Bankless - Layer Zero | Eric Conner

Episode Date: August 31, 2021

Eric Conner joins the second episode of Layer Zero. Eric is the co-founder of EthHub along with Anthony Sassano, and is a recurring Bankless guest as well as a crypto twitter staple. From the early days of Ethereum to golf and Porsches, David and Eric discuss things at large — what does Ethereum have left to prove? How do you manage Ethereum Brain? What will the next generation of crypto natives look like? ------ 🚀 SUBSCRIBE TO NEWSLETTER: https://newsletter.banklesshq.com/  🎙️ SUBSCRIBE TO PODCAST: http://podcast.banklesshq.com/  🎖 CLAIM YOUR BADGE: https://newsletter.banklesshq.com/p/-guide-2-using-the-bankless-badge  ------ BANKLESS SPONSOR TOOLS: ⚖️ ARBITRUM | SCALING ETHEREUM https://bankless.cc/Arbitrum  🍵 MATCHA | DECENTRALIZED EXCHANGE AGGREGATOR https://bankless.cc/Matcha  🔐 LEDGER | SECURE YOUR ASSETS https://bankless.cc/Ledger  🦄 UNISWAP | DECENTRALIZED FUNDING https://bankless.cc/UniGrants  ------ 📣 TracerDAO | Building DeFi Infrastructure. Join the Discord! https://bankless.cc/TracerDAO  ------ Topics Covered: 0:00 Intro 0:00 Intro 4:00 Eric Conner & Podcasting 7:00 Early Liquidity 15:53 Regulators Protecting Investors 25:28 Finance Background 31:12 Integrating Digital Finance 38:58 Bitcoin and Maximalism 46:27 Punks vs BTC 51:00 Ethereum Brain 56:18 The Space Never Sleeps 1:01:30 Marrying Ethereum 1:05:36 Golf 1:06:44 Porsche & Electric Cars 1:10:40 Governance Tokens 1:19:19 Closing & Disclaimers ------ Resources: Eric on Twitter https://twitter.com/econoar?s=20  EthHub https://ethhub.io/  ----- Not financial or tax advice. This channel is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. This video is not tax advice. Talk to your accountant. Do your own research. Disclosure. From time-to-time I may add links in this newsletter to products I use. I may receive commission if you make a purchase through one of these links. Additionally, the Bankless writers hold crypto assets. See our investment disclosures here: https://newsletter.banklesshq.com/p/bankless-disclosures 

Welcome to Layer Zero. Layer Zero is a podcast of unscripted conversations with the people that make up the Ethereum community. Ethereum is built by code, but it's composed by people. And each individual member of the Ethereum community has their own story to tell. Cypherpunks understood that the code they write impacts the people they use it. And Layer Zero focuses on the people behind the code because Ethereum is people all the way down, and it always has been.

I'm David Hoffman, and today we are talking with Eric, Connor. Eric Connor is what I have been calling the unofficial community manager of Ethereum. The metaphor I like to use is that he was stoking the fire during the 2018-19-20 bear market, keeping the fire warm for all of us while we all kind of coped with having absolutely no interesting price action at all. Meanwhile, the innovation and development behind Ethereum and what was going on in the early, early stages of defy was absolutely insane. And Eric was one of those people who has helped everyone, I think, understand that, no, we're not crazy. Everything that's happening here is insanely awesome and cool.

And just because the prices don't reflect that doesn't mean that it's not awesome and cool. Eric has gone in and out of being a prominent crypto-twitter individual. As soon as the bull market came on, he started to kind of take a step back. And now he's kind of graduated into more or less just a shit posting position. and I actually kind of find his journey in relationship to Ethereum pretty interesting. As we all know, Ethereum is very, as an ecosystem, it's very dominating, very overwhelming. And Eric has gone through the whole entire stages of like, you know, early stage interest in Ethereum, deep diving all the way into it, getting overwhelmed, having a bull market come,

taking a step back, and learning how to really walk the line of like Ethereum life balance where you can actually live a life that is actually not completely defined by, like, being an Ethereum or crypto Twitter person. Eric's has always been a mentor to me in learning how to navigate the space and some of the insights and just, you know, things that he says I always find are more and more true as time goes on. So I hope you enjoy this conversation with Eric Connor. But first, before we get there, we have to take a moment to talk about some of these

fantastic sponsors that make this show possible. Arbitrum is an Ethereum scaling. solution that is going to completely change how we use defy. If you've been using Ethereum for the past 12 months, you've probably noticed the high gas fees and the slow confirmation times that have been plaguing Defi. Too many people want to use Ethereum and it doesn't have enough capacity for all of us. That's where Arbitrum comes in. Arbitrum is a layer two to Ethereum, which means Arbitrum can increase Ethereum's throughput by orders of magnitude at a fraction of the cost of what you are used to paying. When interacting with Arbitrum, you can get the performance

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great migration to Arbitrum layer two. To get up to speed with Arbitrum, follow them on Twitter at Arbitrum and join their Discord. Bankless is proud to be supported by Uniswap. Uniswap is a new paradigm in asset exchange infrastructure. Instead of a cumbersome order book system where trades are matched with other humans, Uniswap is an autonomous piece of software on Ethereum, which is what Ryan and I call a money robot. No human counterparties or centralized intermediaries, just autonomous code on Ethereum. Input the token you want to sell and receive the token you want to buy. Something brand new in the Uniswop ecosystem is the Uniswap Grants program is now accepting applications for grants. We have been saying this for a while and will say it again. Dow's have money and they are in need

of labor. If you think that you have something to contribute to the Uniswap Dow, apply for a grant to Uniswap. Just look at the size of the Uniswap treasury. It's almost $3 billion. This mountain of capital is looking for labor. Do you have something of value to contribute to the Uniswap Dow? No matter how big or small your idea is, you can apply for a UniGrant at Unigrants.org and help steer Uniswap in the direction that you think it should go. That's exactly what we did to get Uniswap to be a sponsor for bankless and you can do the same for your project. Thank you Uniswap for sponsoring bankless. Hey Eric, how's it going? Hey, David. Good. How are you? Pretty good. Pretty good. You are a guest number two on layer zero. Nice. Yeah, I'm excited for this new format you were telling me about it. It sounds

like a nice little change up. I feel like in the podcast space like we were just talking about this before recording but stuff gets a little like not scripted but like you kind of hear the same questions and formats over and over. So just kind of a freestyle is my vibe these days. Yeah. And freestyling is definitely something like missing in crypto because like there's so many projects to talk about. And some people like explain the rationale behind their projects in really like awesome ways. But to me, that makes me think of like, okay, why is this person like so good at a, coming up with a project and then B explaining it? Like that tells me there's like a little bit more behind the scenes of what's going on there. Yeah, totally.

No, I know. There's so many, like, I mean, in crypto in general, it's funny, right? Like, I feel like going beyond just the typical, like, interviews and talks is when you get into the more interesting conversations. Like, doing it into the ether when I would do guest episodes, the best stuff always happened after the mics got turned off. And it's not because people are like people. It's not because people are, like, people are like scared to say stuff either. It's just like when you just, I don't know, when there's just free flow conversation with no one's looking at questions and stuff, I feel like people just say. And it's not like they're saying something they wouldn't have wanted to say. on mic it's just like a more natural conversation. I mean it's definitely like a little bit of that right. It's like, all right, now that we're stopping recording, I can like take the persona off and I can like like kind of speak a little bit more freely, a little bit more like I don't have to consider like lawyers or anything. But then also to some degree like it's just like you bring up all the things that you forgot to talk about while you were on the actual recording, right?

And then that's like you said like the super interesting stuff. It's terrible practice and you know I would never actually. do this, but like I always wanted to like just leave the recording actually going. It's like, all right, we're done now. But I'm going to leave it. I'm going to still record though. Yeah, then like release like blooper clips as like one big. People would not be too happy about that, I'm sure.

No, no. Not at all. Not at all. So I kind of want to start this, uh, this conversation and then actually work backwards from it with, um, Ether Delta. Tell us, tell us about Ether Delta and what it was like to trade on Ether Delta. Yeah, man. Wow, that's a huge throwback.

Yeah, I guess most people listening probably know at this point. I got into the Ethereum scene because I had, it was like an IRC trading channels. Man, it's funny even think of back like IRC. Now we're on Discord. So much more. I actually don't even know what IRC is. I never got that experience. It was like, yeah, it's like the original, like totally.

