The Pomp Podcast - Ouriel Ohayon, CEO of ZenGo: The Development of the Digital Wallet

Episode Date: August 9, 2019

Ouriel Ohayon is the CEO of ZenGo. In this conversation, Ouriel and Anthony Pompliano discuss digital wallets, security, Facebook's Libra, and how wallets may support various assets in the future. CRYPTO.COM-----Crypto.com is a pioneering payment and cryptocurrency platform that seeks to accelerate the world's transition to cryptocurrency. With the vision of "cryptocurrency in every wallet", the Crypto.com App offers a full range of financial products with competitive pricing, well designed UX and high security. It is the best place to buy, sell and pay with crypto. COINMINE-----The Coinmine One is like an Xbox that turns your electricity into Bitcoin. You just plug it in, connect to wifi, and tap on the crypto you want. It’s so easy anyone can do it. Everything is controlled from the Coinmine mobile app and the Coinmine keeps getting better with over the air updates that add new coins, features and services to your Coinmine.  Visitcoinmine.com/pomp to get a Coinmine and earn crypto for powering a new world.

What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to Off The Chain, simply the best podcast in crypto. Let's kick this thing off. Oreo Ohayan is the CEO of Zengo. In this conversation, we discuss digital wallets, security, Facebook's Libra, and how wallets may support various assets in the future. I really enjoyed this conversation, and I hope you do as well. Want to know who has the best URL? Crypto.com. That's right. Crypto.com. They're a crypto platform with one goal, motherf***ing mass adoption. That's why we're all here. We're trying to get crypto in every wallet. Crypto.com is helping people do that through buying, earning, lending, and card payment. Everything you could want at

crypto.com. Go help your boy out. Tell him Pomp sent you. Download the app or visit crypto.com. Pomp's got you always. Ever wanted to get into mining and didn't know how? Don't worry, your boy Pomp's got you. Everybody got some electricity and Wi-Fi. All you got to do is go to coinmine.com. You buy a CoinMine. It's like an Xbox or a PlayStation that helps you turn your electricity into Bitcoin. That's right. You purchase it. It shows up at your doorstep. you pull it out of the box you plug it in connect to your wi-fi five minutes or less you're mining bitcoin all you have to do is control it from the mobile app they provide and then you receive over-the-air updates that add new coins and new features on a consistent basis kind of like how

tesla does over-the-air updates and updates the car software just you're updating your coin mine consumer mining made easy that's right go to coinmine.com tell them pomp sent you and thank me later. Anthony Pompliano is a partner at Morgan Creek Digital. All opinions expressed by Pomp or his guests on this podcast are solely their opinions and do not reflect the opinions of Morgan Creek Digital or Morgan Creek Capital Management. You should not treat any opinion expressed by Pomp as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his opinion. This podcast is for informational purposes only. all right guys bang bang i am here with oriel uh dude thank you so much for doing this i'm super

excited to uh talk about a whole bunch of stuff that you guys are doing with digital wallets and key management given uh kind of the world we're in right now so thank you bang bang and glad to be here absolutely all right so let's just jump right in uh maybe give us an update on or an overview of your background um and how you got into crypto and then we can talk more about what you're doing now? So I don't have a great story. I know like all your guests have like super stories about how they got into crypto. Mine is extremely boring. I've been in tech for the past 20 years. I've been bouncing back and forth between building companies and investing in companies. So I've been an entrepreneur. I was in venture capital for years. I created a venture

fund. And in my last company, I was exposed to a lot of mobile apps. I built myself mobile apps and uh i i kind of suffered from the point of failure that you know you have when you are depending on the platform and you you have depending your life is depending on apple and google and when i discovered via podcast by the way which was with nick sabo and i think nick ferris about a couple of years ago uh about ethereum um it opened my eyes was the first time i heard about apps that could not be stopped and it got me extremely curious and you know i started to learn about it i started to listen to more podcasts including yours by the way and um you know i i decided It was extremely, you know, it was groundbreaking and I wanted to spend the rest of my career into it.

So I started to write about it. I wrote a blog post, which started to become popular. I started to meet a lot of people. I started to invest in the space. And at some point, I realized there was a problem I wanted to solve for myself. And the problem was the problem of digital wallets, which I found extremely hard, actually, until today to use. And, you know, that even generated lots of funds for me at some point. So I decided that it was an important problem to solve.

And I posed there and I started to think about an idea and built a team around that. So that's basically the accelerated version about what I did until now. Just also a quick pause, I also were in the content space. I was one of the early writers of the TechCrunch team in the early days and built a blog for them and eventually we sold it to IOM. So I was also part of that story. Got it. And so coming out of, you know, what I'll consider a more traditional tech background, very similar to me, how do you think about where crypto intersects, right? Is it something that Bitcoin, blockchain, cryptocurrency is separate and will remain separate and people kind of have to make a choice?

