Epicenter - Learn about Crypto, Blockchain, Ethereum, Bitcoin and Distributed Technologies - Julien Bouteloup: Stake Capital/Rekt – Uncovering the Dark Side of DeFi

Episode Date: March 3, 2021

Julien Bouteloup is a serial entrepreneur, Ethereum developer and addict of crazy innovative ideas. He started his entrepreneurial career building websites and selling hardware technologies at age 14. Today he is involved with many projects including Stake Capital, Rekt, Curve Finance, and he advises several crypto companies.Julien strives to bring to light the dark side of crypto. As DeFi grows, so do the number of questionable projects and ethical concerns around certain practices. Julien joins us to talk about the excesses in the DeFi space and how the ecosystem should cope with them.Topics covered in this episode:Julien's background, how he found crypto, and the various projects Julien is working on todayThe Stake DAO - its purpose and visionJulien's views on the state of DeFi todayPrice arbitrage attacks in the ecosystem - FlashloansJulien's involvement in Curve Finance and how this platform is pushing towards more resilient DeFi protocolsJulien's thoughts on NFT and Decentralized MonopolyCurve's reaction to the launch of SaddleThe role of validators in the spaceEpisode links:Stake CapitalRekt NewsRekt Capital on TwitterDecentralised MonopolyJulien on TwitterSponsors:Stacker Ventures: A community-run protocol for initiating and managing pooled capital on the Ethereum blockchain. Structured as a DAO, it initiates decentralized funds, accelerates portfolio investments through an involved community, and provides checks and balances to fund management - https://epicenter.rocks/stackerThis episode is hosted by Sebastien Couture & Sunny Aggarwal. Show notes and listening options: epicenter.tv/381

This is Epicenter, episode 381 with guest, Julian Boutlou. Hi, I'm Sebastian Couture, and you're listening to Epicenter, the podcast where you interview crypto founders, builders, and thought leaders. On this show, we dive deep to learn how things work at a technical level, and we fly high to understand visionary concepts and long-term trends. If you like Epicenter, the best way to support us is to leave a review on Apple podcasts. If you're on a Mac or iOS device, the easiest way to do that is to go to epistenter.rocks slash Apple. And if you're new to the show, be sure to subscribe on Apple Podcasts, Spotify, or wherever you listen. Today our guest is Julian Boutlu. Now, if you're on

crypto Twitter, you're probably familiar with Julian. If you're not, though, I've heard different people describe him in different ways. He's an entrepreneur, of course, but he's also been described as a crypto pirate or Defy Robin Hood. I think deep down, though, Julian is someone who just understands the space really well and isn't afraid to call out bullshit when it should be. Gian is the founder of State Capital and helped summon Steak Dow. And more recently, he launched a new project, which is more of a journalistic endeavor. It's called Rec. I'm sure you've seen it. It's got that cool frog logo. And it's helped uncover and shed light on some kind of the various things happening in the DFI ecosystem since it launched a couple months ago.

So this interview goes in lots of different places, and we kind of intended it to be that way. But we spent most of the time talking about defy. Juryan is someone who knows and understands the staking ecosystem quite well. And so we spent some time talking about staking and its role in the broader defy ecosystem. We talked about flash loans since Juryan was one of the first people to successfully execute a flash loan on Ethereum about a year ago. We discussed Oracle arbitrage and market manipulation happening around oracles.

We talked about rug pulls. We obviously couldn't help but discuss the Binich smart chain and NFTs, but I think more broadly, this conversation is meant to serve as a reality check. And one of the questions that we asked was, will crypto create better wealth distribution around the world, or will it simply move centers of power from one group of people to another? Well, I'm still not sure, but this is something that I've been thinking about a lot lately, and I'm glad that we could talk about it here on the podcast. Speaking of things that distribute wealth and provide value for the community, I'm very

excited about our new sponsor, Stacker Ventures. To put it simply, Stacker Ventures is a protocol which allows for the formation, the funding, and the governance of VC funds. So they're decentralizing VC funds. They just launched and they're growing a community of crypto builders and enthusiasts, and soon they'll begin funding early stage crypto startups. I'll tell you a little bit more about them later on, but if you want to check them out now and apply for funding, go to stacker.vc and enter your email address to request an invite. And with that, here's our conversation with Julian Boutoulou. We're here today with Julian Bouteloup. So Julian, you know, is quite involved with a lot of things within the crypto space, especially, you know, a lot within the

Ethereum ecosystem and DFI, but, you know, also has his hands in staking and NFTs and on the team of like one of the largest AMM platforms. So working on all these sorts of things. And so, you know, we're excited to dive into a lot of it with him today. So, but you know, maybe to get started, Julian, I mean, how did you get involved in crypto for the first place? Even before getting involved with the crypto, I know, I know you were, you know, sort of what you've worked on a whole number of startups and I've like, you know, even exited quite a number of them before getting into crypto. And so, you know, how did that like entrepreneurial drive like bring you towards crypto? Yeah. Well, first of all, thank you for having me on the center. I've been following the

podcast for quite some years now. Congratulations, guys, on building this so big and very, very good quality. Yeah, so basically my background, my background is computer science and electrical engineering. I start very deep into mathematics in France. So we call this like a two-year specialization really deep in mathematics. And then I moved to the US and I got specialized in master in. machine learning, distributed system, nothing to do with crypto, but I then started working for security difference company. And in security defense company, I was pretty healthy in CS, so the

Counterstrike game. And one of my friends, I was running some computers to do fires hosting back then. And in 2011, one of my friends told me to run this algorithm and later on, appear to be a Bitcoin. So then I got involved in Mongols and all these different things. And I went back to London, discovered Eater. So like in 2015. So yeah, I mean, my background was I built different companies, like stuff playing carpet.

It was like for satellite gathering data from space, building some machine learning that can predict the future of physical assets. for example, life production of coffee in Brazil or carbon offset. Also did some consulting company in London for machine learning who worked for biggest companies over there. So I guess my entrepreneurial path was always driving by trying to build some innovative ideas. Some of them failed and some of them got successful. But yeah, that's it.

So really tech guy came from the countryside of France and then moved to the US, and I guess that's how I got this vibe of the little bit of the American dream, I guess. I'm not sure. I've always kind of thought you had a very interesting barque, as we would say in France, or a background, because you're one of these people that, you know, there's a few people like this, right, that, like, they leave France, like super early in their life. Like, you know, like, I think you must have left France like when you were in your early 20s or something like that. And, like, you just went to the U.S., is that right?

Yeah, it's cutting a little bit of signal. but I lived France right after my class preparatory mathematics. So I want the U.S. graduate from New York State from a school called Union, which is probably in the worst place to live in the U.S. in Schenectady, like upstate New York, above Albany. I think like a Muslim-American, they don't actually go after Albany, but this was my first. I mean, actually it was my second experience in the U.S.

because two years before, three years to that experience, moving to the U.S. I actually live in California. So I can tell you, like, moving from California to upstate New York in Schenectady, it's a pretty rough experience, but I think that's how I, yeah, it was pretty amazing. That's really cool. I think there's lots of different ways that people qualify you. I actually, like, I was talking, I was asking someone here in the French ecosystem, whom you may know, it's like, oh, I'm going to interview Judea tomorrow. own, like, what do you think I should ask him? And he was like, oh, the crypto pirate. And I was like,

okay, that's another way that people describe your idea, I guess. So how would you sort of describe yourself in this space? I think, like, some people would say you're like a trader, a crypto pirate. You know, now you're some sort of a journalist. You've got a, you know, you're involved in like a hedge fund. Like we were talking earlier that you sometimes describe yourself as like the crypto Robin Hood. what's your what's your elevator pitch essentially for how you describe yourself yeah i'm not sure actually like i mean my background is really mathematics and also uh quant quantitative trading so i understand i understand maths pretty well so i can i can build uh script and algorithm so i can actually and i think for me quantitative trading is passion from traditional finance when i was in

in London working in that traditional finance, I think my age, I couldn't actually get experience of traditional finance during the 90s, you know, when there was no regulation and it was pretty much like World West and everything was possible. So for me, like seeing at Defi and understanding mathematics, understanding like DevOps and all the stuff, you can basically do whatever you want. And that's pretty fascinating. I would probably consider myself as, yeah, a DeFi, DeFi builder. I try to build any ideas that I have on the morning when I wake up, I want to build them.

