneur mistake that they're making there. So you need to bury the technology onto the protocol level so that neither the merger nor the consumer has to worry about um needing to learn a new language of quote unquote cryptocurrency. But the only thing they need to know is that this particular method doesn't have any fee or better, it's actually getting them something right, and that's what you need to build in your product. And it's it's not that

this is easy to do. It just takes more, it takes longer, more diligence, and mostly more diligence in the original setup and thinking. And then there's the the other portion to that, and that's again it's very specific to this topic, uh, the topic of regulation, and unfortunately because of the misalignment of interest, specifically in the United States but also all over the world. Um, the way legal

systems work. As a lot of these entrepreneurs, they they're going to either see the STC worst case scenario or um, not as bad but bad, go to the lawyer and get legal advice on how to build technology. Well, we already know that lawyers in general and regulators in particular don't make for good product designers, right, so that's already

a really bad idea. But then more importantly, um, they will never create a useful product because they misunderstand that this is an international technology and you should just focus

on creating that technology. Meaning if you're just providing the protocol, if you're not interfacing with the user, and if you're actually building a peer to peer protocol, there's no niccense needed, right, I can as long as I'm not trading in anything elictit you and I can trade anything for anything all day long, right, that there's no problem with that, And well, yeah,

with limitations, but limitations are typically physical in nature. If we could transfer this to the digital world and exchange value that way, that would be preferred. But then, more importantly, also these these jurisdictions are obviously different everywhere. I always say, well, if you don't want your security to be traded on the sabbath, or if it should comply to show real and every other regulation you could envision, I probably end up not building anything ever, right, And so it's not

about picking the right regulation. It's about deciding if you want to be in the business of acquiring these legacy licenses and then eventually wait for for these to kind of go away and unify, which will take decades or um more progressively, just build technology and and build technology in such a fashion that you actually don't need any of those. And we have the stereotypical example right in found of our nose every day. It's a bit common, right, But no, it seems like it's it's not like I'm

not saying this likely. I mean it's a hard thing to do, right, I mean bitcoin, But for all intents and purposes, it's it's a miracle that it exists, that it works and so far as so many things had to come together. But now that we have this example, you just need to pay close attention of how these examples came together and build it in that such fashion.

And that doesn't mean that you cannot make money from it, by the way, right Redhead makes a lot of money by implementing Linux solutions, multi building dollar company, but it just requires a different way of thinking and realization what the problem is. So how do you how do you approach that from an investment standpoint, I mean your firm Sesny Capital, like what you're investing thesis or like what

are the areas that you're focusing on? Yeah, yeah, So the first money of IP and like with any thesis, will put it out there, we run it against the teams that we talked to and get pay review and if we find someone who has an intelligent opinion that we haven't considered, then we adjust. Are thinking that's I mean, that's the best thing you can do. Is also the money over I P which is, like you said, kind of like the payment sector. That's kind of an area

that you kind of have your focus on right now. Yeah, because at the end of the day, I mean, investing is about timing, right, So it's when you get in, when you get out, and there's not a lot more to be had the next topic that we focus on the whole topic of regulation technologies, because as you pointed out, there is a lot of value to be had, it's just not around the topic of security tokens. It's more incremental than that, and has to be more incremental than that.

So there we made a couple of allocations in different solutions. Just one example, we're running thirty five notes for UM small fund. They have the ownly decentralized approach to this um issuance topic and um we like what Celsius does so this loan system. And another another voice over IP guy, Yeah, yeah, you need to have a talk with Alex about that topic because now you mentioned you mentioned before the fallacy.

