The Pomp Podcast - #712 Bringing Bitcoin To The Developing World w/ Ray Youssef

Episode Date: November 5, 2021

Ray Youssef is the founder and CEO of Paxful. He is the co-founder of the Built with Bitcoin Foundation.  In this conversation, we discuss bitcoin, Nigeria, India, El Salvador, and bringing bitcoin to the developing world.  ======================= Gemini is a leading regulated cryptocurrency exchange, wallet, and custodian that makes it simple and secure to buy, sell, store, and earn bitcoin, ether, and over 40 other cryptocurrencies. Offering industry-leading security, insurance and uptime, Gemini is the go-to trusted platform for beginner and sophisticated investors alike. Open a free account in under 3 minutes at gemini.com/pomp and get $20 of bitcoin after you trade $100 or more within 30 days. ======================= Ethernity.io: The world’s first authenticated and licensed NFT platform, trusted by over 150,000 members. Digital NFTs and exclusive real-world unlockables, authentic partnerships with athletes and artists. Visit Ethernity.io, where you can buy and sell authenticated NFTs from top notable figures, rights, license, and IP holders you can’t find anywhere else; the start of an entire ecosystem bringing utility to #NFTs.

What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Now let's kick this thing off. Ray Youssef is the founder and CEO of Paxful. He's the co-founder of the Built with Bitcoin Foundation. In this conversation, we discuss Bitcoin, Nigeria, India, El Salvador, and bringing Bitcoin to the developing world. I really enjoyed this conversation with Ray, and I hope you do as well. Before we get into this episode, though, I want to quickly talk about our sponsors. First up is Gemini.

Gemini is a leading regulated cryptocurrency exchange, a wallet, and a custodian that makes it simple and secure to buy, sell, store, and earn Bitcoin, Ether, and over 40 other cryptocurrencies. They offer industry-leading security, insurance, and uptime. Gemini is the go-to trusted platform for beginner and sophisticated investors alike. You can open a free account in under three minutes at Gemini.com slash Pomp and get $20 of Bitcoin after you trade $100 or more within 30 days. Again, a free account under three minutes at Gemini.com slash POM

and you'll get $20 of Bitcoin after you trade $100 or more within 30 days. Gemini, a leading regulated cryptocurrency exchange wallet and custodian. If you haven't tried it out, I highly suggest you do. Go check it out and let me know what you think. Next up is Athernity. You might have noticed just how many NFT projects are coming onto the market lately. The problem, it's becoming harder and harder to determine the true lifelong value of NFT collectibles. Meet Athernity, the world's first authenticated and licensed NFT platform, trusted by over 150,000 members.

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and much more to come from the app to PAX to virtual worlds and gaming. That's Athernity.io. Athernity.io, the licensed NFT platform. Athernity.io. All right, let's get into this conversation with Ray. I hope you guys enjoy this one. Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only. We've got Ray here with us. How

are you, man? I'm good, brother. How are you? I'm doing fantastic. I've been really looking forward to this. Oh, yeah. I got a whole bunch of questions for you. But first, before we start, can you tell people your background and how Paxful actually got started? So my parents took me to America when I was two years old. They were from Egypt. They were looking for probably, you know, a better life, right? Because there was no opportunity where they were. So there were school teachers that came there.

My father worked in a newsstand. And I grew up in New York City. And I got my first computer when I was 19. Taught myself how to code really late. But I got into it really hard. And I had a few successful businesses. I started a ringtone business. And I was like, it was peer-to-peer ringtones.

People would upload ringtones. And I would share them with the world. those like the nap serving tones. And then I went on a kind of spiritual journey, right? And I'll make a long story short, but I went to Egypt during the Egyptian revolution. And I was there in Tahrir Square fighting for my life on that night of January 25th. 800 people died on that night. It was quite an adventure. I'm actually writing a book about that. I could write a book about just that one night. But when I came back to America, I saw the narrative that they were feeding was the exact opposite of the narrative that I saw there on the ground. And that started

my journey. And I started to wake up and I came back to America. And I was right in the middle of Zuccotti Park for Occupy Wall Street. And I went through another adventure there. And at the end of it all, I started to see that it doesn't really matter what you're protesting or what you're doing. If you don't solve the money problem, no other problem matters. That was in 2011. By 2013, I had gotten really deep into Bitcoin. I went to my first Bitcoin meetup after spending, you know, a couple of months researching Bitcoin. And I met my co-founder and we both bonded over the belief that Bitcoin could actually help the little guy. That it wasn't just another asset class for rich kids to play with. We already have enough of those, right? Take me back to Egypt.

When you go there, you knew that this was unfolding or you just happened to be there when the protest happened? Oh, no, I knew it was unfolding. I was in New York. I heard about this. I grew up in New York. I never really had a connection with Egypt, but I still had love for the people there. And I saw they were fighting against what is a truly brutal dictator. You know, under Mubarak, Egypt became known for first and foremost being the expert on torture. Right. I booked the first flight over there. I was actually the only one on the plane over there. Everyone was trying to escape. I landed there, went straight to Tahrir Square. And I just that night, a whole melee broke out with all these Mubaraks, at least a ton of goons.

and they all started attacking taqueria square we evacuated all the men of the women and children and it was just a bunch of guys fighting it was quite the adventure and is this like hand to hand like you guys are punching kicking and fighting or is this like they're shooting at you or what was it like on the ground so it first started hand to hand and what everyone started doing started breaking up pieces of the sidewalk to make stones for throwing we're setting up barricades dudes were arming themselves with like trash cans the shields it was like ghetto warfare to the max and it was it was pretty wild i got wounded actually and the only proof that i have i was there was front lines caught me when i was being pulled off the front line because i got

wounded i was screaming long live egypt right i was delirious i don't know what was going i was actually poisoned they were they gave me these candies there and i gave me the worst atomic diarrhea imaginable so basically uh that was the first phase and then the second phase that's when brought the snipers shotguns and all of that stuff uh it's a long story i don't need to get into it now but it's quite the adventure really yeah and so when you're there the people like one of the things that uh when i was in the military that i used to always tell people is um we send soldiers abroad right and they have a flag on their shoulder and they go under the name of patriotism defending their homeland all this stuff but when the shit kicks off nobody remembers any