Or do you see much more of the blending of the line or a gray area where they become, you know, connected and eventually just they can't be disconnected? it well once i started to understand what it is it was so obvious for me that it was a natural evolution of everything if you understand that everything is going to get digital you know information commerce then you understand that money is also going to become natively digital i'm not talking about online banking and stuff like that and so it took it took me a while to understand that and you know i've been an early adopter of mostly everything except sadly of bitcoin although i knew about it but when i started to understand that for me it was just so obvious it was a natural evolution of the not just of the internet it was a natural evolution

of the economy the money has to become digital the way we transfer value had to become digital and for that you need a native paradigm and blockchain was just so naturally fit for doing that so once i understood that and because i saw with these three revolutions i saw the revolution with my own eyes you know of the internet the desktop internet the revolution of social internet and the revolution of mobile when I realized that for me it was pretty obvious that the train couldn't be missed and I had to be there. So it was just like a natural evolution for me and it seems like more and more the case by the day. Got it. And so digital wallets are a huge piece of this. Maybe just give us like a quick 101 on what is a digital wallet and why are they so

important? So first I think in the world of crypto and blockchains, the word wallet is not appropriate because the world wallet implies that you you have something that is stored in it right you have value that is stored in it uh physically stored in it you know the history of wallet you know you can look at in wikipedia is always associated to something physical and uh digital wallet is an abstraction of something that means that you have some kind of interface that will allow you to know what you own and will allow you to transact with it and receive and send And so those interfaces have a history. They've been there nearly from day one into the blockchain space with Bitcoin.

And the interface was extremely elementary at first and very unusable. And over time, it became more and more usable. And we've seen multiple forms of wallets over time. Some are custodian, meaning that the service holds the funds for you. And, you know, the most famous are exchanges. And sometimes they get hacked. And the majority of them are non-custodial, meaning they only give you access to your funds via the private key that you are controlling.

And there's been multiple iterations of those non-custodial wallets, those interfaces which, through the private key, allows you to know what you have, spend, and receive funds. The problem with those wallets, and no matter how you look at them, whether they are software, whether they are hardware, whether they are paper wallets, is that they put the burden on the user to manage his own security, which is something the human being is not used to. And so a big problem starts from that point. So we can talk about that.

But for me, digital wallet is just an interface. And not just for me, I think this is what it is. It's just an interface for you to know what you own, do things with it, interact with different type of protocols that are connected to the blockchains. And then from there, you know, grow your wealth. Got it. And then as you look at these digital wallets, there's a lot of advantages and disadvantages.

When you describe it to somebody outside of crypto, let's talk kind of like a traditional investor or somebody who's thinking about using one of these digital wallets. How do you break down where the advantages are to the legacy system and then where those challenges are with the existing tools that are out there? So the advantage is extremely simple. It's control, right? The user is in charge of his own funds. There is no way to censor them. There is no way to take control of them. You are in charge of your, you become your own bank.

Now there's the expression, not your keys, not your crypto. So you are, you are the boss, you are the bank. And so that gives tremendous advantages in particular in economies where there is a lot of censorship and then economies where you want to have privacy. But the disadvantage of that is that you are becoming, you are being required to become a security expert overnight and that's something that has failed over and over again and the interfaces no matter how they are built because they are around this this topic of you have to manage your private you have to manage your security are generating a lot of accidents

human errors and that's something that most people are not used are very nervous about and now there is this kind of ongoing search for better user experience and a better way to deal with that because if this is true that up until today tens of millions of people have gone through that process it's extremely unlikely that in the future hundreds of millions of billions of people will know how to do that and no matter how great all the user interfaces managing a secret is extremely hard there's a reason why hacks happen every year and why accidents happen all the time so the advantage is basically control the disadvantage is that you are becoming a security experts are likely to to lose your funds more more than in a traditional uh system or the legacy

system got it and then as you're looking at the different wallets that are out there right there's custodial non-custodial um and they have various kind of levels of um i don't know i'll call it uh sophistication right in terms of what somebody can expect and what user experience is like maybe give us just kind of a state of where are we now with the with the products that are out there right so we understand the advantages and disadvantages but where are we from a state of digital currencies today so basically we looked at it extremely simply and uh we looked at it in a way i know it's unconventional and people will say well you have like you know hardware wallets and software wallets and paper wallets and multi-sig wallets and we look at it in a different way we

look at wallets that have a private key and wallets that don't have a private key and that's kind of the new paradigm that we're introducing in the market with Zango and the keyless wallet is a wallet without private key, and we'll talk about that in a minute. But basically, the common point with all the solutions that exist today is that no matter what type of format, whether this is a hardware or software, those are meant around organization, the access to the private key, and some will be air-gapped and protected by a PIN code and a dedicated hardware, and some will be protected by some sort of smart contract or set of guardians around you that are protecting with you the private key or some will be protected

by just the device biometrics and this is an entire category for us it's not like we can split it in different things some people will prefer these flavors some people people will be more comfortable with that flavor right now the best goal practice is to say right keep everything in the hardware wallet because it's likely air gap and better protected and it's likely true but we like we're looking at the market in a different way with a different angle So we're looking at that as a category which is around the management of the private key, which is the problem, because there is a point of failure and there is tremendous user experience issues. And I think there is a new generation of solutions that are coming up. Thank you, multi-party computation. I don't think we are alone in working in that field that are around providing solutions that are not necessarily sitting a private key in itself and enabling all sorts of new experiences and security level that wasn't precedented until now.

Got it. And so what are you guys doing at Zendgo? How do you kind of look at your place in that world? So it came from a personal experience when I onboarded this industry and I tried like multiple wallets and hardware wallets, software wallets. And I had to go through the tedious process of setting up the 24 password and storing it in somewhere safe, the famous sentence, keep your seed in a safe place. And I was trying to find out what that means. And until today, I couldn't find an answer. The best one I could find was put it in a bank safe.

But I was wondering, if the whole point is to escape the banking system, why should I put all my wealth back to the bank? That makes no sense. And so I saw that I was dreaming actually about a solution that was escaping that step and that was enabling someone to onboard very quickly, not just to onboard, but also to guarantee that his funds would be non-custodial and recoverable no matter what. And we couldn't find a solution with typical public key cryptography. Typical public key cryptography requires you to associate to it a private key.

