Epicenter - Learn about Crypto, Blockchain, Ethereum, Bitcoin and Distributed Technologies - Konstantin Lomashuk: '#bitcoin is like a #memecoin' - cyber·Fund

Episode Date: October 7, 2024

Outside of BTC’s cypherpunk movement, the early days of crypto were more or less barren in terms of innovation. However, this presented a huge opportunity for visionaries and angel investors to either launch or back bold projects, recognizing the potential of crypto stretching far beyond than just payments. One of them was Konstantin Lomashuk, co-founder of cyber•Fund which was a key actor in bootstrapping the cybernetic economy. Apart from early investments in Ethereum, Polkadot, Cosmos, Solana and many others, Konstantin recognized the potential threats to the core ethos of decentralisation and also co-founded Lido DAO in order to stave off Ethereum’s centralization risks.Topics covered in this episode:Konstantin’s backgroundcyber·Fund & cybernetic economyEntrepreneurship vs. angel investingDelegating tasks and scaling businessesLido’s origin storyLido DAO proposals and improvementsSolana vs. EthereumThe evolution of Ethereum’s economyKonstantin’s other areas of interestAI’s risk of centralizationThe impact of AI on cryptoHow CyberFund invests in new narrativesEpisode links:Konstantin Lomashuk on Twittercyber·Fund on TwitterP2P orgSponsors:Gnosis: Gnosis builds decentralized infrastructure for the Ethereum ecosystem, since 2015. This year marks the launch of Gnosis Pay— the world's first Decentralized Payment Network. Get started today at - gnosis.ioChorus One: Chorus One is one of the largest node operators worldwide, supporting more than 100,000 delegators, across 45 networks. The recently launched OPUS allows staking up to 8,000 ETH in a single transaction. Enjoy the highest yields and institutional grade security at - chorus.oneThis episode is hosted by Brian Fabian Crain.

Well, what Bitcoin is doing, it's doing regulation. In general, Bitcoin introduced technology regulation. We invested in Ethereum, then we invested in Polka.comus, you know, like, yeah. And Salana was one of the projects that we invested in a seed stage. We could, in general, stay in Bitcoin. Like, a lot of Bitcoin maximalists believe that the gods are totally coming to solve all our issues. But this is a craziness, you know, like, Bitcoin is a calculator. or like it is a

milcoin, you know, like I'm not big deliver in Bitcoin, I think it can change, evolve. Ethereum pushed Salana forward, Salada puts Ethereum forward. But who is the winner is like people? The fees on roll-ups going down and if the fees on Ethereum going down,

it means that we'll have more and more different type of applications that can find a product market fit by using blockchain. Hello and welcome to App Center, the show which talks about the technologies, projects and people driving decentralization and the blockchain revolution.

I'm Brian Crane, and today it's my special pleasure to talk with Constantine Lomashouk. He's the co-founder and managing partner of Cyberfront, but he's done a lot of other stuff as well in the crypto space, and he's been tremendously successful and influential as an investor and entrepreneur,

so really excited to speak with Constantine. So just before we get in with Constantine, I'd like to tell you a few words about our sponsors this week. If you're looking to stake your crypto with confidence, look no further than Corse 1. More than 150,000 delegates, including institutions like BitGo, Pintera Capital and Ledger, trust Corus 1 with their acids. They support over 50 blockchains and are leaders in governance or networks like Cosmos, ensuring your stake, is responsibly managed.

Thanks to their advanced MEV research, you can also enjoy the highest staking rewards. You can stake directly from your preferred wallet, set up a white label note, restake your on eigeneyer or symbiotic or use their SDK for multi-chain staking in your app. Learn more at chorus.1 and start staking today. This episode is proudly brought to by NOSIS, a collective dedicated to advancing a decentralized future. NOSIS leads innovation with circles, NOSIS pay and Metri, reshaping, open banking, and money. With Hashi and NOSIS VPN, they're building a more resilient privacy-focused internet. If you're looking for an L1 to launch your project, Nosis chain offers the same development environment

as Ethereum with lower transaction fees. It's supported by over 200,000 validators making NOSIS chain a reliable and credibly neutral foundation for your applications. NOSISDAO drives NOSIS governance where every voice matters. Join the NOSIS community in the NOSIS Dow form today. Deploy on the EVM-compatible Nosis chain or secure the network with just one GNO and affordable hardware. Start your decentralization journey today at NOSIS. I-O. So yeah, so constantly, I actually remember still well when I met Constantine. So this was in 2017 when I was a CEO of Tendomint, and this was sort of around the time of the tendament, the fundraiser for the Cosmos Hub and for Atom.

And then I went with Jay to a conference in Bucharest, and he gave this talk about Cosmos Network and interoperability. And I had sort of the impression that most people were like, what is this? I don't understand it. It doesn't make it. And we kind of just couldn't connect much. But then I remember meeting Constantine and his partner at the time, Dima.

And they were like, we've been following it. like this is cool. And then of course they became involved in the cosmos ecosystem and I've done tremendous amount since then and had already done a tremendous amount before that. I'm maybe curious, how did this all start for you? How did you get involved in crypto in the first place? Yeah, first of all, hi, Brian. It's always happy to see you. You know, like and yeah, I remember the day, you know, like 2017 when we met you and Jay, you know, like an engineer, then all these cosmos, all these ideas started, you know, like, and before the Genesis, before, you know, like any production code, you know, like, and it was really like, all about inspiration,

you know, like I saw how your eyes were, you know, like in general, how much light it was, you know, like, and in general, it was a great energy, and where you really were like, and Jay, especially, was a maximalist, you know, like, tried to say, guys, this should work in this way. And yeah, so we were really like fans of Cosmos, you know, like fans of Cosmos vision. I think, you know, like, Cosmos did one of their, like, biggest impact, you know, like in general in blockchain development. Yeah, and I was super excited to meet you guys, you know, like, and in general, happy to know

you all this time, you know, like we did a lot of collaboration during this time, you know, like and I really always enjoy, you know, like our meetings. So if you speak about my, you know, like previous, how I joined, you know, like I joined in 2014. In general, I first time heard about Bitcoin in 2011 from my friend Dima, you know, like in generally, Dima did some mining initially, you know, like her of Bitcoin. And he sent me, let's do mining together. And I, generally, I thought it was a sponsor scheme, you know, like so I wasn't, I, I was, I was is the most smart guy in the room, you know, like. So I didn't got all this ideas.