I like the Defy Pirates. And I'm not sure about defy-I mean, Defy Robin Hood. The problem is like, I also do lawful liquidation so people will probably take this one as not a good status to attach to myself, probably. What's the, I mean, I find this fascinating. I'm very envious of people who are able

to kind of successfully, execute on many different projects at once because this is something I have a hard time to do. How do you manage to be involved in all these different things, which we'll talk about today and at the same time, sort of like keep your bearings on your more longer term vision and goals? Yeah. I think if you talk to most of people, they usually tend to say, oh, I don't sleep much. But actually, I don't sleep. I actually don't sleep. I actually don't sleep. I sleep by two, three hours a night. And apparently I'm part of this range of population that can sleep. I think it's like 0.1% or something that I can actually sleep not much.

So, and I spend most of my time in front of the laptop. So I have to use those hours. And that's how I do that. And I like to also get some really, all the people that get involved, I know them personally, but I seem they're very good. So I couldn't do what I'm doing without people around me that can execute, execute those ideas. Because having an idea is pretty easy. It's probably like 8 or 10% of project. But being able to execute that idea very fast and very well. And also by simplicity, if you look at all the projects that have been involved,

they always respect a few different periods. And those are, I don't care about UX, UI. I just do black and white. Most of my projects are black and white. They don't actually shield anything and just go to simplicity. And that's the reason also why I was like pretty, well when I met Michael in Kerr because it's also like part of the DNA of Curve. It's like simplicity on the design and not into some very fancy UX or UI.

And so what are some of the these initiatives that you're working on right now? So, you know, there's the one that you mentioned that there was Curve. You have the blog that you are working on, RECD. You have, there's the company you have called State Capital. what are some of the stuff you're actually working on these days? Yeah, so back in 2000, I think it was 2017 during the ICU boom. I found out, I mean, I'm not found out, but I saw the space moving into Provo State. And I think I remember like, Sunny, this is where we met back then.

It was 2016, 2017, probably. But then I was like, oh, shit, this space is moving for proof of work. So I had experience in mining in Bitcoin and mine. in Eastern. And it was like, okay, I have, I've got some assets. And I need to find someone, the provider that can provide validation for my asset. And this one, the first one was Tesos. So I said, okay, well, let me find someone.

And I found out that the space was pretty like, it was actually starting on the proof of stake validation. So I said, okay, why not providing proof of stake for my own assets? That's how I start the capital. So stake capital was validating on Tesos. we made acquisition of a Tesos maker called Hot Steak back then. And then we actually started the Staking as a service staff, made a partnership with Equinix, bare metal server in AWS,

like really not like just getting credits, actually like real partnership with those guys. And then I said, okay, we're not opening to the retail side. That's how we did. Now we opened to VETL, got a participating game of stake on Cosmos, get ourselves a little bit more knowledgeable about the people's steak. And then in 2018, wrote this light paper from Steak Capital, which is what Steak Capital Dow. And the idea was to basically create those liquid staking because knowing that those different blockchand will come on life,

then you will need to be able to lock your phone, but also maybe use those bridges, either using IBC or using like other other mechanism. That's how we start. And then I was like pretty, pretty solid in this kind of DevOps environment. by being able to monitor the main pool at sub 15 milliseconds across the world, like low balancers, centuries, all different things, that was basically being able to do arbitrage on the market of defy. And then when defy boom, I'd say, oh, wow, sticking the service is not actually so big compared to what defy can bring on a table.

So I actually moved 20% of the state capital services into staking as a passive income. And then bootstrap and got really big in those different, verticals as market maker liquidity provider arbitrage and then create the first flash loan because I was talking to AVE, I was talking to that and the concept of having access to unlimited liquidity as long as reimburse to liquidity within one block was passionate. It was so fascinating for me. So I spent a couple of weeks working on that and then did the first one and then triggered all this kind of new phase of defy where you could do like all this kind of flash loan and then test all those different protocols.

So that's how I, and then, yeah, so, so this is like state capital moving. Then I were like people asking me question, how do you, how can I participate in state capital? I was like, well, you can run this common line, use the terminal. But they were like, yeah, but where do I, how can I stake? I wanted something like finance. I want something like trust wallet. I was like, oh, shit. So then I create, I start creating this small script for people that you can actually adjust by a

Telegram group, then get updates of their stake, but this was not enough. That was not enough for my mom or my dad to get involved and just like policy of it. So that's how I start working on stake down. And the reason why I start working on stake down is not just me building stakedown. It's because I found someone that was like such a rock star in Web 2 development that you could actually bring that experience to me on the side of the blockchain. And this combination was very fast to create StekDow. So StekDow is in a place for anyone that has no crypto experience that can invest in the space.

But we involved more than 6,000 people that had no experience in Defi, which is pretty crazy in this space. But you can do everything. You can buy crypto. You can swap. You can exchange. You can stake. And also, like, we're now building StekDL of V2. Remember in 2017, I told you that I wrote when there was the ICAL, instead of building an ICEO myself and jumping into

the free cash, I actually created this medium post where I was going after all the ICO possible and I was saying that I was basically warning people that those ICOs scams. Well, what happened to me, I got sued. I got sued for quite a lot of money, $3.5 million dollars. And they sued me because I was adding some defamatory. I was basically calling them scammers on Telegram, but then explaining why. So this was pretty bad experience for me for two or three years. It was pretty bad.

And then I always wanted to create this kind of newsletter to alarm, not alarm, but to warn people about what's happening in the space. And that's how it came up with the concept of wrecked, but also the reason why I start reg is not because I wanted to start wrecked. Because I tried to start it and I fell because I got sued. No, because I met someone that can actually draft and write very well. And this is actually this combination that again boosted this project. So it's always about people, not about like a single end. In a space, if you see someone building a lot of different projects, it means that it's actually doing with multiple different people.

Don't believe that it's doing this alone. So that's why I start wrecked. And now Rex is just like going really deep into investigations. Like we do like dark modes. So we don't actually name the people behind the news, no names and all the tools possible. Whatever happened on chain will be covered by respect. rate to not, we've been

receiving a lot of Lobby for news to not get listed on rate. When we get those, it's actually the opposite. We got full more than we list them. And yeah, that's it. And then a year ago, I was pretty involved in, I like the game so rare, because

for the week called, I'm an investor in Surre, and it's a French, it's a French company, and I quite like those guys. So I said, I will invest with those guys. But the problem is like I got no time. So I said, how can I participate in the game, but I have no time, and you need to play like 24 hours in this game. So then I start getting someone and paying someone to play with my portfolio of NFTs and play the game.

And I was like, oh, damn. I see like Axi Infinity, Decentraland, Crypto, Voxel, all those different NFT companies. You need 24 hours, seven days a week to work on those different projects. So then I said, okay, let's start a hedge fund that will basically lend asset liquidity to those people, the best managers in the place that can participate. And that's how we create Blackpool. And now it's pretty successful. That's a quick journey to my life.

Stacker Ventures just recently launched. They're a community-led venture capital protocol and accelerator. And they're looking for exciting DFI projects for the first fund. It's the first of its kind. It's structured as a Dow. And Stacker Ventures allows anyone to participate in the governance of the protocol and the acceleration of portfolio companies. Stack governance tokens will be distributed to early participants in the protocol soon through a variety of participation incentives.