And then you can do all sorts of things with that private key. You can air gap it, you can shard it, you can do all sorts of things, but there's always a private key and it's a point of failure. It's an information that if it gets compromised, meaning you lose your funds. So we look at that and we could not imagine a solution around that. So we looked at a different area of cryptography, which called multi-party computation and threshold signature, which basically the principle is explicitly simple, is that instead of generating a private key associated to a public key, you are distributing the security between devices that don't know each other, that generate independent mathematical operation that are never going to be exposed to each other. And together, they are going to play the same role as a private key. what you do in essence is that you are offloading the security which is typically on one private

multiple devices and by doing so eliminating single point of failure so that's like the first layer distributing the security on top of that what we are doing at zango and so i forgot to say zango is a crypto wallet in case it was not clear it's a mobile app that you download on your phone and in five seconds you have a non-custodial wallet which is set up and backed up so on top of the cryptography and if you have questions pose me right but if on top of the cryptography what we're doing is we're building a password for experience so it's the first time in crypto and i think it's the first time in fintech that this you can onboard a wallet a digital wallet with absolutely no password nothing to write nothing to remember nothing to lose i can describe the

experience very quickly you just put your email you confirm it with a magic link like on slack you enter your device with the biometrics of the device, and then we scan your face to the other side, you then put it on your device, and it allows you to get into the wallet. And if you lose your phone, you can go through the same steps and recover it again. So nothing to remember.

We call that the password-free experience. And then you get into your wallet. So you have two important things here. You have a wallet that is set up extremely fast, where there is no private key, and that has no password. The last advantage of it is that only you, the owner, can access your funds.

Typically in a wallet, if someone has your password or even your SIM card or has SIM jack or something, will access your fund and spend your money. In Zango, this is the first time

a wallet can only be used by the owner of the wallet because there is the biometrics that is tied to it. So that's also a kind of new approach and a little revolution in the space. So to summarize, Zango is a simple wallet

where the security is distributed that requires no password that is tied to your biometrics so that only you can access and recover your funds. That's what Zango is. Got it. And so as you think about building this, right, there's like the key management component, there's security, which is table stakes, et cetera. But how do you look at Zango's advantage over other digital wallets?

Like I'm a user and I'm sitting here saying I need a digital wallet and I've got, you know, eight, 10 different choices. what's the differentiator that you feel like put zengo heads above everybody else so right now zengo is designed mostly for people who do not own yet crypto and are going to suffer from the pain on onboarding the industry and um that we know that we see that already the type of users we attract are people who have difficulties with the uh with the system but not just it's also users who have used existing solutions and have already lost money, sometimes a lot of money, and understand the pain

of what it means to manage your security and want to still have something that is non-custodial but that offers kind of custodial-grade type of experience. It's beautifully designed. It's extremely simple. There is 24-7 customer support. So it feels like there is always someone on the other line, but it's not a bank. It's not a custodian. So I think we're also attracting this type of user. And I think as we progress, as we add more services, people will realize there is even more value to add to it. I mean, we can talk a little bit of what's coming up,

but there will be elements of guarantees and security that are not yet present in the mobile app that will give more sensation that no matter what happens, your funds are always safe. And I think this kind of peace of mind added value is something that you do not find in the current solutions. You always ask a question about what if, what is this, what is that? And I think what this industry requires more, and that's our added value, is extreme simplicity and extreme peace of mind.

And that's something that you realize the first second you open the app, and you realize it also when you have to recover it, because it looks extremely simple. And if you knew those solutions before, you realize that it's something that is superior. So I think the added value starts here. As we grow longer and as we plug more services and we interface with more protocols and you can do more things with your wallets, then you will realize that this is also a useful interface for doing all sorts of things, not just sending and receiving and not just for onboarding and recovery. So the progressive added value of the wallet will be there. There is the last one, though, and I want to insist on that, is the multi-asset part, right? So there are many, many wallets that claim to be multi-assets, but when you look into the details, they do not necessarily support multiple chains. They many times support multi-tokens in the same chain.

We built a solution that is blockchain agnostic, and that enables us to add a blockchain, a new blockchain, extremely fast. And last week, we just announced support for Libra already, although it's just been announced two weeks ago. So we have the capacity to build kind of the remote control, if you want, for all the assets that you have to manage. And we're not just talking about coins, tokens. We're talking about any form of digital asset, whether this is a digital identity tomorrow, a collectible, a title of property, a security token, etc., etc., anything that can sit on the blockchain. So this kind of peace of mind of I can have anything in that wallet is something also that will matter. Of course, right now it's limited. We only support Bitcoin and Ethereum, and we just launched only.

But I think over time, people will realize it's more and more useful. Got it. Where are we going? So as you build this, where do digital wallets go? What does that future look like in terms of how they're going to evolve? So, I mean, right now there's a lot of solutions in the market. And I don't think there will be hundreds of wallets in the future. There will be probably less.

But what's also certain is that users will not install 30 wallets for 30 different assets. That makes no sense. It's like saying, here is a great TV. Here are all those TV channels. And here is like 30 remote controls. Now enjoy your show, enjoy your movies. Users will need remote controls, and not just because they need to manage all their assets in one place,

but also because they need to interact with a bunch of services that are tied to their accounts, and so they can do that. I believe that your mobile phone will be the hardware wallet of the future. It will be the only hardware that you will need. Our security enclaves will become better as the protocols provided and the APIs provided by the operating system, namely Apple and Google, will get better. I think

we will not need at some point hardware wallets. I do anticipate also that biometrics will become more and more prominent and we'll replace passwords because passwords are the mother of all nightmares in security. And I think in the future we look like

more remote control type of experiences, mobile as a hardware and your phone is your hardware wallet and this is what you need, you will be able to interconnect with it. And if you look at what's happening in Asia, it's already the case,

the phone is the wallet, right? So I think this is where the action is going to happen. It's not going to happen on the computer. It's not going to happen maybe on a connected watch at some point, but it's going to happen first on the phone. And I think the future is going in that way. Got it.