I didn't get all this ideas. And I tried to, in general, so I didn't have time back then. So in 2011, I did some retail stuff, you know, like, and did some business. And I was fully, like, inside of this business. And in 2014, initially I was born in Russia, you know, like in 2014, 2013, you know, like I already had some business that operate without me. And I figure out that, in. general, I don't want to be connected with a country, you know, like any country in general,

and also hold country risk, you know, like because in general, the trend of, I mean, like, administrative economy was not good for me, you know, like, and I feel that I took too much risk if I will build a business in this country. And so I start to research in general what I can do and how, and in general, I want to move to more IT development, you know, like and in general dimma come back to call in grids the place where i was when he was born you know like and in general he lost almost all his bitcoins on madgox you know like and we start and in generally you know like he started cyber fund with his friends you know like and partners and i and he peeled me now like so i had some free time so he told me about the blockchain in general how it works

how it's different from, you know, like architecture perspective, and how hash function, cryptography works, you know, like, so I read a white paper of Bitcoin, and of course, I were inspired, you know, like. And back then, what I can say is that, you know, like, it was how to say great time because we tried to predict how this market will evolve, you know, like, and I can say that we can elucinate a lot, you know, like so people say that LLM are hallucinating now, you know, like or AI, but I think people, when they try to predict the future, they can in general reutinate even more.

But what we really figure out is that, you know, like, I mean, that is healthy for each person on a planet. Because, I mean, what blockchain is give equal access to each person, you know, like. And there, yeah, and so we did their report, you know, like about blockchains, called Suburonetic Economy Report. in general, I joined cyber fund, I bought a share, like a partner share in it, you know, like, and we start to build our products, you know, like initially a fund that invest in crypto assets, that was one of the most profitable fund in early days, and start to in general research and figure out what is the difference between bitcoins and all other assets. 90% of them were

forks, you know, like jet copies like Dodge coin, you know, like still exist, like meme coins, you know, like, and some of them were really innovative, like Bit Shares back then. like our Ethereum, you know, like that only started like her. Of course, you know, like for example, Jay hate Bichairs, you know, like because of the litigation of proof of stake. But I mean, all of these people try to in general reinvent or like invent something new. And it was super inspiring, you know, like. And so after I joined crypto, you know, like I didn't work even a day.

You know, like it's my hobby. It's super interesting. And I always try to focus on this. 1% of technology. And I found out that it is so many cleverer people, much clever than I am. And you know, like we're doing so interesting stuff. That's why I started to invest money, you know, like in it. So I bought my first bitcoins in 2014. Then a bear market started. So until 2016, it was a bear market. So my money only like going down, you know, like during that time. but I reinvested this assets to, you know, like initial I saw Ethereum.

Then I met you guys, Cosmos, Definity, PolkaDot, some other projects that initially started. And so, you know, like in 2018, I will try to be short, you know, like we close Cyberfund and Satoshi Fund. You know, like why? Because in general, our partners make a decision, you know, like to do own stuff. And for example, Dima is now like on Bali, you know, like, and we building some network states, small network stage projects. So he bought a volcano, you know, like an in general building own stuff. And also like deep dived in AI, you know, like Marina is building like EVM on Solana, so neon, you know, like, and there one other guy, you know, like my good friend who was initial

he just retired, you know, like, and I start to keep building, you know, like. And in 2018, when we made with you again, you know, like, so I started like a p2p.org, you know, like a company. Why? Because I want to keep this blockchain decentralized, you know, like censorship resistant, because if it will be run by 10 exchanges, I mean, it will be just a database. And it means that what we all did, you know, like we just spent our time for nothing, you know, like if all these non-blockchains will be not decentralized. And in general, you know, like it starts to be a pretty big company. Now, you know, like our P2P.org is like like KORUS and other one of the leading stake in

companies, you know, like, and yeah, in 2020, as you know, like, we also like did spin off of Lider, you know, like in 2023 only we launched cyber fund as an investment company. So like to in general keep, you know, like contributing to the cybernetic economy, to the economy that in general will be equal, healthy, accessible for each person on our that planet. And yeah, I think, you know, like. like we still keep doing what we did in 2014, researching, investing, and building. Yeah, I mean, I think there's a lot of things we can go into more detail.

I mean, one thing that stands out. I mean, you had the cyber fund for a long time, right? Or I mean, it existed even before you. And so the, and you mentioned cybernetic economy. What does that mean? Yeah, I mean, in general, it's a meme. So, but what does this mean? you know, like when we try, in 2014, you know, like when we even, I think,

wrote a small book, you know, like about that, but we tried to figure out, you know, like how the future economy will work, you know, like with the new technology, it's with open source, with a, in general, what open source sources show us, it's not about capitalism, you know, like, so when you open source your code, you're not maximize your return. In general, you maximize your return in game theory when other people are contributing, you know, And this type of activity is not clear and how to say capitalistic. And what we try to say is that, you know, like we call it a meme because in generally, what we believe, we believe that it will be economy, that it will be more efficient one day.

And it will be efficient because we will have more data, we will have more computation, we will have AI, we'll have blockchains, we will have open markets. And in general, we will have access to everyone. like internet give access to everyone. You know, like then blockchain give access, for example, for financial products and more. And then AI give access to intelligence. You know, like, and you create a more efficient economy. And we call it cybernetic economy.