The first fund to leverage the Stacker Ventures framework recently launched, and they're now looking for exciting defy projects to apply for funding. So if you'd like to apply or if you want to refer a project or just earn stack governance tokens by helping accelerate projects, you can view the first fund details at stacker.vc. and here you just need to enter your email address to request an invite. We'd like to thank Stacker Ventures for their support of the podcast. So, you know, let's talk about the Stake Dow that you brought up. So, you know, I played around on the platform. It's, you know, it's pretty nice and it's a pretty powerful, like, defy dashboard.

But, you know, there are, like, other defy dashboards that are available as well. Like, you know, we have, like, things like ZapRify and things like that. One of the interesting things about stake Dow is that, you know, it is tokenized in some way, which is, you know, something that like Zapper, for example, is not. So, and, you know, obviously in the name, it has the word Dow in it. So can you tell us a little bit about like what is the token for here and what is the purpose of having a Dow behind the dashboard? I mean, I'm a big fan of Zapper.

I'm big fan of Zerio, but Stekdao is really not like Zapper or Zerion. The thing is like Zapper or Zerion, they give you a lot. access to defy. Well, Steckdown give you access to the services that we choose for you that we believe are the best as features for you to participate. So it's very different. And also all the profits, all the different services that we have on Steckdown are redistributed to the people that have the Stake Dow token. So meaning that we don't take profits. The reason then people are saying the second question is, but how do you make money? Well, the reason is because we all have shares in Steckdown.

And also, Steckdale has no investors. We're all contributors. So if you go to the page of contributors, you will select a list of 60 or 70 people that have been participating to build Steckdown. And then basically the Dow, you can make all the votes governance possible. If you want a list like a new chain, for example, Binance, Binance chain, the thing is like, do we agree that Binance is decentralized and that decentralized? That's not the question.

if someone make a proposal on stake Dow and the token holders, they vote for implementing Binance chain as a swap or as an auto market maker on stake Dow, then we'll have to do it. So basically the token control any decisions that we make on the Dow. So for example, we have different strategies. We'll have also arbitrage strategy, flash loan strategy, and whatever money we make inside will be distributed to a vote and anyone stakeda or token will be able to take a fractional ownership of those different profits.

So stake that will also become this sort of like multi-chain dashboard as well, like not just focus on the main net Ethereum. But so as like if DFI starts to move into other chains like you mentioned with like finance chain or, you know, if it moves into, I don't know, phantom or X-di, it'll start. Or these are like eBM compatible chains. Will you also be focused on non-EVM compatible chains as well? or how do you see the evolution of that happening? So the evolution is like right now,

the Dow is live on e-term, but we do multi-chain. So if you take a look to the 2017 paper, light paper about state capital, it described like having the ability to get involved in all the different chains and also any provider can propose their service. So we welcome any validators

to validate and provide the services for stake down. And also, if we will basically, the idea is to have like liquid staking and swaps. So liquid staking for people that can stake and they can also sell the fractional ownership of this liquid staking that they have into secondary market and also bridges. So as a user, a simple scenario is I want to be able to swap between Binance to Dezos, to Palkado, to Cosmos or whatever. possible and if it's life. And this actually capture liquidity and volumes and obviously fees for the Dow. So we're moving into a multi-shamed defy society. So we need to capture those different, different

opportunities. So let's maybe start go deeper into this and like into this like state of defy today. So how do you see this what defy is going to look like now like one year from now? So like today, You know, it's very clear that, like, the vast majority of defy is happening on Ethereum. Like you mentioned earlier, you're an Heath Maximilist right now. How do you see this evolving, you know, especially with like the, you know, gas costs and stuff today that are on Ethereum? Is it pushing out the retail user, you know, the users that Stakeda was initially designed for? Is it starting to price those sort of users out? Yeah, that's a good question.

That's the reason why Stegdow V2 will be focused on. Well, the thing is like, what we, Sechdao V2 will be more like more concept of decentralized exchange. I can say that without any much. But basically right now, participating and swiping and buying assets and staked out quite costly. It's quite expensive. But any defy, if you go to Curve,

figure like to any project, you easily spend 50 bucks for just depositing asset. So I think the fact that blockchain is becoming more democratized and pushed by big subtle experts and influencers in the space, like maybe Rihanna or like people that are always in take apparently. Obviously, people now have access to, they believe or they don't actually say. see crypto as something dangerous anymore. So my point is like, now they actually, we're bringing more people into blockchain, into crypto, but those retail people, 99% of all the users are not tech.

They are Instagrammers. They are people using TikTok and all the stuff. So they want something super simple. And they actually, frankly speaking, they don't actually care about this authorization. They just want to make money. And that's the problem of this world space. So the reason why, I believe, how do you see like different? in the next year, it's actually defy

will be actually controlled by centralized entity that are pretending to run Defy solution or maybe getting involved in blockchain. One of them, one of the biggest player in asking of very likely to succeed is Binance, because Binance they understand that their retail,

their users, don't actually care about decentralization. They care about having fun with money. They want to make money. They want to make investment. So the real question is, are we feeling as a decentralized vision compared to people that only focus on money. And I think finance, phantom, all those different chains that actually are centralized,

phantom is centralized, finance is centralized, like all those different things. They will start a centralized entity, capture a lot of retail, and then slowly but surely move into decentralization by bringing more validators. And I think that's a sneaky move from them because they are very likely to succeed. And yeah, that's the problem. I mean, that's the reason why I think it's basically putting the agenda of Etherm a little bit earlier that, I mean, now Ethereum cannot play or it's coming soon or it's coming in two years. I mean, soon, when they say like, it's soon. It means like four or five years, you know, this cannot continue.

So I think it's really pushing Ethereum people to really deliver. But my point being is like if you look at all the research, I think 98 or 99% of the entire research is driving by. Eastern right now. If you go to ETH, research, C.H, and all the staff, the entire developers, research, mathematician, like really deep in computer science are all on Etherham. That's pretty funny. That's a reason because it's easy to copy staff, but then innovate. It's probably it's tougher. Just so I understand correctly. You think the strategy for chains like finance is that they start centralized and then they will decentralize later, did I understand that correctly? Yeah, it's already happening.

If you read the latest article on VAT, Binance chain, they're basically talking about it. And we also add some very internal discussion from people from Binance that now they're looking to get, I'm sure Sonny you got in touch with Binance lately, but now they're looking for VITERS and they're looking to, instead of adding 10 or 15 or 15, I don't know, like 15 VATERS, they probably are now looking for 80, like more than a, more waiters. I mean, it's businessly, if you talk about business, that's a good move. That's a good move. But then if we talk about, is it fair and all the stuff? It's not, obviously.

I mean, if I take the devil's advocate position here, like if the outcome is that the chain is decentralized and there is no central point of failure, you know, in what it would be like finance, otherwise in the central system, and that succeeds, then how is that not a good strategy? just generally. How does it not benefit the ideals of decentralization? Well, I mean, it's like,

you know, like team, the English guy saying, create the internet peer to peer. The vision was peer-to-peer was this fully decentralized world. But then big, Yahoo, Google, and all those guys, they start centralizing internet

and then giving bridges to people and then huge, huge Lobby, like those guys, they start saying the darknet is bad. You should use our bridges because the real internet, the one percent that we provide is the real internet. Well, actually, the real internet is 99% of the rest, which is the dark net. But then Lobby was so strong to tell you that dark net is used to kill people,

to pedophile for all this stuff. Yeah, you're like very, very bad actors on the darknet, but actually this is a real internet. But we were born in this belief that the real internet, the internet we can use. And now if you look at all those big actors, like Facebook, Google, Yahoo and those guys, okay, they actually provide the sharing economy. Like you have Airbnb, you have Uber, you have blah, blah, blah. But then these, those guys, they control the entire system. So my point is, like, we were starting as a decentralized economy, as a peer-to-pe economy, then controlled

by centralized entity that now control the entire world. Well, I feel like we're basically replicating it again. We're saying, okay, it's fine if those guys, they copy six years of research, five years of research because it's open tools, build their own staff. I acquire a lot of retail. I acquire a lot of power. And then those retail, they will never leave the platform because they are actually inside the system and they will never make the bridge between changing. For example, like if you're an iPhone user, changing to Google user, it's very difficult.

