Ethereum Down Under | Australian DeFi Panel | Immutable, Synthetix, Tracer, Maple

Transcript

hello bankless nation this is our ethereum down under panel this is a spa a special panel for you we are live streaming straight into australian blockchain week so hit say hi to all the australian viewers out there and to those of you attending the australian block week conference hello welcome bankless david and i run a podcast we call uh bankless and it's all about the journey towards defy all about the journey towards using less banks and more decentralized finance in your life and we are super excited to present you with this ethereum down under panel where we're going to explore what australia is doing in defy and it's a lot david you want to introduce the guests on this panel for us oh

absolutely as if they any of them actually need any introduction but we will introduce them anyways coming in the front and middle you will see kane warwick founder of co-founder of the synthetics protocol in the bottom left you got sid powell who's the co-founder of maple finance and in the bottom center we got patrick mcnabb who's one of the uh lead contributors towards tracer dow and also last but not least in the bottom right corner you see robbie ferguson one of the co-founders of immutable guys aussies welcome to the banquet live stream how's it going going great pleasure to be here guys thanks very much for the yeah awesome to be here yeah well we actually just got back to

sydney um like two days ago so yeah it's nice to be nice to be joining our panel welcome welcome here welcome back in welcome back to australia um i gotta ask i gotta start the the question maybe this is for you know everybody who's not in australia but like how do you how does australia have so many fantastic d5 teams like what is it about australia that attracts so many cool projects uh and a lot of the d5 talent kane what are your thoughts on this so back in 2017 when uh i was starting haven um i think there were two projects that people knew from australia there was power ledger because they just done a big ico like a

30 million seo 25 million seo um and then there was um uh coin jar because asher from coinjar had started back in like 2012. he was an og bitcoin og uh still a bit of a bitcoin maxie but we won't hold that against him and that was kind of it like that was literally it like if you ask anyone in the u.s or europe or whatever about like anything else in australia they'll be like i don't know what the [ __ ] you're talking about like what there's nothing right and it was actually really hard because when we started doing the raise and we were talking to bcs particularly bcs who were like in west coast us they were like why are you in australia like legitimately without that question all the time right they're like why like why

aren't you in a real place why don't you like come to like sf or like new york or something like that um and i think you know we kind of pushed back and said well like this is you know d5 right this is crypto you can do it from anywhere um but there were definitely people um you know and even like people in in asia that were like very skeptical about this idea of like australia having you know crypto scene even though we did have like a pretty um big local crypto scene we had a lot of different crypto exchanges and you know there was stuff going on but it never really got outside of australia and i think it wasn't until um probably like 2019 when like synthetics actually started to do well that it became a little bit easier

for people to kind of turn up and be like you know we're australia based and and then we had a bunch of good projects that kind of you know came after that and australian crypto became a bit of a meme right and like i remember talking to sid um you know and and he was like going on raising money and people were like oh you're australian that's amazing like here like here's a sack of cash like and you're like wait what like what's going on here so i think it's been like quite a journey but we're at a point now where like people hear about an australian project and it's actually like a bonus as opposed to back in the day when it was like why are you doing this like come to come to america or something like that so um it's it's taken a while but i think we're now at a

point where like we've demonstrated that australia is a really good place to kill crypto so that's incredible so sid what's your experience with the uh the australian d5 brand are people like handing you sacks of cash because you're from australia yeah well i think as as kane said uh you know once we got into 2020 then if you're an australian project um working in d5 it became significantly easier to uh to raise money and i think a lot of that was to do with the uh the network effect like if you're going out and trying to build something it's a lot easier when you can actually talk to people who have already gone through a similar similar experience before and so kane was really like super helpful in terms of giving

advice and introductions as we were going through that raising process and i think you know hopefully we've been able to do the same thing for other newer projects that have come through and and newer builders and i think that's just helped to kind of build this network effect and a bit of a reputation around aussie d5 projects that like we just know what we're doing and that if you get kind of the the buy-in or the vetting of other other founders from australia then you know it's obviously a bit of a tick of approval robbie what is it for uh for you guys that immutable i mean building gods and chained uh of of course um what is it about the australian blockchain crypto scene that is uh interesting or appealing i think crypto is the first time that australian founders have been able to be