You didn't miss much. Like it was kind of like where people that anonymous wanted to go and kind of hide and like it wasn't being tracked and stuff. But just total shitty. Just like text channels. right and but that's where like a lot of bitcoin traders hung out in their early days and i had some friends that got owned in the gocks hack and that led us to say okay what are we doing here we've got this technology potential why are we trading these decentralized assets why are we hiding in irc channels and all this stuff and we're just trading on centralized exchanges and that sent me down like around

that exact time um was when vitalic pitched theorem at bitcoin miami and everything just kind of clicked So long story short, we, three of us, a couple friends I got owned by Gox and myself, who didn't get owned by Gox luckily, set out to build EtherX, which was a way too early attempt at building a decentralized exchange. But funny enough, that ended up one of the people, he wasn't like a direct team member at the time, but he was in like our Slack channel. He went on to build Ether Delta. And man, like that feels like a totally different universe at this point, right?

Like you had to literally go, like people are so spoiled now by AMMs, right? Or you go on, you just trade and matching happens. And even like if you're using like matcha or one inch, like all this stuff just happens easily and you get matched. On ether Delta, you literally had to go like click the specific order to get matched. And it was so shady. Right. There was no market buys, right? Like you could just market buy.

You had to actually select an order out of. And you could, if you were not paying attention, you could in theory, like select a less optimal order. order than what was best offered. And sometimes you would actually have to if your trade was larger than the actual best offer, but your trade was so large, like it just wouldn't matter and you didn't want to go through all the steps. You'd actually have to take it, go down the list. Yeah. No, it was brutal. And it's funny because like anybody could list a token, which, you know, that created chaos too. And you could plug in like addresses. But like if you think back, right, like it's funny how sophisticated that actually was. It was just like the user experience was horrible.

We hadn't quite figured out the user experience. But like in a way, that's kind of how, like Uniswap, you just plug in an address and it pulls up the token, right? It's just, it was done differently. There was too much information on one screen. So like you knew you knew something was there, but you weren't sure like how long it was going to take to become mainstream. And I would say it happened a lot faster than I actually thought it would. I've kind of always back then probably would have said, uh, 10 years down the road, mainstream might be using dexes. And then all of a sudden, you know, what, two years later, people, Uniswap came.

long and stuff like that. It's crazy how fast it actually moved. That's definitely been like the pattern that I've noticed is like, all right, we have this ether delta thing. Like, it's a great proof of concept. It's obviously broken. And then you don't see any progress for a really long time. And you get a little bit disillusioned. You get a little bit frustrated. You're like, all right, what is this thing that we are actually doing here? And then all of a sudden, boom, there's uniswap. And then like just a few short months later, we've solved all those problems like all at once. Right. It's like there's nothing happens.

You get frustrated and then boom, the solution happens. And then it's just like a step order function and like the way this stuff works. It's crazy. And I guess it's because of all the geniuses in this space, I think. I mean, my investment thesis for ETH has always been like the smartest people I know are essentially all in Ethereum. Like the smartest people I've run across my life. I mean, obviously there's some outside of the space. But like in general, the more amount of smart people I know are in the Ethereum space.

And like, that's always been my investment thesis. think that's why things happen faster. And also, like, we've totally cut out, like, the corporate bureaucracy crap, too. And, like, even coming down to, like, creating products, right? Like, I have a background in product management. Before that, it was finance. And, like, things just take longer to build in the traditional space. Because you have, like, managers and you've got these, like, silos. And you're going through, like, these old, outdated processes, right? And I feel like now people are, like, let's just get a small team together and build this. And we'll feel. figure out funding later. And a lot of that has to do, I think, with these teams know they can launch

a token or easily raise money later, right? And I think that allows people to fearlessly build things. And that's kind of, I believe, why things seem to move so fast in this space. That is a good point that I don't think I've thought of before. One of the magic things about tokens is like they're easy to issue, they're permissionless to issue, so they're always a tool for every single team. But like people can, like, quote unquote, like go public and get liquidity way faster in the Ethereum world than they ever could in the traditional world, right? You'd have to go like seed round after seed round after seed round just to stay alive. And like now we're seeing like things and projects develop with just like one or two seed

rounds and then token. And then like at that point they have all the money that they could ever ask for that they would ever need. Yeah, totally. It's interesting, right? And like you're putting that risk more on just random speculators, which back in like like the, I guess in the 17 ICO days, that wasn't ideal because people, there were a lot of promises made and like the ICOs happened and teams disappeared. But now like you just said,

we kind of are getting the product first at least. Like I don't, I can't remember a team in the last like two years that launched a token really before product. Like maybe a few scammy ones, but nothing like legit, right? And I think that's been the big shift. I mean, tying this all the way back with like ether delta, right? That was the first time we're like, oh man, these tokens, like tokens have been talked about in the white paper and theorized. on Reddit and all of this. But that was the first time where you're like, wow, I can get like instant liquidity for anything I create. And that that was a huge breakthrough that Ethereum created. And I think got lost in a lot of the 17 ICO FUD was it wasn't like about scammy ICOs.

It was about anybody in the world being able to fundraise at a click of a button. Like, and that's all that's insanely powerful. And now at least we're seeing products be built before you launch like a government's token. And that gives speculators a little more me to work with, right? And I think it's less risky. Yeah, they're taking on risk that the team disappears and the token doesn't do well, but that's a way better model that we're at now than back in the ether delta days. There's probably like a connection between the how powerful the concept of early liquidity and token liquidity that we were just talking about and the magnitude of like the ICO craze. Like early liquidity is such a powerful concept that it accidentally created the ICO mania because like we got just like over our ski tips like way too soon.

And so like there's a connection there. Like the ICO mania was so incredibly massive because this tool of early liquidity is so incredibly powerful. Yeah, no, absolutely. And it's like we saw people just totally fomo into that. And it's funny. The other, the flip side of that is not only could anybody raise liquidity, anybody could get into early startups. Right. And that's something that I think people underappreciate as well.

And like I think regulators are most scared of that, I would say. I think when the SEC claims they're trying to protect investors, really they want to have a say on like who they want the gates of entry right controlled of who can get into these things and traditionally it's just been accredited investors which are people that are already well off and wealthy that can get into seed rounds and series a and early equity investments right and that this is a huge paradigm shift so I think on one side you saw these teams say oh wow we can raise money instantly let's do it and on the flip side it was like a perfect boiling point right on the other side it's like oh wow for the first time ever I could try to be an early investor in a

project. And those two concepts are not going anywhere. And I think, oddly enough, we're kind of self-regulating pretty well as an Ethereum community. I think it pretty quickly on Twitter, like if something seems scammy, like it's called out. You know, some people are going to get burnt, of course. Like we're going to go through booms and busts. But I think we're doing a pretty good job as a community and realizing, you know, these models. I think we're at a good point now where it's like at least like we were just saying, you have a product and then you do it. But it'll be interesting to see, like, is the SEC R regulator is going to try to really crack down on this? Like, Anthony and I were just talking last week. I mean, Polonex got fine, but it was only like

$10 million. And it's like, how big is the SEC's bite really, right? Like Poloniate X has made way more money than that, and that was their fine. We saw that with EOS too. So I think that's going to be an interesting narrative to watch going forward. Totally. Here's something I want to get your perspective on. And this is something that Ryan and I talk about on like the weekly roll-ups all the time where we talk about like the SEC regulators preventing like IMX and like the other like token air drops from going to US citizens and like it's all under the guise of like yeah we're protecting investors but like in this format they're definitely not because all they're doing is protecting investors from air drops and like the one of the cool things we've unlocked with early liquidity

is you know putting like potential 1,000 X opportunities into the hands of individuals so like there's two rationales that like could come out of this. One is that like the tax reporting requirements gets a lot hairier when like it moves from just like, you know, small funds and and accredited investors. And there's only like a handful of those that invest, right? Like for an, for the first like seed round or angel round, like it's just like maybe 50 different entities, right? But then when we do in like an ICO, that moves into like 5,000 plus individuals. And so from like a, it's, like, tax collecting and reporting perspective, it's just like two multiple orders of magnitude more hairy to make sure that all the citizenry is reporting the taxes that they are obligated to report.

So there's one perspective. The other perspective is that all this regulation is just like done by incumbents to gatekeep so that they can have all the exposure for themselves. And so like, you know, if only 50 entities are getting into an early, you know, investment opportunity, it's more likely that, you know, they are, the incumbents are one of them and they can keep. all the you know the small fries from having these massive upside opportunities from early stage startups and so that's the other perspective I'm sure it's a little bit of both true but like which do you think is more true yeah I agree that it's a little bit of

both I think there's the so I if I had to pick one I would agree most with the first because I do think government IRS are definitely feeling overwhelmed with tax reporting and how to even handle this right like I I don't even know like honestly if someone tried to look at my transactions from 2020 I can barely figure them out enough to report them. Individuals can't figure it out. How is the IRS can do it for everyone? Right, exactly.

