DeFi By Design EP#39: The Power of DeFi in Unbanked Countries w/ Akin Sawyer

Transcript

[Music] d5 slate team [Music] what's up y'all real quick if you like the d5 state content on twitter and youtube and sub stack please please give us a like and a subscribe on this video on youtube and join our channel join the community we'd really appreciate it we're pumping this stuff out for you all as much as we can and we really enjoy the support and the community that we've built thank you very much and enjoy what's going on guys welcome to episode 39 of the d5 by design podcast uh it's been a while since uh we've recorded what feels like a while but it's what it's maybe just been a week or two and

we've been working hard on a bunch of new stuff on on defy slate and excited just keep building and keep pushing through um these interesting times bull market times pullback times um a lot of rug pulls happening right now uh unfortunately real real recently we've had some interesting ones with the e 2.0 contracts um but yeah i mean we're pushing through and getting after baby so he here here we are today with akin sawyer akin has been all over the d5 and crypto space uh you know affiliated with some projects his own ventures all sorts of cool stuff excited to break that down see what's going on from his lens um and yeah i'm also of course here today with robbie the ghost uh good morning hi good morning andy yes uh plenty of

uh tumultuous times here in the crypto markets um and all around the the building ecosystem as well uh that's really been the motto as of recently is is to survive what could be um a downside and a bear market you know you just want to keep swimming stay alive and really the best way to do that is to get away from the charts and just focus on building and contributing to one or more of these projects and protocols you know don't get distracted by the price and and really just have a long-term focus here one of those guys that is doing a significant amount of building is akin who we have on today so yeah i'm super keen to hear what akin is up to uh he gave us just a just a taste

uh when we talked a little while back and and touched on a bunch of different projects that all sounded uh very important and very uh high impact to the crypto ecosystem so i will pass it over to akin for uh an intro of himself and yeah excited to learn more thanks thanks for having me guys yeah so keen sawyer um been in the crypto space for i'd say over the last you know six years intently um well prior to crypto i spent most of my career in management consulting and structured finance so i have somewhat of a traditional background um you know while i was still in consulting i got involved with um you know fintech across west africa

and so hold on a second akin goes to take over another layer 2 protocol yeah sorry about that um yeah so like i was saying you know spend most of my background in traditional space and i think about 10 years ago i got into fintech primarily in west africa i invested in a mobile payments company and that was sort of my foray into entrepreneurship

i um i sort of had more of a board level position but i got to see the you know adoption and proliferation of mobile money across africa um from the vantage point of sort of being an active board member and that sort of led me into investing in other projects advising other fintech projects so that's kind of first how i got into fintech and gone to entrepreneurship and then along the way you know we we're looking into remittance markets because the fintech firm we built out that was out in sierra leone and we were getting a lot of inquiries from the diaspora they're looking for distribution on the ground

so they could get money into the country but it was challenging moving money within the country particularly to smaller towns and villages and we effectively had built a distribution system for money through an agent-led mobile money platform which basically means you have individuals that essentially act like branches where they help you on board and off board right so you can receive money from them you can make deposits so the intimidated system and we started looking into remittances based on all the requests we were getting and realize just how broken the system was um you know a few strong uh middlemen basically ran the system along with the banks

and the same time you know i was looking into crypto and dabbling into crypto and you know kind of going down the rabbit hole and realized you know i thought decentralized finance was going to be the future and would be the place where a lot of solutions will come about that would essentially bank the unbanked right provide financial services and access to global finance to those who up until now right which is the majority of sub-saharan africa still don't have bank accounts so that was my that was my initial four into the space i think that's a um i think that's a a big a big thing that a lot of people miss out on during the speculative manias is like the core reasoning for why what we're doing

and i think one of the biggest ones is yeah is banking the unbanked you know living in a first world country you almost don't um even even understand that right like it's like it's not even a part of your everyday life on like not having access to a financial system um right and so when you're able to witness that it makes the uh it definitely makes the vision and the purpose a lot stronger um you know and and that kind of goes into building you know what what we're building here with education platform all these developers are building um you know and and yeah i mean so that that kind of led you into your uh stunt with barnbridge um so perhaps uh a bit of uh thoughts on the barbridge platform you

know what it is for those who don't know and then kind of what you did there to to help it grow um definitely curious about that yeah so i mean as a precursor to that just to give some context um so when i initially got into crypto it was around trying to solve this remittance problem i i got involved in a startup that didn't you know wasn't successful but i sort of kept at it and i got very curious about governance and how these networks as they grew um will be governed and that actually led me into decred um so i was at dks about a year and a half doing a lot of work around governance um you know uh you know marketing you know any sort of like anything i can get my hands into to sort