of that stuff yeah it shows you and the person next to you and you want to get the hell out of there you want to get home safe you want to make sure no one on your side is injured right is the same thing going on or is there an appeal to a higher level when you're fighting for many of the people that are there on their homeland like there's a difference when you go somewhere else to fight for your homeland or your country your nation versus when you're actually fighting in your country or in your nation like how did you see that in terms of as that fight is unfolding are people there trying to just make sure you and i were on the same side let's get out of here safely or is it no we actually are are doing this for something bigger it's a great question so it

went through different levels right okay people that was fighting with the there were soccer fans they were called the ultras they're all these young guys and they saw these you know these goons they knew mubarak sent them so we're like oh yeah gung ho let's attack these guys let's keep them from taking Tahrir Square. Tahrir Square is a massive, massive place, like three times bigger than Times Square, and there are three main entrances. So basically, once we evacuated all the women and children,

we had to keep Mubarak's goons from coming into Tahrir Square. We were trying to hold it. So we were just trying to barricade the area and keep these guys out. In the beginning, it was just kind of like, it was kind of fun, actually. It was almost like you're being in World of Warcraft,

but it's real. And everyone was looking at me, and they didn't know what to make of me. It was, I was screaming in English, didn't understand Arabic, like, who is this guy? They didn't care because I was fighting with them, and i was fighting well right it was but then as the night grew on and night started to fall things got really really serious you know there were people that were there like i saw a guy whose

head was blown off with a shotgun blast and at that point everything changes right then it's a desperate situation and then that's when you start to heal people it wasn't about even egypt anymore it was about god people were screaming god is greatest you know and then it was that serious right it went from just happy fun to god is great it's pretty damn what's the saying everyone's a believer in a foxhole, right? Uh, as a thought process. So the story in, um, uh, the United States at least was, uh, that there was this huge uprising, et cetera. If you go and you read a little bit of, right. So I, I am, uh, not nearly as well versus you are. Uh, there was a lot to do with food prices increasing for what I remember in terms of, um, the situation got so dire for

people on the ground in terms of they literally couldn't afford to eat that eventually it led into and kind of fed into this huge uprising what's the truth like like in your view in terms of like what was the ultimate tipping point in egypt at that point where people finally said like enough is enough i'm not an expert there unfortunately but you know the egyptian people have been traumatized by a 30-year rule under mubarak where this guy literally like he may torture the egyptian national export right they would torture the people there there was no speaking out people were just sick of that the egyptians are very warm very loving people but they had had enough and you saw it in the youth like they were so energized to make this stop and

they fought with their hearts you know on their sleeves but for me when you know i saw this one night january 25th 2011 that's when you know they made fun of in the meetings it was the night of the camel because they really came at us with horses guys on camels with machetes right so they called it the night of the camel but 800 people died that night it was a bloody street fight i've been in a lot of street fights i grew up in the hood in new york so i've seen a lot but this was on a different level man like people were dying everywhere and these guys held it down it's amazing achievement then when i got back to the united states everyone was like it's facebook i'm like facebook meta excuse me like there's nothing meta about this man this was blood and

guts on the street people were dying and you're talking about facebook so i'm there online trying to defend the position there's me and only one other guy talk telling trying to tell the truth and you wouldn't believe who it was malcolm gladwell who wrote the tipping point it was only me and him saying hey man this is not facebook this was an organic revolution young people giving up their lives to make this happen and i was like there's an army of trolls attacking us every time we say this so that turned me on to the concept of a nemesis an organized opposition and that is what i really needed to begin to just conceptualize the the level of resistance that humanity is up against right and it happens in politics but on money it happens on

a whole other level and that's what's so beautiful about the bitcoin movement because that's part for the course here. Yeah. When you went to Zuccotti Park on Wall Street, obviously there wasn't violence for the most part, right? It was a very peaceful protest, but there was a lot of people pissed off. A lot of people were very upset with the global financial crisis and felt like the banks had basically gotten one over on the citizens of the country. Was there similarities outside of the violence in terms of people's anger or kind of distrust and feeling of being left behind by a system. Is that a fair characterization or is that too much of an overreach? No, it's fair. So the spirit was the same. Like these young people really cared. Like

the people at Manzoukati Park, they really, like they really, really cared. And some of them truly knew what was going on. They were very awakened in the right sense. The other similarity was the level of resistance that I encountered there. Now, a lot of people might look back on the Egyptian revolution and realize that it was a kind of an orange revolution, right? In fact, it definitely was in the end, it did not serve the best interests of Egypt. And I saw firsthand in front of my eyes, I saw the whole movement in Ducati Park get infiltrated and taken over. And I actually tried to stop it. And when you see this happen in real time, it completely changes your perception of things. And that's when I could not deny what was happening. Because before that, I was just a

typical brainwashed American. I believed everything I saw on the news. I truly did, man. And looking back, I couldn't believe how dumb I was. But after this, it was the trauma I needed. It was one trauma after another necessary to break this resistance. And so Paxful today, talk to us about what you guys do on a day-to-day basis, what the product is. So the product is essentially barter for money. If you think about it, it's almost like Hawala 2.0. Hawala is a system of money exchange that happened 1400 years ago to solve essentially the same problem that we have now. Back then, the Roman empire forbid agency. So all these international traders could not trade on behalf of one another. So how do you run an international business doing that? Nowadays, we have a very

similar problem. It's a problem that I like to call financial apartheid. Some people cannot trade freely, and others can. And who can help them? Oh, you're not allowed to help them, right? Because of all the compliance laws and all this, and all this intricate web of just broken systems, those people are literally kept in a financial prison, right? So how do you help those people? If you ask me why Paxful is here, Paxful is here very simply to make those people rich. How do you do that? Just allow them to transact freely. What are the tools you need to do that? Honest money, peer-to-peer electronic cash, Bitcoin. We have this tool right now, the first time in human history. We also have the idea of peer-to-peer prevalent in the minds of the

people. Uber, Airbnb, Craigslist, peer-to-peer is everywhere. So why not share your bank account and make a payment for someone on their behalf, right? And we have this amazing movement of peer-to-peer believers, the Bitcoin community, 3 million strong and growing, right? So we have everything we need now to actually make this happen and actually free these people from financial apartheid. That is the problem. And that is the biggest problem in the world. That is the reason why some people are rich and some people are poor. And once you begin to understand this, it makes it very clear. The natural state of humanity is prosperity, abundance, and wealth. Poverty is an artificially imposed social construct.