Or a Google user going to an iPhone one. It's like it's a mind-fuck total because they don't actually give you the tools to do so. So what's happening exactly the same. We're starting as a central, they're starting as a centralized entity, getting a lot of power on the market. And then soon they will say, oh, but listen, look, we share the same vision as you guys. We have a decentralized system that you guys can use and you can be your own bank. You can be your own company and that's it. So, I mean, it's a fair game.

They're playing. I mean, it's not new. Traditional finance. If you look at Facebook, Facebook got copied in Russia, in Asia. They all have their own Facebook. They all have their own Uber. They all have their own Airbnb. So it's not new.

It's just the way it's actually made, trying to trick their users into. believe that they are in control of their own keys and all this stuff. I think this is different, different picture now. I hear that argument. And I think it's a super important thing to consider as like, you know, if we think of like the long-term vision of crypto. And I've been thinking a lot about this recently. Are you familiar with Ben Thompson and Stratoree?

He's a like very, right-jimist tech writer and he has a newsletter like, you know, hundreds of thousands of subscribers. And he writes about this, you know, he's been writing. for years about this theory of aggregation or aggregation theory. And this theory states that like basically businesses on the internet tends to word aggregation because of network effects and because of just the potential for economies of scale and like low marginal cost scale. And you know, this is of course like it's counter to the to the prevailing narratives in crypto that we need to have everything decentralized. But what we see happening is that things

end up even in crypto sort of being centralized. And like finance is one example, but it's not the only example. Do you think that there's a risk that crypto and this idea of full decentralization just isn't attainable if things begin to scale at a global level? I mean, if there are a billion users on Ethereum or like, you know, three billion people using crypto, is it even reasonable to think that there can be scalable systems that are fully decentralized that have that many people on them. Yeah, it's a good question. I mean, Bitcoin 2009, Ethereum, 2014, it's already seven years old.

If you look at the research, people are saying, oh, but look, Calcutta or, I don't know, like, New Shane, they are fosters, and they are much, they are well, well, more designed. But, I mean, people to, to, tend to forget that those actually, ETHM technology is very old, Meaning that obviously back then there was a revolution, but now moving and migrating an entire market cap of, I don't even know, like maybe $250 billion, it's very difficult into this kind of system of proof of stake, fully decentralized mechanism that is not going into from mining and miners and stuff. I'm not sure if it's actually a risk, because if we really believe in this, that we're building the force of evolution, which is a system where it's fully decentralized, I think people will have. The thing is like now compared to the, I mean, the previous revolution, I call it like a sharing economy and the one before is internet. But now, actually it's different because before, in order to do something, you had to ask regulation or ask companies that if you could build using the API, build using the SDK or build a connect to Facebook login or stuff. You have to ask questions.

We're here. If people don't start using decentralization, they will be isolated in some. their own market. You don't want this. So now it's not like for business reason that they are, I mean, it's not like they're not forced to do it. I mean, forced to do it like from someone on the top, from regulation, because regulation doesn't want this before.

Now, it's actually forced from the bottom. If you don't actually integrate and then go decentralized, you will be not, you will not be able to have access to those huge market. We're not talking about, usually we say, oh, as a new. company, traditional company, I want to go to the American market because we're talking to 400 million users. And the American users, they like to spend money and it's very fast. And then we're going to need to go to Asia.

China is the other place because they go fast in spending money. Well, here, it's blockchain. If you don't actually get involved in blockchain and decentralization, then you will lose billions of people that can use your product and make money and you can capture fees. So I think we are aiming for decentralization. But like now, the right move for those business, if you're running a business, is what people are doing. They actually centralize the thing. Capture a lot of liquidity very quick.

Capture a lot of users very quick. And then slowly but surely will decentralize. And then buy what? By forking and cloning project that already is super successful on Ethereum. I think I agree with part of that. But at the same time, I wonder to what extent, like there are forces that. There are external forces that could, you know, shape the way or like shape the direction in which the space goes. So like one of those forces is, I guess like forces that are just inherent to the way technology works.

So like this aggregation theory thing, I think like, you know, if that is correct, that's one force. And then the other is regulation. So for example, like you're well aware that there is the Mika proposal in Europe and that, you know, in his current writing, it might just put the U.S. immediately in the driver's seat because like U.S. banks are able to issue stable coins and European banks aren't. And so I wonder to what extent there's just so many other, I don't want to sound pessimistic here, but I do like recently. I've had some sort of existential questions about like crypto and whether, you know, it is really in the hands of those that are building, you know, the Ethereum chain, for example, like those working on that research and like those really driving the ideologies. if it's really in their hands about what actually happens and how the space actually evolves into, you know, whatever it is going to evolve in.

Yeah, no, it's a good point, man. That's exactly what you just said. It's a perfect recap of the situation compared to all the previous revolution. It's always companies going against people. Right now, we're actually saying companies trying to be the people, but then national states trying to regulate what people as a company doing. So I think one of the biggest as European, I see like three different major forces, obviously like US, Europe and Asia.

As soon as one of them is being able to worldwide print or tokenize their national currency, the race will be for those D5 products of blockchain to actually start using them. And obviously, US is already leading this because they already have like, Gemini coin with the twins. They are like coin base and all different things. But if you actually look, that's a good point is, okay, it's decentralized. But what is actually truly decentralized? Because at any point of time, it's already, already happened.

Fully decentralization is normally a hack happened. The person gets the money. And normally the people that if you are fully controlled, which is basically the vision of blockchain, you are fully controlled. of your assets and you can do whatever you want. I'm not actually posing the question, is it bad, hack, exploits, or arbitrage, but normally the person should be able to use the money as he want.

Right now what we're seeing is like big company like USDT. They say, okay, the next day, oh, the CEO, I think this is a CTO, always go on Twitter and say, oh, I'm very glad people. I post the money from these hackers because these hackers, this hacker stole the money from this very legitimate company. I'm like, yeah, okay, that's good because maybe. this is an exploit, this is a hacking, but at the same time, it's against the vision of decentralization, because normally you have fully control of your assets.

So, yeah, big comp, and that's the reason why I think Curve that finance probably one of the biggest and major project in Defy, if you actually look at, if you like the game risk, risk, you play nation, and you're nation against nations. And here, if you believe that the crypto will be, is part of evolution, this false revolution, then every country in the world, major countries in the world, would like to have the national currency tokenized. And then as soon what happened is like they will want people to swap between different stable coins. And what happened is right now, one of the best places that you can,

apparently they're saying like 50 or 60 percent, that's what's something I heard, but maybe it's all bullshit, 50 or 60 percent of the entire market of crypto will be stable coins. Because the underlying asset of value worldwide is currencies. The FX market is doing $6 trillion volume a day. So the goal of project like Curb.com, which is like focused on stable coins, and it's basically see that as an XX market, even if curve capture 1% or 2% or what's the future of FX is, then it will be like making billions of volume per day. Well, my point is right now the real competition and centralization of power is on stable coin.