of help the network and i think that's really where i kind of got an appreciation for how you know on-chain and off-chain governance is going to be what's going to be it might be really really important and a big differentiator in the space so spend about a year and a half with decred and you know want to take a little bit of a step back um i think my timing was fairly decent um you know so about may of last year you know i kind of took a step back from d cred and you know sort of looked back into d5 right so there are lots of projects i've been following or gotten involved in you know during the ico boom they're now beginning to launch you know launch main nets have um you know beginning to find product market fit and so

sort of caught that defy summer wave you know it was a busy summer last year even in the midst of covet and so that that eventually led me into into barnbridge um and it was just happenstance you know i've been involved in synthetics community had seen a tweet that kane put out about barnbridge i think sometime in september of last year you know ignored it for a little bit of time but eventually sort of found my way into the discord and you know i was one i guess one of the early you know first few people in or early people in and there was a lot of conversations around governance and thinking about building a governance system a dow first approach which you know was you know definitely piqued my curiosity

right it was an opportunity to sort of start from the ground floor and help to design a you know governance system i i mean based on the experiences that i've had i've had a decred you know some positive some sort of like learnings um i thought it was an interesting opportunity to to sort of support them through thinking through governance initially um and then from the product side you know it was really it's really structured finance right it structured finance on chain which also just you know was you know spent i spent between fannie and freddie in secondary mortgage i spent about four or five years and so i appreciated you know things from a product development standpoint and structured finance and so you know bombers just sort of pulled a lot of

things together that you know where you know sort of leverage my background and leverage my interests and yeah i just started contributing in a discord um early on and thinking through some of these issues around governance and how to build a governance system and right you know it's a spectrum right because every decision you make comes with certain consequences on the other end so trying to find the sweet spot and iterate around ideas around governance was sort of what drew me in initially and you know after a few weeks you know as as yield farming started on barbridge and there was a massive uptake right so i'd say it was sort of like you know perfect timing because we had come off

the froth in the summer you know september was sort of like a dead month basically with a lot of drawdowns and i got to send to a lot of there's a lot of capital looking for the next thing or something that they felt was legitimate and i think barnbridge kind of fit the bill so you know over the first couple of weeks the tvl and the farming contracts grew to as much as 600 million dollars and which brought a lot of attention right and and then also kind of raised this right and so i think the team now thought about you know bringing on bringing in more resources to help accelerate even product development and kind of move the project forward so i was asked to join and

um joined the team of the core team in i'd say late october nice yeah and i guess this question is a little bit off of your uh your you know personal journey but in that in the course of trying to find a solution for those remittances um you know i hear a few people talk still about like ripple um and basically just pointing to transaction speed and low transaction fees as kind of the end-all be-all for remittances um what did you find on on kind of working your way through that issue of remittances you know did one coin kind of prove itself as the

best or are you really still on that journey of trying to find that solution yes i i think that so i think things have at least in my mind things have gone past remittances right so when when you look at remittances like particularly in emerging markets a lot of people are sending money home for like a handful of reasons one is to basically support their families right so just enough to kind of keep food on a table and support their families but a lot of people are also sending money home for lots of other reasons like they want to invest in something um they're all you know it crosses the gamut right and so when you think about what remittances was just literally a first step moving money from one spot to the other well once that capital arrived

like you need to do something with it right so i think people are with with the pluration of d5 right i think people have looked past remittances which was basically the first problem to solve and now realizing that they could subscribe to a whole new financial system that they never had access to before right and you were saying earlier and i don't think a lot of people appreciate how challenges how challenging it is for people in emerging markets to access financial services i mean first of all most people are dealing with currencies that are highly inflationary right so your wealth is basically deflating every year i mean nigeria has about 20 25 inflation every year

um you know some countries are even worse so solving so the remittance thing became okay not just moving money but also storing value in something that was a little more stable right so even though bitcoin was has historically been quite volatile you know i tell people if you look at a if you look at a long-term um chart you know it's going up and and so your option in many of these countries is well do you lose 25 of your value every year or do you take the risk and put money in bitcoin and then stablecoin showed up right so tether is is used you know um it's probably the stable component of choice in emerging markets

and then when stablecoin showed up now you have a game changer because you can store value in a digital form that's dollar denominated um and then not just store that value and move that value seamlessly without permission but that now gives you access to all sorts of financial services so i think now what people are now beginning to realize is i can i can store my wealth independent of the local currency that i've been stuck with all my life and the policies negative and you know all the poor policies or you know that have been pushed and now i can sort of you know um i i can live outside of of of the limitations of the borders i