And so for a long time, I've just thought that there's two core thesis that my partners and I have had in crypto, which is one, Bitcoin is a sound money that will act as a great store of value over a long period of time. And the second was that every stock bond currency and commodity will eventually be digitized or tokenized. And so the digital wallet to me is the core infrastructure for that second part of the thesis, which is the stocks, bonds, cursing and commodities getting digitized. Today, I think we see most companies that are talking about this. Let's use Facebook as an example. They're thinking of digital wallets as a wallet

for a currency, a digital currency. So they've announced Libra. And then they've also announced that they're building Calibra, which is a digital wallet that will support Libra. One, let's talk about your thoughts on not only currencies, but the stocks, the bonds, and the commodities also being tokenized or digitized and digital wallet supporting that. And then we can get into a little bit about Facebook, Libra, and Calibra. So my view is that any asset that can be digitized will be digitized. And I know stocks and bonds will be one of them,

but I think it will go way beyond that. Our identity will be digital. Our title of property will be digital. Proof of ownership of anything that is an asset will be digital. So artists or let's call it art and traceability of art and logistic traceability will be also digitized. And there is nothing that will not be digitized at some point. It's just the sense of history. We see that already.

It's already happening. And if that is the case, you need a home for those certificates or for those proofs or for those titles and for those assets. and it's obvious also that it's not going to be the same interface for all those type of assets so the best wallet will have the best interface for a certain type of assets you know when you store bitcoin and you send bitcoin it's obviously not the same as a digital identity or a collectible so various interfaces will be there will matter right the browser doesn't look the same if you are on an email or if you are on e-commerce site so it's about the same site and here i think it be that so for for us when we think about wallets we don't think about what's for coins or currencies

we think about it as the browser that will enable whoever owns a digital asset to uh to browse it to spend it to interact with it to invest it to share it uh to plan for it etc etc so it goes way beyond the traditional exception acceptance of you know what a wallet is and what a digital asset is and We are indeed very bullish about security tokens. We believe this is going to happen. We have received grants. We haven't talked about the company, but we received grants from platforms that are going to be massively used for that. And so we believe that this is something that's going to matter. I don't know if you want to jump right into Libra, but that's already the first part about your question on digital security and bonds. Yeah. So maybe just give everyone a quick overview for those that don't know the difference between Libra and Calibra. And then we can talk about some of the nuances. So Libra is the protocol, the decentralized currency that Facebook, but not just Facebook, along with another set of important members, have announced a couple of weeks ago. and it looks like a stable coin or stable-ish coin

that will be launched next year. And that's kind of one chapter. It's kind of the protocol and the rules around managing the reserve behind it. And this stable coin is pegged to a basket of fiat assets. Maybe in the future, it will include digital assets, but it will be pegged and it will be rather stable. And on the other side, you have a company

which is a subsidiary of Facebook, which is called Calibra, which is a custodial wallet. which will be a mobile interface at least based on the screenshots that we've seen on the website that will enable the owners of Libra to transact with it. It will be a custodial wallet

meaning that Libra will be the owner of the private key around the Libra that you own. You will have to onboard it with a KYC so you unlike non-custodial wallet you will have to prove your identity with a proof of

identification government idea and uh it looks like also calibra is going to be baked in facebook main properties whatsapp instagram messenger etc etc so it's going to be probably by far the most popular digital wallet ever created to date uh not just in crypto but i think in the world like way more than paypal or maybe you know the second most popular will be uh apple pay or uh in-app purchased from Apple, but I don't think we go way beyond that because they've got like a couple of billions of users already. And so

Calibra is that type of wallet. What they also have announced is a platform and a source code that developers will be able to use to also build their own wallets, right? And they are actually seem to encourage that. They want to have

all sorts of flavors and formats of wallets that people will be able to use. Some will be custodial, some will be non-custodial. And we jumped on the race because we liked very much what we heard with this project. I was secretly hoping that something like that would happen when I started

working on Zango. And so we immediately looked at the code and we built support for Libra test network. Got it. What do you think the challenges they're going to face? Well, it's obvious that the first one is going to be regulatory.

I know it's coming up. And I think it's coming up in a week or something like that. I'm pretty confident, though, that they will manage and they will be fine. Because when you look into the details about how the Libra Association is managed, about the fact that it's not controlled by Facebook, and that Facebook is only one of the voices, the fact that they're going to KYC their users, the fact that the reserve is going to be audited and controlled, The fact that it's not going to be a fully decentralized Bitcoin kind of protocol where governments have absolutely no visibility and they don't know what to call when there is a problem happening. I think they will be fine as they learn about it. And I think, you know, this hurdle will be overcome. I'm not worried about that.

