The Wolf Of All Streets - J.P. Morgan, Birthplace Of Decentralized Crypto? | Stuart Popejoy, Kadena

Episode Date: January 31, 2023

Stuart Popejoy is an interesting character. After getting a degree in Comparative Literature, he started his career as a programmer at Apple and then moved to designing and building trading systems, which led to a top management role at J.P. Morgan, where he was responsible for JPM Coin. Shortly after Stuart launched Kadena, a layer 1 blockchain, and created PACT, a smart contract language. We talked about all things crypto: Kadena, private blockchains, the next killer app, the role of SEC, the advantages of proof-of-work and more! Stuart Popejoy: https://twitter.com/SirLensALot ►► JOIN THE FREE WOLF DEN NEWSLETTER https://thewolfden.substack.com/   Follow Scott Melker: Twitter: https://twitter.com/scottmelker  Facebook: https://www.facebook.com/wolfofallstreets   Web: https://www.thewolfofallstreets.io  Spotify: https://spoti.fi/30N5FDe  Apple podcast: https://apple.co/3FASB2c  #Bitcoin #Crypto #Trading The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. This video was created for entertainment. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this video constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.

Jamie Dimon, the CEO of JPMorgan, has long been a critic of the crypto industry, calling Bitcoin and crypto a Ponzi scheme, saying that anyone who works for him will be fired if they even trade it. Well, that makes it very interesting that one of the most compelling and interesting projects, Kadena, came out of JPMorgan and was originally a private blockchain at JPMorgan. I talked about this with Stuart Popejoy, the CEO of Kadena, and he tells me how they made the transition from JPMorgan, why Kadena is so compelling and interesting, and why they chose Proof of Work to do it. You guys don't want to miss this interesting conversation. Let's go. I think what I found most interesting in the research was obviously your history at J.P. Morgan,

since J.P. Morgan's CEO, Jamie Dimon, of course, is notoriously bearish on crypto. So how does that happen? How did you make the transition from J.P. Morgan? I mean, the transition happened at J.P. Morgan, really, because my background is working in equities markets and algorithmic trading and stuff like that for 15 years before I got into blockchain. into a research group that ended up focusing on blockchain and eventually ended up being the JP Morgan Blockchain Center of Excellence, out of which a bunch of enterprise blockchain technologies came. Set this quorum. We were part of the, we were the pilot for what would eventually become JPM Coin. So, yeah, and at the same time,

Jamie Diamond was starting to make all of his comments. So, you know, you had, it's typically, it's not that, uh, it's pretty common in huge organizations that, you know, one part, you know, it's, it's weird to think of Jamie Diamond as one part of JP Morgan because he's CEO, but you know, people asked him his opinion on Bitcoin. He said, thumbs down. At the same time, there were definitely traders at JP Morgan who were in Bitcoin. So make of that what you will. You know, Jamie Dimon is constricted by law not to make statements about equities, but he can make statements about crypto. So, you know, you tell me if you're a trader.

But he did go out on a limb and say, you know, anyone who works at my company and has exposure to this could be fired at one point. But clearly that was not the case. A bit of hyperbole, but who can blame him? Also, to be fair, I don't like to defend, of course, but you can make a differentiation between the assets, which he's spoken about, and the underlying technology, which you were focused on at the company. Well, and that was always what people were saying at the time. You know, that, of course, I think fell apart. I mean, private blockchain in general was what a lot of banks, including JP Morgan and Kadena's original, you know, impetus was to take this technology we had developed and apply it for private blockchain. But crypto and public blockchain, you know, so-called public blockchain

is where all the innovation happened. So whereas, you know, private blockchain use cases are anemic, you know, and, you know, basically exist just kind of to, you know, justify the existence of the group that might be doing it. I mean, they're not driving technology.

And meanwhile, you know, the technology development in crypto continues to accelerate even in the bear market. More so, I think you could even argue. In the case of private blockchains, though, why are they so anemic and basically useless? Because you would think that there would still be a very strong use case, especially for a bank, for example, to have control over that blockchain for their own cross-border transactions, not obviously expanding beyond that. Sure. I think there was always, I mean, that was what

excited us originally was that there was always a possibility to leverage the frankly superior tech of blockchain and superior security to make new kinds of use cases available that simply couldn't exist before. You could have a so-called permissioned blockchain operating as a single source of truth across as an interbank service that's actually decentralized at that point. The thing you have to realize is that most businesses don't want to decentralize. Like, I mean, you see enough resistance to it in crypto, right? I mean, how much in crypto claims to be decentralized and then because it's just easier or more convenient or for any number of reasons actually isn't decentralized. Now go to businesses where they

hold all the cards and you're saying, well, you're going to get all these advantages if you, you know, share with your competitors, you know, so that's something like Swift, for instance, the payments network is, you know, is something that banks are constantly, you know, like those represent a source of, you know, lots of finagling and influence where banks want to, you know, banks are, a given bank really wants to exert influence over something like Swift. So they're not like these, like harmonious things. They're, you know, they're very, they're very political. And, you know, so the idea that they're all going to like sign on to a public blockchain and not try to control it. So those use cases never got off the ground.