What is the country that is the most kind of active with your products? I'd have to give it up to my boys and girls in Nigeria. Those people are on a different level. They're crazy, right? They're amazing. So people ask me, like, why is Paxful here? How did you guys get to 7 million users? Bootstrapped?

Are you guys geniuses? No. Very simple. Our journey defines our values. And our value, number one, stay connected to the streets. Right. Back in 2017, all this was happening. Right. Even before that, 2016, I started reaching out to all these Africans online, trying to show them how to trade bitcoins. Right. I gave away like a thousand of my own bitcoin just trying to show people how to trade. I would talk with Africans constantly. Right. And of all the Africans, they're all brilliant, very ambitious people. But the Nigerians were on a different level. And I said, I'm going to invest my time here because these guys can move. And when I finally went there, went to Lagos, and I met the people, I saw the sheer depth of the brilliance and ambition there. And the problems, the problems that they have, we cannot imagine.

In Nigeria, if you have a bank account, you've got money in it, you get a Visa debit card, bank card, you can only spend $100 a month online with that. You're not even buying an Xbox. If you want to send money to the country next door, Cameroon or Ghana, it's either just take a suitcase full of cash and hop on a plane and do it. They are literally in a financial prison. And once I saw that, I said, you know what? This is the place. These are the people. They're going to make this stick.

But the first thing we had to do was get Bitcoin into the country. How do you get Bitcoin in a country where it's nearly impossible to get money out of the country? We had to solve that problem, right? $10 million is the minimum order for cacao beans if you want to ship it out of Nigeria. I didn't have $10 million to ship out cacao beans. So what were we going to do? How are we going to get Bitcoins into Nigerian hands, right? We had to give the Nigerians a digital import, a digital asset that they could import into the country and exchange it for Bitcoin.

So what did we do? Showed them how to get gift cards and exchange it with Chinese gamers. And that got $50 million a week to this day into the country. Explain how that works. So very simply, someone in Nigeria wants a Bitcoin, right? He will get a gift card by any means. If he's doing some work, they'll say, hey, pay me with a gift card, an Amazon gift card code, right? just an e-code someone will send it to him as payment he'll go on to paxful he'll see an offer

some guy in china says hey give me a hundred dollar amazon gift card code and i'll give you 80 bucks worth of bitcoin and they'll do the trade with the escrow boom the guy gets his bitcoin instantly there's no coin based in nigeria right so this is how we did it 60 million dollars to this day a week flows through that single corridor and that's how we got the first bitcoins into africa with sheer like hustle and it was a huge hack but it worked yeah and so i've been to nigeria i went to lagos uh and i went to um computer village i'm assuming that you've been there uh probably multiple times um and what blew me away this is probably in 2015 maybe i went maybe 2016 is just how young the population is how digitally native the population is and the whole

idea of electronics gift cards like all these things that in the u.s we may not think is like the most important thing but they're definitely a big part of uh the consumerism and like e-commerce and stuff like that that's all being played out in like an analog world you can walk down computer village and there's all of the phone stores there's people handing out gift cards there's people who are selling all sorts of different dongles and chargers and like like all this stuff and sure it's a place where that specifically is supposed to be happening it's literally called computer village but i walked through the first time i walked through i was like what the hell is this and i literally came back and i wrote a piece uh that said i saw the future of the consumer

internet in nigeria because it was just such a small or such a large young population that was so digitally native it just felt like of course these people are gonna move all to the internet and start doing it it sounds like you saw that as well and then you figured out well how do we actually insert Bitcoin into this situation on top of it? Everything I've learned about the killer app of Bitcoin, I've learned from the people of Nigeria. And I have to thank them for that. These guys are brilliant and they will find a way to solve any problem. They will literally barter anything to get to the final result. They will use any financial container necessary and they'll make it work and then they'll find a way to scale it up. And that is the beauty of a culture

so driven. So if you want to understand the future of the world, just look at Nigeria and you think about what just happened recently their government instituted draconian means to stop all the bitcoin why in in january 2020 remittances into nigeria were 2.5 billion dollars a month by september it fallen to 55 million dollars 2.5 billion to 55 million so 98.7 percent gqs now granted a lot of that was because of covid yep but a lot of that is because of crypto bitcoin specifically but it was Paxful at that point that only supported Bitcoin. Now we support Tether as well. But the Nigerian people saw that, hey, wait a minute.

I can ask my friends and family to just send me Bitcoin and I'll actually make a profit with the remittance instead of paying a fee. And they just scaled it up to the point that freaked out the entire government. So they banned Bitcoin ownership or trading or usage? What is the actual thing in Nigeria? The central bank forbid any of their banks from doing business with cryptocurrency exchanges. Okay. So they tried to cut off the legacy system from the new system. Exactly. And when that happened, peer-to-peer volume spiked by 20%.

You can't stop Nigerians, right? They just went to fax when they kept trading. Unfortunately, then there's a bit of corruption in Nigeria and the police started harassing known Bitcoin holders, but even the Nigerian people, they're resilient against that as well. So there's really no stopping it. I don't think I've ever told this story before. I got shaken down in Nigeria. uh i was in a uber and i was being driven um at night with a buddy of mine and we got pulled over and the uber driver's just you know like normal stuff he's basically probably like hey i got two white guys with me like of course we're gonna get pulled over and the uh cops had us get out of the

car and thankfully my buddy had been in the situation before and he as we were sitting in the car he immediately said take your wallet and hide it and so i didn't know what that meant so what i did was i just reached in and i took my wallet the money out of my wallet and i put in my sock he took his wallet he threw it underneath the chair in front of him and we got out and they were asking us for money or whatever and i'll never forget it because you know they're asking us for money i just pull out my wallet i don't have any money whatever and they like wouldn't leave us alone but it wasn't like a scary situation it wasn't like a it was almost like this is like how this happens here and so i took out my phone and i saw the video and i started