And like the reporting rules are still not quite there. I think we're years away from those being really clear. So I do think it's that, right? Right now, like you said, a lot of wealth is concentrated in a few entities, a few people, and it's easy to audit them and look at those returns, right? And that's where a lot of the money's being made, so that's where a lot of the taxes are coming from. Now that wealth is spreading out more, I believe crypto is really kind of spreading

wealth out to a newer, younger generation and amongst more people, yeah, if they can't track that, they're going to be worried because they're potentially losing out more if people aren't reporting them correctly, right? I also think there's a perspective, too, where in general, like, within regulators and within the government, there's a power game as well. And I think some of these, entities need to stay relevant, and they're, like, crypto's the thing coming down the pipeline, right? And they're all trying to become the agency that regulates crypto, right? Because that's a that gets them more funding, more bodies, more power. But yeah, I don't know how, I mean, they have to be scared, right?

Not scared because it's scared because it's overwhelming to them. It's new. And some of this stuff is just really, really hard to trace. There's software out there, but like, you know, LP positions and how that's treated and all this stuff. I mean, I think if ever, they're 20 years away from you able to properly understand this. So they're trying to figure it out. Yeah, yeah.

Shit, where I was going to go with this? To some degree of this, like, think of the people behind the, with the responsibility of, like, figuring out all this stuff. Like I said, we can't figure it out. It's going to have to be some sort of, like, automated thing. Like, something like chain analysis or some, like, government, like, automation of just because we can read the blockchain, like, it's going to have to be, like, an input, your addresses receive a number type of thing.

And, like, maybe you can make arguments about, like, how. how the calculations were done wrong, but like, there's so much, like, and plus, like, people, I play with my ledger all the time. It's like, oh, like, sometimes I'll wake up and I'll make 50 transactions in a day for some fucking reason. I don't know why. And like, all of a sudden, there's 50 transactions that I have to, like, log in report. And like, again, for the individual, if the individuals are overwhelmed, there's no way that, like, the IRS isn't going to get overwhelmed. And it's also the perfect substrate to automate, right? It's literally a blockchain with all the transactions. It has to be an automated thing. Yeah, I agree.

I agree. I think that's the way forward. I think really what it's exposing is how ancient and outdated the tax laws are in general, right? So I think what we might see is agencies just being too overwhelmed and that leading to simplification of tax laws. So what might that look like? I know some countries have basically just like a Fiat and Fiat out policy where it's like just net gain or loss on your Fiat and you pay tax. Yes. Just forget that simple. It's just like that. Well, the problem is that then that incentivizes never actually going back out to Fiat, which is like definitely. definitely something I preach. Yeah, yeah, exactly. Yeah, that's a bankless model, right? But like something like this, right, to get things more a flat tax, for example,

and not all these different tax. But like Ethereum defy has become too complicated for the tax laws. Like how you handle AMMs, some, you know, like I report them one way. I know some people reported a different way, other countries treated. Like they need to just come up to the times. And I think I hope this is going to result in simplification. Like I don't mind paying my taxes, but the huge bitch of it is trying to figure this all out and logging 7,000 transactions and all that. I do mind spending like 40 hours a month

of my life like trying to actually do it right. Exactly. You talked about how like these different agencies are trying to like all jostle for position to try and like be the agency that regulates crypto. And this is something that like well, while generally most all Bitcoin maxis and most bitterners are pretty naive, sometimes the stories that they tell and the narratives that they weave are like super accurate. And maybe this is, Bitcoiners don't have a monopoly on this narrative, but like, the state is an organization, and like all organizations

everywhere have an incentive to grow larger, right? And so like, there's, like their CFTC, SEC, SEC, the Treasury, they all have their incentives to grow their funding and grow their influence and power just because they're by the nature

of a very organization, right? And so like no, and so this is always why Bitcoiners are so like anti-state. state is because they all like see the logical conclusion that like some sort of like three or four letter agency out of the government is going to want to capture our industry. And so what are your thoughts on that? Like how do you think about that? I mean I agree. I definitely agree with any organization is going to try to get bigger and over time get more barnacles and become less

efficient. Right. And I think like you see that in this infrastructure bill, right? Like it's supposed to be an infrastructure bill. But then there's all these amendments and tackons and the crypto laws are in there. And like to me, it's just become inefficient, I would say. And I definitely am worried. I don't know where the fix is going to be. I personally, like, if I had to vote on something, I'd probably say term limits just to kind of keep career politicians out of this. You know, I agree, but I don't, okay, so everyone was freaking out over the infrastructure bill stuff. And like, kind of rightfully so. We need to fight for ourselves. We need to lobby. But I think what people don't realize is that that this crypto generation is growing up and getting larger. And a lot of people from this

crypto generation are either going to become politicians or have power to vote in politicians, right? And I think what we're seeing now is a lot of, you know, politicians maybe going out near the end of their terms, life, whatever it might be. I mean, some of these politicians like 100 years old in Congress. I think they're going to just eventually be replaced with crypto-friendly people. I know it's hard to imagine now because people think that, yeah, the states against crypto and all that stuff. But if you kind of grow up in this, it takes a while for a paradigm shift to happen, right?

That's why I'm not too worried about long-term, you know, regulation of this stuff. But at the end of the day, right, if we can be regulated, if defy can be shut down, then we're doing something wrong, right? There's some centralized point of failure. And that's kind of been my point on the infrastructure bill. Like, guys, okay, yes, it would suck to get some regulation

put in against us, some tax reporting requirements. But if you can stop defy, we're doing something wrong. We're here to make sure that this stuff doesn't matter, right? Right. Yeah, all they're doing is they're just putting more and more onus upon the individual, but they're not putting more and more onuswap. And that's like, that's the important thing, right? Like so long as uniswap and so long as the actual code is untouched, then fine.

Like, we'll take, we'll concede whatever so long as it's, you know, reasonable. Yeah, totally. I mean, I think we have done ourselves a little bit of a disservice with heavy reliance on centralized stable coins, USDT, USDC. I do think there's a point of attack there for governments that we need to be careful with. I mean, most all D-5 protocols are very heavily reliant on this liquidity from centralized coins. I think that's where they would try to go after first if they could. But, you know, now Coinbase is a public company.

They have a bunch of lobbyists themselves. So, yeah, I mean, this is a long battle. But I do wish we would kind of reduce our reliance on that, if anything. Right, yeah, I do hope, and I'm sure Amin would agree with me, is like, Rai is actually the way that we stop giving so much power over to USDC. Right. You said that you have a background in finance, and so I actually want to pick your brain on that. My old roommate and a bunch of my friends from college, they were in like the business school part of the college,

shot part of the university, and I kind of like tease them and joke with them about like one of the reasons that I've done so well in crypto is that instead of majoring in business, I majored in psychology. So I didn't actually have to unlearn anything in order to learn crypto, but you actually majored in finance or have a background in finance. So what was it like coming into crypto with a finance background? Do you think that was all like relevant or like what was that story like? I would say, yeah, it's interesting. It's funny. I've always been kind of fascinating with finance. I was like my dad set me up with an e-trade account when I was 10 years old and like dial up internet and gave me a little bit of money in there. And I was picking out some stocks that I like tonight. So I've always been into trading and kind of my own personal financial stuff, which led

me to a finance degree. But, you know, the finance degree was more of a play. And I've always been a numbers guy and into trading, but more just like it was going to be safety coming out of college into a job. But then the financial crisis happened and I graduated in 09 and that wasn't really the case. But everything worked out. Yeah, I would say like... Graduated in 2009 with a finance degree. Jesus Christ. I got lucky enough to find a good internship and then a job right. after somehow. But yeah, it wasn't the best timing in the world. You know, I would say like what helped me most was more that background I had in like trading and finance. I don't think my finance

degree specifically has been too applicable in crypto. But what it has helped me with is like realizing how outdated the traditional finance world is. Right. I worked at a bank for five years. And like it was great experience, met great people. But man, just like the process. is in place and the technology. What's funny is I discovered crypto while sitting at my desk working at a bank. Yeah, I ran across an article about Bitcoin in early 2013 as I was like bored at work scrolling through something. I think it was on Reddit. And I instantly. What a hilarious just like snapshot of his of just like oh yeah, bored at work at a bank discovered Bitcoin because he was bored. Exactly. And then it, you know, it fascinated me. I sent it to my girlfriend at the time now my wife. I sent it to her. her and I'm like we should probably like kind of look into this thing led me to buying some what's really funny wait so you bought bitcoin and and saw the thought that bitcoin was cool on your first exposure to it yeah well you almost never hear that I wouldn't I didn't buy it that day sure a few days after I did a little research and created a coin base account and then

most people like they get exposed to bitcoin and then they're like man this is bullshit and then the price runs up and they're like oh I miss out on that and then that's when they get in You know what's funny about me is like I get very upset if I miss out on something that I after the fact find to be really awesome. And so I was already mad that it had gone from a dollar to like $200 at the time. So I'm like, I already missed this, but I'm going to buy some anyways. So like, you know, I felt like some of that with some NFTs these days too. But yeah, anyways, then I found it.