In our first economy, cybernet economy report was about their, in general, blockchings. But we also mentioned that we look on blockchains like artificial intelligent networks. Because, you know, like how you can kill Bitcoin or either. Ethereum is there how to say organization, can you stop it, you know, like, or maybe it's new type of artificial intelligence, you know, like that manage us as people, you know, like, as an agency, you know, like. And so we figure out that we call it cybernetic economy and we made the decisions that we want to facilitate it.

In general, our mission, current mission of Cyberfund is accelerate this cybernetic economy. What does it mean that, I mean, for example, what we did with the Ethereum, when we found white paper, we allocate our capital to it. And now we are allocating capital to many others, you know, like companies like Salana, you know, the days like Celeste, Angular, many others. And in the same time, does it make economy better for humanity and for people? Yes, because now everybody has access to coordinate finance on top of shared layer and have the same financial terms. Everyone on a planet. So isn't the big impact? Yes. I mean, in general, Ethereum Foundation delivered it, you know, like. And what, but what was our next impact?

We built, in general, like our initial version of LIDA liquid staking solution to keep Ethereum decentralized and sensory persistent for all these people, you know, like. And I think that we want to do it again and again by allocating capital or by building our products. in general, help, you know, like, in general, I believe that cybernetic economy happened in any way. So, you know, like, with us or not with us, but what we want, we just want to influence on probability. One probability is that it will happen faster. And another probability is that, you know, like, that it will be more healthy for each person on the planet. And, yeah, that is our mission and our vision.

I mean, you mentioned, do you have, I mean, if you told me outside, also you have, like, a, you know, retail business you started, then you started Peter Orr, for example. He started a whole bunch of, like, other projects. How does that, how do you go about it? Like, how would you describe yourself as an entrepreneur? How do you, how do you know, like, okay, this is an idea I want to pursue and, like, what does it look like, especially kind of like in the early stages as you get something off the ground? Yeah, I think, you know, like, first of all, entrepreneurs are really important part of our society. They take risk, you know, like in general, build something. In my case, you know, like, I think it's in my DNA and maybe it's even my problem.

I'm a serial entrepreneur, you know, like, and I think that to be entrepreneurs really hard, and that's why I really love every builder, you know, like, like, for example, you work like in tendermint and chorus and something else, you know, like, so in general, it's take a lot of energy and you always feel you're not good, that you don't deliver or like you are the worst person on a planet. And I think that it's hard, but I don't know by some reason, you know, like I can, in general, I, now I only like building one more project, but I don't want to build anything else in future. Why? Because first of all, you can meet your time. second, you take a lot of risk.

The third one, you are how to say, I mean, really like burn yourself, you know, like, and I think, you know, like in my case, you know, like I, in general, couldn't stop myself, you know, like when I launch P2B.org or when I help, for example, some other people, you know, like to launch a new projects. And I think that when you do, when you're a venture investor, you're a much more happy person, because you're always, you know, like successful. You're always, you know, like, can give a good advice, you know, like it's much better position, you know, like, and it's much better for your, you know, like mine.

So I think later, you know, and I also did a lot of investments more than 150, you know, like, and I under, it's much, in my particular view, much more easy work and much more about happiness, because if you in general help some startup and they're successful, so you're also successful as an investor, you know, like if they fail, I mean, you lose money. It's not a lot of pain. But if you're a builder, each new projects, you know, like, it's like you are going on, you know, like Ariana, you know, like in general in public space and start to fighting, you know, like, you can remember how we started validation, you know, like when we, in general, it was first cosmos game of stakes, you know, like initially it was 100 different validators and then, like TostSertos that's not exist yet already, yeah. a handerick a great guy and others you know like they all start fight with each other and try to show why they are better do some marketing and some other story and first of all you know like

i think i was super lucky because i have a good partners you know like for example in 2020 vasili joined my team and he in general did a big impact you know like on a success of all these companies you know like and i think that sir yeah and for me you know like how it's happened. So I think it's a lot of ideas. I think that market is fully, how to say, like, has a lot of space for new ideas, you know, like, and for example, you know, like, word Mark Andreessen tells that, you know, like everybody told that everybody in 2000, or in 1990, for example, when internet was just happened, you know, like everybody understood that are, like, everybody will need Zoom, you know, like, or like Skype,

or something like video calls, you know, like. And then you wait when their technology will enable you that exists, you know, like that can happen. You know, like, and so I think that it's always a lot of space what you can build. And the question is why you're building like this project is not another. And for me, you know, like it was different stories. Sometimes I just came from my values, like in p2p.org, you know, like I really understand that I've to understand blockchains better. I didn't want to build a business. And second, I want to, in general, to invest better. Yes. And second was that I wanted to keep blockchains

decentralized and sensualp resistant. And that's why I launch p2p.org. Then sometimes, you know, like for example, when I contribute to, for example, launch of Neutron, you know, like it was just a story that, I mean, this team lose current work, you know, like, and I help with idea that I would build, you know, like, because I think that Cosmos, for example, ecosystem didn't have our own virtual machine. And if Cosmond Hub will have own virtual machine, in general, maybe it will find, find our product market fit better than any snail. So it was like an experiment and just how. So, you know, like always is different. And I think that maybe I have an ambition to build some big projects with.