The second problem that they will have to face is that of adoption, not distribution, but adoption. distribution will be solved overnight because as it's plugged to their hubs and their users instantly billions of people have access to the to the web but they've tried that in the past they tried to put payments into facebook messenger and uh that was not successful people did not really use it so one thing is to have distribution another to have adoption and to have adoption people have to understand the value of it right so i think there will be um a challenge about explaining why people need to use that and i think you know if they are targeting primarily developed economy is going to be challenging because I don't think people will immediately

understand why they need to use that instead of their native currency unless they have a very strong economical incentive, a coupon, a discount, or something that gives them the benefit of using it. And they probably have better chance in countries where financial infrastructure is either very weak or is being attacked or non-existent, right? So for example, in African countries uh you know mobile transactions are controlled by financial transactions are controlled by mobile operators and they charge crazy fees for that so it sounds like it's a natural fit for them so they would have to like do some marketing to get adapted there but the pay might be way less important than in other countries so i think this world will be there probably their main two

challenges and there is a third kind of wild question is how the manage the reserve will be managed and the the peg and the stable stability of the coin will be operated and the equilibrium in the system will be operated and the security of the system will be managed. But that remains to be seen. Skrrt, skrrt. Want to know who has the best URL?

Crypto.com. That's right. Crypto.com. They're a crypto platform with one goal. Motherf***ing mass adoption. That's why we're all here. We're trying to get crypto

in every wallet. Crypto.com is helping people do that through buying, earning, lending, and card payment. Everything you could want at Crypto.com. Go help your boy out tell them Pomp sent you. Download the app or visit crypto.com. Pomp's got you, always.

Ever wanted to get into mining and didn't know how? Don't worry, your boy Pomp's got you. Everybody got some electricity and Wi-Fi. All you got to do is go to coinmine.com. You buy a CoinMine. It's like an Xbox or a PlayStation that helps you turn your electricity into Bitcoin. That's right. You purchase it. It shows up at your doorstep. You pull it out of the box. You plug it in connect to your wi-fi five minutes or less you're mining bitcoin all you have to do is control it from the mobile app they provide and then you receive over-the-air updates that add new coins and new features on a consistent basis kind of like how tesla does over-the-air updates and updates the car software just you're updating your coin mine consumer mining made easy that's

right go to coinmine.com tell them pomp set you and thank me later so how do you think like one of the things that I keep thinking through is if government step in and really apply pressure to Facebook on Libra. So it just came out recently that Facebook is going to not pursue their digital currency plans in India at the moment because of regulation there. Obviously, India has a very large population of over a billion people. I think on Facebook, it's actually the largest country by user base for Facebook. If they're not able to operate with the currency, do you think it's fair that they'll continue to develop and distribute the digital wallet and they'll just move to helping people custody and support other assets, the stocks, bonds, commodities,

et cetera, that we talked about? Or do you think that there's kind of a sequential path here where we have to have the digital currencies as the first asset and if we can't get over that hurdle of support and adoption then we won't get to the other things so indeed there are some countries that already have expressed a big like you know big like major stop to right to to libra and uh some i think will likely be hot stuff and you know china we already said that there's no way libra is going to be there and that they're going to develop their own national central currency or digital currency so it's hard to see a future there but what i do see though is that countries that say no today might change their minds i think they're they may have more to earn rather than to

resist and the challenge that facebook has and libra has and you know the association is to educate them explaining why it's there in their interest because you know once you enable people to transact once you provide them access to financial freedom and control at the point with crypto, right, you know, all this decentralization thing that people talk about the whole point of it is so people can have access to financial freedom, you create more economical value, more economical

value means more wealth for the country and more wealth for the country means more power for your, you know more power for the country, so I think if they manage to convince them that this is the opportunity and they manage to be associated to that development, the attitude

may change, so some countries might take more time for them to to get in. I think, you know, if we start with the US and the attitude of the US is going to, I think, affect a lot the attitude of other countries, probably Europe. And then if US and Europe are in, it's going to be maybe easier to convince, you know, continents like countries like India. So we would see how that happens. I think it's not going to be an easy playbook. And they have like a major role in front of them. But I'm kind of bullish that they will manage to at least convince a bunch of

countries to play the role and that this will snowball because at some point what will happen is that Libra will trigger a strong interest for all sorts of currencies, digital assets whether it's Bitcoin and others, will open the eyes to hundreds of millions of people and if this is the case the states will

have to choose, they will have to choose if they want to embrace this revolution or if they want to fight it and I think this is a fight that it will be really hard to win and at least it will be hard to be isolated it so obviously it's you know history has proven that when a trend is happening you don't want to really want to serve it and you know if a state has bought internet and would say right no way

for me there is no internet in my country they would have left been left in prehistory so i think the same will happen in in uh in your digital assets so the best bet for for libra is to say that well at some point you know countries will not have the choice they will have to embrace this revolution so do they want to do it with us or they want to do it without us that's that their question and you know that will be the the challenge that they will have to to face but i think the history plays in their sense got it and so i guess you know as we go forward what's the one thing that you think uh will either happen with digital wallets um that people aren't expecting or the thing that everyone is expecting that you don't think will happen well the big question for

me is that our wallet is going to be something that are going to be operated by uh newcomers like us all right and you know is the future going to be around self-custody um or are we going to be seeing just an extension of what we've seen until now which are basically banks and you know if you look at the space today today people leave most of their funds in exchanges and that's why those acts are so spectacular because you know most of the funds people own are stored in exchanges and custodian and the reason why is because it's easy it's easy it's convenient it's great to know that you have someone on the other side so the big question is is the future going to look like the past or is the future going to look different is that going

to be a future of self-custody where key management is something that is solved and where users can actually take control of their own funds and control everything that they do and have this kind of freedom and independence or we will live in a world where people need trusted third party and be back to the beginning in a way. And my hint is that it will take a generation for this attitude to change. It will take a generation because when you look at kids today,

when you look at kids, they live in a digital native world. They live in video games. They live in Fortnite. They live in places where digital currencies is their world. They want that to be their world. And as they grow to become adults,

they will also expect that into their future. So maybe our generation is already too late, but I think the new generation, we want something else. We want to build something else. And I think it already started the same way AOL started the internet, and suddenly we saw that portals became a thing of the past, and then came Google and all sorts of decentralized websites with Web2O, and the content became distributed in all sorts of ways.