You called it the fallacy of the fat fat protocol thesis. Um, so I guess based off of that statement you you stay away from protocols, not at all. We're allocated to a lot of the protocols we just um treated appropriately. So the all the the protocol allocations and supports, they're

managed by the data science team. So to that extent, you're obviously right now there's nothing you can invest into in the cryptocurrency space, right, So in the cryptocurrency and exchange in my mind, investing is the long t peround means that that's all speculation. You can invest into algorithms, and that's what we do. That do those tradings, and there's a lot of learnings to be had, so our expectations in the future once the systems have all gone

through the ring. I've been tested a thousand times for Sunday and you're you're probably aware of the quote unquote Binance hag right, which is really the wrong label for what happened there. But let's call it that. In a way, it wasn't advertising for that particular exchange, right because because just absorbed it and paid everybody out from the fund. Don't try that with your f d i C insurance, by the way, right, that would just in the f

d i C case, that would be just one bank glass. Um. But yeah, so money over appears one large topic and wrack technly in the other topic. But again, incremental, it's like we focus on the low hanging fruit that are actually time the end feasible right now with um the state of the protocol levels that we have, so we'll look at like bond issuing systems is probably one of

the easier products. Like people saying stuff like tokenization of real estate, they're just using it unfortunately, as a metaphor, and that's always a bad idea. As a technology investor. You don't want to use meta for us. You want to understand the technology. So unfortunately we use something we know to try to describe the technology, but then we put it into a box. Right yeah, yeah, as a

technology investor, you can't afford to do that, right. You need to fundamentally, at least fundamentally understand vocabulary, which is like we're still forming the vocabulary, right, So don't take my particular notion of how to define things as be all end all. If someone comes up with something better, I'm absolutely willing. I'm wanting to adapt that. Whatever I put out, it's always meant in the spirit of peer review.

I mean, that's the main reason why I talked to you or right on forks or anything to get peer review. I want to know when I'm wrong, and I want to know really really earlier, ideally before I spent too much time and money on making further mistakes built on wrong definitions. But unfortunately, it seems like a lot of people just jumped to just taking on these words, i e. Cryptocurrency. The term cryptocurrency is other useless. Right, any currency, hopefully

in its transfer mechanisms using some form of cryptographic protection. Right. I assume that VISA is using that. I'm not sure, but I assume they do, and they might not use the blockchain variety. But at the end of the day, then that's the other topic. Oftentimes, when I find people using this term blockchain technology, I think they haven't thought about this for long enough, because blockchain technology in that never sense is really just a fancy way of encrypting

things which has been around for twenty years. Right, It's really about creating um the incentive mechanisms factor in your network that creates the immuntability that lets you allow to build digital bearer instruments, which at the end of the day will then allow you to build the quote unquote digital vending machines with which then I think those are all the problems that lead to the regulations because they're trying to like put these into these classifications that just

don't exist. And UM, a lot of these utility tokens, if you will, um are meant to be used on a system. UM like maybe you would go to david Busters and buy tokens to play video games or chuck E Cheese, or when I go to the grocery store, they give me reward points, um, and they're kind of similar to that, and I can use them back in the system. However, when I use my Chuck E Cheese token or my my grocery store a word points, I don't. That's not a taxable event. But now they're calling them assets,

and now they're taxing me to use them. And then it's like, but that's not what they are. That's not you know, and so they're uh, and that's what only one particular context. And actually frequent fire mars are actually taxable, right yeah, same, but like that's different again in other jurisdictions. And again that shouldn't play a role. Because I was

just at the conference. You probably were there when I was talking to Hasta from the SEC, and the first thing that I told her that I always tell regulator or lawyer that I talked to is like, whenever you open your mouth, shouldn't you make the disclaimer that you don't get ready you like technology, that the only thing you get to do is limit the right of your citizens, because that's all you get to do, right as a regulator of any nation, like you can tell your citizens

what to do and what not to do, mostly what not to do. So if that was actually always phrased in mass particular fashion, it wouldn't get much play, right because you don't get fast standing up in front of your citizens saying hey, I don't want you three hundred million people to be able to buy digital tokens and