live in because i can store my wealth in something else i can transact globally that's another issue right global banking has been highly restrictive for many people in emerging markets um just because of where they live right so you try to do transactions with certain ip addresses they get cancelled you don't have access like even just making basic payments right i have a subscription to spotify like just that is a challenge and so when you when you see people now leveraging crypto they realize that it's not just a better store value it gives them access to financial services and it's permissionless so i'm not restricted anymore um from transacting and that's where we're seeing a lot of

adoption right many many emerging market economies particularly in sub-saharan africa are you know highly import export dependent right so they export raw materials um you know oil gas copper whatever commodities and they import finished goods and in that kind of system you need foreign exchange and historically it's dollar right all commodities are basically priced or bought and sold in dollars globally and you know as some of these countries now started facing recessions where the supply of dollars were shrinking you sort of had you know massive economic um pullbacks right because i

as an import exporter could not find the dollars to settle these transactions right just scarce and so crypto was basically the only alternative right so you have all these kind of forces coming together that's kind of pushing people into crypto and once they get in and realize that wait this is a much more open financial system right and it has real utility for their daily needs then you know there's no going back right because you can you can rely on the math to be reliable right you can rely on following the same rules you can't rely on your central bankers you can't rely on right all the authority figures that basically have you know all your life basically screwed up

and and proven to be unreliable so i think that's the sort of the new narrative that people are now thinking through how do you leverage these decentralized networks um to actually build real financial services that is essentially fair right and and levels the playing field in terms of participation yeah and we've seen the ethos of of crypto just permeate through the entire system um permissionless open and really access for all which you know although kind of um is diluted in right these high froth moments uh gas gets very high and we can see that there there are still um participants that are priced out

that that ethos and that philosophy still you know pertains through and motivates developers towards a certain vision i'm i'm curious kind of you know from the from your experience in working with um under banked countries um some of the trends that you've seen in in the like what's in demand in those african countries you're working with and how you see that really transitioning into some of the future of crypto um and kind of fill in some some of the gaps in this question like you saw you know a need for remittances and some way to just move money digitally

and really that that problem was solved with bitcoin but now it's it's evolved past that remittance problem into more of a store value and and more of a d5 type of narrative where there's some more that you can do with this money you know what are some of the trends that you see uh in sub-saharan africa and these underbanked countries and where do you think it's leading in terms of you know what problems are still to be unsolved and are those solvable by ethereum or is this you know kind of taking us in a new direction uh that'll be completely foreign to us when it when it

manifests itself in terms of crypto technology yeah so i mean i think when you look at sub-saharan africa right it's it's probably the youngest population in the world right so you have the highest percentage of of people under you know 24. um and a lot of these young people have grown up in the same way that millennials everywhere else have right they've had access to the internet they know what's going on globally they have access to information they're they're seeing the same things everyone else is and they're also you know precursor to to to crypto was also was the democratization of information

right so there's so much content that you can leverage and you can learn from right whether it's on youtube or whatever it might be and all these young people are looking for you know a better future right and and don't want to be limited by access to just no jobs like i mean look in nigeria the largest country in largest population sub-saharan africa unemployment is you know depending on what number you look at is around 30 or 40 percent and then you have underemployment on top of that so you have all these young people with very little to do they're looking at what's going on in the world and they're realizing look i'm intelligent i don't have a lot of opportunity but you know i can self-teach myself to code

if i can get a laptop i can you know i can learn to provide you know whatever services it might be whether it's being a youtube influencer like so they're all these like creative type jobs that are now accessible and what crypto has now brought in is a layer that lets you be paid right so you can be a developer in some african country that's really good at what you do and you can essentially be a freelancer and work for projects globally and get paid right and the friction there used to be high right okay how do i pay some guy in the middle of nowhere in some country where i've never even heard of the currency before or the currency doesn't even have liquid markets it's not traded in global markets like

that's a huge problem and going through the formal banking system was you know just terrible and a nightmare even for established large global companies they have that problem until today and so when you bring in crypto and you remove that friction all of a sudden right all these young people are now enabled right they can trade they can buy things they can add value and get paid and you know i think you know out of necessity right when you have a lot of time on your hands like you try to find things to do like you want to productive you want to like find a means of income and so these people have spent a lot of time just sort of like where they have access trying to figure a hack away into a system that has been exclusionary up until now