fundraising on a level footing with the rest of the world so uh the the story about us is back at the start of 2018 after we released uh ether bots which was the the first multiplayer game um on any blockchain we tried to fundraise for two months in australia no luck uh as soon as we went to consensus in new york within two days the entire round had been full and so um crypto i think has given this unique opportunity for sort of australian founders to participate in global fundraising um and there is a ton of really really good talent in australia i mean i think we have one of the best educational systems in the world we have pretty high risk tolerance in general which is useful for entrepreneurship in crypto um and then i completely agree i

think we're seeing the the um the trickle-down effects of the crypto mafia being built out of brands like synthetics um i i you know i think we're even seeing that adders and x immutables and we had uh zora and be be co-founded by an ex-immutable um the the lyra finance folks i know worked on i'm the earliest versions of haven and synthetics um so it's it's definitely people who see that kind of flywheel turning of okay more vc's investing it's less risky to join in as an australian founder uh and then more vc capital pours in this is all concomitant with the fact that we're having the biggest aussie tech successes ever like aussie tech was dead a decade ago and now we have atlassian we have canva we have vc firms raising billions of dollars off the back

of those successes and um i think this is very much the beginning of a uh great couple of decades falsely tech wow the beginning of a great couple of decades for aussie tech and maybe aussie defy as well so patrick round us out here so what's it like to to you know start a new d5 protocol new primitive like tracer uh in uh you know in this generation of of aussie defy and aussie crypto yeah certainly echoing a lot of points of the guys already i think standing standing on the shoulders of giants within the industry certainly helps um there's been a lot of innovation a lot of great uh great entities that have formed out of australia but i think maybe going into the

yd5y crypto um for aussies a little bit more i think there's almost an element of financial repression here with some people in australia i think that the financial markets are some of the most regulated markets here in the world and there's not a lot of room for experimentation uh within the financial markets and i think um d5 particularly speaks to people that are creative and it's an outlet for people to experiment and to innovate um in this landscape and i think um with that alongside the fact that australia's got one of the most prominent gambling industries in the world there's there's that natural tendency for for australians to uh to jump into decentralized finance and

really try and create a new financial stack guys i want to tap into some of the differences that uh people from outside of australia might not be familiar with with what it's like to be in australia how is your guys's how is the australian financial system different from what we would expect here in america or or from in europe and also uh pat you just touched on this i want to go down this into this a little bit more just the disposition of the australian people like how is how is the australian culture different and how is that relevant to crypto mainly just what are the differences to being a builder in australia how is crypto used differently in australia how is regulation different in australia pick pick your angle pick

your uh your variable that you want to touch on and just tell us a little bit about the differences between australian crypto and rest of the world uh pat i'll throw it back to you to start if you don't mind yeah i think at the end of the day with d5 it all sort of compiles down to the uvm bytecode at the end of the day so with respect to how we're completely different from the rest of the industry in our structure within d5 it's not super clear there's there's a massive difference i think we're we're globally competitive from the same landscape in the sense that we're all operating on the same substrate but i know there's a variety of different cryptocurrency exchanges within australia that have been prolific at the spot market level and i think yesterday spf here at the uh

the blockchain week event announced that ftx would be rolling into australia as well so there's plenty plenty of emerging emerging licenses being issued and and the market's really starting to be regulated in the ways that um that i suppose are needed for mass adoption to to a degree um so i think yeah we've got a competitive uh landscape that's for sure robbie i want to throw that same question to you what stands out is the biggest difference when it comes to crypto and how it relates to government finance the people of australia what stands out to you the most that the government hasn't taken an active opposition to it i think it's probably the number one um discriminator between us and the us

it is still yet to be decided and i think we have a much higher chance to actually get kind of um government buy-in probably a because we don't have the global reserve currency and it's it's not a threat by um sort of synthetics and derivatives which is a uh it just makes it easier for our government to kind of um swallow it down but then the other thing is it's just very cheap to politically lobby in australia it's like 20 times cheaper than the states um and so you know many people in this call are all having and building these relationships with um as regulators and politicians so hopefully we can bring it to a you know to be the new kind of crypto bahamas or the place where people want to go and found um crypto startups