potentially get rich stuff from that will potentially lose anything. So, speaking speaking of that, there was the California we're both in California Sherman who came out and said point blank that U. S citizens should be uh, it should be illegal for US citizens to buy cryptocurrency. Right. Um, So he did get up and say that, yeah, you probably, I mean, he probably just wanted to get a reactionize no one can be that misguided too. Well, he I

don't think he was misguided. He actually said so. He said the reason why they should be if they it should be illegal for them to own it is because they believe it takes power from the U. S. Government or the the US dollar, the petro dollar, which weakens our stance to give sanctions to countries like Iran. And he specifically mentioned them. Um so he said he he knows exactly what he said. Um, but I think that

gives fuel to Iran. So they're like, well, heck if this, if this takes away the part of the U. S to slap sanctions, and we're all for it, right, So yeah, I mean you obvious need to take a step back and see how this is more likely to play out because yeah, and for the time being, nations, the states are in a competition, right and we see this play out right now in a very specific way, i e. Nonsense like what New York did with the bit licensed people will just leave New York and exclude New York

City business for participating and or just decide entirely have we don't want to play with US citizens. So if you carry this forward, Um, if you have done the same things like yeah, we don't trust this internet thing, we don't let us people have access to the internet. Can you imagine that happening and how we would be competitively in the world today, right, and it's no different,

it's actually worse by several orders of magnitude. What I mean by that is, so not only is block BLOKTI based solutions going to dirupt a disrupt value transfer, but because of the decentralized nature, A will disrupt anything that came out of the decentralized Internet. And then we see already the beginnings of that right now. But obviously things like Google and Facebook and the way they create money for their shareholders that shouldn't have been allowed in the

first place. Right the Internet is the commons, and no one should be allowed to filter it and then aggregate content for their own purpose, and specifically not in a

various way by by selling data. And now that's pretty much accepted wisdom, I'd say, But um, coming back to this topic of competitiveness, we can already see this play out right now here and there, with other jurs addictions being faster to adopt more appropriate regulations if any or simply saying we are hands off, or tell everybody, well, but we just treat these as digital commodities, as in

the case of Canada and so forth. So if I asked you, if I asked you to give me your outlook for the the world, but the US, where the U s fits into the world over the next couple of years. It sounds like you're optimistic. You think the US is going to get on board and not push too much of this stuff overseas. I think that was already left behind and that's only going to continue. Um Well, a lot of damage I think has already been done. Um I think at this stage just can still be undone.

I don't really like to think in nation state terms. I don't think they're used for organizing principle at this moment in time for humanity and because we're facing so many global problems. But um again, I'm a technologist at heart, and so I'm eternally optimistic when it comes to the the ability of technology to solve every problem that we're facing. And that's kind of my focus. So to that extent, I think it will always start, um with efficient data

distributions or information distribution. I think once we solve that, it will kind of dissolve a lot of these misconceptions because um, if if you will, all these misconceptions are all these ideas that I'm I'm an American, I'm in Indian and whatever. Those are all just indoctrinated. Indoctrinations were just to say beliefs. If we just let go of that,

we're all pretty much the same as humans. And so if you have the technology to to actually disseminate that information, like, the more you travel, typically more accepting of other nations, right, that's what you find. And and the more you learn and general about how the world works and what's important, the more accepting you are, the more collaborative you are. And that's the winning formula, right, And that's why at the heart of this particular development is open source technology.

What's open source technology? There's a bunch of people that don't know each other, from from all around the world that collaborate to one particular purpose. Why are they doing that? What's the internsing momtive? Because simply because a they can and be it just excites them to see that particular thing in the world. And so you can't stop this with a nation state. You can stop this regulation, you can't stop this with government created money. Right. What they're

gonna they're gonna try, but it's unstoppable. Yeah, And to me, I mean it's unconstitutional to try because at the end of the day. I mean, any currency should be free. I mean, what's the greater expression of your freedom, freedom of expression than allocating your wealth your funds. It's more than state. The state is always going to want to try to control that trade because they're always gonna want