recording and i was like they're trying to shake us down like joking around and the cops immediately start ducking out of the video right i'm like all right you guys could go whatever and so i just remember like it was like such like a weird experience because like in the united states if somebody said like oh i got shaken down like there would be the threat of violence and like like it wasn't like that at all and the next day i remember uh telling that the nigerian that we were with uh who was kind of acting as our guide there and he was like laughing at us he was just like like oh you the the nigeria you see every day is very different than the nigeria that everyone else sees on a daily basis and so i started paying more attention of what was going on in the country

and i just kept coming back to the fact that the population was growing so quickly and the estimate that i've seen is that by 2050 there will be more nigerian citizens than u.s citizens based on population growth rates usually i mean it's just like does that end up being if you can almost like orange pill a nation that's growing that quickly and is going to have that many people that that ends up actually being the future of bitcoin and uh and kind of this entire industry absolutely i mean consider that every out of every 10 africans outside of africa six are nigerian right these are people that are social that are you know prevalent that travel the world that are very knowledgeable that are highly ambitious they know if you look at nigerian

populations in america almost all of them doctor lawyers high tier top professionals driven driven and you know all the corruption they have that we have to deal with when we go there the nigerian people have to deal with it 10 times worse right so i just want to say it again here so Everyone understands the Nigerian people are some of the most honest and forthright people I've ever had to do business with. We have an office over there. We opened a Bitcoin center in Abuja, Pax Nija.

They are some of the most amazing people I've ever met in my life. I would trust them in my life. Oye, calling you out, bro. Oye Joleto, he's our man there. He's a Nelson Mandela fellow. He runs our Bitcoin center in Abuja. We're opening up once in Lagos.

Every day people come into that center and they want to learn about Bitcoin. And these guys, they educate them. And they are so happy. You should see how happy they are. Tell me about the center. What's going on in the Bitcoin center? Education, street education.

You can come there and you can meet anyone and they will sit you through and will answer all your questions about Bitcoin, walk you through your first Bitcoin purchase, peer to peer. We're inviting speakers to come there as well and educate the people. You have to understand that Nigerian people are, they are so interested to learn. Like this one lady, her name is Rachel. You know, she was working in the kitchen in the TransCorp Hilton in Abuja and she saw my built with Bitcoin cap on and she just came up to me. And she started asking me, teach me about Bitcoin, please. Like, she literally left the kitchen with her apron still on. And she didn't have her cell phone.

It was broken. She just wrote her number on a crumpled up piece of paper because that's how much she wanted to learn. We built this Bitcoin center for people like her. Because I met my co-founder at the Bitcoin center in New York, right? So now it's time to pass it on. Oh, and we're opening up a Bitcoin center in El Salvador soon. It's going to be a massive space as well.

Outside of Nigeria, what is the second largest geography? uh india india kenya cameroon is blowing up ghana is huge absolutely huge in ghana so you're you're one of the people who i think is going to agree with this but but check me if not the developed nations are almost too developed we don't need bitcoin from an everyday yeah need we need it from a devaluation of the currency so limited to long term it becomes more obvious if you look at But if you look for them on a day-to-day purpose, if I need to go to the ATM, I can go to the ATM pretty easily. If I need to move my money, if I need to take my money out, I don't worry about them taking it from me. I don't worry about any sort of true censorship, right, et cetera.

It's not true in a lot of developing nations, right? You know, we've seen the numbers. I don't know what Nigeria is, banked versus unbanked. El Salvador, I think it's like 80% unbanked, right? You sort of look at these numbers and it's like, oh, these people need this on a daily basis. And so does that lend to the fact that the developing nations will adopt this stuff faster than the developed nations? or do you think it's actually going to just kind of all happen together? Oh, no, no.

They're way ahead and they're going to be far, far ahead. So like you were saying, there are two narratives. Well, actually, there's three. There's the Peter Schiff narrative over here, right? Bitcoin, blah, blah. We're going back to the gold standard. Yeah, exactly. Then there's the second narrative, which is, you know,

Bitcoin is a store of value, right? In the West, developing world, that's most prominent. And it does make sense, right? Then there's this whole other narrative, which we learned from watching the peoples of Africa and the emerging world, which is Bitcoin as a means of exchange. Bitcoin as a way to move us beyond the walls of this financial prison, this economic apartheid that they're in.

You can exchange with something like peer-to-peer markets like Paxful. You can get Bitcoin through any means, whether it's a gift card, cash, any online wallet, et cetera. Once you have that Bitcoin, this is the powerful point, you can exchange it for anything else. So if I need to pay an invoice somewhere in Europe where I don't have a bank account, I can sell the Bitcoin to someone there and they'll pay it for me with their bank account or their online wallet. I can send money.

back home to my friends and family from the West into the emerging world and cut all the fees and all the border payments and everything and save money. Commerce as well. The merchants in the emerging world, they can't get Visa and MasterCard merchant accounts, right? And they want to sell their goods to the world. They can use Bitcoin. And even those merchants in the West, they want to access all the buyers in the emerging world, but they can't because of fraud. Well, here comes Bitcoin. So along every use case, speculation is just one of the use cases of Bitcoin. You could also put store of value investing into that as well but then there's payments remittance wealth preservation and commerce and the seventh use case that i call social good right and the emerging

world those are prevalent and that's what's going to lead and that's why they're leading nigeria is the leading country in the world for bitcoin adoption and that's what you're going to increase some people ask me is what is a you know does do 30 percent of nigerians have bitcoin absolutely not it's less than one percent it's just the quality of those one percent they are so intense that it seems like it's thirty percent but you can imagine once thirty percent of nigeria does have bitcoin how fast it's gonna spread to the rest of africa 1.1 billion people 700 million young people can you imagine crazy what questions you guys got yeah so my question would be uh somewhat around regulation right we've seen china banned bitcoin they may be unbanning it i guess

now. El Salvador adopted Bitcoin as legal tender. There's been much more conversations around it here in the United States. So just your opinion on kind of like, one, do you see someone going all in on Bitcoin similar to how El Salvador did it? But two, does whoever do this just get a huge advantage? Are they getting that first mover advantage and putting themselves far and away ahead of everyone else? Well, El Salvador is a special situation because of their president. He's a special character, guaranteed. Right now, we're in actually talks with some of the biggest governments in MENA and Africa about Bitcoin.

But they have very rudimentary questions, right? So the way I'm trying to present this to them is, look, guys, you depend on the diaspora communities in your country to bring all this foreign money into the country, right? And let's put it down right here. All this foreign money, dollars and euros, all these emerging countries, they consider that hard money, right? And they need to keep enough of that in their country to prop up the value of their currency, right? That's actually the biggest problem in the world right now.