People are chasing governments and national state to print a national currency, not just because it's cool. It's because when you can print money and distribute your money, you are in control of the world. Yeah, no, I mean, I definitely agree with you. I mean, I've been a believer that, like, stable coins are going to be what takes over most of crypto. Because I think that's what most average people want to be used. And they want to use DFI, but they probably want to use defy, but they probably want to to use it with their like stable units of asset not with like crypto out of like bitcoin or

Ethereum necessarily. So I mean we mentioned the the you know regulations and I you know you you briefly mentioned this like arbitrage stuff. Do you think like you know so like kind of to move into like some of the defy topics we wanted to cover, you know, one of the most common attacks that's been happening within the defy ecosystem. It feels like nowadays, it feels like it's happening on like a weekly basis is usually the sort of price arbitrage attacks where people will use flash loans, which you know, we can talk about as well. But, you know, to do like some sort of Oracle manipulation attacks as

like a lot of things are depending on these on-chain exchanges as an Oracle. And then they're like, you know, using these these things to exploit and like take steal value from. the system, things that are relying on maybe, you know, maybe they shouldn't be relying on these poor oracles in the first place. But, you know, in traditional finance, these sort of attacks are like, you know, illegal and it'd be considered like in the realm of market manipulation. Do you think that like this, the, how do you think this crypto ecosystem will have to evolve to, you know, clearly this is not something that's acceptable in the long term? And so how do you think the crypto ecosystem will have to grow to evolve here?

Yeah. So, yeah, I think there's got a lot of discussion involved of people saying that what's happening in defy and flash loans. It tends, I mean, tend to be not acceptable in the sense that people are getting hacked or they lose money and whatever. But I think like, let's get back to for a sec to flash. I mean flash loans are nothing new if you compare to traditional market. In traditional market, they're not called flash loan, but they call wealth. Like big fancy, big VC, rented business capital, hedge fund, and especially banks or insurance that have the capacity to go on the market and to take massive position, like the thing that we saw in Gapstong.

You know, GameStunk, people then... then buying a long position and then all the VAT users going there and then trying to short the big VC in New York and in Wall Street. The thing is like those behaviors already exist in traditional finance. What is actually pretty mind-blowing in decentralized finance is those different behaviors can be triggered by people that have not a single penny in their pockets. So meaning that it's like saying traditional finance like saying, okay, wait, people can actually go big on the market. So we need to stop banks, insurance, rent to business capital and a hedge fund to actually interact with finance. No, it's not possible. The reason and the only reason why decentralized finance like traditional finance exists is like in the 90s and 2000.

You had people taking arbitrage. People don't actually understand that if you're doing arbitrage, if you're making money with flashed, if you're making money with liquidation, this is the only reason why such a system exists is because you have actors that make sure that if you take an under-collateralized loan. I'm not like criticizing flash loans. I think flash loans are like really great.

I think like flash loans get this like weird rap. Like, you know, I was actually one of the first people, you know, I wrote a blog post about flash loans back in like 2017. I always been a big fan of flash loans. I'm talking about more about like the different uses of flash loans. So I think there's some. very good uses of, of, like, how people are using flash loans. So, you know, when you have more efficient liquidations, more, like, better arbitrage.

My question is more about, like, I don't even want to focus on the flash loan part. You know, the flash loan is, it's a tool that people are using, but you're right. Even if there's no flash loans, whales could still be doing this. But what I'm talking about is, like, this level of, like, market manipulation that happens, and Oracle manipulation, this would be illegal in traditional finance, or like, at least, you know, the goal is that we should try to, like, prevent this kind of behaviors from happening. And so at least in traditional finance, we do have this tool of regulation. How well the regulators do their job at preventing this in traditional finance?

You know, we can debate about that. But, like, in defy, how do we build, you know, we don't, we can't rely on regulation to come save us here. maybe we can. I don't know. But like, if not, how do we create a safe ecosystem where like the deep, the protocols that we're depending on are resilient against these sort of manipulation attacks? I completely agree with you. The difference is disanthalized finance compared to traditional finance is decentralized. I mean, that's part of the name. So my point is if you compare what's happening in disavit finance, you're saying, oh, this will be not. acceptable and will be punished in traditional finance.

Or the reason why we have them in decentralized finance is because the system that are being built and not correctly built. That's it. And that's the reason why flash loans or any other way of manipulating over the course and all the stuff, if they are possible, it means that the protocol needs to change. Because if you're building something that can be, not exploited, but can be armed by a huge liquidity, then it means that your system that you've built is bad because it's a trustless mechanism.

Anyone can enter, anyone can exit. So if you're not building a system that is mathematically bulletproof, mathematically bulletproof, but also a crypto economics, like game theory, then it means that your system shouldn't be in tradition and defy, but actually should be in traditional finance. If you just copy traditional finance and bring them into decentralized finance without actually thinking outside the box, then you get exploited and you get high. But I think like most of them in this centralized finance, whatever we covered in rec, I don't think people agree with me. But I think most of them are arbitrage.

They're not exploits. They just they build a system and people use the system. They build a system for people to arms and make money. But those people were smaller and they actually make bigger money. But at the end of day, they're just arbitrage. I mean, not all of them, but most of them, yes. So, right. Okay.

So your take here is that like these systems themselves, are like poorly designed and like performing these like arbitrages and like this is how we like the system will be forced to evolve in order to design better and better more resilient systems essentially. Yeah, exactly. The reason why your money is safe at the bank is not because the bank is saying the money is safe. It's because you add robbers trying to steal into the bank, you know?

I mean, don't trust very far. It's the same in traditional. If a system is fully secured, you need to use. they need to show you that this system was trying to get a hack by millions of people. And then you can say it's secure. It's not secure by design. It's secure by being in practice on chain and being like the reason why Bitcoin is secure is because if it wasn't secure, Bitcoin is like a trillion market care.

Then people who are just like, it's Bitcoin right now. It's the biggest holy grail of money part. Like the biggest bounty on earth is Bitcoin. And if someone tells you it's not secure, I'm like, okay, cool, go then and hack it and take the money. The reason why it's secure is because the money is not being hacked. It's the same in Defy. The reason why Defy is solid.

If you tell Defy is mostly the traditional finance, then your protocol shouldn't be easily manipulated by providing liquidity in such a way or another. But obviously, it's more complicated to defend. But if we actually, I'm sure like in the future in the next couple years, it will be impossible to manipulate those different networks. internally to the project because it will be a black box, but then the next level will be cross chains because what will happen actually

having like trillions and trillions of dollars and then getting like arbitrage, bridges, power chain, like all these different things. Wow, this is pretty fascinating. So, you know, you mentioned that you're also one of the, you know, team members of the curve finance. And so how do you see like curve like, you know, helping push the ecosystem towards building those,

these more resilient, uh, defy protocols. Well, right now, if you're looking for huge liquidity, like actually zero employment loss and zero sleep age, if you're good enough,

then you can use such a system. Um, Kerr provide you a place for being able to swap huge amount of liquidity. That's something that was never able to do in traditional finance. For example, like one of the feature that a curve made is you can swap 45, 40, 25 million US dollars, depend on debt of synthetic. But you can swap huge amount of money from East to BTC. And then we use some virtual, like the product, Synthetics to basically allow this swap.

And then you have a settlement. So doing the settlement in order to wait, then we issue an NFT and we present your settlement. And as soon as the settlement goes on chain, then you can claim your funds. But my point, I think that was before this tool and after this tool in D5. The reason for that is like if you do such a thing in traditional finance, you will need to sign documents. You will need to wait a couple months and sign what we call in MC, Multicolateral Party, MCP. And this will take long, we'll take a lot of money.

lawyers, you'll take like middle, middleman. Well, here, you can do that in just a couple of minutes and zero sleepage. I mean, you just pay a fee. So my point is, like, curve becoming, like, the underlying protocol only same, but also like cross chains soon and working and integrating in multiple different chains. But it's the underlying protocol. If you want to do, for example, like, imagine users on Kanbays or user on Binance or stuff like that, I don't see those guys not implementing curve as the underlying protocol and maybe

charge a little fee, because right now it's the best protocol if you want to do a swap. And huge volume, like solid technology, and entirely focused on security. It can be shocking for people to look at the UI, but that's a different discussion. Yeah, you were talking earlier about how simple the UI was. And I actually look at the UI. I'm like, I see what they're doing here. I know the aesthetic they're looking for, but I, I don't find it's very simple.