these are how to say millions of users, you know, like, but from other side, you know, like, I still thinking, am I ready, you know, like, am I ready to eat this glass, you know, like, am I ready to fight again, you know, like, should I do it, you know, like, oh, I still more help founders, you know, like to deliver these products. So, you know, like, you always, and I think, you know, like, it's part of your DNA and it's really, you can, from one side, really has how to say to understand what you want and sometimes it's just programming yourself. So you also have a lot of experience now as an entrepreneur, right, having built a bunch of different projects in different industries and different types of, right, centralized companies,

decentralized protocols. What are your biggest, what are the biggest lessons you learned and the biggest things you do differently today from, you know, 10 years ago or five years ago? Yeah, it's a good question, you know, like I would say that I think every six months that I didn't know anything, you know, like six months before. So maybe I started super low from my management skills and others, you know, like, but what you really should as there are, if you just start your entrepreneurship, you know, like, you should understand that, I mean, it's everybody do mistakes, you know, like, and everybody are, you know, like in a learning curve, you know, like. And it's no end to this learning curve. And I think that what I really like, 10 years ago, I have a super different vision, you know, like, and I even don't remember, you know, like,

how I operate the company, you know, like. And for example, I didn't know how product management work, how project management work. In general, I thought, okay, project managers are not, we don't need project managers because it's not fancy, you know, like we need only product managers. And in general, you learn that, I mean, first of all, it is already some type of really like a clear way how you can appraise their companies.

But of course, when you are trying to implement some of that in company or not in companies in Dallas, in generally, you, you know, like do the same mistakes that's, you know, like previous, you know, like management experience already did and maybe like already fix it in best practices. And so you make one iteration and then you understand your mistakes and you make a second iteration, you know, like, and you'll source and you fix some issues and then you do the third iteration. The main goal is that each iteration should be better and you need to reflect, you know, like the mistakes and try to, you know, like fix them. And also what I got that different companies

has different cultures, you know, like even in our group, you know, like of companies where I am participating, for example, P2P, Neutron, Lido's some other like our projects, you know, like when you, or Neil Foundation, for example, you know, like when you

join our off-site or some event, community event, you know, like, you feel that the culture, the spirit, the people are really different, you know, like. And I think that there the most important, things, you know, like you as an entrepreneur, is in general to bring right people, you know, like from one side has an idea of, you know, like, and find a product market feed. And not, it's impossible to buy it through the product manager or like through BDE or other

guys. You need to do it by your hands. And the second, you need to build their, I'm and find great people, you know, like that will help you to in general continue building like this forward. And to do it, you need to inspire people, you need to have a great vision, a great mission, and in general, set up, you know, like processes, you know, like how it will work. But do I have a particular, you know, like, so as I told you, you know, like, it's a learning curve, you know, like, and each six months, in six months, I will tell you maybe another story, you know, like what I learned. You mentioned you have to be like hands-on or do it yourself. Like, what are the things you feel like, like you really have to do and where you have to be really involved versus things where,

you know, it kind of like it works well to have other people handle them. Yeah, you know, like it's a really difficult balance between your delegation and your hands-on. You know, like, for example, I really bet in delegation and I am really super hands-on. And that's why for people it's really also difficult. And also they do the same, you know, like, for example, when they manage their own team. And then it's such a big problem, because if you don't delegate and you control,

you can scale, you know, like, and you can grow. And I think that for the right approach, you know, like to, first of all, I mean, we can look on any, like, organizations that it has a vision, you know, like, and it's really difficult to delegate a vision. You still can what, you know, like, it's difficult to delegate the vision. Why?

Because it is sometimes. the idea of your founding team, you know, like. And then you have money, you know, like in general, if it is organization, then generate some, you know, like revenue, you know, like, I mean, it should give rate. It doesn't matter, is it Ethereum, Bitcoin, or any other? I still think it should have a business model and generate some fees or like a positive impact in this cybernetic economy, you know, like.

And then you have like people, you know, like people who in general, you know, like are execute and building and in general contribute their time, you know, like the most biggest assets that they have to success of that, you know, like company or like organization. And I think that what you can delegate, you can delegate, you know, like money and like people, but what you're really difficult to delegate is vision, you know. And that's why you are creating some type of like, I mean, documents or policies, you know, like, for example, mission, vision, and purpose document, that in general, your long-term objectives, how you see, for example, in 20 or 30 years, you know, like what we need to achieve. And in general, you know, like from

this vision, it's much more easy to build a strategy, to understand what is the KPI, some metrics you want to achieve to bring people and in general, like, deliver some success for organization. You mentioned you're kind of, you know, good at delegation, but, I mean, for example, I think p.2 p.p.org, right, you guys have a CEO now that's, it's not you anymore. How do you, like, how is that work for you to kind of like handle, to go from being very hands-on project to having other people manage the day-to-day, like, has it been hard for you? And like, what have been your learnings in that process? Yeah, so great question.

Yeah, first of all, Alex, Yessen, who is in general, like, our CEO for P2P is the amazing guy, you know, like, who joined us on CPO position. He didn't know anything about crypto. He's not crypto-native. but he has all talents, you know, like, and I think that in an ideal way, you need to structure how you give away

a company, you know, like how you, you know, like, have, you know, like, decided on key values of your company, on mission, vision, and purpose, you agree on this basic foundation. And then you start to give away people, you know, like in our team, you know, like to in general as a business. I have a couple examples, you know, like how I give away, you know, like the company or

the organization to CEO. And sometimes, you know, like, it's like swimming. You just need to drop it. And they need to swim, you know, like and find a way, you know, maybe it's not the best one, but still, you know, like you should give enough authority and decision making. And in general, give all those things away. for people to start to operate. And of course you need to support, you know,

like in for example, in cyber fund, we build a team, we call it strategy team, who help and support, you know, like our, for example, CEOs or organizational leaders on different levels. For example, for they can help to work with strategy or like with hiring or like with, for example, for example, like some type of other things that CEO need, you know, like are.