And then I just kind of went down the Reddit Rabbit Hole, IRC Rabbit Hole. And then what's really funny about the story to kind of tie it all back to my finest degree is like I worked in the treasury department and our treasurer at the time had this little like box in the kitchen you could put questions in. So I wrote a question mainly I've been a troll I guess my whole life, but I put a question in there. And then I said, what do you think of Bitcoin? Like it's been on this big run lately. And this is the treasurer of like a large regional bank, right? And he responded to it and he actually had a good response. And like it kind of he would respond over email.

there's a whole group. And like he was like, you know, it's a typical. It's probably in a bubble, blah, blah, blah, but he had some good thoughts on it. And it kind of like sent this like Bitcoin like exploration across the whole floor of the treasury department at this bank. You know, I don't know if many people actually bought into it. But I gave, I would say, at least 30 people exposure to Bitcoin at about $200. So hopefully some of them bought it.

Wow. That's hilarious. Asking who is like that was the CEO of the company or who is the question ended up at? The treasurer, yeah. The treasurer. So asking some, like, leader of a financial organization, their opinions on Bitcoin, after it just ran up in price, you can repeat that story like every four years up until today. That's what's funny.

I mean, you know some people, you know, I haven't worked there for a while. I still have some friends from there, but you know some people think back, oh, man, remember when that guy was talking about Bitcoin in 13? I really wish I bought it. I really wish I said, who was that guy? Like, I got to look him up. Right. Yeah, it's funny, right?

like early on. I mean, I know you were in ether early too. And like just all these technologies early. Like no one believes you really. Like I never really talked about it early on because I didn't want to be the guy giving out like financial advice when something could go to zero. But like I had friends and family I would mention around. No one gave it a thought. And like during bear markets, no one talks to you. And then the second price starts going up and it's way past where it was one day. Everyone starts talking about it. Right. No, first you're the crazy crypto person and then and then you're the poor crazy crypto person. And then you're like the rich, crazy crypto person.

But people love you when you're at the third point. Exactly. And you know what's funny is it's happened like three times in Ethereum now with ETH and then DeFi tokens and now NFTs. They've all kind of gone through the same like, wait, now you're crazy on ETH. No, you're crazy. Defi's never going to happen. NFTs, why would I buy JPEG?

And like all three have gone through the same cycle. Right. Yeah. No, people like assets and people like digital assets for some reason. Yeah. My, uh, during, uh, during 2018 and 19 when I, for was first getting into into crypto, my mom's friends would always like, in a very concerned fashion, ask me, ask my mom, like, how I was doing. And like, to this day, and then like, crypto prices starting, started to go up.

And they would still ask her and it's very concerned. Is he still doing like that weird Bitcoin thing? Like, how is he, is he okay? And like, she would tell him, like, oh, no, he's like, he's actually doing pretty well. Like, his podcast is, like, going all right. He's actually making a name for himself in the industry. And they still don't get it. They're still like, no, no, he should get out of that.

Like, that's going to not going to work out. It's funny, right? Like even to this day where, you know, crypto Twitter's giant listening and followers of podcasts and YouTube channels, whatever, and like, you know, multi-billions of dollars in market caps out there, it's funny how a lot of people in the mainstream still think it's like a fad or there's only like five people into it. It really has been. I've talked a lot in the past if I'm not sure if these two worlds are going to collide or just run parallel forever.

I mean, they truly are just running parallel now. I feel like I live in an alternate reality. And I don't know, like, when I go back to the traditional world and like people that don't know about crypto and stuff, honestly, I feel like kind of so disconnected from them because this is such a different life. Not going to make it. Yeah. Earlier we were talking about just like how we're going to get like good regulation and just good relationships with the nation state. And like to some degree, like as soon as like there's this phrase like science moves on one grave at a time.

Like honestly, once the boomers all die, like it's going to, things are just going to get a lot easier. Like no offense to the boomers, like both of my parents are boomers. But like that's kind of what we need for this like digital world, this digital financial system. to either get more integrated into the rest of the world or just have started absorbing all the people and we can finally leave that ship behind. Yeah, totally. I mean, and that's kind of what I'm saying earlier too, right? With like eventually crypto-native people will become the people making the laws, right?

I think, you know, I'm even like a boomer, I guess, when it comes to crypto, right? There's a huge younger generation of anywhere from, I'm sure, all the way down to like 15 years old now, up to, you know, 25 that's coming up too. So it's going to take some time. But yeah, like your quote about science. I mean, this is just kind of how humanity works in general, right? A new idea, a new movement comes along. And people are skeptical of it at first.

I mean, look at the internet, right? You can pull up tons of articles about the internet where people are laughing at it and making fun of it. And like, why would we ever use the internet? The famous today show clip, right, all this stuff. And then stuff just takes over. Now, what's interesting with crypto is like you're challenging a lot of, of, you know, institutions, the state, moneyness, and that's going to take longer than the internet

to take things over, right? Because those are bigger concepts. They're bigger institutions to kind of have to uproot. But eventually, I mean, it's inevitable at this point. I don't even think like two years ago, I would have said that it's inevitable. I still thought there was a path where Ethereum didn't win, but there's, I mean, it's, there's no doubt in my mind at this point.

Like at a minimum, it might not just like totally, usurp the current system, but this parallel world, which is its own financial system, its own creator economy, all this stuff, that's not being stopped at this point. Right. Yeah. At the very least, maybe it doesn't make the past system completely irrelevant, but it gives the option for people to make it irrelevant for them as individuals, right? Like, if you want to just forget about the legacy world, you can't.

I mean, there are still some problems that we need to figure out. Like, I still need to figure out how to pay my rent without using my money. my Wells Fargo account. Maybe that never happens. But maybe that's just what, like, Wells Fargo is succumbed to. It's like, what is your purpose? Like, you pay my rent. Right. Yeah. Speaking of like Wells Fargo, man, going into like a branch, I had to go on the branch the other day and send a wire. I can't believe like it, that still exists. And like when you realize, like, not that I want people to lose their jobs, but I think what people will realize is how much of this can be automated and fixed with a blockchain, right? Like I'm going into a branch to talk to like two,

people to send money, like, and I have to fill out forms. Like, it's just crazy, right? Like, all this stuff can be fixed with technology. I mean, even technology better than the banks have that's not blockchain, but I think what's eventually what will win the banks over are two things. The first is global access to liquidity, right? So right now you're like a bank, you kind of just have your branches. Like, if you're not a Wells Fargo, you're probably a smaller regional bank.

You can only tap into like one or two states, right? And that gives you a very small reach of a customer base. When these larger institutions realize, hey, we can access money anywhere in the world at any point on defy, that's going to be like, wow, we can make a lot more money, right? We can access a lot more liquidity. And the second is cost savings. So once they can replace all these people they don't need because the technology is outdated. Exactly. All the paperwork stuff, you know, these companies are looking to cut cost everywhere.

So once it becomes kind of an accepted thing in the world by regulators and whatnot, those are the two things that are going to win the banks over. Yeah. To some degree, like some of the processes that banks have are just like, we just do them just because we do them. Right. Like the reason why you have to go into a bank is like historically is because the bank would actually know who you were. That's not like no bank knows who anyone is anymore. Like you just show your ID and then like, oh yeah, the picture matches the face.

That is you signing a transaction. Like, does your ID match your face? Like, oh, yeah, okay, does the private key align with the, with the public address? Like, yes, yes, it does. Yeah. And, like, there was one time I needed to send a wire transfer that was over the limit. And I couldn't do it for my computer, so I had to go into a bank. But I was in a situation I didn't have enough time to go into a bank.

And so I called the bank up to see if I could do it over the phone. And, like, no, the only way that we let you do this is we send you, like, a PGP, like, encryption device. And I'm like, that's just a fucking. hardware wallet. You're going to send me a hardware wallet so I can make a transfer out of Wells Fargo. Like it's just like so obvious that they are like trying to incrementally like do the same things that crypto does an order of magnitude better and did that like 10 years ago. Yeah, totally. I mean, I think your point about personal relationships is an interesting one. I mean, you used to go into a bank and they knew you like you said and like that that's nice, right? Like these people will have your money.