I think the same thing is going to happen with wallets and digital wallets, is that right now we are in a custodian-first situation world, kind of bank-like world, because this is the paradigm that we know that we feel comfortable with. But I think it will change in the future and I'm very confident that with the right solutions, people will want to own and be in control.

And finally, the last thing I would ask is whether this is something that's going to be controlled by giants or Facebook, the Apple, the Google, Microsoft, the Amazon will be your wallet, or will that be something that will be owned by or operated by newcomers like us, right? And that are coming with new solutions

that have built network effects, that have unfair disadvantages in the way they build their solutions and that at some point become too big to be ignored. So there's also this question. It's really hard to say at this stage. I think it's too early to know. Apple, Google, Amazon, all those guys except Facebook

did not make a move yet into the space. So for now, it doesn't look like they're going to come in immediately. So the room is still empty. Got it. Before I end, I always do rapid fire. You ready? Of course. Most important company in crypto other than your own.

So I would say without hesitation right now, if you ask me today, it's Binance. I think they've built the most outstanding operation in the space. And I'm saying something that's pretty obvious. But I think that may change, and I think someone like Facebook, because of the impact that they have in terms of distribution, because of the fundamental expertise they have in building great user experiences and services people use at scale, that may change in a year or two. So for now, I think we are in a balance, kind of winning it all. And the operation is really outstanding. It's really world-class execution, what those guys are doing. But I think Facebook has a chance to take over in terms of importance,

although they will do different things. Got it. What do you think is the one regulation that you would change or improve if you could? So there's two things I think should change immediately. First, the KYC regulations, if people want to buy, the KYC should be much clearer and much more standardized and that can only come by clarity of regulation. KYC should not happen for low amounts of purchases or for, you know, non-custodial low amounts or even custodial low amounts. So that's something that is absolutely not required. then I don't understand you have to go through the pain of uploading documents and everything

if you want to buy just $10 worth of crypto that would facilitate easily the adoption to a much larger number of users. The other thing I think would be a tremendous improvement is if the tax administration was ready to accept a payment of tax for crypto benefits, crypto profits in crypto. And I know there is some experiments in Wyoming and others, but they always speak to fiat. And so that, you know, kind of making the rule not very interesting. I'm talking about native payments in crypto. And that would be so, so game changing and also facilitating the development of the industry.

What's your most controversial thought in crypto? Most controversial in crypto? I would say that it's tied to what I just said, though. It's kind of contrarian, but also goes together. is that very likely the future in crypto will be KYC first, meaning that we're all dreaming of this kind of anonymous world where everyone knows what they own and that they should not reveal each other

and that they should be independent and private. But on the other side, there is no society without organization and KYC will be mandatory. It's already starting to be the case with the new FACS regulation. I think it will extend at some point to also non-custodial services. You know, Calibra will be KYC first. That said, I think KYC will have a different color than what it has today. It will be user-controlled.

It will be privacy-controlled. It will be decentralized oracles, unified user interfaces. It will be interoperable and not the pain that we're seeing today. So I think we'll have a future that is KYC first. And the other thing I would say is that mainstream adoption cannot happen at all without Apple and Google playing the role. right now there's a major major issue in the in the in the adoption of crypto and it's not talked enough about is that if you are uploading a mobile app and you know the future is mobile and if you're doing a mobile app with crypto and you want to enable payment in crypto for any kind

of digital asset or service you cannot do that apple will reject your app google will reject your app you cannot sell digital service with crypto and there is no way the industry is going to develop if that is not happening so mainstream can only happen not if we solve scalability not if we solve a better consensus and security or governance but only if apple and google play the play the game and i don't think they do that what's the most important book you've ever read i'm not a book big book reader uh i read a lot uh but i kind of very spotty way of picking my books and uh you know there's two books that have impacted me but uh they're not in the crypto space uh in the same way i came very late so i'm not a crypto native guy uh i would say the first one is

the chess player by steven zweig is one of my favorite writers an austrian writer it's an amazing book about uh about the story of this uh of this uh chess player who is basically a genius and um but has kind of become forgotten and will be rediscovered on the on the boat by someone and play a game with him and realize it's the biggest genius of our time. The story is interesting, but the reason I like this book so much is that it's because it opened my eyes on why reading is such a delightful experience. And after that, I read many, many other books, although I don't read any more today. And the other book that I really like is A Confession of an Advertising Man

by David Ogilvie, which is one of the fathers of advertising. And it's one of the most compelling reads that I've ever seen on how to tell a good story. and how to sell a good story. And the story has to always have a meaning. And when you see all the hype that you have around the world of crypto, it's very easy to detect that many of these things are oversold and that are not tied to real meat and real materials.