If they accept Bitcoin into the country and they allow their people to accept money in Bitcoin for all the gigs they're doing outside of the country, etc. And they start accepting that Bitcoin and giving them local money in exchange, what they effectively can do is they can mobilize their internal labor force to bring in hard currency. because they can exchange that Bitcoin via OTC for dollars, euros, or whatever they want at any time. And we're coming to them and telling them, hey guys, number one, allowing Bitcoin to come into your country is not going to take euros or dollars out of your economy. This is their biggest concern, really. It's actually going to bring more euros and dollars into the economy.

And when you say that, they really have a hard time believing it, but that's the truth. Because that's what their people are doing right now on an individual level. Once the government does that, and they have this huge store of Bitcoin, You can imagine how much that's going to appreciate in the years to come. And at any time, they can choose to turn it into foreign currency and raise the value of their own currency. Now, on a secondary note, they want to ask, they ask, well, what about terrorist financing? What about money laundering? Those things are very easy to track and control.

And the truth is there's so much good, clean business out there that needs to be done, considering the financial apartheid and the curtain that they're under that all that other stuff is not even worth considering. So it's not even an issue. Gotcha. John, what do you got? Yeah, nice to meet you. Can you talk about what you and Paxful are working on now? What regions you guys are going after? How you guys are trying to expand customer bases?

And then any new assets you guys may be looking at to use in your system? Well, the question of assets, that's a hard one. We only just recently started supporting Ethereum. We've been very slow to add assets to Paxful. And a lot of people are always asking us to add this and add that. And it would make us more money, that's true. But we see it as having an ethical responsibility to protect our users. You know, everyone's like, when is Paxful going to add Shibu?

Paxful? No. We just added, we have Bitcoin, we have USDT, and now we have Ethereum. And that's only because our users, tremendous demand from the streets. Right. So that's why. There has to be real use cases for anything that we add. All the Bitcoin maxis, they can argue against Ethereum.

But there's actually real use cases now. Right. And that's worth considering. So as far as what we're working on, we're working on products. products that will be built on top of this peer-to-peer marketplace and allow grandma to be able to send money back home or make a payment without the complexity of cryptocurrency and certainly without the volatility of cryptocurrency and if we do our jobs right cryptocurrency you know it doesn't even have to be visible in the entire operation you'll just be

able to do what you need to do better faster and easier and should you choose to dive into the rabbit hole that is bitcoin god bless you all the resources are here at your disposal gotcha what i find um so powerful about this is that you're taking a two-pronged approach if i'm going and i'm looking at it systematically for the country of nigeria giving them the asset is not enough right like inserting it into the economy is not enough because you're actually doing education as well it's almost the uh you have to give people access how you expertly um did with the uh the gift cards but you also explain why and then it's almost like the education is what spreads and then people eventually realize the answer so like a lot of times we

we spend time talking people always ask me like what's the best way to explain to my parents uh bitcoin so don't start with bitcoin start with the problem absolutely right and when you start with the problem and then people understand the problem then they ask you they lean in they ask well what can i do about it oh let me tell you about this other thing and so it's uh in some way the education ends up letting people then choose for themselves and they begin to understand why something is important in their life. And that ends up having a much longer kind of higher retention, more engagement type outcome, which is ultimately what you guys are seeing in a lot of the data, it sounds like. Absolutely. And to finish answering John's question,

it's all about education, right? Every market that we go to, we're going there and we're leading with education, right? Built with Bitcoin. That was a non-for-profit that we started in 2017. And the mission is to build 100 schools across the emerging world. We built six in Africa so far. We'll be building others in Latin America, Southeast Asia, et cetera. And that's education on a fundamental level. But these Bitcoin centers are education on an even higher level. And that's going to go beyond that.

We want to incubate all these startups and all these builders to build on top of Bitcoin and crypto. So they understand what they're actually building so they can actually deliver real solutions to people. Education comes first. it's it's the start of everything you can never invest too much into it you'd be surprised at how fundamental it's lacking like for example 2fa this is one of the biggest things there is especially in africa because most most africans uh they use their same email for their email as they will use for every you know financial account that they open up and unfortunately i would say that 99.9 of all african websites have been hacked and their passwords have been stored in clear text

So there's some hacker out there that has your email, has your password for your email, which you're using for everything else, right? So just getting people to use 2FA, that's a huge, huge part of it. And then from there, everything else comes. But people do want to learn, right? So if you're offering people education and they want to learn, it's a worthy investment. I don't see enough of this happening in the space. So I invite everyone to come join us because you can never educate too much. And education builds trust.

so i am looking right now at a couple of articles that were written in july of this year uh one from uh the guardian as an example talking about why the nigerian government is reacting to uh to bitcoin um and it specifically cites you guys in the article uh and it says that nigeria is now second only to the u.s for bitcoin trading in terms of uh of the country and what it also touches on though, is this is not just a, Hey, we like this asset. We want to engage in this asset. We want to hold this asset. It's also talking about a different array of factors, political repression, currency controls, rampant inflation, et cetera. How important is it to go first to places that have these macro issues versus you could show up to another developing nation that maybe doesn't

have, I think the inflation in Nigeria is like 15% or something, right? Doesn't have, as they talk about here are political repression or the currency controls. Like, is it almost like you have to go to the situations that are the most messed up and that's where people really need the product and it's easier to help educate them? Boots on the ground, baby. If you're not willing to do that, you need to get out of the game. It's all about boots on the ground. Pakistan, India, Bangladesh, El Salvador, Brazil, Cameroon, Senegal, Argentina, Chile, all these places, With Vietnam, Thailand, Indonesia, Malaysia, these are all markets that are really opening up right now.

And we see it first because we are talking to the people every day. I'm the CEO of the company. I do customer support every single day. Not just on our website, on Twitter, on Instagram, Telegram, WhatsApp, wherever people can find me. I'm always talking to people. And that's what everyone in the company does. You have to be a part of Paxil.

You have to do that. And that goes for everyone in the space. If you don't have the cojones, set boots on the ground in these places, then you shouldn't be in the game. Axel is here because we love setting boots on the ground and we lead by doing that. And when you do, the opportunities open up. Everyone welcomes us. Walk me through.