sid i want to ask you that same question what is the the big differences that stands out when uh with regards to australian crypto yeah i think i think there's a few things so um to kind of touch and just build on what robbie said so you have fairly complex you actually have a fairly complex legal and regulatory structure um in that the the corpse act is super comprehensive and actually quite restrictive but i think what you've seen is kind of a posture of the government that are willing to to have conversations with new projects and i think that stems from kind of from australia being a smaller economy in a smaller market so i think they're quite conscious that if you make it too difficult to do business here um then you will just have you know you will just have teams kind of go offshore

because uh because it is a naturally smaller market and so it can just be easy to sort of bypass it so i think that's been quite favorable and so i'm actually quite bullish on on where the discussions will go um and then the other other element is kind of the australian uh banking and financial um market structure is quite concentrated so that means you actually have like an over-representation of people who kind of come from financial services and i think that's helped us over represent in terms of the number of founders in the space who come out of australia but it means that our teams are quite naturally hybrid like we have a lot of people with financial services experience so it's like we can you know brainstorm how a d5 product or pro protocol should work but then we have to go offshore to hire the talent because

it's not the same level of uh stem representation in australia so i'd say that kind of creates a unique perspective we actually have teams that are sort of straddling different jurisdictions and um and markets so i'm getting the gist that you guys don't have your own version of gary gensler in your guys's uh in your guys's regulatory environment uh kane what about you how what are the differences that stand out stand out to you thank god for that as well i one is too many um we don't we don't need an rc car canceller jesus um so uh so i think i grew up in the states right so um my perspective is kind of interesting because um i've spent half my life in the us half my life than uh in australia

and so i think for me some of the cultural aspects uh of australia were quite interesting in comparison to the us right um uh you know like we are not a super risk diverse culture but i think that for a long time the best founders would leave and they would go to like new york or london or um you know san francisco or the valley or whatever um and so we didn't have a lot of like homegrown uh kind of uh icons of like old startup success right like the people who were like you know in the paper for being super successful we're like literally

digging like rocks out of the ground right and people were like oh that guy's amazing look at how he digs rocks out of the ground it's incredible right um and and you know we we just didn't have this model for people to like say actually i can do this thing right so even though you had a lot of people who were in a position um i think financially and socially where we've got a really good safety net and the downside of like doing entrepreneurship is really low in australia right like you drop out of uni and you go and do that like you're not going to end up in like a gutter like you would in the states right where like it's very extreme um in terms of you know what the downside is for you like in society like in australia worst case you're like living on one night beach

like chilling out get paid a couple hundred bucks a week right there's not much downside to you um and yet we didn't have people willing to kind of make that leap like let's go and try and build something and i think it's only been in the last like five or ten years robbie's point about like you know atlassian right like people see the atlassian uh co-founders and they're like wait a second like we can do this like we can actually build a sas company from australia not leave stay here reinvest et cetera um and i think that like the point is is very valid that this is only just getting started and i think you when you add on to the fact from a crypto perspective that regulators have been super permissive um like and like way more permissive than i ever expected them to be right like no regulator has

ever come up to anyone in synthetics and then like stop doing what you're doing or even like why are you doing this or whatever right um and i do think that that attitude of like only really going after outright fraud and things that are like very clearly detrimental and just an assumption that people who are building novel things are good actors has really put us in a very good place right where like you know synthetics we're good actors like we believe in regulation we believe things should you know we believe in fair markets we believe in transparency we think that defy is the way to get there um and and so not kind of squashing that immediately with like over-regulation or whatever i think has allowed this to flourish and we're like genuinely only

getting started i think it's only going to get better from here yeah i was going to say you guys can you guys teach the us how to do this i know right like for real like i'm just curious do you think there's opportunity for australia to be a leader on the on the global stage in this respect uh like not only with respect to the entrepreneurship in australia australian defy but also from a global regulatory leadership position because every single regulator in every western democracy is asking themselves what do we do with this defy question is there an opportunity for australia to like show the way forward okay that's the question to you yeah so