So having a book like that in my mind has really helped me shape how to tell a story, how to understand the meaning of a story and build something that is meaningful. aliens believer non-believer we talked about it on twitter i think once uh i'm i'm a believer i'm a believer that they exist uh but i'm a low believer that human life form uh alien exists and i will explain why for multiple reasons first the first feature that you have to ask yourself is whether you you read the bible and you are a believer in the bible because if this is the case it's unlikely that there is any other form of other worlds

with human-like intelligence. That's kind of the first feature. It's not that they're extremely religious, but it's already like applying a prison to believing in other forms of human life in other worlds. The second feature is, I think, by this time, if there was some other form of human life-like intelligence, somehow we would have found about it,

or they would have found us. And I would find it very surprising, with all the progress of technology, we wouldn't have heard about it. So for me, there's no doubt that it's existing, but I doubt that we found another pump on Mars or on Venus or another solar system that we have never heard about. There's only one pump. You really believe that? Why should I say something that I don't believe in?

Yeah, I do believe that. I do believe there is only one pump, that's for sure. and uh have you seen the recent um interview that uh joe rogan did with uh bob lazar who uh who worked in uh like area 51 or area s4 whatever on the uh the um space uh aircraft or alien aircraft i have not all right you definitely have to watch it because it is uh it's very uh, compelling, but also, uh, it's a little scary, right? When you start to really think about if there is life form outside of earth and we come in contact with it, um, it may not be good for us, right? I think we aspire to, uh, to discover it, but, uh, but, but it may not necessarily

turn out good, um, you know, for us or for them. And so it, it, uh, it's pretty crazy to think about i look at it but i doubt that he says something about i've met an alien so so i look at it i mean of course i would be you know i'm ready to change my mind i made like you know terrible choices in my life and change my mind 200 times and sometimes multiple times a day but right now this is really what i believe and i'm ready to be open to changes in the future the future changes all right what uh what one question you have for me to uh finish this up So you are, for me, one kind of mystery, right? So I need to understand something.

Like, how do you organize your day? Like, you've built a power growth machine that I don't manage to follow. And I've been involved in many, many plays. I've been involved in things that have grown. And you've managed to build in a year or two something that I've never seen before. So tell us your growth secrets. Like, how do you make that happen? And how do you organize your day?

That's the key. I don't. I think I am just incredibly authentic, right? I do exactly what I want to do when I want to do it. If I make a mistake, I immediately say I made a mistake, right? If I say something that was wrong, hey, I was wrong about that. I am curious when I want to be curious. I'm convicted when I want to be convicted. You can tell when I'm excited and happy, and you can probably tell when I'm annoyed or, you know, you know, bothered by something. And so it's just this, this belief of most people are trying to craft an image, a story, a persona that isn't true, right? And it may not be 100% true, or it might not be 20% true, right? But they're trying to craft it in a way

where they want to be perceived through a certain lens. And so what that does is, for most people, it comes off very crafted, right? It comes off very inauthentic, or they're very reserved. And I always joke, and I say, the reason why something like, you know, my Twitter account, um, or, or, uh, the, the different things online, uh, go so viral is there's actually a ton of people who believe exactly what I'm saying. They're just too scared to say it. Right. And I'll say it. And so I think that part of that is, uh, you have to be really comfortable with yourself, right? Like I think that the problem, um, and this is across society, uh, that we've run into is everyone is always comparing themselves to everyone else and therefore we've probably like

if there was a metric of like how what is the percentage of self-consciousness that has like permeated society it would be off the charts now right because everyone is looking at everyone else and being like oh they're doing x or they're doing y or i don't want to be seen as inferior to them on, you know, this one or two aspects of life. Whereas I think the people that have built these massive audiences, the common thread through all of them is authenticity. They say what they want to say when they want to say it. They know that there's a percentage of people who are going to disagree, right? And that actually drives even more engagement in a community, right? So if you look at everyone from Naval, Joe Rogan, et cetera, they have plenty of detractors, but the detractors

clashing with the supporters actually drives a lot of engagement as well and a lot of distribution. But the individual who's creating the content or is kind of the provocateur of the community, they're just incredibly authentic. And I think that that is, or that has been lost over time um, online. And so one of the things that, um, you know, I always tell, uh, especially young people who come to me and say, you know, Hey, how do I build a brand or how do I build an audience or, um, you know, make a name for myself. I tell them that you have to make a decision, right? And the decision isn't, what are you going to do? It's what are you comfortable with? And the comfort isn't about action. It's about the ramifications, right? And I think that, um, a

long time ago, I just knew that I was comfortable being really wrong in public. And once you get comfortable with like the worst case scenario, everything else is easy. Right. And so I think that that's been the kind of the key advantage that I've had. And so what that looks like in action is I wake up some days, I tweet once or twice, you know, I spend much time with founders and evaluating companies and kind of go about my day and you wouldn't know me from Adam. And then other days, you know, I get up and I tweet 50 times before noon and I record three podcasts. And, you know, frankly, I act like a, like a madman on the internet and it's just whatever I want to say, but, but there's no real point, um, which I think is a, is an advantage

because it keeps things fresh, right? It keeps people kind of on their toes. Um, and I don't really know another way so i'm gonna keep doing it until uh one day i'm gonna wake up and say all right i don't want to do this stuff anymore i'm gonna go do something else i i so agree with what you said let me ask you a question like how much of the crypto twitter do you think is authentic versus not authentic like what would you be your best guess in terms of percentage so i think that there's uh it's not a binary world right i think that there's like a spectrum and what i mean by that is, uh, there's some people who are super, super authentic. There's some people who are completely, uh, crafted and, and, um, kind of, uh, manufactured, right? So, so those are the