What is the when you choose a country and you say, OK, we're going to go there and you put the boots on the ground. Do you just literally put two people on a flight and say, figure it out? Or is there like a strategy and an actual execution plan? Well, that's a good question. So I usually put myself. OK, I like that answer. That's a great answer. And the second I touched down, I'm like, okay, I need a latte.

Let's get some coffee, right? And the first thing I'm looking to do, number one, is I want to identify the problems that people have, right? So, the first thing I'm going to do is I'm going to try to meet all the Bitcoin believers. There's people on Paxful in every country in the world where, you know, every country in the world is Paxful. So, I'll have a big meet up there, throw a big dinner, beer, everything. Come on down, meet the CEO, let's talk, right? And I'm trying to find out what are the problems people face on the day-to-day level here. And it's normal people trying to get money back home, merchants trying to sell their goods, OTC traders, whatever it might be.

Tell me every single little bit of friction that you have. That is the gold that I'm looking for. And once you understand that by actually talking to real people face to face, the next thing is, okay, what are the dominant ways to transact? What are the top payment methods here? Bank transfers, of course, right? But there's all these online wallets, right? Which are the most popular ones, especially amongst young people? which are the ones that have corridors outside of the country, right?

And then you identify the biggest players in the country. Who's actively solving these problems right now and how? Then once you have that matrix of problems, payment networks, and players, then you can start to make things happen. And that's where that real hustle of business development comes in. And it's very simple. You identify, you just find the problem to solve, right? Like of all those problems, you pick the problem.

Then you figure out which payment methods you're going to use to solve this problem. and you bring in the light players to do it and you show them, okay, here's the platform that you can use. What do you need to change about this that can make you do your work better? And how can we incentivize you so there's major upside going forward?

If you do that right, you will have a magical system. You will build magical corridors all over the world. You will create a new market of magical money friends in that country and the effects will be absolutely explosive. How many people do you think have used Bitcoin and cryptocurrency so far?

I've seen estimates as low as 50 million people globally. I've seen estimates as high as like 300 million. Do you have a sense for where you think that is? You have 7 million, so I can't imagine it's 50, right? Like you guys are big, but you're not the whole market. Coinbase has, I don't know, 68, 70 million registered users, right? So they're not all active, but at least at some point they set up an account and registered. So like 200 million, is that a fair estimation in your opinion?

that i've used it directly or that it's touched people because the thing about pax was that third-party transactions are a thing right now so if i bring that into it you know like i will somehow you know i'll go out on pax when i'll sell some bitcoins to pay a an invoice in the uk via bank transfer right so if you count that other side it's at least at half a billion okay so so if you count the third-party transactions then it's half a billion but if you take that out 200 150 200 okay so let's say 200 what do you think it is at the end of this decade so in 2021 2030 what do you think the number of just humans around the world that have used this stuff ends up being at the end of this decade we're talking nine years here brother yes

oh i'm going for four billion four billion yeah just that's a pretty good guess yeah i'm going for four billion that's our target four billion humans in the emerging world i don't really care about the west i'm not even considering them four billion humans in the emerging world and we can do it now because all these remittance partners all these people that wouldn't talk to us before would even look at us they're coming to us now even the banks in africa are coming to us we met with the banks we met with the government we met with all of these people they want to learn they want to understand and they're coming to us now a year from now it's going to be even more explosive And then we can actually like let the money flow freely. We can actually, you know, take some Bitcoin, sell it and then turn it into a cash payout at a POS central or a mom and pop gas station in Kenya and Nigeria, South Africa. Forget it. It'll reach the entire world at that point. Four billion people easily.

Four billion people by the end of the decade. And then when you think about, let's say, 30% penetration in Nigeria today. So let's go to one of your most popular markets. What is it going to take to go from 30% to 90% penetration? So, okay, so that number being thrown on 30% is wrong. It's less than 1%. Less than 1%. It's less than 1%. Explain why. It seems like it's 30% because there's so much traffic. It's intense. But people just don't understand Nigerians, right?

Nigerians are prolific people. They have immense hustle, immense drive, immense ambition and energy, right? So that 1% seems like 30. When it actually does get to 30, oh, my goodness. I mean, at that point, we'll be like, that'll be like three, four years down the line, I think. And at that point, the whole world, all of Africa will be moving forward. All of Western Africa will be saturated. because Nigerians are everyone.

They'll drive this adoption intensely. That's what people have to understand. To make that happen, though, will mean boots on the ground. These educational centers where people can come in, meet someone face-to-face, that has to happen because you're not going to get people in the emerging world going to this en masse in a purely digital format. This is their money.

If you go to someone there and say, hey, keep your life savings on your phone or your computer, they're going to be like, come on, man. There's a bit of hand-holding here. Yeah, yeah. So you think that it's a very small percentage, one percent or whatever right now uh three or four years to 30 and then how do we get to 90s it literally just boots on the ground and everyone focused on making this happen to get to 90 percent

uh this is difficult because if you go out into like rural parts of africa like we built uh our six bitcoin built a bitcoin school in kaduna state in nigeria uh this is really like rough territory like you know is that where the fighting is happening in like northern nigeria okay exactly We go to the places where there's the most need. The school is safe, though. There's a lot of protection. The governor of the state is very cooperative. But if you go to that place, you'll meet out of 100 people, and two of them will actually have a cell phone. So, you're talking about there has to be basic utilities like cell phone access first coming in there. So, for us to reach 90%, we're going to have to be at the point where we're actually giving away cell phones,

or we have mesh networks set up to support all this infrastructure. So, there's a lot that has to lead in there was people don't understand how underdeveloped it is outside of the cities in those places. That's the only thing holding it back. When you think about what it's going to take from here, what are the things that you're prepared, right? When you start out with a story like Egypt, when you talk about Zuccotti park, those are, you know, life-changing moments for you and experiences. What else do you think has to happen in order for this to kind of proliferate across the world? You know, for all the tools that we play with, we play with money, we play with technology. It's a spiritual battle. You know, it might sound corny to some people,

but it truly is. We're dealing with money here, right? And money has been the first pillar that the bad guys to control of. They are able to basically cut off value transition of humanity, which means we can't cooperate. And cooperation is our greatest strength, right? So we have to understand that at the end of the day this is a spiritual battle we're in a bull market right now and nowhere is a spiritual battle tougher than in a bull market right you look at all the greed happening you look at all the pain that's going to be coming because of what's going on right and what has to happen is we need the best minds in this space to take their eyes off of this whole gordon gecko ish kind of nebula that we're in and focus it again on the ground in the places that

needed most walk me through um and we can use nigeria as the example since we've been talking there a nigerian how is this changing their life like how does bitcoin change a nigerian's life on a day-to-day basis well if you look at the traders on paxful it's made them rich right they come up to me i mean these are normal people like we're unemployed and it's like hey i was unemployed and now i have five employees and like they show me their life like i bought this car i go that's great but then there's the people that they're serving right the people that they're serving to do their daily tasks, whether it's receive money from friends and family to run their business more efficiently. And they're doing a lot better as well. So everywhere you look,