And what I think is important is important to build their foundation for the team, to hire right people in the beginning, you know, like to have a strong, you know, like values. And then, you know, like to find the right person, you know, like, and look on the test period, you know, like how he or she performed, you know, that you trust, you know, like your baby, because companies, you know, like a baby, that in general, they will deliver the objectives, you know, like and be a little bit, you know, like even when you give a company to see or you have a different stages, you have a hands-on, you have a strategic guiding, you have a hands-off, for example, you know, like,

it's different stage and different your engagement, you know, like in this stage. and for me, you know, like, it's like you push your baby out, you know, like, and from my experience, it is a lot of things that maybe even work better without me, you know, like, because I think that are, I mean, like, when you give a company in some level, people who are, you know, like, who are, you know, like who are start to manage their in business you know like they have different skills and maybe they're better execution or maybe they're better in b2b sales and they start in general build some pieces of the company that you didn't think will be really valuable you know like from your vision initially maybe let's talk a little bit about lido because i mean lido is like it's again like a

different type of organization, right, as a decentralized, like a doll. Tell us a bit, like, what was sort of the origin story of Lido? Like, how did it come about? And what was the early phase? Yeah, I think, Brian, you also were part of that, you know. I know, I know. I think if any more great project is structured as a telegram group, you know, like, and generally, I came to Vasili, you know, like, again and say,

So we need to win game of stakes. In the same time, we need to be the biggest validator in PolkaDot. And we also need to launch liquid staking to save, you know, like Ethereum from centralization. And Vasili said, okay, we can do only one. And then we in general, you know, like took two main prizes in game of stakes in Cosmos. In the same time, we took about 25% market share of staking in Polikadot by some accident. And we also came to all our friends and competitors. You know, like usually people are, you know,

like has different how to say relationships with competitors. You know, like, but we came to all validators. We're like, yeah, I will even start a little bit early, you know. Like when we came to you, you know, like I think it was Web3 conference. And we tried to build a project called Defy API. You know, like it was, I don't remember 2018 or 2019. And nobody, you know, like, It took nobody even know the word defy back then, you know.

Like so, I mean, defy wasn't popular. And we came to you and say, okay, guys, we in general want to build an aggregator of different validators, like API, that you can put inside of the wallet. I think it was Cosmo Station or something like that. And we signed five validators. I think it was your company. It was Certus. It was steakfish.

And it was maybe a couple others. And in general, it was not super successful, you know, like product is getting rate, I don't know, $10. And in general, we had a revenue share. That's why we pay this $1 of revenue. And in general, but what is built in general is built some relationships. Because we spoken with you guys, with our competitors and also like friends, we in general came with some idea, we sign agreements and we delivered it.

You know, like, yeah, it was not successful. And then we came to you again in, I think, 2020 and said, guys, I mean, in general, Sweden will be central. all these exchanges, they have a priority because the LTV lifetime value for the user is much higher, so they earn no money than self-cast debilidators. And we can't do anything. Of course, it will be some seller-stakers, but not a lot. And it will be biggest exchanges that acquire users by just giving staking for free.

And it was a big opportunity for them. I don't know why they didn't do it for free, but yeah. And we came to all, I think, five different validators. And in general, created a group and even had a call. And pitch lets in general build a DAO, put in the DAO 50% of the tokens. And another 50% will give to people who are, in general, split between us. Yes. And in general, we'll finance from the DAO this, you know, like fees on our, like development of the product.

And as I remember, nobody supported this idea why some people thought about regulation, some people thought about other problems, you know, like, and in general, nobody signed in this initial version of the DAO. And then, you know, like I came to Vasily and said, we still need to build it because, you know, like, Ethereum will be super centralized and we need to find resources. And even so I will take all the risk in general, like invest my own personal money, you know, like to build the initial version of Lider. And it doesn't matter.

We don't need investors. Let's build a product. And in general, we start to build a product. You know, like, so we find three different teams, I mean, who develops smart contracts. You know, like we wrote us back with, in general, we have, Vasili has friends, you know, like who now like one of the core contributors and founding team of Lider, you know, like, Yvgeny and Przini, like, Victor, Sam. They wrote as in general, you know, like I described how it can work, you know, like they wrote a spec, you know, like with Vasile reviewed.

And we settled how initial version of LIDA can work, you know, like. And we came to three development company and in general split the development of the solution. Because one of their issue was because you didn't have a way to hold Ethereum stake from Bickon chain in smart contracts in Ethereum L1. so you need to develop some distributed custody. It was not a lot of solution of distributed custody. The project was super complex. But we had our cryptographers in NIL team, and in general, Neil team contributed to some crypto library.

And also we had our, we also used some tender mint, you know, like maybe you even don't know about that. So in general, you know, yeah. So in general, we use tender mint, you know, like in a way to split this key to many parties. and that nobody know the whole key. And so we found 11, you know, like, contributors who in general joined initial setup team, and it was, for example, MEC from like, from Curve.

It was chorus. It was, for example, guys from Celeste, Mustafa. Nobody know about Celeste back then. And it was some other, like, 10 grade or 11, it was run from maker, a different other 11 people. In general, they took this responsibility, you know, like, and houses, you know, like our distributed custody before, I mean, the special feature were delivered in the Syrian Mainnet.

And in general, you know, like in 2020, the code happened, you know, like, and the LIDADA were deployed, you know, like, it was initial validators, five validators, you know, like, I think all these validators who didn't want to participate in the beginning, joining, you know, like LIDER when it was delivered as a product. And it's great that, you know, like LIDA found the product market fit. Now I think it has more than two. I even don't know how many our validators are running through LIDA, but it's more than 200 and it used different technologies, SSV, OBL, you know, like and some other stuff. And in general, it's really contribute to Ethereum, you know, like decentralization. And I think, you know, like LIDD is already,

delivered part of the mission. And still, you know, like big things on roadmap, like dual governance and also like some other pieces like permissionless taking. But finally, you know, like what Lider was driving, like driven by vision, by mission, you know, like and also, you know, like it was driving by our early mistakes, you know, like if I told you, you know, like we run a fund and we were custody of this fund, you know, like, we really feel pain. And we really want to always build some products that is self-custody, that is decentralized,

and in general, you know, like, that can work without people, and in general, bring and deliver the mission. And I think Lider found the product market fit and in general, really adoption because it delivers the value to the, as a middleware to the users. Yeah, absolutely. I mean, I think it's still probably like the largest doll in some ways. I mean, certainly in terms of like the TVL in there. And I think it's cool. There's like so much innovation happening in Lido and I think so many. What do you think is, I mean, you mentioned dual governance or like what do you feel like are the biggest changes that you would like to see to Lido in the future?