They're dealing with your money. Like that's something that most people would want. That's gone now for multiple reasons that you know the banks have combined merged and gotten too big for that and all this stuff but i think one interesting thing that defy has is this like connection and relationship to team members and that kind of happens through discord channels and twitter you kind of feel at any point now it's a little easier for us to say we're kind of prominent in the space and have been around a while and a little more well known so maybe for people newer to space they don't quite feel this as much but it feels like at any point you could hop on and talk to someone from the team. And that's almost like being able to hop on and talk to a bank CEO or Jeff Bezos with an Amazon order, right?

Now, how this scales long term will be interesting, but I think that's one of the cooler things about Defi right now. Yeah, and definitely makes people feel a little bit more like trusting in this weird code thing that's like ruling our financial lives. But like, oh, yeah, there's that. And like, to some degree, it's not necessarily even the team. It can actually just be the community that's in there too. Right. And for some reason, communities love to answer questions and be customer support. Yeah, exactly. We're very, like, collaborative and social environment.

Totally. Hey, Bankless Nation, I hope you're enjoying the show so far. In the second half of the show, we talk about what I've been calling Ethereum Brain and what happens to the person when they have just overwhelming amounts of Ethereum and crypto just going around in their lives. And how Eric has managed, you know, Ethereum. brain and what he does about it to like retain his grip on humanity. We also talk about Bitcoin maximalism a little bit and talking about how Bitcoin maximalism is a coping mechanism for coming to terms with a protocol that has never upgraded. And we also talk about DFI tokens and our mutual desire to see tokens distribute cash flows to holders as well as the long-term outlook

of yield in DFI. We also talk about some golf. We talk about some electric cars and some other grab bag subjects. So I hope you're going to enjoy the second half of the conversation before we get there, though. We have to take a moment to talk about some of these fantastic sponsors that make the show possible. When you shop for plane tickets, you probably use kayak, Expedia, or Google to compare ticket prices. So why would you limit yourself to just one exchange when you trade crypto? When you make your trades, you want to make sure that you're getting the best possible price on your trade and that you aren't paying high gas costs that you could have otherwise avoided. That's why you should be using Macha. Macha routes across all the various defy exchanges on Ethereum, Polygon,

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I want to actually go back to the pre-Etherium era of your crypto life. When you were focused on Bitcoin, because there was only Bitcoin to focus on, like, was your imagination as like grandiose as like Ethereum is now? Or like, what did you think like the future prospects of Bitcoin would be at that time? Because there wasn't Bitcoin maximalism back then, right? No, yeah, that's what's interesting. It didn't really exist. it was still like this.

And when I entered in like 13, it felt more like the Ethereum community does now to me. What first just kind of attracted me was, okay, this concept of a digital currency, a digital money. And like I mentioned, I have like a trading background and I like just getting in on new trends. And so that's actually what captured me first and why I kind of instantly went to like these IRC channels, right, of trading. But what was interesting is most people then in like these, we weren't just talking about like price and trading, right? People were talking about these larger visions of kind of what we're

talking about right now, like how can Bitcoin usurp the traditional finance system and talking about concepts that we're talking about on Ethereum now. So it's not like the traditional or the Bitcoin and Maximus following that we're used to at this point. And it's what's really funny is most of the people in those chats when Vitalik pitched at, or didn't really pitch, but gave to talk about Ethereum at Bitcoin, Miami, most of those people bought into ETH because that's kind of the vision that they had seen, right? So I think when I first saw Bitcoin, just it was such a new concept to me. I didn't really know where it would go. I don't think I really had that vision until we started working on EtherX, which was like end of 14, I believe, tried to launch

at the beginning of 15. And I mean, I had such conviction and Ethereum, like not one, day like I said earlier, like I had some days where I'm not sure if Ethereum's going to like be this huge like takeover thing. But I've never one day thought Ethereum wouldn't be like a success on its own, right? Like this idea of code running, smart contracts running, I don't know why it clicked with me so much because I before it I had never thought of it, right? But the second I saw this I'm just like, so Bitcoin kind of like led me into the rabbit hole and got me thinking about this digital money idea and what could be done with like a trustless ledger. and all that stuff.

You know, and having worked in like a treasury department, which is kind of like the heart of a bank, I kind of like saw how ledgers worked at a bank and then like, you know, they're so antiquated. So that kind of like trapped me in. But really the second I saw that talk about Ethereum, I've never looked back. But I don't know what, I don't know why it captured me so much to this day,

to be honest, but I think it just clicks with me so much. And I'm glad it did because it's obviously paid off. But yeah, that's kind of, you know, know, my Bitcoin to Ethereum journey. See, this is also always why I call, like, Bitcoin is just a massive proof of concept. Like, it was the conversation starter. And, like, it got, start conversations around, like, digital identity and trustless peer-to-peer, like, transactions and swaps.

And, you know, to some degree, like, even colored coins was, like, an early version of, like, the ERC20 token. And we're talking about how, like, your Bitcoin address is, like, your passport into, like, the digital nation state. Like Bitcoiners were talking about like what I call like the bankless nation before Ethereum was like even in existence. I want to get your opinion on this take. Bitcoin maximalism wasn't really a thing in the way that it is now until like roughly around the time that Vitalik coined it. Right. Like first Bitcoin was Bitcoin and Bitcoiners were Bitcoiners and they had all these fantastic ideas about a trustless nation state free future with no

regulation and like all these all these possibilities with bitcoin and then and then this like bitcoin maximalism switch happened where like bitcoiners subconsciously realize that the only thing you can do on bitcoin is have bitcoins and like all these grandiose ideas are going to actually happen elsewhere and a decent amount of like bitcoiners are just like in denial about that and so like they created bitcoin maximalism to like cope with that fact that's kind of how that's my interpretation of history yeah no i agree with that it was a defense mechanism i think so going back to you mentioned color coins like that i think that's one of the most interesting things because i think that's where the pivot really happened so back in like 13 when i discovered bitcoin people were

talking about colored coins they were talking about scaling um these were big topics in the space and like color coins excited people because it was like this idea of tokens and i remember people even talking about like stable coins right like getting like us d t peg or u sd peg tokens through color coins and all this stuff so there was this vision and And when Ethereum came along, you know, the stories, of course, are Vitalik really wanted to build Ethereum on top of Bitcoin and kind of got shut down on that idea and stuff. So that kind of created the initial rift, I would say. Yeah. And then once Ethereum took off, I think it started taking these ideas.

And it was more of defense mechanism and obviously a little bit of saltiness, right? Like any Bitcoiner could have bought into the Ethereum presale. I mean, they accepted Bitcoin, right? So I think once they saw those ideas going away and realizing that they weren't going to happen on Bitcoin, not because at that point, like, now nothing's going to happen on Bitcoin. Let's be honest, because like the maximalism, the minimalist approach is taken over. But I think even right when Ethereum launched, it still had a chance, but it was going to just be more cumbersome now to do it on Bitcoin. There was no reason.

And it became a defense mechanism because it's like, okay, we had these bigger ideas. We wanted to do them. Now we're not going to do them. And look, I'll give them a little credit. Like backing into the digital gold store value narrative has paid off for Bitcoin. It's an easily translatable thing to the mainstream. I think people buy into it. That's why Bitcoin's at, what, $49,000 today.

But long term, it's not the winning narrative, right? Ethereum's narrative is much stronger, but it's going to take a little bit longer for people to understand it. You know, Bitcoin's not going anywhere, but they had to kind of pick this narrative, right? because there wasn't going to be another one. Right. And in my mind, picking the narrative of, like, digital gold, you're adding a futuristic word upon an ancient word.

It's like, hey, there's this ancient thing and we're going to make it futuristic again. But, like, the reason why Ethereum's narrative is so complex is because there is no ancient corollary to Ethereum. It's purely, it's digital layered on top of digital, right? Like, it's only sci-fi. And that's where so many people get confused and skeptical about what Ethereum is.

but like when you kind of like suspend your disbelief like oh yeah no this is like the most sci-fi thing that we can ever think of right yeah i mean it's still hard to explain to people i mean i've been in the space seven years now in ethereum and if people ask me like to explain it i still struggle right like it's tough to do like because there are so many things happening and so many visions but yeah i mean the digital gold thing it's like really what bitcoin is saying at this point is we're scarce there's a scarce amount of these things you should collect them, right? And scarcity goes back a long time. Now, for Bitcoin, what's interesting is I don't think the 21 million cap is viable. So at some point, we'll be long gone probably,

but at some point, this scarce narrative is going to kind of blow up a bit. And that'll be interesting to see. What I find really interesting is like, okay, so here's a good prompt. Are crypto punks a better store of value than Bitcoin long term? A hundred percent, a hundred percent. Because they don't have to secure themselves. Right. Exactly. And there's never, like, there might be more Bitcoin mines because they need to secure the network.