i i think so right but there are also like structural issues with australia right it's really [ __ ] far away from everywhere so trying to convince someone to come and like live in australia and you know uh and operate um here is hard um that said trying to convince people to domicile in australia um or you know to start a dao or something like that um and you know everything's global now like the majority of the synthetics core contributors are not in australia i think there's net we're down to like there's six in australia out of like 35 or something like that right the vast majority are here obviously that's different to um uh you know things like immutable where like they've got a big office here but even still i think

immutable has a lot of people overseas versus who's in australia so it then comes down to like okay if regulators are willing to be permissive they're willing to be open they're willing to you know kind of allow good actors to do things and experiment um then you're going to get this compounding return where like things just get better and better and better and you have more success and and you know more experimentation um i don't know that it's possible for like the us to replicate that though right like the rep like replicating that require like it's just there's something about australia in the way that like the market is structured which i think allows for this to happen and and for it to be like lower stakes i think in the us the stakes are too high

um for regulators to be as permissive as they are in australia um there's there are too many stakeholders there's too much conflict of interest like it's just hard for that to to work i don't think you can take this australian model and replicate it pax is another big um uh inhibitor i think australia's corporate tax rates are much higher than america and stuff hold on we have to kind of jump you could you could see some innovations like if there are australian innovations on the legal side like for example you know incorporating dows as legal entities um then that might set a pretty good example for certain states uh to follow in the u.s like potentially florida which is definitely one of the more crypto progressive states you know wyoming being another one that comes to

mind and i think that would you know that would gradually kind of introduce the notion of of you know d5 being more legitimized in uh in the states from a regulatory perspective totally and i think this is this is something that we've been very um forthcoming with uh on the tracer front and in mycelium front particularly in pushing for like appropriate down regulation here at australia um jack deeb on on our side he's been working with the koala group who's just an international body that's looking at um dao regulation in different jurisdictions and how to how to most appropriately model law such that it can fit into the relevant schemes and i think um

every stakeholder that we've interacted with in australia um and we've been pushing to educate um so far and it's extremely positive has just been very um very receptive to learn um and to everyone's point so far uh it's it's been um just welcoming i suppose um they don't have skype and or they don't want to stifle innovation they don't want to they don't want to stop things from progressing and they just want to ensure that there's the appropriate environment for people to continue to innovate which yeah i think it's really positive yeah yeah like i alluded to definitely very jealous of the environment that you guys have described as what's going on down there i actually want to turn this conversation to a current event that i would imagine would be very relevant to

be talked about at an australian blockchain week you guys had a an exchange cost or turn off recently the asx 24 futures market i believe i'm just learning about this again because i'm a naive american but it was unavailable for most of friday and they said that it was turned off due to technical disruptions and hardware failures i'm wondering what's the talk of the town down at the conference is this uh like a a timely relevant topic for for crypto people to be discussing and and is this being viewed by the greater just like landscape of australia as a crypto relevant subject or have people not connected those dots yet um kane i'll start with you since i i think your your

project is most relevant to this i'm like so detached from triad phi that i didn't even have any idea that that happened so i i probably can't speak to it maybe one of the other guys has an opinion yeah see do you have any thoughts yeah i mean i think i think it's fascinating like i mean for the longest for the longest time we've been kind of rattling about how you know in in australia you can't do banking transfers outside of regular hours you know you can go to the supermarket but you can't send money around like the whole financial economy stops outside of of uh of regular 9 to 5 hours um and so to you know to have this kind of futures exchange down i think you know it it points it'll it'll be like it's not well accepted now but i

think it'll be sort of deemed quite obvious like why didn't we consider it important enough that financial markets should basically be always on and i think that's that's like the power of b fight right is is you can lend money at any time of day you can trade futures or other instruments or or spot and this is really important if you're going to be integrated as part of the world economy like the rest of the world isn't sleeping um and so the idea that you you know the idea that you would just have such restricted restrictive hours and also infrastructure that can uh can go down like that i think really points to to the strength of deep fly as core you know it's one of the core value propositions totally and i think that's that's an