Yeah, it's a good question. For me, first of all, I mean, landed driven by a mission and vision, you know, like, and I think that from one side, you know, like this organization can try to build new products, you know, like for example, like restaking, you know, like when it's happened. But from other side, you know, like,

whether prior to rise, permission with staking and dual governance. Why? Because I think that Ethereum is a root chain of a digital world, you know, like. And generally, you know, like, it's a big common good, you know, like for all people in the world. And I think that, sort of we can't fact up on security here, you know, like, and we can't lose it. It's a big chance for everyone, you know, like to have Ethereum, to use Ethereum. And I think we are super lucky, you know. like and I think that what is

wider working I mean in general light is the middleware is smart contracts but it is a DAO and also like contributors who get some like grants to deliver and in general contributors are working on I think that are in general how it works

you know like any person you or anyone who listens this podcast you know like once a year can send her like a proposal It's called, in general, the framework called Goose, and that collect objectives, you know, like, what likely will do next year or next three years. And then, you know, like it is a voting. So now voting on this proposal. You know, like, for example, let's build with taking or let's build like dual governance and keep on an eye on security.

Or let's do prematurely staking. So anyone can make a proposal of strategy. For example, the last proposal was by Hatsu, and later during this year it was Regus, in general a new proposal. And in general, it is objectives and main products are decided by voting of token holders. And then this token holders, they distribute grants to like development company, and this development company are delivering features. And I think that the current proposal is about that we need to deliver dual governance.

Why? Because it is a vector of attack that somebody can buy a lot of lighter tokens, you know, like, and try to still upgrade the smart contracts and still, you know, like E's or, you know, like, from the Dow. And this is one of the vector of attack, and it is, I think, already code in, on OJITs, you know, like, and I think it's really important to, to develop this feature. And another is permissionless staking, that in general, you know, like solo stakers can use, is, you know, like in LIDAR, to in general run their own node with only for East, you know, like. And I think the current LIDA community of solar stake is growing, you know, like, it is a lot of

application, and it is a big demand on it. And I think that LIDA is there, I mean, mission-driven organization with only like, simple, like, mission to make, to keep, you know, like Ethereum secure. decentralized and censorship resistant. And in general, if you have any proposals, you know, like what Linder can fund as a DAO, you know, like to keep Ethereum decentralized, censorship resistant and, like, secure, you know,

like you can, in general, propose it during the next application, you know, like our time, you know, like in propose, you know, like, and maybe LIDA will add it to the, if it will be voted, it will be added, and granted will be distributed to deliver it. So you're also very involved in Solana early on. You know, I think today we see a lot of attention on Solana, so I see a lot of attention on Ethereum.

We see quite diverging visions as well. Like, what are your thoughts on, you know, Solana versus Ethereum, like, their visions of scaling the future? And, yeah, like, which one are you? very bullish, bearish, and for what reasons? Yeah. You know, first of all, I'm bullish on both. And for me, I initially, you know, like,

invested in Ethereum Macio and then we invested in Polka. Dot Cosmos, you know, like, yeah. And Salana was one of the project that we invested in the seat stage. And for us, you know, like, why we did it? In general, we could in general stay in Bitcoin, like a lot of Bitcoin maximalists, you know, like and just you know like believe that the gods at Toshanukamont to solve all our issues you know like but this is a craziness you know like bitcoin is a calculator or like it is a milcoin you know like

I'm not big believer in Bitcoin I think it can change evolve if it will be a crisis and it is a lot of innovation you know like and now I are in the world by like great teams like Alperovacus and some others but are still you know like kind of station of Bitcoin that it is a lot of maximum and a lot of beliefs, it's like a religion more. And for us, you know, like why we believe in cybernetic economy and we believe in efficiency, an efficiency created by economy. And in general, I mean, we invested in Ethereum because we understood that it will be like how, say, microeconomy

where like different organizations, applications in general will generate fees and in some. side of the Ethereum. But, you know, like, it is a vision of Ethereum Foundation, Vitalik Buterin, in general, Ethereum community, how Ethereum should achieve it? You know, like, is it a right vision? I don't know.

I think so. Yes, and I in general believe I really love what Ethereum is doing. But it was a different time in Ethereum history, you know, and it was different speed of development, you know, like before we remember days when they didn't have a lot of, for example, progress because of the growth or like because of the funding issues or because some other issues, you know, like. And I think that we invested in some other projects like PolkaDot and Cosmos that also contribute to how and Solana and many others and how in general like blockchain space looks like now.

We also did a lot of innovations. And in general, they push Ethereum to go faster. Because if you don't have competitors, if you don't have a, you know, like, or you don't have a market, this is one issue. Or you, in general, it's also bad for you because you start to stagnate and you don't start to grow faster. And I think that Ethereum pushed Salana forward, Salada puts Ethereum forward. But who is the winner, like, people and I like.

That is important. people good the best service, the most secure service, the most cheap service, the most fast service, you know, like. And that's why, you know, like I bullish on both. And it is a chance that, you know, like computation will be a commodity in future. Maybe like it will be like a lot of cheap computations. I don't know. But I still think that any blockchain or any project should run not because it's a coin or because it's money, like we call it money and it's give you, how to say, valuation

that is not baked by revenue. I think each project should be like really baked by real fees or by real economic activity. And for me, you know, like how the future will look like, I don't know, but what I really believe the best money will be the best assets that generate the biggest amount of fees and will be the most stable one. on. Yeah. I mean, in terms of generating the biggest amount of fees, it does seem like this Ethereum roadmap is sort of like making it hard for that to happen, with all of the activity happening, going to a layer two, layer three, things like that.