There will never be more punk's mind. And what's funny is, like, some people listening to this may be laughing. Oh, it's ridiculous to compare Cryptopunks to Bitcoin. But really what Bitcoin's entire pitch is behind the digital goal pitch is, hey, there's only 21 million of these. You should own one. Cryptopunks is the exact same pitch. And Cryptopunks has cool art behind it and has some traits.

So, yeah. Uh-huh. It triggers the FOMO. There's like a status symbol behind it. Like, you get to say that you got it early. Like, it's all the same things. Um, the only difference is one's fungible and one's non-fungible. Uh, I, I don't think Bitcoin will have to mint more bitcoins. I don't think Bitcoin will ever hard fork. I think it'll just like get reorged over and over and over again until like it turns into like where something like BSV is now where like exchanges just delist it because like they can't keep on dealing, dealing, deal. with the reorgs. That seems like the, that's like the hands off, like, we're just going to send this thing off into the ether, and then this is like the inevitable outcome to it. Because like, Bitcoiners are already committed to like never, ever hardworking. Yeah, it's interesting, right? It's like if they don't and fees aren't high enough at that point, like you said, it'll be easily attackable. But yeah, but even at that point, we're going to be so far down the road, like with the whole eth deflationary ultrasound money thing, like, yeah, is it even going to be worth them to fork it

and add it because that is their only narrative left. And if they remove that, what's the point? Right. Yeah. I mean, they talk about Bitcoiners say like if something hard forks out of Bitcoin, then it's not Bitcoin anymore. Right. Right.

Like they've committed to like whatever this Bitcoin thing is. And they will ride that thing into the sunset and crash and burn along the way, in my opinion. Right. Yeah, we might see it sooner than later. I mean, we might see it within three happenings, I think. So that's another 12 years or so. Right.

Yeah. You said we were going to be long gone by that. No, I think it's going to be within, yeah, three or four happening sounds about right. Yeah. So, Eric, you've been, when it was a moment you were like, quote unquote, like full-time crypto, as in like it consumed eight to ten hours of your life, at least. Yeah, let's see. I would say it was around, well, I didn't go full-time working in crypto, so about two years ago,

right after we started Ethub into the Ether and then I got a job at Nosis. That's when I really left the traditional world behind. But I would say since 15, even though I had a traditional job, I was probably on the side spending way too much time on crypto, right? Like either on my phone or when I would get home, spend the entire evening in the space. So what's interesting, though, is like I always wanted, it was still speculative.

Like even when Heath did its first run up to like a thousand or whatever, you just didn't know like if it was going to go. back so i always wanted like a steady salary for the family on the side right and not just totally yolo it and too so that was that was a very fun thing to finally hop over to nosus and i'm always thankful for the opportunity they gave me because that was like okay now i'm full-time eth but i would say i've been pretty much entirely down the rabbit hole since about the time we tried to launch etherax which was like 15 or so so it's been like six years now and i at this point it's getting too hard for me to keep up I think what we're seeing is like the deep we're seeing like not silos but like different ecosystems

pop out within Ethereum. We're getting the defy ecosystem, the NFT ecosystem. I mean, keeping up with both is nearly impossible at this point. I just almost can't do it. Right. And like even when you're at like a legacy job like in your mind is still thinking about crypto like I kind of still consider that like full time crypto. If that's where your brain is all of the time, then like that's kind of.

of where you are. And so then you started Eth Hub because we needed to fight the Bitcoin or Fudd. Thank you for doing that. Got a job at Nosis. So you're doing the ETH Hub podcast, which in the past had like three episodes a week sometimes at minimum. And then you're also doing your Nosis job. Like how did you deal with that?

Like I kind of have called, gotten this thing that I've been calling like Ethereum brain as in just like, oh, you wake up and think about Ethereum. You're thinking about Ethereum all day. You're doing Ethereum thing. things like have you noticed Ethereum brain? Have you gotten Ethereum brain? Totally. Yeah, I got largely burnt out probably like, well, first of all, you can see these gray hairs here and then the beer. I don't know if that's more of the charts. Are those Ethereum gray hairs or are those just like aging gray hairs? I definitely reached a point where

I got burnt out and just one day, it's more just like constantly looking at screens on your phone. And one day I just said I got to like drop off Twitter and discord for like a few weeks, right? Because actually you and I have talked about this a little bit offline, but the difference to me in working and loving the Ethereum space versus the traditional world is most people work their traditional job, you know, eight to five, they come home, they totally disconnect, right? Maybe you have some friends from work, but you're not then going home really, I wasn't going home and reading about treasury departments and treasury functions, right? Like I wasn't passionate about it. The difference in Ethereum like you and I and and many others is we work in it, we invest in it, all of our friends are in it, all of the

conferences and travel we do are in it. And it just becomes, it does become overwhelming. And I recently have tried to start stepping back at times. Like I'll take breaks from Twitter. We scaled back the Eithub podcast a little bit. I mean, I recently had a baby girl too, so that's obviously taken over life priorities. But I do think it's such an interesting thing. And it's a bit, it's healthy it's very healthy to work in something you're very passionate about i'm very thankful for that and like not many people can say that but i do think there's an unhealthy element to not being able to disconnect and it's the 24-7 nature of things people across the world the price is always trading everything's always on um i think it'll hit us all a little bit it has me um but i would just suggest

stepping back taking a break go to hawai for a couple weeks if you can do something like that and leave your phone at home yeah I remember as soon as like towards the end of 2020, or no, at the beginning of 2020, right after the March crash and things like really accelerated right after the March crash. It started like April, April and May, you kind of got the tremors of like Defi, defy summer. And like, DeFi summer was such a just like whiplash of, you know, the 2018, 2019, early 2020 bear market was like, it was just like people really got to know each other.

I got to know you. I got to know Anthony. I got to know, like, D.C. And it was like, it was just like a very calm, peaceful environment. Like, we're just, like, taking this one, the one news event of, like, the month, which is, like, this un-swap thing. And we're all, like, parsing it apart together collectively on Twitter. Like, the only crypto-Twitter conversation was uniswap for, like, three weeks because we all

invented this crazy new paradigm that solves all this Ether Delta thing. And then, like, we get smacked by Defi summer, like, 2020 and, like, a bull market and a bunch of new entrance and all of a sudden just like we were all so hungry for like crypto innovation and crypto content and crypto stuff that like we forgot to learn how to like tune things out and so then and then defy summer comes and like all of the things that we were longing for in like 2019 and 2020 all came and hit us all at once and so we're all like primed to consume literally everything and and the where like you know things could Ethereum could only saturate your life like you five to eight hours a day, all of a sudden goes to like, well, you could actually spend like all

24 hours a day, like consuming Ethereum stuff. Totally. I mean, it's, it's funny, right? Like, I don't work a traditional nine to five job anymore. I kind of do my own investing and startups, kind of like angel investing. But I, so people are like, oh, so you don't work? And I just kind of laugh. Like, yeah, I still, like I'm managing yield farms. I'm trying to find new investment opportunities. I'm doing the podcast. I'm trying to keep up with the news, Twitter, Discord. Like, that's still a job, but it's almost like a new paradigm job, right? Like in this Ethereum space, we found so many different ways

to like make money and connect with people that like you don't feel like you're really working, but you still are working, right? Like I'm not just sitting on a lounge chair all day, like taking in the sun. But yeah, it's long term. It'll be interesting to watch like how people do get burnt out and the response to that.

Because it's still hard to step away because you feel like you're missing something, right? Like, oh, man. And so I had finally gotten a point, like, around when my daughter was born, where, like, my farms were on auto control. Like, I wasn't really, like, moving funds around and chasing yields. And, like, Price had kind of calmed down a little bit. And then all of a sudden, the NFTs blew up.

And I'm like, are you fucking kidding me? Like, now I have to spend, you know, more time tracking NFTs. And I don't want to miss out on some opportunities here. And I want to understand. Did you feel obligated for some reason? Like, oh, NFTs are a thing. like now I do this. This is what I do now. I did. I felt obligated. And part of it's because like what I told you earlier, like I feel like if I missed out on something that I end up liking

and it had a big price appreciation, I'm just going to hate myself. So I had to dive in and like understand like all these drops and the generative art stuff. And like I've been a crypto punk guy since day one. I was on there claiming when they were going out for free. But that's kind of been the only NFTI. I didn't go down like the crypto kitties thing. And I've kind of just held my punks. you know, not done much with them. But I had to like reteach myself this. And now it's like, okay, I just added more work to my job. Now it's Ethereum, Defi, and NFTs.