and so i think what we're now beginning to see is people realizing that you put in a certain amount of effort whether it's in learning something and you can get paid for it and as long as the quality is of a standard that someone's willing to pay for it then you can get paid like the payment layer is no longer like the the friction point um it could be improved like we have we don't have a perfect system but for the for the young african and you know in some country like it's it's a world of difference and now there's like you know you know people are now encouraged to come into these systems to leverage the internet to you know be at the same table as everyone i mean i've been into into discords where i just see a whole bunch of nigerians like

in the space or other africans then they're you know in the same conversation as everyone else and trying to figure out how to make and earn a living out of this new system so you know i think that that first opportunity is now opening up all sorts of new use cases outside of trading where people can leverage their skills right um to add value and get paid i think from that now you're getting an acceleration of innovation right because now you have people who have the skills right who might have spent time learning how to code in solidity um you know seen a few products themselves and they're now trying to build solutions for

the locales they live in right so imagine you know you have a critical mass of people who now understand defi operate within it are beginning to learn to code remember those people have you know millions of people in their countries who are still right who still haven't been on board who still don't understand what's happening but also need to access his point of value so you know you're seeing a lot of intermediaries show up you know well i know how to do this for myself there's nothing stopping me from helping others right and so might start off with these intermediate systems where everyone now is an agent everyone now has you know people now know a guy who can help you pay for a global transaction even if you don't know how to do it and once he's done it

a couple of times you start trying to say well this is not rocket science maybe i can figure it out myself so you not have this sort of like you know process where people are now being onboarded because they realize oh the guy that makes my payment has some app on his phone he has this thing bitcoin right he's settling for me and charging a fee i need to figure out how he's doing it right so information starts proliferating and then more and more people start coming in and then you start having unique solutions that now start coming out these markets um to solve very unique problems they have and i think we're at that stage now where people are now beginning to think of how to solve these problems and investments are coming in right where where where the majority of investments in sub-saharan africa

and startups have been fintech which has been great because you have a lot of people who have now built financial tools right kind of based on the current financial system a lot of these teams are now slowly pivoting to crypto right because they figured out distribution right they know what the need is they they've built products and you know web 2 and the current financial systems that kind of work still have friction and when you introduce them to d5 they're like well this is what this is the stack that really makes sense right because it removes the friction that we've been kind of under and really gives now financial independence i think that's the phase we're going into now where a lot of these teams are now saying you know

there are risks to being you know um there are real risks to being hedged into the current financial system because it can be shut out and there have been incidences of that where you know people have been shut out of the system for whatever reasons and and so people are essentially being pushed to d5 because that's that might be the ultimate sovereignty um and you know that's i think as as professionals enter the space and start building things the capital will follow and i think we'll have an explosion of of um of new solutions that you know many of many of which you never thought possible and never thought of yeah and the global adoption is just is as you're saying is it it kind of goes in a snowball at a rapid

pace right you know as you say you've got one person who's kind of interconnected they get their local community going and all of a sudden everyone's you know on it and i think the real risk for kind of the other side in terms of like the institutions or the money managers or the large corporations is yeah the risk of missing out and the risk of yeah you say being almost like shut out by their current system whether it's you know in in europe with the ecb and their money printing in the states with the fed and the printing and the and the policy controls and this and that you know it's either you succumb to what is in your nation state or you you have this chance to kind of opt out and and i think based off you know your global experience

and knowledge you know you'd have a pretty good take on kind of what the what the global macro environment looks like you know from your from your perspective you know being in the in the financial markets and in this infrastructure for years now you know obviously we've seen changes we've seen policy shifts you know so i'm i'm curious to understand from a global uh perspective of what's happening in the financial world and then kind of what you think based off that perspective uh you know what the impact of that on on crypto is so you know i guess let's start with how you think you've seen the the world change o over the last five ten years you know and what you kind of see

in the future for the global world uh and the economy and then kind of how that affects your crypto global thesis you know of adoption uh speculation um you know all all the things yeah so i mean i mean i think that of course the global micro financial system is the context right everything sort of springs from that and you know what we've seen you know i think it really started for me during the last financial crisis right so back then i was working for fannie mae and so we're really at the center of the of the mortgage meltdown from one perspective in that you know fannie is the largest basically the largest issue of of mortgage debt