And then after that, blockchain starts having promise for being a cost-cutting thing. But technology that just offers a technology benefit never wins. There has to be some business case. It has to enable some kind of new market. And if it doesn't do that, you're never going to get huge organizations to take all the risk to switch to an unproven technology. That just never, ever happens. So, you know, so until, you know, I think some of the interesting use cases that are still going on are some of the, you know, things where people are like trying to, you know, encode kind of complicated real estate trusts and things like that on the public blockchain. But again, on the public blockchain, I think you're always, and for a while, this was

kind of its narrative as well, is that, you know, the most interesting things are going to come out of hybrid. We're now more, we're now pure play, you know, in public blockchain because that's where our technology has found the most application. And again, the pace of innovation is unmatched. So I think private blockchain is forever going to be... I mean, I think an interesting thing you could say is that there are still a lot of challenges facing the public blockchain tech, you know, things along the lines of scalability and all these kinds of things. So, you know, the kinds of stuff that we're starting to solve now in terms of having, you know, a blockchain technology, like a smart contract technology that can be on a, that you stop talking about layer ones and start talking about, like, how are you going to bring

these different use cases to market? Whether that's games, whether that's all these, you know, whether it's a bunch of new use cases that can make sense in web three, once we solve those, once we really start showing how those technologies can scale, then you might see it start moving its way back to private blockchain. So that was obviously basically just described, I think, the evolution from private blockchain at J.P. Morgan to Kadena now, right? But at what

point did you sort of see the light and make the decision, okay, I'm leaving J.P. Morgan, I'm going to become CEO of this project, we're going to make it a public blockchain, and we have a separate value proposition from everyone else? Well, originally, it was more, it was a private blockchain thing. And the idea was that JP Morgan wasn't really ready at the time to fully embrace open technology surrounding blockchain. So we left so that we could really accelerate it and start working. You know, they also probably wouldn't be very happy with us working with other banks. So, you know, we started POCs with other banks. We started POCs in insurance, healthcare. We were doing a lot of work with Humana for a long time. But it was around that time that we started realizing that our technology could scale to public blockchain. And, you know,

so that was in 2018. So it wasn't immediate. We didn't leave JP Morgan to go straight to public. We had to, we had to kind of get warm public ourselves. And that was a, that was even kind of a slow process. And, and it was really, I think the on the, the arrival of DeFi and, and really, you know, the kind of on-chain technologies where we finally just cut the cord and said, you know, this is what we're all about because this is, you know, this is really where the innovation is happening. And we have something to offer that is different than what people are doing on, you know, on Ethereum or on particular platforms. And, you know, and I think that hasn't changed in the bear market. I think one of the

things that has changed is kind of the exclusive focus on DeFi and, and kind of speculative use cases, which, you know, that we like that we like, you know, broadening the conversation and not, you know, and not just talking about the latest hot NFT. I would say it was a gradual process. And it was something that um i think also the technologies matured in the public space you know by the time defy shows up i think it's because people you know the the eco you know the various ecosystems really started to understand um what was unique about smart contracts and about and and what you could really do with value on chain and now that's actually starting to break up in a weird way because of all the layer two stuff about smart contracts and what you could really do with value on chain.

And now that's actually starting to break up in a weird way because of all the layer two stuff. So I think we're entering into a new phase where it's not clear what the future holds. And so that's pretty exciting. So with us, it's always been kind of like wanting to stay close to the innovation and where the value is being created. So we've got layer zeros, we've got layer ones, we've got layer twos.

As you said, where does Kadena fall in and what is the unique value proposition that differentiates it from all of these other projects and blockchains that we're seeing launched and sort of gain momentum? I think it's actually, we have a kind of laser focus on decentralization, frankly. It really goes through all of our technologies in the sense that we launched ChainWeb as a scalable proof of work. Still the only, it's actually the only just straight up scalable layer one because all layer one technologies,

when they start talking about scaling, and let's remember what scaling means. It doesn't just mean going faster. It means going faster without limit, right? In the sense that all of, you know, like people thought when Ethereum would complete the merge, oh, okay, everything's going to be great. No, it's like when they put an extra lane on the freeway, right?

Traffic shows up pretty much the next day. And before you know it, you're still in a traffic jam. You've got to do something different. You've got to have true scalability. And that's what the Kadena blockchain offers because it can expand to meet needs without limit. And it's the only one that can expand horizontally. Anything else you look at has some kind of vertical split,

like whether it's subnets on Avalanche or, you know, Ethereum approaching a layer two centric, you know, dank sharding and proto-dank sharding, what's coming next on Ethereum. Or if it's app chains, app chains are also, you know, there's not, you know, there's nothing. So that's one thing is just really focusing on scalability without sacrificing decentralization. That's one of the main things we focused on in our layer one. But