Yeah, we work on the UIV2, but yeah, I can understand that it might be a little bit too much for some users. Yeah. So I'm curious, you mentioned NFTs here. If you think NFTs will play, I mean, like a lot of the attention of NFTs has been around collectibles. And like, you know, you talked about so rare earlier and all these different collectibles projects. How much do you think NXT will play a role in tokenizing, like, debt instruments? and contracts and things like this. Do you think that this trend that you're seeing here on curve will continue to grow?

Yeah, I think that the biggest value in NFTs are not, I mean, gaming, like, verticals of, like, gaming, porn and all these things are huge vertical. But I think, like, if you really do the NFT market, is actually into finance. So if you do, like, tokenized debt, real estate, like, all those different things. thing. I think this is where the NFTs can actually, you can tokenize the contract and then send the contract to someone. You can trace the contract. You can also like, like for people in the, in a supply chain

or like items, like this is huge. I think that the real value in NFT are in this kind of services. Right now, the democratization of those NFTs happens on the, on the gaming side and collectible and arts. They are good. I mean,

the art market is a trillion market can have worldwide, but I've seen traditional finance, it's trillions and trillions. So, yeah, an FD market will be pretty huge. And if we, if you look at the curve synthetic swap and you understand the mechanism of using this NFT that we present a time between the settlement happen on Shane and you're able to redeem it and you can actually send it, then it's it's a it's a complete game changer. I feel like last year with flash loan,

people start using flash on a little bit and then it become super big and people start talking about it. Well, actually, I think what Curp did with this mechanism of a swap, being able to swap millions, even bigger centralized exchange like BitMex or Binance or FTX, they cannot do that. You cannot swap the 45 million US dollars on the platform without actually getting a huge sleepage or creating a huge stamp on the market. That's not possible.

Well, except maybe Cracken, but Cracken does actually fuck up the entire market in one shot. You guys had on rec, you had a post recently talking about the creation of decentralized monopolies within the space. And like, so, you know, there's been this string of, you know, mergers and acquisitions between Deepi protocols. And it's a little bit unclear what these even mean. But do you think that like there is this growing amount of centralization of soft power within the space, especially as like, you know, We see this rise of like governance tokens, but it seems that oftentimes these governance tokens have very little actual governing power. And like instead we see a lot of the soft power in the space like accrue to like some of the developers and development teams like Andre and stuff where like they are somewhat unaccountable to the communities themselves. Do you see this becoming a risk within the ecosystem over time?

I think this is one of the bigger, bigger subject in blockchain is, as you mentioned before, is like, are we going into this kind of like replicate? I mean, what we're building, for example, in rec, we have this subject called opium diaries. And we try to explain what we're building or like trying to understand the future. Are we building a better future? Are we building a better society? or just like replacing the current elite, current people on the top by ourselves. And I think this is exactly what's happening.

Whatever mistake were made in traditional finance, we replicate the exact same thing in disauthorized finance. But then we try to make them cool on the public attention. So my point is like, if you look at history, 80s, 90s, 2000 was massive fights. Google, Microsoft, Microsoft buying or stealing some. patents. Apple, like buying some company and turning into Apple, stealing some patents, and all stuff, like all the same. There was no open source, but there was like legal fights. Well, right now, it's like, I really like the space because people pretend to build a future

and a better world for people, but actually on the ground, they're making merging acquisitions, they're attacking people, they go very bad on lobbying on some different strategy. So what we are now, it's not like peace. It's a complete wall. It's like people are trying to get the biggest shares of the markets. And all the different tactics and all the different moves are being played right now. Legally or on-chain or acquisitions and also like some stuff going on, like very, very sneaky move. Like, for example, a network gets hacked and then suddenly gets acquired or merge.

and then all those different things. Some stuff is happening in the background. And then the only vision here is to be one of the biggest company in the world as a conglomerate. So you will soon see in Defy company like Alphabet, Facebook, Apple, you will see like five or six different major companies that are not protocol level, but are companies that build across all the different protocols, either financially or outside finance. But that's 100% sure. It's already happening. And that's what we have all the, it's well known that we talk about defy drama. Well, when you see someone going online and say, oh, I go off for five, for five days or three days because I don't have much enough, it's because stuff is happening in the background.

But, yeah, we have, I think like in this space, we are like three different people. They play on glory. So a lot of them wants to glory over money and over security. And you have this triangle. You know, it's blockchain, transparency, security. and then speed, where here's that glory, money, and security. And this is already happening. If you look very at the space and you try to understand, it's what we actually try.

It's already happening. We have massive actors that are trying to build conglomerates right now. A couple weeks ago, after the launch of Saddle, which was like a little bit of a clone of curve, like, you know, they didn't fork the contracts, but they forked a lot of the ideas of curve. and, you know, but focus more for Bitcoin. We saw that curve actually had a proposal to like remove all the incentives for TBTC, which is like actually sort of like an unrelated product kind of built by the same company that was building saddle,

but like, you know, sort of as like a punishment for building saddle almost. And like, do you think this would also, you know, do not think this also classifies as like some sort of like anti-competitive behavior? Well, I mean, first, you got two things inside. I don't think they're correct. First you said, Saddle is not a copy, but just change the card. No, it's not true. Saddle is an entire copy of curve, but instead of being in Viper, it's in solidity. And also, apparently, they didn't understand the code, so the duplicate curve code,

but couldn't actually make it, I mean, didn't fix some bad performance that you could have in curve, if I can say that. And then secondly, the only... the point was copyright and then you said yeah the proposal i don't see i've seen any proposal that can stop because the things like was initiated by the CEO by the founder by matt by tbc but we didn't incur we actually didn't go against and stopping incentivizing the pool we didn't do that i mean that's not part of the curve i think curve we like everyone i mean it's a fair play if you if you take the code but modify and make it better or something then we'll be okay cool that's that's

interesting. But no, no. So there was no proposal to stop incentivizing TBTC pool. And also the code is also like curve code, but modified in solidity. And certainly inside this concept of anti-competitions, I mean, that's interesting. I think that's what exactly will be building an entirety five. If you think about it, people are focused on money. But I wrote it before and also it's in the light paper. I think the most interesting and interesting bit in this space. And that's what actually people want to have access to. It's not money. It's governance.

Because governance control money. Governance is power. And there's exactly what's happening in the entire ecosystem. For example, like whatever we pushed in stake down, the fact that you can delegate Curve token, that's just to acquire power of curve. Then you can actually plan for the good health of curve, for example. But what you want to do in this space is want to acquire governance. Because when you have governance, you can enter it and you can place your, your, your,

chips on the table, you know what I mean? So what we're playing here, we're playing 40 chess 100%. So if someone's saying on the ecosystem on Twitter, oh, this is bad, what's happening here? No, no, no, nah. That actually is just someone lying because the entire game is actually a 40 chess, even like more than dimension than a 40 chess. And everyone that is playing, understand the rules.

And whatever happened in public, happened differently on the ground. So my point, like anti-competitive thing? Yeah, 100%. That's what people do, but it's not the goal of curve. Because curve, curve is underlying, underlying protocol. So curve will accept anyone to build on curve and will push for anyone to build on curve. That's the thing. But then on the top of it, people that are trying to acquire governance and trying to build conglomerate, yeah, obviously, they're trying to kill competition, whatever it's a cost, 100%.

I very much agree with this idea that crypto actually, like, creates new forms of power. And I think it's, Dmitriy Kofanos came in on this podcast and we talked about this a little bit and he's been quite vocal on Twitter about this. And what does the world look like when there's a thousand new billionaires? And when those billionaires start, you know, having enormous amount of power over, over like this defy ecosystem. And especially if that defy ecosystem starts replacing traditional finance, we want to be sure that like that's what we want as a society. I think that this meme that crypto is like helping the unbanked and creating, better opportunities for everyone. I mean, it does, you do start on an unequal playing field.