right so the majority of mortgages in the u.s are called conforming loans and fannie and freddie buy basically the bulk of those and package them and sell them off to investors and during the financial crisis right what basically happened was a financial system that sort of went out of hand in terms of regulator market participants right and regulators failing basically and the system almost blew up and the basic learning from that at least from the u.s perspective was that when push comes to shove the government will bail out the establishment to the detriment of the average person right so in the u.s a lot of people were getting or defaulting on their mortgages right people are losing jobs and most of those folks none of those folks got bailed out

but the bankers almost blew the system up all got bailed out essentially one for one right and you know a couple years later they're paying themselves mega bonuses all over again so that whole incident basically was all right this is how the game is being played right it's not really a fair system as you might have thought now off of that you know financial crisis what the what the fed was doing was basically buying up all these assets and like pushing capital into the system right trying to basically re you know you know save the economy by just pushing money into the system through the banking system trying to provide a lot of liquidity and once that worked to a certain extent right and you know it did bail out the

system but what basically happens is when you try something out of works and you sort of hold the keys then you sort of lose discipline and you keep using it so what we've had over the years is every problem of the economy is money printing we'll just print money we'll buy assets because you know it staves off the real problem we don't have to deal with and we can defer that into the future and then when covet hits that's like the mega like event where you know over the last year i could say worse than ever you know yeah right and and to some extent it's like well what are you going to do right this is basically an economic lockdown globally and of course money printing goes out of hand

you know 40 of all dollars ever existed get get get printed and to some extent it helps right it sort of staves off the worst but what people don't really need to understand is when the dollar gets debased to that level um there's a term that people use saying like the us exports inflation it actually affects emerging markets a lot worse because remember a lot of these commodities are dollar-denominated and based in dollars they're going through an economic slowdown and there's more money right chasing less demand so in an economic slowdown the demand for oil should fall right it's like people are shutting down plants right but there's more dollars chasing the same resource which means if

i'm an oil exporter in that kind of environment not only is the value of oil going to drop based on demand falling but the value of all will drop too because there's just so many more dollars in the system right and it's like if you take two resources you know cash and a commodity if the amount of cash just increases then the the economy the commodity is going to fall in value right because it's just simple math and and so many of these emerging economies suffer a lot more because one they're commodity based which means they're going to take a big hit when it's economic slowdown and they're going to take a second hit when the u.s starts printing more and more dollars and it's going to show up in inflation in these countries it's going to show up

in larger devaluations so you know emerging markets tend to suffer more right and these are the same people who don't have great access to financial services don't have like all the problems still persist and now are worsened by it so that's the global backdrop and in my view with that backdrop continuing right it's only going to push more demand into crypto right so the demand side of i need a currency that's stable that increases because my inflation in my country is getting worse the side of i need to trade globally and you know i can't even find dollars right because my country country's selling less oil less copper or less of whatever right all the dollars in the system are going

to the privileged right the average person that doesn't have access to sit at the table isn't getting dollars that guy is being driven to crypto because that's his only hope right so you see now like this demand side in these countries now moving to the only resource or the only way they can actually engage in global finance and as long as this system persists where you have high inflation where you have these um you know disruptions in financial systems elsewhere more and more people are going to move into this crypto space in crypto world because right it gives them access it gives them a better store a more reliable financial system where they can understand the rules and the rules can be you know monitored and you know they don't

necessarily shift right and so to me when you see that backdrop like that basically is in my view it sells the seeds for the destruction of the current financial system because it forces people to look for something new and when they find it and realize it's superior they stay and once they stay in that system i mean i was talking to someone last week i gave an example right d5 still is around maybe i don't know 60 billion dollars in tvl maybe around that range i've had a big pullback 50 or 60. right i mean 50 or 60 billion dollars in the u.s context doesn't look like a lot but to an economy that has a gdp of 10 billion 15 billion that's a big market right you know and from a relative standpoint

those economies can engage in that financial system and get real value-add yeah right it's it's it's it's it's remarkable in that sense um and then you think about the overall tvl of of crypto as a whole right we're in the trillions so that's a material size financial system that you know people can now access trade with trade it and out settle transactions right so for me it's like the more we have this macro backdrop of money printing the more it's going to force um you go primarily in emerging markets to enter crypto and i just feel like it becomes a chain reaction that doesn't stop can a quick question on the mechanics that you mentioned

um when you know there is periods of hyperinflation even if it isn't you know uh even if it doesn't reduce the currency into like that inflationary spiral like you mentioned during corona you know massive spike in money printing um when you know that we talked about how demand is dropped right in periods like corona um and then that is going to drop asset prices um and then further when a currency is inflated that's going to drop asset prices as well um i'm curious kind of how to to that to the individual not the