I think what's more interesting, and in terms of what is now happening in blockchain is the fact that we have the smart contract technology. That's one part that hasn't changed is that we launched with a smart contract technology called PACT that worked better for private blockchain, allowed you to get use cases out in a safer and faster fashion for private blockchain. It's true for public blockchain. And now it's true for layer two because PACT technology can be used for websites. It can be used for layer twos. It can be used for layer one. And I think what you're going to start seeing going forth

is when you look at things like what Fuel Labs and Celestia and some of these other people are doing is that there's actually starting to be a focus on what is going to be the unifying technology that allows you to access all of these things the same way. And our smart contract technology ends up being the thing that like, you know, it's like you come to Kadena because of, you know, the fact that we've got unique, decentralized, scaled layer one technology. But then once you see our smart contract language and you can realize what you do, you stay for that. You stay for PACT. And that's really what 2023 is going to be all about. It's going to be all about all the different ways you can use PACT, all the different kind of applications you can do. And the fact that we can do things like optimistic roll-ups a lot, again, in a more, we can actually deliver optimistic roll-ups as they're supposed to be, right? Because optimistic roll-ups still don't, you know, they don't, they still don't have slashing. They still don't have a lot of the actual, you know, underlying security features they're supposed to have. And one of the reasons why is because it's very hard to move, you know, solidity is a great technology. We've been critical of it, but, you know, let's be clear. Solidity is the technology that made smart contracts get to market, right?

It's what brought us all this stuff. And something like Optimism makes a lot of sense because you can do solidity on the layer two, you can just let it on the layer one, but because it's such a hard technology to grow, it's such a hard technology to change that you see a lot of projects get to where optimism got to, which is that it's actually really, really difficult to take, to make the hard jump to something like, okay, now we're really doing this, this very complicated interaction. With PACT, it's, you know, everything about it is easier to understand. It's a safer language. It has formal verification so that you can actually tell whether or not you have bugs in your layer two to layer one. So that's really the message we're going to

be talking about in 2023. And you've chosen to stay with proof of work, which you don't often hear people talking about smart contracts and scalability horizontally and moving at the speed of settling every Wall Street transaction and billions of people. But obviously, the claim is that that's possible on a proof of work blockchain. So why have you chosen to remain proof of work when obviously Ethereum has made the jump? And it seems that that is the trend at the moment well let's not forget ethereum launched in 2015 right it's 2015 right um or the 2000s i can i also get the exact date so right in there right in there we're allowed to ballpark it in this market yeah you know uh and they launched saying we're going to switch to

proof stake in a year always um and and i i applaud them for the merge though to be clear that's not an easy thing to do and you know and by by not doing all the sharding and doing all the stuff they they made a very kind of sober technology decision and they execute on it and i i definitely applaud them. I think that was incredible, incredible, incredible. And it was smooth and you know, it was, it was really something to see and like, and since they've been, it also just meant that, you know, you could put to bed all the conspiracy theories, which I sometimes subscribe to that they were intentionally kicking the can down the road and all this kind of stuff. You know, I definitely think they made

mistakes along the way and could have gone sooner, but you know, but they did it. So, you know, so no, the reason why I say that though, is that proof of stake is nothing new. The problems with proof of work are nothing new. You know, this is something we were talking about in 2015, 2016, you know, so we, the reason why we made the choice is that one we knew that scalability was not going to go away and two we knew that you we could scale proof of work in a way that you can't scale proof of stake because it actually it all comes from the original bitcoin paper and some of the original side chains papers that's the technology we use to scale stuff it's not new technology we have just deployed it at an industrial scale and nobody else has because there's no equivalent for it. So it's not, it doesn't mean that it's massively more

efficient. It does mean that we can go to 20 or 50 or a hundred or a thousand or 10,000 chains using the same amount of energy. It doesn't require more energy. In fact, it gets, it's the weirdest thing on earth. It gets more secure the more chains you throw at it. So you get more for less. So it's an efficient proof of work. You know, but it's proof of work. I'm not, you know, I'm not going to, I'm not going to be an apologist for proof of work. I'm not going to try to deny the problems of work.

It's just, you know, security, decentralization. You've got to see what you're getting for the work you're doing and you know and so it's it's it's uh it's a contrary choice for sure and it's something that as the pact layer is as we start seeing pack you know emerging in layer two emerging even in web apps and you know as pack becomes this kind of unifying technology that developers from all over the place are using, we start talking about being able to clear to other platforms too. So I think the public blockchain part of Cadena starts coming into focus

as a particular kind of settlement layer that can preserve decentralization and that's going to be valuable it's but it's not the whole story so you know so that's that's that's where that stays and and i think the other thing is that there are other things going on with uh consensus technology in terms of you know using things like uh you know zero knowledge things like, you know, zero knowledge, things like that, as that starts to make its way into consensus technology that will allow us to, you know, either minimize or eventually eliminate proof of work. But we've always been about leveraging the technology that is proven, decentralized, and safe, because it's hard

to get those three things. Right. The famous trilemma, but usually then it means more expensive, right? Or slower. Right. And that's the trilemma, right? And Kadena is famously the only layer one that solved the trilemma because it's the only one that leveraged this low level technology. And then, you know, and so somebody might counter, yeah, but you're proof of work. And I, you know, I'm not, I'm not denying that. But again, we look at the world of crypto as something that is, you know, we're, we're also one of the, one of these people who say like, oh, well, crypto is still young, even though it's not that young now. I think it's kind of a defense. And some things are not so young. When the internet had been around for this long, some pretty amazing things were happening. So it's not that young. When people say it's young as a defense mechanism or as an excuse for why we're not at mainstream adoption or at scale to a billion people.