kind of the two extreme ends of the spectrum in between is where majority of the people are. Right. And so it's, you get 80% authenticity, 20% crafting, right. Or 50, 50, whatever. What I think is a more interesting way to look at it is not so much just, uh, often authenticity versus inauthenticity. It's more around what are the topics people are authentic about versus not authentic about, right? And the banks is a perfect example, right? Somebody actually, I was at dinner last night, and somebody who's fairly well known in kind of finance world, but just now getting into crypto, and Bitcoin said to me, you know, what's the thing with the banks, right? And why hammer them all the time. And what I explained to him was, the banks are

the perfect example of what is wrong in the world of money, elite status, etc, right? They will do things where they are financially incentivized to actually break the rules, because it makes them money, right? So if they do something illegal, they get fined, they never get fined more money than they made on doing the illegal thing, for example, right? Or their incentives with their users and customers are usually a binary outcome. If the bank wins, the customer loses, right? And so what ends up happening is there's this underlying distrust and unhappiness with a sector. And we see this in surveys around what are the most trusted brands, the least trusted brands, et cetera. And so one day I just said, look, I'm going to call this stuff out, right?

I'm going to just say the truth. And part of what I thought, it's short the bankers in that, because there's two pieces to short the bankers, right? And look, part of this is like, I have no problem telling people my logic behind this stuff, because again, I just think it's the truth. There's not a banker on the planet who thinks they're a banker, right? So the best part about this is bankers come up to me all the time people who work at jp morgan goldman sachs etc and they're like man i love when you say long bitcoin short the bankers like the bankers suck and i'm looking at i'm like you're sure and it's not that it's not them right it's like that's the beauty of something like the bankers it's this faithless kind of um clinical term that uh nobody thinks

they're associated with it. And everyone, you know, quote, unquote, dislikes the banks or hates the bankers, right. And so it's a very kind of polarizing or rallying message. But ultimately, what short the bankers means is it's not the people, right? It's the it's what the actions of those people drive, right? So it's the income inequality, it's that binary outcome where banks win and people lose. It is the belief that somehow central banks, governments, banks themselves are engaging in activities that manipulate currencies and markets and economies in a way that actually hurts people or widens the income inequality gap, all this stuff. We all know this, right? All you got to do is have an internet connection and you can figure all this stuff out.

It's just that people don't like to talk about it because they feel like they're put at a disadvantage, right? And historically, that's probably been true because what was the other option, right? If you wanted to opt out of the legacy, what was the option? There really wasn't one, right? What were you going to do? Go buy gold bars and put them in your closet, right? There wasn't really like a viable option. Now there is, right? And so I think that's where We're seeing a lot of people who are considered to have big voices in the Bitcoin and cryptocurrency community. They are pretty straightforward, open, and honest about the challenges that the legacy financial system has. Many people within the legacy financial system also believe those things to be true, right?

We see it all the time where you'll get a central banker who says something about the kind of for-profit financial system, And they're saying the same thing we're saying. It's just that they've never seen what's the viable alternative. And so once you introduce that viable alternative, now people get, I think, more confidence to say what they believe because they have a way to vote with their wealth to go somewhere else. And I think that's what you're really seeing in Bitcoin and crypto is people are not only now becoming more vocal about those challenges, but they're also voting with their wealth and they're saying i'm actually going to take my money the value that i've earned in my life and i'm going to go put it somewhere else that is outside of this system because i believe

that this system is flawed that's a big i so agree yeah i so agree and it connects to the future being self-custody and you know trust honesty is the keyword of of what you just described here And I think this is something that is the driving force of that revolution. It's not the seek of wealth, absolute wealth. It's just a redistribution of the rules of honesty and trust. I completely agree. And look, here's the best part, right? And especially when I'm talking to institutional investors, I tell them all the time this.

I say, I have an incredibly high degree of conviction around what we're doing, but I am not confused that we could be wrong. But I believe that the risk we are taking, we are being adequately compensated for by the potential return on whether we are right or not. And I think that's the key piece, right? When you look at it from a risk return standpoint, if you have conviction in what we're doing, the reward drastically outweighs the risk, right? And so that's something that I get excited about. And so it's not just one aspect of life. It can't just be, oh, I make financial decisions by investing in other people's capital or my own capital, but I don't actually believe this stuff. I think that's a really, really dangerous place to gravitate towards. And so for, you know, me and my partners, I think we've really kind of wrapped our heads around, you know, kind of a 360 degree view of this thing. And we have that conviction.

We know we could be wrong. But if we are right, that reward will drastically outweigh the risk. Clap, clap. Completely agree. So, look, man, you'll get me too excited if you ask me questions like that. I see, like, I feel the vibes and energy through my Philabee office here. It's like shaking all around. All right.

Well, listen, I really appreciate you taking the time to do this. I think that people are really going to enjoy hearing, you know, your views kind of from the ground, building one of the leading digital wallets and kind of taking some nuanced approaches to key management and things and then how that interacts with not only the larger Bitcoin and crypto ecosystem, but also things like Calibra, Libra, Facebook, et cetera. So thank you so much for the time. And I hope people enjoy listening to this. Thank you so much.

I have to also thank you because thanks to your podcast, I learned a lot of things that I know about in crypto. And, you know, if people have the time, they can connect to me very, very easily. Very easy to find on Google. Zengo.com is the URL to find us. If you come to Tel Aviv, say hello. And thanks so much.

Hey everyone, Pomp here. If you liked this episode of Off The Chain and want to help us take crypto to the top of the Apple, Spotify, and other podcast charts, please do us a favor and rate, review, and subscribe. To review, simply go to the Off The Chain homepage, scroll down until you see the five blank stars. Taking 15 seconds to fill those stars in

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