corporation um you know what why why is that such a bad thing excuse me why is that such a bad thing um you know asset price is dropping you know clearly if inflation is um going higher um you know that that's going to mean that the the asset prices are actually increasing so i guess the question here is you know inflation is causing these asset prices to go higher um less demand is causing these asset prices to go lower does this ultimately balance the system or is it right that's kind of where i was going you know who is harmed in that in that sense yeah so that's a

great question right so like let's let's look at it from a u.s perspective which is relatively easy to look at right so most of the most of the capital that was printed um during the corona pretty much last over the last year um most of inflation was seen has been in asset prices because most of the capital is distributed from the top down so the banking system is the process through which money is distributed into this u.s economy right now the problem is if i'm giving banks all this capital in a normal system what you want the banks to do is lend right so you borrow money to all sorts of companies right they create value and then it's almost like an investment if that value now creates jobs that jobs inflates the economy

right people start earning more money they start buying things right so you you get a return on that investment by economic growth the problem with printing money during the current virus period is you know you had that money wasn't going into lending because you had demand you had a drop in demand like i'm not going to lend money to the movie theater business no one's going to see the movies anymore right i'm not going to lend to you know a lot of leisure a lot of travel like that whole system shut down so you didn't have those guys creating jobs jobs are actually still dropping even as money was being printed people were losing jobs because of the demand problem right now in that environment where was the money going into it was going into capital assets right

it was going into stocks so stock market was fantastic last year if you own stocks if you own tesla like you did well but who owns stocks in america the majority of stocks are owned by the very top right and maybe the upper middle class and some middle class folks have 400 k's but the average guy who's living hand to mouth first of all he doesn't own stocks he doesn't probably even own his house so he's not getting any of that inflation value right he's not getting any capital appreciation because he's not participating in that market it's inflating and by the way that same person didn't even have a job like they probably lost their job and they're living off of unemployment that the government is funding right so the federal government now added some more money to

unemployment so a lot of people you know they basically said you can't you know they they curbed um um you know a lot of people who were behind on the rent the governor's basically paying your rent um folks who are like behind on their mortgages you know so basically you have this system where the government is basically paying to keep right the little guy barely afloat but like most of that capital is going to those who already have money which is why we saw our fault like you know look at look at every billionaire in america over the last year right they own assets like they've they've i mean elon musk went what did like a 5 10 x i didn't remember the number in his wealth in one year because and so in that kind of system you have a big problem

because you basically get an economic recovery without job creation yeah and in that system is basically you're paying for inflation and not really getting the return and the people that hand the most are the ones who are basically getting the checks but don't own the assets effectively yeah so you just get increasing equality right the people that make the most of people who own capital assets companies right that were getting bailed out look at even the bailout that was supposed to help out the initial bill i was supposed to help out this little guy the banks gave all the money to their friends right you know yeah large endowment i mean colleges that had multi-billion dollar endowments were getting like dollars from the ppp when the guy on the street who runs a restaurant was basically being like

shut out and he didn't get a dime of that so you have a system now that is basically broken right and and so that that's an example of the dislocations we're seeing happening where inflation is is bad because it's making the rich richer and it's not really solving the problem around jobs which you really can't solve in the pandemic right you can't you can't force jobs to be created where there's no demand right so now as a result of this akin we're seeing a lot of the political parties um well the political party which has been elected uh in the states the baden administration cracking down on taxes basically we're saying okay um you know if this inequality is being created effectively by the fed

what we'll do is we'll start to increase taxes on the wealthy you know we'll start to have a wealth tax a higher capital gains right and so this kind of forces uh these asset holders to think about i mean just very explicitly tax evasion which is just not something that any anybody should really be thinking about because the whole point of taxes is to further uh you know the country that you live in to help the country that you live in to succeed and to be you know thriving at a high standard of living but now it kind of forces these people you know into into this mindset of like okay well how can we hide our money how can we do this and you know that that even further create you know exacerbates the issue um you know and so i think some of these

people have thought about dfi as kind of a way to you know come in and and basically use bitcoin and and other cryptos as a way to hide their money um you know and so with that said we've we've been seeing some regulations kind of come down into um into d5 recently you know we've seen some sec people um some some chairmans and heads you know have interest in understanding what's going on with you know with the d5 ecosystem um now i'm not saying people are only using d5 to high taxes but i am saying that there is a lack of kyc and basically regulation in d5 um so i am curious on what your thoughts are on upcoming kyc and aml regulations that could be coming to d5