That's, I understand what you're saying, but I mean, in the grand scheme of things, something that's 14 or 15 years old that is a technology that could effectively change everything, it's very early. And also just doesn't, if you look at something like a thoroughly decentralized system, there's nothing else like it.

There's no, a system that can operate in the wild, you know, and that's one of the reasons, you know, one of the things we're pushing for in websites in terms of using Pact for websites is the fact that Pact has passwordless, you know, login, all that stuff licked. And what's more, you know, we're going to be rolling out stuff that allows you to do multi-save across, you know, your different devices and just a kind of standard session for web that's something that like normal web developers don't have good access to right now you know so crypto is ahead it's just that there's been so much focus on you know it's that thing where it's like this your success ends up being your worst enemy crypto is tremendously successful know, a lot of money was being made

between 2018 and 2022. And so that's where a lot of the focus was. But, you know, people forget. We're still doing something harder than other tech. We're putting a technology in the open where anybody can come at it and making it something that is safe and secure and decentralized. And that's, you know, so I think that is genuinely new. I think it is young. I think we still have

like really important debates to be had on the role of decentralization in crypto. And I, you know, and I'm still on Naxxie on decentralization. I agree. And I think that, listen, there are arguments to be made that for certain things, centralization is better because it's faster and doesn't require decentralization. In this case, I think it's clear that decentralization is the most important factor, but I've always argued that it's a sliding scale, right? I think a lot of people would say it's centralized or it's decentralized, and they want to be able to put it in one of those two buckets, but it just isn't, right? Even to the point where if you're fully

decentralized, but everything's running on Amazon web servers, then where Amazon web services, then you potentially are relying on a centralized platform for your decentralization. So where do you think it falls on the scale and how do we slowly sort of move towards that true decentralization? Well, one, I think it's that it's being aware of what we're doing right in the moment, too. Right. In the sense of like what's going on right now with modular blockchain? You know, what are the technology like? You know, so one of the things is zero knowledge, right? Zero knowledge. We've got to, you know, Cadena is working on zero knowledge, you know, stuff in our wallets and stuff like that. And it's a great technology. But the problem is, is that all the dominant, you know, all this dominant technology using Sn Something like Optimism today, in effect, is centralized.

So when you see what Ethereum's moving, and even stuff like what Celestia is doing, and that's a great team. We're paying a lot of attention to them because they're thinking very hard about these things and they're working really hard. But a lot of what they're doing is saying, oh, well, you know, for a lot of things, do you really need stuff to clear out to an L1? And I find it sad. You know, it's one of those things that that's what makes me get up in the

morning is that's one of the things that makes me want to, you know, give people more ways to clear the cadena blockchain because the cadena blockchain is still a classic decentralized blockchain and it can handle the load. And, you know, so part of this is about preserving the ability to have 100% decentralization still be in the discussion when you're talking about L2s and when you're talking about all these other things.

Because I am a little worried about what's going on with protodank charting and some of this stuff. I mean, in a way, they're moving towards a, you know, kind of just using the blockchain as just a timestamper. And I get it. I, you know, again, I think Ethereum is being very practical. You know, they're trying to, everybody's, you know,

I think what's cool is everybody's focused on the next level of adoption you know like blockchain is great defy is great but how are you going to get like a facebook on crypto how are you going to get like a world you know uh world of warcraft on you know uh fortnight how are you going to get something like that on you know uh working on crypto you need these layer twos i you know that's for sure and and you know those things can crypto. You need these layer twos. You know, that's for sure. And, you know, those things can accept. It's like you're saying, there's a sliding scale. A game can probably accept quite a bit of centralization.

Of course. But, you know, the reason why we're so, you know, kind of maxi about decentralization is that, you know, I suspect it's one of those things that, like, when things are centralized, I feel like there's other details lurking around the corner that, you know, are going to bite you. And the great thing about decentralization is that it's what it says on the tin. Decentralization brings a whole bunch of other things with it. It means this stuff is open, right? It means that it's like it's all open source software. It means that you can see everybody who's participating in it,

at least in one way or another. I mean, obviously you can use your knowledge. There are ways to make things private on chain, but you know, at its, at its, you know, the, if you, I look back to Bitcoin often, you know, I look back to the sets, the original social white paper often, because that's how we got here, right? That's, that's what kicked it off and there's things about that system you know like even when people start saying that like oh well the solution is we have to move to everything being encrypted i'm like wait you know hold on i i get i think that's another sliding scale right definitely not everything should go on a blockchain of course