I think, first of all, we need to make a calculation, you know, like when we are working on it. And second, our equation is, you know, like, it can be part of how to say go to market when you put the fees down, you know, like, and I think there, we are now, you know, like, today is there, like, September, you know, like, 2024, and we are in a stage, you know, like, where it sees their new wave is coming. And this new wave is not coming, like, because of their only global market. Of course, global market and they really impact crypto really much because crypto is still a risky asset. But what is important, and if recession will happen, I think it will be super bad for

crypto. But what is important, you know, like all these things are, in general, we are on a new wave of the projects. And what are these projects and why they will exist? First of all, because the fees on roll-ups going down. And if the fees on Ethereum going down, it means that we'll have more and more different type of applications that can find a product market fit by using blockchain. And it's super great. The second, we have innovation like chain abstraction. That in general, you know, like, you know, we have all these ideas in 20, I don't know, 16, you know, like that you should be good, you know, like in general, like in Web 2. And it's only like happening, you know, like right now that we can build that UX right now is project like one

balance, like in finance and so on. And I think that, I mean, what is important, you know, like current change of Ethereum economy, you know, like current price on DA and growth of roll-ups, this is an enabler, you know, like to in general adopt or, you know, like, and in general grow and, you know, like an unbored one billion more people. And it's super great. Really, again, start to burn is we'll see. So I feel like one thing is, so you've been in crypto for a long time, right? So you have a lot of projects that you kind of involved in and they take up a lot of like, you know, your attention and energy. I'm curious, like, knowing everything you know today and with your skills today, if you sort of, you know, if you had like a blank slate, you didn't have to worry

about P2P, Ido, cyber fund, all of those. What would, where would you go? Where would you pay? Like, what are the sort of problems that you would want to spend your time on and research? and maybe start something in that area. You know, I mean, it's a lot of, a lot of different spaces, you know, like, from biotech that is in general will impact us pretty soon to AI, to cosmos, you know, like, it's a lot of interesting areas. I don't know what would I choose, you know, like, and why. I think that I really think about digital identity.

and in general how people will operate their like how to say soul or their like new representation in digital world that is a really like make me a lot of thoughts around that you know like and I really think that we didn't see or yet you know like our successful digital identity projects so I think I would go in such space. I also like orbit vision, you know, like about how you can keep your digital identity and data and how operation system can work in future. So what I think is important is that we are coming to like singularity, you know, like, and the question is what will be after and are, you know, like, and how to keep it really good for people and, you know, like for everyone. It doesn't matter where you're born, you know, like I think 20 years ago it was much worse the situation. Now you have

internet, you have a lot of online education, and you are stuck to live better and better and better. And what I really worry that it will regress by some reason, that some people will have too much power, you know, like that is worry me more. And what I really like want to achieve by like cyber fund, by allocating, you know, like capital and also my time, but. And also my time, by building my products. And in general, like, are a way where each person on the planet will have the same, you know, like when they born, the same,

like, or, like, terms, you know, like, and in the same, are, you know, like, opportunities. So I know AI is also a focus for you guys at cyberfront. And obviously,

it sort of is the thing that a lot of people are, you know, deeply focused on. I mean, one of the things that's really, like, stood out to me, or one of the things that's, like, striking about AI, at least so far, is that it seems to be, like, an incredibly centralizing technology, you know, where you have, like, a few companies that are able to pour, like, huge amounts of resources, right? Like, many billions of dollars until, you know, training a particular model.

And, you know, it looks like the amount of resources. the money, these companies are spending on these models also going up very dramatically, so getting higher and higher, and then have basically this super intelligence, which maybe will be owned by, you know, a few companies. At least that is like one scenario that seems not unlikely if you just sort of look at the current trends. And of course, at the same time, right, in crypto, and the core idea is around decentralizing ownership, decentralized, power, decentralizing control. Do you, how do you think these two forces will sort of, what happens when they come together?

What happens when AI really breaks through, starts to influence everything? And, you know, is there, how would that intersect with crypto? Yeah, I really know, like, the AI start to be super dangerous, you know, like from way, how is for really growing fast, you know, like, and how much power it gives to people who, in general, can create this. New type of models that, in general, will recreate much, how to say. In general, be more, in general, can create this, like, our typical intelligence that is bigger than humans, you know, like.

And for me, you know, like, I really don't believe in regulation, you know, like why because it's inefficient it's slow and it's impossible to regulate you know like current i companies to not make you know like some type of uh some type of technology that will be super powerful and i i think that also like it looks like the companies understand that they can optimize algorithms they have data they can buy more energy and they can buy more energy and they can buy more compute. It's like Google, you know, like, you know, like, they, they already understand the secret source of success. And I think that are, but I really believe, you know, like, like with blockchains, you know, like that maybe I am a dreamer and I'm definitely like an optimist.

And I'm really believe that new technologies in our will evolve that in some way, we will find the way how, you know, like to build, I mean, a better model, you know, like that will be regulated by technology or distributed and in general, you know, like controlled, you know, like. And for me, you know, when I speak about blockchains, I think what we shouldn't forget, that what blockchain is about, for example, when you look on Bitcoin, you can look what Bitcoin is doing, it's doing regulation. In general, Bitcoin introduced technology regulation. They achieve the regulation.