and you know how you think the d5 ecosystem you know will react to it or you know what are some possibilities in your mind yeah so i mean so i the first thing i'll say is that you know the little guy is always scapegoated in a system where things are going awry right prior to even crypto right what have companies or global multinationals tended to do they've tended to try to reduce and minimize your tax obligations right so effectively apple all the big corporations see in the world pay very little to no taxes why because they're global companies and they figured out

right with all the legal resources they have how to basically shelter their returns based on all sorts of corporate structures right domiciling in certain countries are tax-free right if you really want to solve the problem then you solve the loopholes in the tax system first you go after the big corporations and the one percent that basically regardless of the system have always found a way around um you know not paying their fair share you know the average person who has a job who's making 60 000 a year you're probably paying you know good between 20 25 of your of of your income and taxes the average corporation is paying nothing near that it's probably closer to like single digits or

you know the smartest companies are playing close to zero yeah and you also consider like some of these companies also get benefits for you know putting their headquarters in certain cities and get all sorts of tax write-offs for that so that to me is if you want to solve that problem go to where there's the biggest sum of aggregate capital and make them pay their fair share that's the first thing now the thing the thing with regulation and crypto and d5 is you know i feel like yes is there a need for some kinds of regulation on the margin to make sure they're you know you know there's a lot of the first activity yes and all those regulations already in place right when people come in and out of the current financial system there are lots of lower

laws on curbs right so when you're on and off ramping i think that's basically where a lot of the regulations are sort of optimized for right but the big narrative of crypto is not that criminals are using it or people are using it nefariously right a lot of information is on chain right in fact right there have been recent cases where criminals were caught because they used crypto right the regulators have had much greater success in catching crimes leveraging crypto's payment systems than they have using the current banking system and by the way the current banking system supports the most criminal activity we'll ever see in the world like most of the fraud you see in the financial systems

is supported by the banking system primarily the u.s banking system because most crimes in the world are supported by the dollar and so if you really want to like say we're trying to like you know raise a flag against crime then go to the banks and you know tighten the screws in them because every year year in year out banks are paying billions of dollars in fines for you know supporting and moving illegal activity i don't see the regulators whose primary job it is to sort of regulate that system you know you know raising a big stink about that but yeah they're coming to crypto and saying that the margin right maybe point something percent of activity in crypto is used for the first activity so we got to shut the system down we got to regulate it

so it's a little bit of to me like finger pointing like it's become this politicized thing where it's easy to kind of point the finger and target crypto um but i'm sure some regulation will come i do think that from a us perspective it has to be pragmatic and the reason for that is you're operating a global system where any domicile that tries to tighten the range too much will lose in the long term because talent will leave right they'll leave to other places that are much more you know fair and open capital moves around the world very easily and the capital will follow them and you know countries that try to take too much of a

hard line will end up losing in the long term and i do think that you know crypto and centralized networks are the future right it's a new technological platform that has so much value that i mean i would think from a u.s perspective that we're pragmatic enough to say sure let's try to find sensible rules and regulations that make sure it's fair that you know remove some of the fraud we see in the system that's just like outright fraud fraud is fraud like yes go after all those things but don't kill don't throw the baby out of the bath water and and let's make sure that we're also trying to encourage um talent to stay here and develop new solutions and you know not not try to protect the incumbents right the one thing the us has been good

at historically is renewing itself and riding the wave of new technology and so that's not you know let's not try to like save the incumbents that are sure to like you know die you know eventually so those look like the uh you know the ones who are threatened by the current power of crypto um and forcing any regulation that kind of stifles crypto um could be a result of that traditional financial system that's in power now kind of being threatened by this new system which um is is more helpful to the average person rather than a top-heavy system that uh you know supports kind of these elites

so we we've you know identified that the system is broken you know what is the solution here how does crypto help bring us out of this hole and how can we make sure that in crypto we're not repeating the same mistakes that drove the the traditional system into the ground yeah i mean so i think that so i think that well i think the way you you try to harness this thing is you kind of start from first principles right so if i'm a regulator or a regulatory system you're trying to you know the the biggest thing right there is they're trying to do is protect consumers right um that's like the and so you know think about smart ways to ensure that consumers are protected and

part of the way you do that frankly is making it easier for the intermediaries they trust to access these assets right so if you look at what's been challenging in the u.s from a crypto perspective is regulated entities have don't have clear rules right how do i interact with the system and we're seeing some rules have we saw some rules come out from the occ last year which allowed banks to participate more fully provided some clarity like you need more of that and the reason for that is that the average person doesn't necessarily hate their intermediary right the average guy who has 20 million dollars who has a financial advisor he probably like loves his financial advisor he's made a lot of money for him