but i don't want to throw the baby out with the bathwater. I think there's some really great things about having open systems where you can see everything that went down. You've obviously made the claim that all of Wall Street could settle at the end of every day on Kadena, that you guys can maintain operations at full scale of anything you could possibly need. That's been a huge problem for others who have made the claim in the past, right? I mean, we've obviously seen blockchains go down because a cool NFT project is launched, right? Oh, sure, sure, sure. And, you know, and that's, again, something that, you know, why we're very conservative about these technologies. You know, like Bitcoin hasn't gone

down in forever. Ethereum hasn't gone down in in forever you know and and this merge was again like like bravo on doing that because like they took a very secure system based on as crypto in crypto speak a very old technology which is their version of proof of work and they moved it to proof stake which you know proof stake's been around for a while now too um so i don't but you know the point being is that that those are very uh secure technologies and and the idea is that you know cadena is not going you know we when i say that by the way also i say it can settle it's a big difference i'm not saying i can host every trade on the u.S. stock market. No way. That's what we're talking about.

You want to talk about that next level where we're talking about modular blockchain. That's what you're talking about. But like settlement is a whole different story. Settlement is market participants, you know. So market and it's the end of day, right? At best, actually, a lot of stocks take three days to sell. But it's like end of day. So I actually know that our current blockchain could do that um but it's you know it's like it's one

of those things again you'd have to like it's so we can make that coin today and our blockchain can handle it it's just i don't think it's going to happen because you know stock market settles the way it does i don't think wall street's going to be switching their systems anytime soon. They're not going to be switching over anytime soon, but settlement. And I actually think the settlement and, you know, and this is again, a conversation that's getting more interesting now with a lot of the layer two and, you know, uh, you know, a lot of this modular discussion is, you know, how are you really going to like, what kind of settlement do you need? And, and layer one, I think is still the best settlement, you know, and, and to my mind,

proof of work is the best settlement because it's the most decentralized. It's the one that has the most capability and, you know, proof work isn't perfect either. Right. And I'm not talking about the green stuff anymore. I'm talking about older debates about like, you know, you know, miners and all that stuff. It's just more decentralized than proof of stake, you know, just inherently. as we all know, right? And one of the things that you have to hand to Bitcoin is that Bitcoin managed to jump that hurdle. It managed to, you know, end up in an arena where its regulatory status really isn't in doubt right now. I mean, you know, you know, we all, there's a lot of other stuff that's in doubt and, you know, and, and, you know, the rebel case and, you know, there's all sorts of stuff coming up that, like, everyone's going to be paying a lot of attention to. But Bitcoin is just going to sit there throughout the whole thing. And that's because it's decentralized.

Absolutely. And some would argue we talk about mainstream adoption and being able to settle, you know, billions of transactions and having billions of people using it. I think you could argue that we haven't had the killer app to get us there yet. You talked about DeFi sort of being, I guess, a test study for what you guys were doing, but have also mentioned NFTs, gaming, which leads into metaverse. Do you think that we have a killer app in the pipe? You talked about bringing Fortnite onto a blockchain, all these things that have gone massively viral

and would really probably spark the next major wave of interest in the technology and in the space. Do you think there's anything coming down the pipeline or do you think we're going to just continue right now to sort of test the waters, dip our toes in in each of these arenas? Well, what I'm excited about is that Web3 continues to

capture people's imagination. You know, and we see this. We see this when we're presenting at like JavaScript conferences. Because, you know, we're leaning more into that side of things these days. We're leaning more into, you know, some of the aspects of our tech that are generally

applicable. And, you know, some of the aspects of our tech that are generally applicable. And, you know, and it's not like we don't say we're a crypto company. Of course, we're a crypto company, but we're talking about some other things. And, you know, people are still coming in there like, yeah, but I'm really interested in Web3. And I think one of the ways crypto is still early is that it still has an early adopter ethos, right? In the sense that, like, people who come to crypto systems put up with a to crypto systems, uh, put up with a lot, you know, they put up with a lot of, well, one, they take this and that's one thing they do. Two, they put up with systems that are strange. They talk about things that have strange terminology, terminology, and, you know, and, and, and by and large, crypto is something where people are

interacting with, with kind of a new technology vibe, which means that, you know, which is why people stay around when there's a hack for like $600 million or something like that. It's because they're like, well, we're in this crazy world and, you know, we're still trying to figure it out. I think one of the things that has to happen, though, is that there has to be a return to a focus on safety, security, assurance. You have to come back to this idea that it's not enough to just go fast, even though that's critical. You have to go fast and you have to deliver something that conventional technology can't deliver. And that is this level of trust that's just way above anything happening in centralized tech. And I think, and that's why I worry about some of the pro-dank charting stuff and the dank charting stuff is that, you know, and again, they're thinking hard about these things.