Bitcoin is creating wealth for people, not just in the price rising. It's about people actually being able to trade. Free trade creates wealth. If you remove the restrictions and the friction from trade, then the result is just wealth is being created on a large scale, a medium scale, on a small scale as well. People are able to do business that they couldn't have done before. People are able to receive money at a greater frequency and a greater rate than they were before.

And these are normal people, right? Normal, everyday people on the ground every day. It's making their life easier. It's putting more money in their pockets. And look at an example like America. For the average American, an extra 50 bucks a month, that's actually a lot of money. That changes lives here.

And you can imagine how it is in Africa, in Latin America, in Southeast Asia. it's even greater and bitcoin is having a similar effect over there as well especially people into the peer-to-peer trading so it's creating wealth that's what it's doing like and ultimately that's our job our job is to come here and create wealth for the people that need it most for the people that might not even think they deserve to have it yeah it feels like what you're balancing here is there's absolutely a financial aspect right and financial aspect meaning like there's a price it goes up and down and people naturally are humans and they're going to try to buy low and

sell high, right? That's going to happen with traders or whatever. But there's another part. And I think the part that, you know, you and I see eye to eye on is there's a group of people who, if we look at the United States, we ask, go to work. And when you go to work, you can be an accountant, you can be a teacher, a fireman, you can literally be a middle manager at a corporation, whatever your job is, go be as good at that job as you possibly can. If you do a good job, you will have the ability to be promoted, gain further in your career, you get paid more money, et cetera. Oh, by the way, after you come home from work and we've asked you to do a good job there, you have to spend less money than you make. And then you need to become a professional

trader. You have to be an investor. And the reason we have to be an investor is because if you simply just save your currency, now all of a sudden it is going to be devalued away. And so that request of the average American, let alone in other countries, but even in America, go be the best you can at your job, your chosen career path. And also everyone has to be an investor because the currency is being devalued. There is no store of value that protects that purchasing power. That to me is ultimately where Bitcoin sits is like that savings technology and can really change people's lives because you only need to get them to understand market structures of the two different assets and say, listen, if you want to use for currency purposes,

any other currency fiat currency whatever like knock yourself out that's not actually the problem right if i want to use dollars to send back and forth with you right now whether it's a dollar a naira or bitcoin as long as you and i can receive it the actual monetary policy in that exchange isn't the problem right it's the who's holding it at the end and if you just hold the naira right it's even worse than the dollar but if you hold it and store your wealth in it for long periods of time that's where the problem comes in and it feels like that's a big piece of what you guys are doing is you're helping people understand what these Bitcoin centers, et cetera. Hey, this is a savings technology. This is a global store of value. Of course,

there's going to be these other currencies, but that global store of value is really, really powerful and could change your life. Absolutely. You know, wealth preservation is one of the core uses of Bitcoin. And it's this thing from speculation, right? This is just, hey, put your money in some Bitcoin. Don't watch a price for two years and just wait. this is responsible financial behavior and it's easy right you don't have to be a master investor this is something that everyone should do and it's true you know people that have done that have seen the rewards of doing that and i hope people in the west will continue to do that more and more as america gets poorer and poorer and we see this happening i think a lot of people are

going to start waking up to this you guys got any other questions in terms of uh what uh what ray's doing all around the world in africa and i guess asia as well where you guys are trying to do this work what other issues are people running into when trying to get that either financial literacy or um just be able to store their value of wealth in like it sounds like remittance payments and the ability to trade freely between one another cross borders is a big deal but is there anything else you see that kind of stands out romance is huge payments are huge too like in 2017 what happened is the central bank over there forbid people from sending out wires out of the country because they wanted to hold on to the euros and dollars for themselves, right? And then all these guys came

to Paxful, and I'm like, I'm just doing the customer support, and I'm asking them, why are you here? You know, why did you type Bitcoin into a search engine and get over here? And they're like, yeah, I buy cars from America, and I have them sent over here to Africa, and I sell them for a profit, but I can't do that anymore. I'm like, oh, okay. Well, how much is the car you're buying? Oh, it's a $6,000 87 Range Rover from Mannheim Auctions in Detroit. I'm like, okay, bro, here, just buy $6,000 worth of Bitcoin from this guy. You can do it on bank transfer, peer-to-peer. And then I'm going to show you how you can sell that Bitcoin to someone in America. And he'll pay the invoice for you from his local American bank account to the auction. It'll take

one day. And at first, they're like, no way, man. This is a scam. But once they tried it, because they were desperate, there were really no other options, it worked. And they couldn't believe it. Like, wow, this actually works. And they could continue their business. And once it work for them they told all their friends you could say that's the payments commerce use case but literally anything you need to do with money you can do with bitcoin and a peer-to-peer marketplace because you can literally turn that bitcoin into anything else so effectively what a peer-to-peer marketplace is is it functions as a universal translator of money and a transporter as well and that's honestly the invention that the world has needed for the past

1400 years especially the past 70 years because that's when this curtain of financial apartheid has you know it's been weighing on the necks of humanity so strongly and nowhere you see that more evident like than in africa the piece that um as you're talking is like hitting home to me is that people in a lot of these developing nations they have a supercomputer in their phone and when you can carry your wealth on your phone you can transact with anyone anywhere anytime without permission from anyone i've always thought the store of value right as like a big key piece to this um and it is but the ability to use the mobile device like if i really start to think more deeply about it there's a number of mobile banking products in african countries that have

leapfrogged american user experiences right because basically they got to start from scratch right and that was actually an advantage because they didn't have the legacy system uh kind of uh to just iterate off of they just got to build what what it looks like is that what's happening with bitcoin as well in some crazy way we're just starting from scratch and and building the right thing rather than trying to integrate it into the legacy system in the uh us absolutely look at m-pesa you know m-paces the kenyan uh mobile wallet started by safaricom one of the top telcos there and they just did it they didn't ask for permission from regulators otherwise they would never have done it they just did it and became the biggest thing in kenya 98 of all

All Kenyans have an M-Pesa account. Very few have bank accounts now because they don't need them. And Bitcoin is the same thing. Because Bitcoin is global and Pan-African and Pan-anything else. For example, M-Pesa exists in seven countries in Africa. An M-Pesa user in Kenya cannot send money to an M-Pesa user in Ghana. The two networks are separate. And that just shows you the breadth of the problems.