their money, right. Yeah. But what shines through there, though, is this idea that government's identities there aren't they're functions of society. So that's another thing that we need to get back to, realizing that governments are to serve societies. Now we created all these like quote unquote entities and institutions. There aren't institutions, there are functions of societies. If we realize that this is the case, then we can replace

most of them with technology. Because there's a lot of these entities that we're that we created, that we that we keep alive for no particular reason, right, I mean, they shouldn't exist and like nonsense, like the internal revenue, so it should not exist. The The idea of how we implement our taxation system um by basically penalizing production has been has been accepted wisdom since the eighties that this is not a really useful system to have because it's causing what we call a lot of a lot

of partial parts of the money law doing things. But well, yeah, if you if you tax Apple because they happen to be in Crepitine all about, they can create entity in island to other ones and then uh slash the text boat and half of course they need to do that, right, I mean what we would be gross negligent not to do that. So what what you're really doing as you're incentivizing, um those entities and the most productive people typically of societies to look elsewhere. Right, So we have a and

that's and that's uh. And and that's why blockchain or bitcoin and blockchain is so interesting because you have to be so multifaceted, and one is on philosophy. And that's where a lot of these policymakers and economist miss is they don't understand human incentive. They try to organize everything, but they missed that big piece of incentive. Um And so you've nailed that, um Man. This has been an awesome conversation. Uh, these are the parts that I really

enjoy about this space. So I could just talk about it forever, and I know we've gone way longer than you had agreed to come on for and every they appreciate you taking the time. Um, it's been it's been great. UM shared some really good information, some good food for thought. But I want to I want to respect your time now, UM, because you're so interesting. I'm sure other people want to know. Is there are a place they can keep up with you. Well.

So I've been working on this long time project which I called my book project. Although I'm not entirely sure whoever result in the book at this point in time, because I started this fourteen years ago, but it was right after I realized that we never got around to actually finish what we set out to do, which is to build the worldwide weapon. Instead ended up with the

commercial web. So I started writing an outline on on my block it's just my last name came dot com a long time ago, and um, as of a year or a year and a half ago, I started writing an article also every month every other months on Forbes, which was basically an outline of one of the chapters in in the book. So at this point in time,

it's obviously largely slanted to watch the centralized system. It started out being about the centralized systems, but knowing obviously what I now Now with current developments in the blockchain space, it's much more sophisticated in in detail oriented. Worse, the initial outline was mostly on principle, so it's like fourteen principles of how you need to organize information distribution to make it sustainable, which to me is that the core

of most of the problems that we face today. I mean, we will summarize that there's fake news, but it goes much deeper into the fact that you can basically google anything and find your ever so misguided opinion confirmed. And it doesn't matter if the world is flat or um. You have whatever name you want to assign to your respective and visible friend, right. Uh. And that that's obviously true because there's so many people that subscribed to the idea.

So I kind of adapted the opposite means. If if a lot of people think that's the right thing, is probably wrong. So I set a lot of people eat that McDonald's, that's probably not the right thing to do, right.

That's one of the highlight examples. But um, yeah, so to that extent might be, I always like to get feedback on the stuff that I published there on on forps, the only thing that I once in a while published an article because it's not the right venue on forps, publishes on on linked In, but I'm not much otherwise

present on on social media. I think I tweet maybe every three weeks of that and then mostly too like a now and say, we have a meet up, but does anybody want to talk about the Centristic exchanges or game technologies or whatever. Right, well, I'll get some links to those in the show notes and as far as your meet up, so I'd love to come since we're both in the local area, so I definitely want to stay more in touch with you on that um. But we'll go ahead and wrap it up. Thanks so much

for joining the Market Disruptors Podcast. Hey, if you like this episode of the Market Disruptors Podcast, please help us take this to the top of the podcast charts. Just please do me a favor and rate review and subscribe. Taking fifteen seconds to just leave a quick review goes a long way and helping us reach more people and disrupt more markets. I really appreciate you listening and I'll see you next time on the Market Disruptors Podcast.