So like anyone can go out and create curve or saddle and or any kind of D5 protocol and enormous amounts of power around some liquidity in that protocol. But the time for that to happen is like getting shorter because those actors are starting to really establish their dominance over the market. It's going to be very hard to, you know, to like dislodge them, much like it's very hard to compete with Google or Facebook or any other company. Yeah, exactly. And then you're right here. It's like, but what is very dangerous for Defy is instead of asking the nations of Google or Facebook to answer questions here, what we're building in Defy is just single person that will have as much as power than an entire company such like Google or Facebook or whatever. Of course, like you can say that the protocol is being decentralized and token orders. But most of those people with massive states, in those different protocols

will be acting as if they were in traditional finance, Google or Facebook or something like that. And it's already happening. Now, if you want to pass some vote in some protocols, you need to talk to those persons. You need to do that, okay, please, can you do that? Okay, I can do that. But in exchange, I want you to do that.

You know, it's already happening. So lobby, lobby in the centralized finance is controlling decentralized finance. Whatever we're trying to say on the public saying, okay, it gave opportunity for anyone to get, involved is transparent. Like anyone in Philippines on the middle of nowhere in Africa can actually participate. This is true.

But saying that is just like the way of increasing our bag and controlling more power. So yeah, if someone goes online and say, oh, crypto is going to change the world in a good way, it's going to be perfect. We're building El Dorado and all this stuff. I mean, there's a true. We're building something that is better, but don't say this is perfect world because it's complete bullshit. Whatever we're actually building right now, we're just taking much.

market cap from traditional finance for big entities to get it in our pocket on the other side. That's exactly what's happening. We're building citadales. You know that this ready post about this guy saying the reason why wrecked was started as an underground kind of dark style thing is every year I always read to one or two times this article unveiled, which I think is beauty. Because I want to force myself to remind me what I'm actually getting into. you. This article is, I'm from the future, and I'm here to tell you that what you're building is bad. And it explains all those people getting involved in Bitcoin or Defi are crying a lot of Bitcoin and building those Citadel. So if you don't have Bitcoin, you cannot enter

the Citadel. You cannot access to some services. And it's already happening right now. But I don't want to be pessimistic. I mean, I think Defi is fantastic. You should all join. I'd like to ask you what you think the role of validators play in this in this game of 40 Chess. And specifically, I mean, what do you think is the risk around validators as a service, such as like bison trails and other companies like that, effectively controlling not the staking assets themselves, but the infrastructure on which those staking assets are being staked? And, you know, what are the risks of the majority of staking being captured by actors such as this? you have a good example of loom you know loom got was like 60 or 70 percent at some point controlled by binance and it completely died

i mean the reason why this happens is because binance doesn't give a shit about loom but was trying was actually getting money from loom and i mean this is an example of like most of us taking as a service value they don't actually support the vision of disauthorization it's just there as a business model and the reality is like a quick cash you know You make quick, you make cash right now, and then you can jump and do another opportunity. So it doesn't matter if actually concentration of power goes on chain from those validators, as long as they make money. It's exactly what's happening. And then also a lot of big validators, they have a voting power.

So don't believe that someone that has 10 or 15 percent of voting power in such a network. It doesn't actually get requests from the outside. Every single day you get requests from the outside from people saying, I mean, for example, like myself, I'm pretty early in Maker. I have like some voting power and maker. And then whatever people are trying to make some vote on maker, they always get back to me and say, Julian, do you mind doing this?

And then I can give you this. It's always happening. But imagine if you're doing this a higher level. Like, violated or stuff. I mean, I'm telling things that people probably don't want to save. But this is actually happening. The entire defy is not corrupted, but is some really, really stuff happening on the ground.

And lobby, governance, money being played. big actors asking people to do such things because if they don't do it, then they either not going to integrate their service or they're going to not going to help or they're going to tell people in the auditing firms that please don't audit this project because they didn't want to do that. So everything is being played. But the thing is like actually, it's even bigger than traditional finance. So whatever you see in traditional finance as bad actors, I think we get all of them in this enterprise finance, but even bigger because everyone can actually jump in and do whatever they want. So it's interesting. I mean, also also the fact that in

staking as a service, we all know each other. I mean, I know you guys. I know, I know Sonny. I know everyone. We all do sticking out of the series. So every time there's a new network that want to get some staking as a service, we create a Steggram group and we get all together and we talk. We talk. This is already happening. There's a few different providers in the world that will provide good services and you want them on board. That's it. That's how it is. And then we charge a commission and we charge money and we make money. That's Perhaps one more question, which is like slightly related to this. It's a little bit off topic, but since I have, you know, two people that run validators here in front of me, I'd like to ask both of you,

perhaps. Where do you think like staking as a service providers, so I'm thinking like Sika, Chorus One, like these types of companies that are effectively acting as delegators and validators as a service, like the bison trails, etc. Do you see one merging into the other or do you think that they'll continue to have like separate roles in the space moving forward. Like, do you think staking as a service providers will become validators as a service or, you know, is it the other way around or do they like continue to live separately for eternity? Didn't travel of beats got acquired by Coinbase?

Yes, they did. Not surprising. Yeah, I mean, I think the last thing they have left for sticking as a service is their repetitions. They're getting delegation from businesses or from, big VC or hedge fund. And those big VC and hedge fund, I mean, they won't ask questions.

I mean, child of business is really like a business for providing the service, making a lot of money. On the other side, sticking out of the service that were was trapped in 2017, maybe, we were like back then Sunny,

like getting like, that was pretty new, new market. I was like just like two or three different actors. I remember like it was like, setters, state capital and Sunny on the, on the cosmos side,

like few of them. I think for our side, we have a reputation to maintain, I would say. But yeah, I've seen a lot of regulators moving into money grab and cash. Like not having any questions regardless if the shame they were getting involved into was actually legit or providing any utility. As long as you get a percentage of the market cap and you get commission and you're making money, then those guys, they will just provide. services. So it's not about most of those people and not about the vision. It's just about,

I mean, we have to understand that those providing, sticking into service or any, any services in defined it costs money. Most of them, we're running AWS servers, Google and the staff. So when you have a team and you have a legal entity and you pay, then you just go for the money and you pay the team and then that's it. Yeah. I mean, I tend to agree. I mean, I think that, you know, at least Pacific, I mean, our goal has. always been to focus more on like few networks that we can be like active governance participants in and you know i think there are entities whose goal is to focus on just like scaling up and like being just running everything possible but that's i i think they'll be niches for both of them i mean

i'm like julian mentioned i think that the uh the ones who do want to scale up to everything possible will probably be the ones that make more money on that but you know i i feel for us at least you know making money off the valid it was never really the goal i mean I mean, if it was, we'd be running on way more networks than we are right now. So, yeah, I think it just depends on. Yeah, but I mean, yourself, Sonny, it's interesting how you started. It's like you really want against the validators, but want for the users, meaning that you started taking a zero percent commission fee,

acquire a lot of users, got up to millions of U.S. dollar asset on the management, and then turn into fees mechanism. which is interesting because it was a completely different business model compared to the other regulators and then you got the entire voters saying this is not fair you were saying and you were saying oh but I'm doing this for the experiment of governance testing some new governance model and I think it's one success as a success I mean in the past three years the entire ecosystem completely changed it's like a day in defy is like it's a year in traditional in traditional finance But yeah, we've seen a lot of different sticking as a service dying because they were not actually focused on making money.

And then the ones that were focused on making money, now they are super powerful. So it's like it's always the same. You know, like people actually, I mean, we've seen a lot of people that were there just for the vision. And they were like, no, no, no, I don't mind. I just provide a violator. But then they end up, like, a large cost in those AWS, in those cloud services that they have to stop. And then we don't see them anymore. Yeah, that makes sense.