I'm not, I'm not, I, it's one of the reasons we're pushing PACT so hard is that we feel like PACT is a very safe smart contract technology. And, you know, while there's going to be a lot of things you can do that aren't clearing to our proof of work, scalable layer one, that's always going to be an important part of the story. And you're always going to deliver is it actually has to be safer. And I think that's one thing you can't say about crypto in the past two years is that the user experience is the opposite right now, right? The user experience is one of extreme danger. Extreme danger, extreme friction, right? Extreme risk. I mean, the very fact that we have to have a conversation about things like proto-dink sharding, for me, means that we are very far from ready for mainstream adoption. I'm not saying that as a negative thing, but we know the vernacular within our echo bubble and within the industry, and we understand all of these things. But I think you make the argument that we don't even want people knowing what an NFT is by the time this goes mainstream. They're just an asset that they're trading or utilizing for something. We don't want them to be talking about DeFi or NFTs or proto-dank sharding or merges. We just want them to be using it the same way that they do the underlying technology of the internet or their phone. Right. Right. And that's also why, you know,

I mean, it's interesting that I, I think some of the things that, you know, I think crypto has been moving mainstream forward. I think the whole passwordless thing that's happening now, I'm saying that's, I'm saying that's coming from crypto. Of course, you know, it's not like crypto is doing new cryptography. Crypto has been for a while now leveraging proven cryptography from the past decades. But we have kind of shown how it's done there. And, you know, and like,

that's something where, you know, we're, we know what's going on. We were experts in that field. But the good news is, is that as those technologies come to the fore, and, you know, and you see them integrated

with a technology like PACT, you're going to be able to deliver this experience that has all the security of crypto, but works perfectly in Chrome. It works perfectly in Safari. It works perfectly in Firefox. And what's more, you've seen it before. It's not going to be one of these things like a ledger

where it's like, oh, what's going on here? And there's all these weird numbers. It's just going to be your phone. And then Kadena is one of the things that makes Kadena unique is that Kadena from the beginning is always really focused on making multi-sig supported by the platform as opposed to supported by the app. So the idea being that anything you do on Kadena is automatically multi-isig. So that means anything you sign up for an F on Kadena on your phone, well, you know, you can add your watch to that and you can add your computer to that.

And you can get to the point, because remember, that's another thing, you know, I think it was interesting. I found it interesting that, you know, CZ is always, he's interesting, right? He's got something new to say. And one of the things was when he was actually starting to get critical of people holding their own crypto. I was like, okay, you know, that's not an argument I was expecting to hear in the blockchain. As people be, you know, the mantra is not your keys, not your crypto. And here's CZ being like, that's too hard for people.

That's unsafe. And he had said the opposite just weeks before, interestingly. You know, he had said that, you know, and I think there was a reason to do so. But when we saw the BlockFi's, Voyager's, Celsius, FTX all go down, he said, yeah, listen, get your money that you're not trading off of exchanges. But he does have a point on both sides, I will say. You don't want your money on exchanges, but that doesn't mean that everybody's ready to be their own bank.

True, right? And there really is no happy medium. So, right. I'm not saying that not your key is not your point. Well, there is a happy medium. I believe that. Yeah. The happy medium is, again, this is where we have to like,

we have to like do something pretty amazing, which is that we have to, and this is something Cadena is laser focused on, is that we have to make the multi-sig experience available to the average user. Available and easy. And easy, right? And grandma can use it. Right. Right, exactly. And, you know, I mean, she's going to have to have some devices, but, you know, everyone seems to have devices these days.

So I don't think that's too much. Grandma can use a phone now. I'm pretty convinced. Yes, I'm pretty convinced. Grandma definitely has Facebook. So yeah, it's that kind of thing. This is something where, again,

look, conventional technology, when it comes to multi-factor, is still iffy. It's still like most of them is SMS, right? Those of us in crypto nightmare you could argue that having sms authentication is worse than having none at all right exactly once they get in there it's over oh it's horrible you know so it's right so this is something where again crypto

you know insofar you know multi-sig is as old as bitcoin right i mean bitcoin has been able to do multi-six since the beginning um cadena was able to do multisig since the beginning. Cadena was able to do multisig right when it launched. And everything you do with Pact is multisig enabled. So this is one of those things where it's like, crypto is the ability to turn it around, where it's like, today, crypto, harder, more risky. Tomorrow, crypto, easier, safer by default. Like in the sense that if you're always like, you know, making it that like you've got, you know, you've got recovery codes and, you know, three devices.

I mean, that's a very safe situation. And that's something that like it's hard to get with your bank account today. It's hard, you know, these days. Yeah, it's incredibly frustrating trying to get with your bank account today it's hard you know these days it's yeah it's it's incredibly frustrating trying to get this i do think by the way europe is more ahead on these things than the rest of the world and the united states in general the united states is wow just the banking here just moves at a snail's pace it's so frustrating um so crypto i think is where we're gonna you know it's up to us we going to push it forward and we're going to push it forward by, and when we do that, that's when we start to make this promise. And we make that scalable.