There's 2,000 payment networks in Africa. Only 3% of them talk to each other. So again, what is this glue that creates this pan-regional utility? It's Bitcoin. And pan-global too. You want to access liquidity in China, in Indonesia? Here is Bitcoin and a peer-to-peer marketplace. And it literally opens everything up.

That's why I call it Hawala 2.0. The Roman government forbid agency 1,400 years ago. and we're in a world right now where the whole concept of agency has been just restricted and barreled down to only a few right now no one else can transact so it's the same problem and here is the solution peer-to-peer electronic cash i want to end with one question and uh i see a couple people in the chat they're saying things like uh this guy is so passionate about people i love what he's doing for africa uh he's a wealth of information etc thanks what why are you doing this like what does bitcoin mean to you and why are you spending so much of your time energy uh

and kind of mental cycles on driving adoption in places that other people don't even want to go or haven't ever been you know i'd like to say yeah i'm doing it to add value i'm doing it's the right thing but the truth is like i grew up as an immigrant in new york city like and i saw what my mother and father went through when they came to this country and you know god bless America for allowing us to have that opportunity. But it was not easy. Like what my father went through, like working in Houston, Columbus Circle in the 80s and 90s during the crack epidemic, just to make enough for us to eat what my mother had to go through. I mean, that was hell. Why do people have to leave their homes and go to a foreign country just to have basic opportunity?

Why is that a problem in the world? Why are some places better than others? I didn't know the answers to these questions as a child, but I know the answer to this question now. We're living under a system of artificial wealth control. It is death-based system that is anti-human. And I don't like things that are anti-human. I'm just trying to help out my people. And by my people, I just mean humans, right? But it's a very emotional thing for me. I'm a very emotional guy. I'm driven by emotion to do these things. Otherwise, I wouldn't go through this kind of hell right it's hard to do these things right to be on the ground these places to push new boundaries to go up against all these regulators you know and try to make a real like change if

you want to go through something hard try to make a real change in the world and the bitcoin community knows that better than any other community in the world and if you really want to change things you've got to be on the street to do this as hard as it is the harder it is i know i'm doing something right i want to see a world where my mother and father would not have to leave their country and go to a place where they were not welcome, where they didn't speak the language, where they had to go through that hell. Why couldn't they have opportunity where they are? Why can't everyone enjoy the kind of opportunity that we have or had? That's all I want. I want a pro-human world. That's it. I believe in a world where everyone can be wealthy.

I believe that poverty is artificial and the wealth, abundance, and prosperity, that is natural. and i'm just fighting to make that happen that's all that's why i like you i like you too but before before i let you leave i'm going to give you the floor who in nigeria or other countries around the world do you look back and you say thank you to like these are the people who along the way deserve credit because i think one of the things that um in the western world specifically in the united states we put these people on pedestals that are hedge fund managers or billionaires or founders of companies but the deeper you go into where true adoption is occurring there's people who nobody even knows their name yeah so are there two three four twenty people that you're like

the world should know these people's names i have to give a shout out to the hardcore hustlers and no one knows their name like one guy his name was tolan 77 that was his username on paxful and this guy literally cleared like 90% of all the gift card transactions in the very beginning when it was all these like unemployed single moms coming there and trying to get their first Bitcoin. This guy made it happen. He was 19 years old, a college student in Texas, and he just went the hustle like a madman and was doing $10 gift cards just to get people their first Bitcoin. Like a hustler on that level, totaling 7-7, you saved the day, bro. And to all the guys out there like him, and you got understand. These are people that are not even technical. If you ask them to explain how Bitcoin

worked, they don't know. But they just took a chance on this Bitcoin thing and just got to business, like straight up lemonade style, standard business. And they made it work and they did the hard work to make it happen. And to all the brothers and sisters in Nigeria, in Ghana, in Kenya, in South Africa, in El Salvador, in India, in Pakistan, in Bangladesh, all those people that are making the hustle happen, especially those first few guys and girls in Nigeria that got in on the gift cards and they took a chance and they made it happen and showed us what this Bitcoin thing is really all about. All love and respect to you guys. I learned everything I know from watching you. Your hustle is inspiring. It is legendary. I'm writing a book and I promise you,

you will be mentioned. You have a title for the book yet? Not yet, brother. Maybe you can help me with that. No, no, no, no. I'm not getting in the way of anything you're doing. You're doing pretty damn well yourself so i'll let you just do your thing uh i am putting ray's uh twitter account right now in the chat make sure you guys go follow him uh is there anywhere else that you want to send people where they can learn more about what uh what you guys are doing uh you can go to my twitter you can go to the paxful twitter you can go to paxful on youtube you can go to our blog paxful.com or you can go to you know just paxful and just do a you know play around there but reach out to me personally like again i'm shooting out a flare here to anyone out there

who wants to change the world, especially if you're a product guy or a product gal, reach out to me. We are building some amazing new things. We have an insatiable appetite for talent. And if you are good and if you have empathy,

this is the key thing you need to be at Paxil. Empathy for the people. I promise you, you'll be in an environment where you can execute freely, where you can do whatever you want as a mini CEO

and reach the people in your work who will reach millions in real time. I will not get in your way. I'll be out to help you. So if you're out there and you're listening, come to me that's the best pitch anyone's done on this show ever all right you guys got anything else no that was great though awesome i appreciate you coming on and taking the time to do this