over the years right but the problem is well my financial advisor can give me access to crypto and i want some crypto in my portfolio so how do you solve the problem don't let that guy now go into this wilderness by himself and basically gets scammed potentially ensure that the financial advisor who you already regulate has a transparent way to get into the system to learn and feel like this is not you know a problem and let them now provide these services to their clients right i mean there's already already that regular system that exists those relationships exist and i think that's where a lot of the focus should be what are sensible rules that make it now easier for these intermediaries who

already regulated to get access to the system to build into it to fund the growth of the system and then for all their clients to kind of come along with them in a much more structured way i think things like that are what really make sense and and that's why i think you're going to see like you know the real growth and unwrapping of the majority yeah i think that's a big sector of people that is is in need of of exposure to crypto i mean maybe not necessarily the ultra high net worths but simply the mom and pop who have 401k who have been working hard for the last you know 20 30 years in their say 40s to 60s and basically are looking for something that they can

uh have a little bit more risk or a little bit of exposure to um i i think that a lot of the crypto market is currently dominated by younger people and then basically like institutional level like funds or um global funds and so yeah i think that's a big population as well um you know and i think that gives uh gives us some validation for what we're trying to do as well on defy slate um you know we're trying to basically onboard uh these types of people and to help you know advisors and such be able to access um you know these types of investment opportunities and and all that so again it's been absolutely great we we had a hard stop here about four minutes but if not this is probably the most important question for anybody who's still listening is

you know where or what is the highest roi activity to uh start in crypto for new people you know should they learn to code should they start uh helping a project should they launch their own should they be traders investors you know kind of what is the multifaceted approach for somebody who's new you know who wants to invest you know who wants to you know get active you know what what would you suggest somebody who's kind of new to the system you know do to get involved yeah i mean so i think for anyone who really wants to understand what's going on like it's the biggest roi is learning right so the biggest roi is with the time you have trying to understand your perspective and i don't think

everyone needs to what do you bring to the table and everyone has one thing in common right you have the ability to kind of spend time on most of us i mean when i got into crypto i came with a background where i had a traditional background i have a degree in economics where i knew certain things about current system but the lots of things i had to learn and lots of things i almost had to rethink from square one like when you have a decentralized system and all these networks like governance is gonna look very very different like and so a lot of it is just spending time to try to understand what's changing and beginning to sort of form a view of what the future could look like so it's basically you're trying to learn as much as you can to kind of form a thesis and a view

on what you think if this is successful what does the work look like what does the world look like in the future and as more the more information you take in right and the more time goes on the more you kind of refine that thesis right what was i right about what was i wrong about i think for the average person who has time right if time is available like spending time and building your own network of sources where you can learn like listening to podcasts you know following key people on twitter beginning to look at projects you think are interesting go into the discords go into the telegrams ask questions interact right there's no to me that's the biggest roi and the reason why is that the people who have the most

information and sort of build a level of understanding it gives you a way to assess things going forward right so if you want to be an investor in the space for example like you need to understand these protocols right potentially you need to sort of spend you know roll your sleeves up and get your hands dirty and and see what's worked what's failed right there's just no you know there's no big to me there's no bigger roi than that because having the knowledge and understanding is what now gives the ability to to see the system as it moves forward and make good decisions so if coding is your thing and your developer great that's a great way to sort of join as a builder but like with any other entity that exists like their skill sets are needed

across the board like community management marketing like everything you see in a traditional space like there's a space for that person in crypto you just kind of have to find your niche begin to add value and you'll find your way um crypto is growing right there's a lot of need there are a lot of needs from a skills basis and you know it's not as developed as most traditional marketplaces where you necessarily apply for a job in a job site like most a lot of people get jobs are just being the right place at the right time by being in a project that's growing and scaling people get to know who you are you know you can add some value and you might be called in to help part-time full-time whatever it might be but to me if i was a young person today even if you had a day job like make

crypto your hobby like spend time trying to figure out where you might fit in the system and and kind of just walk as you go yeah yeah crypto is the easiest place to get your foot in the door right because it's just joining in discord and yeah you know like you said once you get your foot in the door a lot of times getting a job is just about timing and uh being in the right place at the right time yeah it's fully open it's permissionless it's borderless it's yeah it's why we're here it's while we're educating people with defy slay and it's a you know it's a it's a long process but we're excited to be a part of it and thank you akin for for coming on it was a great conversation it was a pleasure thanks a lot for having me guys take care