That's when this promise starts to become real. Because I still think, I actually still think crypto is a very low level technology. You know, it's something that, it's like you said, nobody should know these terms. Nobody should know what proof of stake these terms nobody should know what proof of stake is nobody should know what dank charting is they should just no one should know what fungibility is i mean like that's a weird word it's just like you know you pay for things and you own things right and there's these kinds of things and it's the things it's not what technology empowers them when you get ease abuse scalability and you know and also i think when you get ease of use, scalability,

and also I think when... So I think there are still some very kind of low-level technology maturation going on. And that's one of the things that makes it exciting to work at a place like Kadena is being able to be part of that conversation. Yeah, I mean, imagine calling your baseball card non-fungible cardboard or

something. It's just so nonsensical to think. And then everything that is possibly traded becomes a non-fungible something. I just think we have a huge vernacular problem and need to start speaking in terms that the mainstream can understand. How much then knowing that we need the mainstream and we need retail, which means they need to have a positive outlook on this market, a positive opinion of it, they need to view it as safe and secure. How much damage do you think we've done our industry's self-inflicted wounds over the last year? Oh, God. I'm so glad 2022 is over. And I'm just really, really hoping that 2023, you know, that every, I mean, you know, we've got, you know, okay, now we got like, you know, Gemini and Genesis going down now. But I'm, you know,

I think it was, it was really bad. And I think one of the reasons why it was so bad is because so much focus had kind of moved to all that stuff. So much focus had moved to Luna. So much focus had moved out to the Axiom. They were, you know, they were just making so much noise and taking up so much of the, you know, of the oxygen. Idioms, Tom Brady, Kevin O'Leary. Yeah, that last Super Bowl.

Major League umpires. Yeah, those goofy ads. Yeah, I mean, it's just, you know, it was, it was something that I think, I think the damage is real. I think also the, uh, I worry about, I'm not somebody who hates the SEC. Um, I actually think coming from equities and coming from working in algorithmic trading where there was big, you know, by the way,

big things went wrong in algorithmic trading where there was big, you know, by the way, big things went wrong in algorithmic trading, right? I mean, huge things went wrong. And, yeah, and I worked around these traders. You know, in the end, crypto isn't so different from the rest of fintech. And, you know, and these traders, they grumble every time, like the SEC or, you know, or FINRA or some of these other regulatory bodies step in. And it's like, guys, these are the people who are letting you continue to have a job.

And I think crypto is starting to see that now. My hope is that they focus on the fraud, you know, and they focus on there's so much stuff to go after. It's crystal clear. And meanwhile, you know, I want to see the more innovative thinking continue about how we can have better regulatory regimes for these things, you know,

because you need a new one. You can't just apply stocks to crypto. You just can't. How we test doesn't apply to a technology created in the 21st century from the 1930s. I think everyone agrees with that. And I think also it's fair to say you can support the idea of regulation

and you can even not dislike the SEC, but you can dislike this SEC, right? Well, but there's a lot of, but, you know, it's a political organization, right? I mean, you know, there's a, you know, you saw all the Congress people, like, you know, every time something like this goes wrong, you know, you have people who yesterday were like, why is the SEC slowing innovation? And this day they're like, why didn't they see all this coming?

And like, why weren't these people already in jail? So, you know, they, I think it's going to be the, I do think that just like in stocks where the SEC has actually made it safe to trade, right? I mean, they make it, the SEC ultimately protects the market by making it not look like a bunch of wolves, right? You know, it makes it look like someplace that's safe for retail to go. So we need something and yeah, I don't know if this SEC is the one, but you know, I don't, but the SEC is also something that, yeah, it's an organization that has to survive in the political winds. So, you know, they need to look like they're doing something and, and there's certainly a lot to do. I mean, it's just, there's, there's so much, but you know, and then there's some stuff that's more of a head scratcher, but you know, we'll, we'll, we'll see how fast they move and we'll see how fast they move. And we'll see also if our legislators and people like that can bring out,

can start arguing for, you know, can realize the value. Because I actually think other governments are actually, you know, they're very, you know, you see like statements coming out of Canada or coming out of European governments. You see a lot of embrace still. You know, in the UK, you see a lot of embrace of blockchain technologies. You see a lot of forward thinking. People are still excited about the technology. And, you know, in the United States right now, I think there's, you know, because of last year, we're in a, we're in a tough spot. So,

so we're just going to stay heads down. We're going to keep working on this technology. It's why we like being decentralized. We know that that's something. Another thing with decentralization is it's just a little bit safer. I mean, in the sense that, you know, something like, something like FTX can't happen in a decentralized context. Other things can happen, but not that. I would like to think that we've delayed the inevitable

rather than canceled it. Yeah, no, and that's our view. Our view is that, you know, I just, I'm trying to resist the kind of, also the cliche of like, oh, you know, it's good. You know, bear market is good because now we'll really focus on, you know. No, I think it wasn't good.