Right. Yeah. And it kind of seems like there's just like always something like on the horizon, right? Right. So like when you've stepped back, like if from the perspective of like stepping back from Ethereum as like a skill, like what advice do you have? Yeah. So, okay, this is one of the more interesting things I've personally run into lately is

you know a decent amount of us i guess we could say have made it or will make it with our investments and whether it's defy nfts or whatever and like we work in this space that we might get burnt out on what i what i kind of struggle with is when i step back i've become so enamored and so into aetherium the space like i'm not really sure what to do like i always have to be working towards something right so you know i like to golf i have hobbies outside but like i can't fully leave the ethereum space so like Like what I would say for people, it's almost like trying to quit something cold turkey, right? Whether it's like drinking or smoking or like eating something bad.

What I've realized is don't just give it all up at once, right? Like keep your favorite Discord server, give up Twitter and step away from everything else. Because honestly, you kind of feel a little bit lost, which is weird for me to say. Like it sounds strange. But all of a sudden you're like, wait, what am I waking up for? What am I like trying to accomplish? And that's like honestly why I had to go down the NFT hole. It's like I wanted something new to bite on.

Like I feel like I had kind of accomplished the east side and the defy side. And now like what's next? So I think that's why it keeps bringing people back to though, to be honest. It reminds me of the metaphor of like carrying the, I don't know what came up with, the ring from Lord of the Rings. Like Frodo carrying the ring around his neck. Like he carried it for too long and like now he can't get rid of it. Like it's not on his body anymore.

but like it's still burned into his soul. Like once you like consume enough of Ethereum, like you can think of it as a drug. Like you actually can't like leave. Like it's got you and it's and it traps you. And then and that like Ethereum was like my, I haven't talked about this too much. But like before I got into Ethereum, before I got into crypto, I got broken up with with a girl that I thought I was going to marry. And Ethereum like filled that void for me. It's like, oh, I, like, this is super fucking entertaining.

I can, like, forget about, like, just, like, being really bummed about life. And I can, I can, like, just think about Ethereum all the time. And, like, you know, four years later, I'm like, okay, like, no, you can't marry Ethereum, David. Like, you need to, like, step back. And, like, I don't, and that's why I, like, straight up move to San Diego. Like, I needed to, like, step myself out of, like, Seattle and just where I was, like, raised and had to put myself into, like, a new and. environment.

And, like, if you're like, there's a thing called like state dependent learning. If you, like, I haven't like lived in San Diego before. So it's like trying to welcome myself like into a new life and give my myself like permission to like stop having so much like Ethereum brain. Totally. Yeah. No. I mean, I move too, which is funny.

Like I feel like a lot of people moved and that was a way to like kind of get out and escape a little bit. But I mean, the whole like marrying Ethereum thing is a funny metaphor if you think about it. I also think why some of us have such a hard time stepping away is we kind of like think of Ethereum as our baby a little bit, right? Like you mentioned starting ETHUB. Like why did we start ETHUB? Well, because Bitcoin Maximus were spreading foot narratives and smacking ETH down all the time and we needed to fight for it. Right.

And now Ethereum's like grown up and come out of that and it has its own narratives and those things don't matter anymore. But a lot of us have helped shape where Ethereum is today, right? Like even down to 1559, right? Like I co-authored you or heavily involved in like helping people understand it. Like these are big things that shaped the future of Ethereum. And it's hard to like just like no one wants to abandon their baby, right? So like it's hard to fully step away. And I don't think I would ever fully step away.

I think it's just going to be too impossible. But it's kind of like like where do we go after this stage of Ethereum where it grows up? Like what is our next role, right? What does that look like? because there's always going to be like younger, more eager people coming up that want to do, I mean, you're doing five podcasts a week or whatever. Like that's probably not going to, you're going to get burnt out eventually, right? But like I feel like we're all going to always be in the space and just kind of do different things.

Yeah. And like you said, the space is splitting into like the NFT cohort, the DeFi cohort. And there's going to be more cohorts into the future. And like keeping up with all of them is going to be absolutely insane. But maybe there's just like maybe the people kind of come into Ethereum at their own specific like generation. So there's just going to be like generational cohorts of Ethereum that all kind of like go through their own just like, you know, the learning journey of crypto and then like finding their place

in in Ethereum that's right for them. Yeah, I mean, that's one of the biggest transformations I've seen too. Like early Ethereum, it was only a space for devs, right? And like no one wanted to see like speculators or traders. Like the Ethereum Reddit literally doesn't allow price talks still to this day. And you felt like you didn't have a place. It's crazy how much that's true. change, right? It's a place for anybody now. Like you don't need a finance background. You don't need

a trading background. You don't need a coding background. This was even still a problem. I would say back in early 18, even. There was like this pretentiousness of, oh, if you're not a dev, you don't have a spot in a space. And man, has that changed fast. God, that was going through my brain like endlessly in 2017. It's like, oh, this crypto stuff is super cool. I guess I'm just going to watch it grow in front of my eyes for the rest of my life because I won't be able to actually like do anything because I don't know how to code. Yeah, no, it's crazy how much that's changed, right? Absolutely. How's it, how's, uh, since you've practiced stepping back from Ethereum, how's your golf game gun? Well, not great because it's not very easy to golf with a baby. Um, I'm hoping to get out

here soon. It's been solid, but it's not where I wanted to be. Let's put it that way. Yeah. Before I play with you, I need to get a lot better so I can kick your ass real good. Oh, I am not good at golf at all. I'm very much one of those people where like I hate putting first off. But like I know that if I stop or if I start giving a fuck about golf, then like I'm actually getting a start and go out and practice. I've never practiced golf. I only play. I never practice, only play.

Which is a tough sport to do that. Yeah, what's funny is like I feel like golf's a great sport for people into Ethereum. Like I feel like if you're looking for a hobby or something new and you haven't tried golfing and you're super into Ethereum, try golf. Because just like Ethereum, you can never perfect it. and there's always something new to learn, be frustrated by, get happy about. Like, there's a lot of similarity. So, we need an Ethereum golf ending. Ethereum golf, golf, I have a treat.

Oh, God. So, how's your Porsche? It's nice. Yeah. Yeah, it fits golf clubs, which is good. Yeah, basically all you needed to. I got just recently. got a pole star, which is not a Porsche, but it's definitely an electric car that goes really,

really fast. And like, I keep having to remind myself that like, okay, just because you have a really fast electric car doesn't mean you get to go like a hundred miles an hour down the San Diego highway. It's dangerous. The fast electric cars, man, you're going like a hundred and you don't realize it. It's crazy. I've only owned one electric car. I'm never going back. I don't think. Like, it's just, it's too great. The experience is awesome. Just being able to plug it in. Like, I know where the environmental impact right now, we have the production and all that, so it's a bit minimal,

but I do feel better about myself driving it around, that's for sure. Yeah, like sometimes, like, there's been times where I have friends all the way up in L.A. and like a little bit, maybe in like South Anaheim or Orange or something, and just like if I ever want to go out there, like I actually don't have like the weight of like consuming gas to go do that.

It's like, oh yeah, it's a lot more casual. Now I don't have to fill up my gas tank with gasoline. It's nice. I'll just plug it in later, yeah. Yeah, I feel like we're finally seeing the electric car revolution happened. I feel like a lot, like we're getting nice-looking electric cars now, which I never knew, like, before, why they made them look so horrible. But I think we're finally there. The Porsche Take Hand is, like, one of the best-looking cars, I think that's out there.

They finally realize, like, let's not make this look like an electric car. Let's just make it look like a Porsche. Like, I don't know why these car companies didn't do that. I test drove that car a few months ago and you told me to do the like the stomp on the brake and then hit the gas and do the launch oh my god man like that just puts your stomach into like a different dimension it feels like you know those roller coasters that launch you like zero to six or whatever it feels exactly like that right yeah and there was and I was being an absolute idiot on the test ride definitely going over a hundred and uh coming coming up behind a guy and a guy like

turned on, like, didn't turn on his blinkers and came into my lane, so I had to swerve. And the handle, I swerved at like 100 plus miles an hour. And the handling on that thing, just like it cradled it. It cradled the swerve and just put me exactly where I needed to go. I feel like if I did that on any, like, normal car, I would have just like spun out and died. Right, exactly. Yeah, if you haven't drove the Porsche, I can, go test drive it. Porsche is going to see a spike of a bunch of test drives next week now that we're talking about this. no i absolutely recommend it um no it's it's been fun have you have you seen what a polstar looks like uh i looked it up the other day yeah it's nice yeah so what's the deal are they like in product

they're easy to get in production you already got it yeah yeah yeah so like i i was going back and forth between a pole star and a tesla it's like the more affordable versions of an electric car i didn't i i don't i couldn't get myself to dish out the cost of it take hand It's just like one JPEG, man. Defending on the JPEG. But Tesla is, you can't get a Tesla. Like they're all, you can't get one until 2022. And also, Polestar is a derivative off of Volvo.