How you can regulate the supply by technology, by a piece of code that distributed between people. And I think, you know, like the new type of regulation, when we look on the centralized autonomous organization, you can look on Lider that is a piece of smart contract, the middleware, that in general, you know, like regulate the way, how. different engine work with each other. And I really believe in technology regulations. That's why

we invested in Metalex, in Gabriel Shapiro, you know, him well, you're my synchrolete great report together long times ago. And in general, you know, like Gabriel Shapir is one of the most talent person, you know, like in cryptor lore space, you know, and that I know. And in general, what he's doing, he's building this works. In general, how to more. how to merge regulation that we have in blockchain and that we can build as a software with the current organizations. And I really think that if,

and that is also part of the cybernetic economy that we call, you know, like it's in general when you build a process and this regulated not by bureaucracy or like by people or because the people should do like that. But it's when regulated by code. And I think it will be a day when we can in general.

or regulate these models or like this power by some type of you know like regulation maybe on chain or like through blockchain and in general crypto i is there how to say when we start to look by cyber fund you know like in general we are we headed in our initial thesis in 2014 you know like but we start to spend more time on it of course i mean and for us it's not short term our goal is to build a competence the next 10 years when you start to look in the eye and crypto AI and AI. So it is three markets, you know, like one is AI, one is crypto in AI, and one is AI in crypto.

And all of these markets has a big opportunity, you know, like, of course, AI is growing right now, but we see how agents can use, you know, like from payments to like buying more execution and in general how you can build economy, And I think that why, you know, like crypto in AI is super closed is because it's also about mechanism design, you know, like because what is the crypto and why it works, because it's in general, it's a mechanism that's constructed by cryptography, by code and some other things, in coordination, you know, like.

And the same when you build some ML and, you know, like AI, it's also, I think that when we will add some economy in some. side of AI, you know, like and make it more open, I think we'll see a lot of benefits in that space too. And I'm curious about the AI in crypto bucket. How do you think that will? Yeah. In generally, you know, like, if you speak, I in crypto, first of all, you know, like,

I mean, we have some, for example, when we look in a, uh, why cryptor need AI, you know, like for example, I mean, we invested in a project called font, you know, like, and they are building a model, you know, like, especially for based and trained on the crypto data, you know, like, and so in general, you can use AI in all like, for example, it's a lot of, I don't be believer in it, but of course we can really understand that it is there, a lot of, how to say, a lot of trading is do through ML, you know, like, and it is a lot of fun that use ML to do successful trading.

And we can say that, you know, like, it will be like some AI models, you know, like that will, in general, you'll rate you some strategies that can be used in the crypto, you know, like. And there are also, you know, like, in case of some type of, you know, like security, you know, like cybersecurity, AI also can, do some type of work around that. So it's a lot of intersection, you know, like,

and there's a lot of projects that can be used and find the product market fit, you know, like, are in this intersection. And I, you know, like, I think it's a lot of bullshit in AI, but it is a, I mean, it's like in any technology that start found a product market fit, and AI definitely found a product for product market fit. We see that on trophic, you know,

like did the one billion revenue, you know, like this year, that is a lot. That's super fast. And I mean that it is a lot of really like things that AI is delivering different sectors of technology and crypto will be one of them. Yeah, absolutely. For Cyberfund, aside from the crypto AI intersection, are there other, some other areas of crypto that you feel, you know, they need more attention and investment and there are areas that, you know, other people are neglecting? Yeah, you know, like what we do with cyber fund, we try usually to invest in the early, you know, like new narratives. For example, how we invest in a figure like cosmos

or like Celestian or Salana or like Aguilera, you know, like why? Because we found some type of narrative that can in general create more efficiency, you know, like on the market. Or like it's super differentiated, for example, Ethereum is a super slow blockchain and Salati is super fast. They have super different narratives. And I mean, for us, you know, like the same is in AI

and crypto AI and other areas. What we try to find out, we try to find, you know, the technology that first of all contribute to our vision of cybernetic economy, you know, that make more equal people for all humans.

you know, like, and in general that contribute to efficiency and access. And it can be, and for example, in the crypto, we are superbelievers or believers in chain abstraction right now. Why? Because it's so few acts, you know, like. And in general, it's make your funnel better. You can transact, you know, like, and trade any assets to any assets, you know, like in one click.

And in general, it's significant. and problem. You know, like to bring a lot of great new products, you know, like, and I think that you know, like then we look on computation, you know, like current computation are super expensive. We are, you know, like, Ethereum, like is not super fast computer, you know, like, and current computation are expensive with roll-ups is still expensive, and we think that we will need 1 million more X computation, you know, like on-chain or trustless. And this is another field.

So it's a lot of, for example, identity. I mean, we need to find a way how we can, in general, keep our data private, you know, like, and has benefits from identity. Because who has all benefits from your identity right now? It's a large corporation. They start to use this identity. They start to create this. community, you know, like, and I think if you're going to like this singular,

singularity, you know, like, I mean, we need to find a way how not only survive, but how to live well, you know, like how to live in the digital world, you know, like how to, you know, like get more people inside, you know, like and get that, you know, like, get value from it. And so, yeah, so in general, we try to find this new narrative that enable, you know, like, the growth of the submarine economy that accelerated, you know, like, and still not an avil, for example, if it's their open AI that is a closed source, you know, like, that is not where we will allocate our capital, definitely. Yeah, cool. Well, thank you so much for coming on, Constantine. It's been great. to talk a little bit through your history and like you use and your learnings. I think you've had like such a tremendous impact

on the blockchain space. And I mean, I know many of you are, many listeners, I'm sure are aware of you, but I'm sure equally many of you, you know, have not heard about you and didn't know sort of like the influence and the role you've played. So yeah, thank you so much for coming on. And thanks for all you've done.

It's been really great to know you. to work together and I'm excited to have no doubt that you know you'll continue to have a massive impact on crypto and on this uh realizing the cybernetic economy mission in the next next decade that's ahead yeah thank you brian very much you know and i hope to keep building together more and more absolutely thanks so much constantin