I would rather these things hadn't happened. I would rather, or they didn't happen with such force. You know, I think those people really heard crypto, but having said that, absolutely, it has actually refocused the conversation, you know, and, and it has kind of, you know, it's returned to some of these things because, because look, one of the reasons why a lot of these things got to, got to where they were. And one of the reasons why decentralization is suffering so much is because, you know, because of these scalability issues or because of these UX issues, like most people hold

their crypto on an exchange and exchanges, centralized exchanges deliver this massive amount of value in both directions. They deliver value to the people who want to hold crypto and are afraid of this freaking technology. And then they deliver a lot of value to the projects that haven't solved these problems yet you know they're actually a very you know crypto as we know it is powered by centralized exchanges it's just the fact absolutely absolutely fact yeah so i mean you know we it if you, it's almost like if you want to know if crypto has made it yet, well, is the whole story centralized exchanges still? No, it hasn't made it yet. Like, as soon as we get to the point where it's not just where it's not just like the decentralized exchanges are like everything and then the decentralized stuff is over here. Once this gets bigger, that's when we know we're starting to actually like move things forward. So agreeing that we have delayed the inevitable

and that 2022 is massively damaging to the space, what gets us over the next hump? Is it price? Because it's always price, right? In this market, it's always been prices go up, everybody cares, prices go down, it's going to zero and it's always price, right? In this market, it's always been prices go up, everybody cares. Prices go down, it's going to zero and it's dead. Or is it going to be the Fortnite or the killer app or some game or some use case that we haven't seen?

I mean, what do you think could be the catalyst for us to sort of erase 2022? Well, I mean, 2022, of course, happened in this macro context, right? I mean, you can't. I meant more this. Yes, it's disingenuous to say that crypto is in a winter when everything's in a winter. I just mean more the self-inflicted wounds to retail and to the the person who says that, like, I'm glad we're in bear market because I do think it changes the focus to, you know, to showing how crypto can really deliver something different. And I think that's where you start looking at Web3 and you start looking at the way, just giving people more ways to work. The way I see crypto is you're giving people more ways to work with value. You know, like right now on the web, so much stuff is just advertising. You know, you think you're

doing something, but you're actually just selling, you know, your information is just being bought and sold. And, you know, to get something that, you know, you can get in another way, but it's just so easy. And, you know, but what's really driving it is advertising right so so we don't have to be so hard on ourselves about the fact that like speculation drove a lot of crypto because you know advertising is driving a lot of web tech so it's it's never like that the most straightforward story so that is one way that i am excited about where we're headed with the bear market is that you know the kind of like the easy money thing yeah fact that there's all this trap capital and people are like what do i do with it oh hell i'll throw it in

crypto you know let's face it i think that's part of what created the 2022 situation is just this kind of like you know wild environment where people are just throwing money at anything you know someone likes a sam megman freed you know a smart person looks at that and says oh i know i know what to do with that so now we get back to these more interesting questions we get back to the killer app so we get back to you know delivering something differential i'm personally of opinion that it's it i don't see it as a killer app i see it as an app that ends up being a killer app because it actually delivers these things that that we're talking about that excite us, right? But then I think it opens the floodgates,

you know, because this is a general enabling technology that gives people, that puts the power of value in the individual's hands and takes it away from the Amazons and takes it away from the Googles and takes it away from, Amazons and takes it away from the Googles and takes it away from the big companies and really gives a way for decentralization to keep going. I mean, something like in something we see with like people moving to Mastodon and how hard that is, you know, that like how hard it is for Twitter, you know, so it could be something

like a messaging, you know, it could be something not messaging, but like something like, you know, being able to figure out how we can, because I think one of the things about Mastodon is hard is that it's, uh, is all the federation and the fact that, you know, you don't really know what you're getting into when you join a particular Mastodon thing. So it's like, crypto is interesting because it's got a global outlook. You know, it's like the crypto you use in the United States, same crypto you use in, you know it's like the crypto you use in the united states same crypto you use and you know anywhere else right so i think this is something that like taking that incredible power and you know and really giving it to the masses where the masses you know where where you can say something like not your keys not your crypto not your you know not your nft not your, you know, not your NFT, not your, you know, all these other things that could

deliver value. And that actually being something that makes people feel safer and gives them more, even if it's like their personal data, even if it's, you know, like something like Brave was trying to do, you know, where it's like, even if it's about, okay, advertising is important for the web. So let's actually, instead of just saying that users have writing laws like GDPR, no, we're actually going to deliver that technology. We're going to deliver the technology where it's all on your device and you hand it out as you see fit. And the way you know it works is because it's backed by blockchain.

Makes perfect sense. I love hearing someone who's developing something new, but referencing all of the old and original ethos that we love. And I think that's quite unique in this space. Thank you for that. Where can people follow you after this? And check out, of course, Kadena. Yeah, so Kadena.

Yeah, we're kadena.io. I'm kadena underscore IO on Twitter. And I'm sirlens a lot. I'm there a lot. We have Discord, Telegram, all that stuff. And, you know, and the other thing is that if you're, especially if you're like a builder or a JavaScript technologist or something like that, we're coming to a conference near you soon.

You're going to see a lot more Cadena this year. Awesome. Can't wait. Looking forward to it. We'll have to circle back at the end of 2023 and see Awesome. Can't wait. I'm looking forward to it. We'll have to circle back at the end of 2023 and see if it was, in fact, a better year.

Absolutely. I'm pretty bullish as far as... I have high hopes. It'll take a lot to be worse. I'll tell you that. It's not a very high bar, I guess. It's not. Exactly.

Well, thank you very much, Stuart. It's been a pleasure. Yeah, it's been great.