Bring it back to, you know, some of the last couple of Defi stuff we wanted to talk about. One of the things that, like, with Rec is about, like, you know, how the average user is not basically constantly being adversely selected against. And, you know, I feel like you guys have actually done a good job of, like, training a lot of, like, meme around this with, like, the whole aping in and, like, do you think, do you think Rect has been, you know, helping foster a culture of DGN, DFI? or do you think it's meant or it's been like doing a lot to like help protect the average users? Yeah, I think it's on both side. It's, I mean, actually, if you've seen the, I think how we started, we started wrecked was by this sticker, the death. I mean, the culture of rape is really fitting this kind of like day jing, hacking and it's black and white on the ground. we send if someone get wrecked very bad like suffering on the ground suffocing then we send

these very bad stickers and there is this vibe about this movement of like on the ground uh hikers and all this stuff but i think it's on the other side if you really spend time on wrecked read all the wrecked information then you will have a good understanding of whatever is happening in defy and also a good way to defend or to protect yourself against different attacks or different exploits that are possible. Either the over-call exploits, flash loans, we really deeply go inside the protocol and explain those different interactions. We spend hours and hours. Every time there is something happening, we investigate. We usually the first one to deliver the news, but not deliver something because people expect us to deliver, because we actually 100% sure that the information

we provide to the users is correct, is pertinent, and it's very well, well research and well explained. That's what we do. I'm also working in like some like a little book for wrecked hackers, like meaning like how to, how to basically as a normal user, I mean, a little bit of experience with coding,

how you can actually replicate all those different acts, how you can plug and play those different exploits and all the stuff, meaning that if you provide this, the space will be more secured. How do you educate users? Like, you know, we talked about like mostly about like the technical and mechanism design exploits. But what about like a lot of these like social exploits and the rug pulls and all these things? How do we like, you know, make sure the average users are educated in how to make good decisions on, you know, as much as we want to think of this is trustless and everything.

It seems that there seems to be a lot of trust required to interact with most of these systems. So how do we educate people to know who to trust and how to make those decisions? The problem I don't think is possible. I mean, I don't want to say that. I'm saying it's difficult to tell people, please don't get involved in this network or this project, if this project is providing 200% API or something. I mean, and trustically speaking, people and humans are just like, we'll do everything possible and they would just believe in some stuff that is making money.

So explaining them that if whatever you're doing is bad, then they will not understand. And the thing is more about the incentives. We need to provide tools or analytics and matrix and different systems that can tell them, this is red flag. Please don't invest. Please don't participate.

Please don't ape. But the problem is like this aping vibe or on Twitter, people say, oh, I put 100, in this very famous builder and then I got a million US dollars and then people with your shares. So then the next time, as soon as there's a new network like that,

people who just tried the chance that will invest as well. So yeah, I don't think I was having like an argument with someone from regulation for days ago and they were saying that defy is more dangerous than traditional finance. I don't think so.

I think it's actually safer. But the problem is because it's more accessible to people. Anyone in the world can jump very quickly. week just by a mobile wallet and put the money. So we talk in a range of people getting access to defy it is actually bigger. I mean, not bigger, but faster. And people without actually any understanding because not, I mean, digging into the information

before are actually subject to get by direct by those different protocols. I see you need to follow the people behind the project. We need to ask questions on the telegram and you need to, I mean, on the different channels. And also like listen to you guys. You guys are more like providing good example of education in this space that have been there for a reasonable amount of time. So I think if people want to join a project, they first need to look at AP Center or other people that are providing educational courses that seeing that if those guys actually got interviewed on those different media channels. Yeah, so don't trust very far and don't try to hide because you're saying that you can make. And also, I mean, I'd be like a devil advocate here, but I think if people get wrecked by,

I think they deserve it, to be honest. So what is your D-Gen score, by the way? You know, did you see the atomic blue D-Gen scores? What is yours? Man, I'm, yeah, I'm, I don't want, I don't want docs. I mean, can you actually see on the same information? I don't want docs myself, but yeah, I'm pretty good there on D-Gen school. I mean, I would say top 10, but yeah, pretty good.

So you're obviously clearly a master D-Gen, and, you know, I think, you know, you're working on all these different projects and, you know, there's ways to get exposure to like, you know, all the cool work you're doing on all of them. You know, you can, there's the stake Dow token. There's the curve token. You know, I've heard that there's a wrecked Dow coming eventually. What is this Julian token? You know, is this going to be some basket of all things Julian? Yeah, this is exactly. I mean, I think like, I mean, I'm an investor in the world, the social token system and I feel like I'm not I don't have Instagram I don't have Facebook I don't have all the different tools but I I do believe that I mean most of the people worldwide

99% of the entire people worldwide they use the system and the retail is big fun of those system so I believe that social tokens will be a major will take a major market cap in a near future in crypto so then I invest and then I create this on this platform so I don't like people saying create the token. I mean, I just click on the button and then the token got, you know, it's just like, it's like, it's funny. But and then I was like, okay, I need to find, I need to find utility behind this token. And that's why I actually start distributing the air, like, I thought that was funny, but I actually dropped more, more than 100 ledgers. And by giving away ledger to people that had Julian token, then I got fucked by ledger company with the, by the exploits.

I think that was pretty funny. But, uh, my entire flat got red. by some guys, random guys, and non-den and all the stuff. I mean, that was like pretty, that was a pretty bad experience. But my point, then I started doing this, offering free class in Viper and auditing and exploits. So people that at least 100 trillion token

could have access with me or an hour. And I will go deeply into the code, like how to start Web3 project, run, like, auditing in the code, like basically driving those users into how to build a Web3 project. And so I did also classes on a good, RAS, JavaScript, and also like a little bit of C++. So I really want into class system, but it takes time.

So I was doing between 2 and 2 PM and 3 p.m. And then I was like, wait a second, how can I basically whatever I'm building give a chance to the people that have access to this policy base? So in stakedown, I distribute. I think there's probably like 8 million U.S. dollars from the stagown. theme in other projects. So if wrecked down is going live, if Blackpool is going on life, if state capital is

because state capital is actually turning and not turning, it's actually operational as a quantitative, aging quantitative firm. So like trading market maker liquidation, arbitrage and then like really intense into mathematics and the flow of developers. Think about state capital as 0.0001% or whatever Alameda SBF is. doing because this guy is too big right now. But yeah, so that's it. So basically what I do?

So every project I'm starting, I will give to those guys free shares or free governance shares of those projects. Then I was thinking about how can I give 1% of all my investments inside this market of people that have been either trusting me or following me. I mean, not following, but like investing in this token. But I think for legal reasons, it's probably not possible right now. But yeah, this is stuff that I'm looking for like rewards. Also like liquidations.

So for example, like what happened two days ago yesterday, like some those kind of like very bare market things. When I make a lot of a lot of, I call them rewards on liquidations, then I will distribute a portion to those people. Cool. Well, that's been really awesome. So why is the best place for people to, you know, follow you? you and all these projects that you're working on.

On Twitter, it's my at B Nelish. And it's basically my name reversed. So B is for Butaloo and then Julian. So it's B Julian opposite. Yeah, they can text me on Twitter, on telegram. Yeah. I'm embarrassed to admit. It took me like at least a year to realize that your handle is just your name backwards.

just your name backwards. Man, you're the one behind like Tinderman protocol and you cannot like solve this little puzzle. Awesome. Thank you for coming on. No, thank you. Thank you for having me, guys. You guys are very rock and I really recommend your podcast to anyone that want to understand this face because you guys have been providing a huge value to people.

Thanks. That means a lot coming from you. Thank you. Thank you for joining us on this. episode. We release new episodes every week. You can find and subscribe to the show on iTunes, Spotify, YouTube, SoundCloud, or wherever you listen to podcasts. And if you have a Google Home or Alexa device, you can tell it to listen to the latest episode of the Epicenter podcast. Go to epicenter.tv slash subscribe for a full list of places where you can watch and listen. And while you're there, be sure to sign up for the newsletter, so you get new episodes in your inbox as they're released. If you want to interact with us, guests or other podcast listeners, you can follow us on Twitter.

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