Like they used to, Polestar used to be, um, uh, Volvo's like skunk works. Like their like performance division. And then they just spun out, made the Polestar one, which is like the Supreme luxury car for like 150,000. it's a hybrid gasoline electric car, and then they made the Pulse Star 2, which was like the affordable affordable version. But like since it's like, for some reason, Volvo's have always been in my family. My dad and his dad had matching 1972 Volvils, which he still has.

And then my first car out of college was a Volvo. So then I decided like, oh, Polestar close enough. Some tie to it. Right. Yeah, exactly. That's funny. So Eric, since as a host of a podcast, usually sometimes hosts don't get to say everything that they get to say because they're always talking to guess

is there any subject matter that you have never been able to talk about you've always wanted to be curious like to have the floor on hmm that's an interesting one what haven't i've been fully honest about you know i've talked about this a little bit i guess this is still a theorem related of course but I've been a little bit disappointed in the governance tokens and like where we haven't evolved like at all. So when the governance tokens came out, the pitch was, hey, you can have a, you know, if you own this, you'll probably own a portion of our protocol fee going forward, right? And like when I've had guest on, I've brought this up a little bit, but I'm not like, the response from most defy founders is, oh, that's in the token holder's hands, right?

Like I love Robert Leshner, but like if you listen to my episode with him, like the entire time, Oh, comp token holders, which makes sense, right? Like for legal reasons and all this. But I'm a little disappointed in the advancement of that. Like I think sushi is kind of one of the only protocols that's doing any revenue take to token holders. And I really wish that we would come further than just pure speculation for the value on these things. So I think decentralized government, Vatelic put out a good piece about token voting the other day. I think we're kind of just like shooing some of these problems under the rug.

We saw like a weird unyswap vote happened the other day where some team tried to get like 25 million. It took like the last second for like a Twitter outrage to happen for it to get shut down. Did that actually end up? Because when I, last I looked at it, it actually had more yes votes and no votes after it got flipped with more no votes after people like realize what was going on. So that actually ended up going through. I haven't tracked it today. So that could be the case. There were all kinds of weird things.

Like the UI was broken like no votes were going to yes votes and stuff. It was a mess. but I'm a little disappointed in the progress of governance tokens. Now, I will say most of this stuff and fixing and innovation happens in bear markets. I think people are just distracted right now. But man, we're missing such a good long-term value narrative for defy tokens if they're actually paying a part of the protocol revenue to token holders, right? That kind of gives a nice little like feedback loop. So if I had to pick a topic where I think people in the ecosystem,

system are kind of like ignoring or not paying enough attention to, I think it would be that. So yeah, that vote did end with the grant's grant getting approved. Oh, it did. Was that today? Earlier today, yeah. Okay. Interesting. That's kind of interesting.

I have said that like it would be nice to not just emulate like the greater fools valuation of like the traditional stock market is like, oh, we got the uni token, the comp token and like, oh, governance. it's like by the token, but actually like morph that into actual like analysis of on-chain cash flows. Yeah. But one thing in, like, there are certain paradigms that Ethereum completely breaks and renews. And there are certain other paradigms that, like, it absolutely doesn't, right? And like, well, if you start to spend cash flows, then, like, you actually, like, you can't

spend them on, like, development and, you know, innovation into the protocol, right? So, like, maybe it is actually, like, too soon. I do think there is room for that to be like a paradigm that Ethereum doesn't actually fix. Yeah. Yeah, like where this goes, like how it relates to traditional evaluation is still to be known. And there's going to be like a lot of tweaking of this, right? And I think even like we could go way further where it's like incentivize people more to not just farm and dump the token. Like if you hold it longer, you get some kind of incentive.

There's all kinds of things that. Isn't that just a greater fools like Ponzi game thing too? Because that just turns into a Ponzi game. Yeah, kind of. I mean, this is leading to the ultimate conversation, right? where I haven't brought up too much on the podcast, but what's like the endgame for DFI once incentives run out, right? Like what do yields start to look like? Do users just drop off? You know, everyone in the space touts these super high yields, but the reality is they're not long term sustainable, right? Like the token, so there's two aspects to a lot of these yield farms, right, are these defy protocols.

There's the core rate, which say like on an Avere compound, that rate is driven if you're lending, that's driven by. borrowing demand right so there's a huge spike in borrowing demand for usdc your interest rates going to go up now that can be muted down if more deposits come in to the lending side and then the second part is a lot of protocols are giving away their own token now they're probably not going to give away their token forever although i would debate that like the supply cap meme isn't really necessary for defy protocols so we might see that lifted and kept but once say the subsidy of the coin like in comps case are away at comp on top of the interest rate once that dries up and you get a lot of cash that starts to come into defy over time because it comes easier if rates start to settle down to like traditional

finance levels what like what's the strong narrative for defy at that point beyond just trustless holding of your own wealth or your own money or whatever right um so i'm curious to see how that shakes out i mean if we do settle down to like traditional finance levels like to some degree that might just signal that like a a got actually adopted or be people might actually feel more secure about like entering into that market and like keeping that because like aside from how like magical and wonderful and fantastic and efficient defy is like there's plenty of other reasons to adopt a theorem infrastructure rather than your traditional banking infrastructure totally yeah i think that's where we will go um but i don't know if people realize that these rates are going to eventually get arbed down to traditional rates right there's nothing really magical the magic right now is it's it's harder to get into Ethereum so the rates are higher and there's more speculation happening but the second you know large funds hedge funds banks can put in their deposits those rates are going to get crushed down and they're going to be pretty equal to their traditional world so I think people should expect that going forward we're starting to see it a little bit

like last year comp you could earn 8 to 10% pretty easily these days it's more like three just on the core rate not the comp subsidy on top but yeah right but defy has also been like pretty quiet, right? Like, as soon as, like, trading activity picks up, like, yields, yields pick up. Yeah. Like, my gut is that rates will always be at least marginally higher than traditional rates on their floor at the very least. Yeah, agreed.

There will be a spread for sure. Yeah, it would be interesting. And plus, if, like, if these things do get arbed down, they're just, the market itself is going to be, like, insanely liquid. And also, if, like, a bunch of, like, traditional money comes in to arb that down, is going to be really bullish for ether. Yeah, totally. And what's interesting is I don't put anything in DeFi that's not insured through Nexus

Mutual. So it becomes interesting for me when rate, so it costs like 2.4% or whatever to insure on most safe protocols through Nexus. If rates start creeping down towards that, it becomes a net negative for me, right, yield-wise. So I think the whole insurance thing needs to be figured out a little bit better long-term as well. And I know there's a lot of teams working on, of course, Nexus too. But more streamlined, like the ideas of I'm only insured when I'm actually in the protocol. And rates need to get

a little bit more competitive there. So do you micromanage that insurance or like if things like go negative? Do you just like, eh, I'm just going to like not bother and like two days later it'll be positive again? Yeah, I do. I do manage it. It kind of sucks, right? Like they do like 30, 90 or 180 days. I always do 30 because if like the rates were to tank or whatever, I don't want to be net negative for longer. But yeah, then you got to like in your calendar remember when your compound covers expiring and you got to go re-up it. And like sometimes I'll there's the work you're talking about. Yeah, exactly, right? It's a full-time job. I know there's been, what was it, like armor, like armor fire someone was doing where like you would only be covered if you were in the

protocol. Like so if you took your funds out and then that cuts down your cost too. There's a lot of tweaks and improvements. I would like to see where protocols offer an insurance native option, right? So like this stuff's baked into say Ave and it's like, do you want an insured deposit? You get 2% less or do you not? That would be so much easier. Yeah, that seems to be like with the logical conclusion of where that would go. Yeah. Yeah, I think it has to. All right, Eric. Well, I think we could wrap it up there. Cool. Yeah, it's been fun. Thanks for coming on layer zero and let me pick your brain a little bit. Yeah, absolutely. I appreciate inviting me. I like this format. So I'll definitely be tuning in to others too because I think it allows a nice flow of conversation.

After you, I have Justin Drake. Oh, nice. You're episode number two and he's episode number three. That's a good one. Dimitri Buteran is episode number one and he comes out. We're recording this on Friday. He comes out on Tuesday. Listeners will be hearing this a week from Tuesday.

Awesome. Sounds good. Cool. Thanks, man. Yep. Good conversation. Cheers. Bye.