element of why we're all here as well for the decentralized market infrastructure and and being able to create something that's that's robust and it doesn't have that single point of failure i believe that nichols spillout was was from the um from the ukrainian sanctions i think something flowed that way and the llc got caught up in it as well and there was a bit there was a few few issues of bags being being dropped in different areas and people trying to pick it up and no one on the other end but i think with what we're building ideally these things don't happen moving forwards um and justin's point we do have global 24 7 markets where um everyone can access them at all times and there's no one that can really just click their fingers and turn them off and i think that's an incredibly

powerful thing we were just recently oh yeah go ahead robbie i was going to quickly say the asx has actually chosen already a tech partner to replace the chest system which is kind of the system that under the hood powering these transactions um with a blockchain and at the moment it's not as if it's on ethereum or anything open but like that's an incredible willingness and and progressiveness and they started this rfp back in 2015 um so i actually uh out of all kind of stock markets in the world i think the asx is probably positioned to do this transition for a big economy the fastest wow that's huge yeah because okay you guys are telling a story of just the regulatory environment just being very favorable to innovation but not just that but also the companies and

platforms that already exist itself being open to new technologies and so uh kind of my original question were were people viewing this inside of a frame of crypto like oh the exchange went down this is are people uh you know savvy enough to understand like oh crypto fixes this and it sounds to me that like no it's super obvious and everyone's kind of up to speed on that is that right robbie well ultimately australia is a country which has gotten very rich over the last two decades by two things one is a massive amount of natural commodities in kind of oil and gas and coal um which we've just been exporting and now that's mainly run out and those those export partners are in some cases placing tariffs on us and

we realized we actually need a way to sustain this economy in the future the only reason we're even reasonable today is we massively invested into super and we said everyone had to lock up 10 of their earnings that the kind of um long-term pensions and so i think we're in this unique position where the government very badly wants to or at least private actors certainly and the government is just like less powerful compared to private actors than in other places around the world um that they would just want to start off this this tech industry um and i actually think that's another part of this long-term debt cycle is countries like the us have a lot more to lose but they also assume that the tech industry will stay there together like forever and that they kind of take it for granted and we've seen with literally

like you know the mayors of austin and kind of um miami coming out and making a big play to encourage founders to come build there rather than just being like yeah of course you've got to build here um you know san francisco is the home of tech is is like this stuff matters being personable making customized pictures um and actually trying to have key leaders developing this stuff really matters i think we're getting in australia at the moment um and we just have a lot more to gain a lot less to lose so we've been talking about australia a lot we want to kind of switch gears and uh to talk a bit more specifically about defy and d5 decentralized finance has had a really interesting trajectory uh i remember a time when it didn't even

exist uh and uh we saw in you know 2018 2019 some early projects trying to like carve out space in d5 but the rest of the world didn't really know it exists and there were a set of early adopters and then in you know 2020 d5 had this breakout moment in 2021 that sort of accelerated uh and now maybe has things slowed down a little bit at least the hype cycles a bit more towards nfts and yet the builders are continuing to build so i want to ask the panelists here about trends about the future of defy about what you guys see ahead for this rapidly developing software space where software is eating

the banking system software is eating finance so tell us a little bit about the trends i want to maybe start back with you kane what are some of the things happening in d5 right now some of the the trends some of the things that uh people should be taking notice of so i think there's now uh multiple threads of d5 going on right which is which is one of the reasons you know all of us on this panel i think for uh maybe the people at the top are a little bit more extreme than others are you know pretty deep down to eighth rabbit hole but i think all of us are are pretty aligned with the ethereum ecosystem right and i think what happened is that that uh alignment uh that a lot of the early d5 builders had

and still have you know you go back to like people like roon right like very like deeply you know engaged in the ethereum ecosystem um you know hayden like the people who were building early d fire are very deeply aligned with ethereum and i think that there was a disconnect when the fee market for uh block space in ethereum broke right and we got to a point where like it was actually not possible for a new entrant to interact with d5 on ethereum it was just like cost prohibitive right um and a lot of us who had a lot of eth that which is how you pay for gas we're a bit oblivious to it right and myself including we're like oh it's not too bad like you know i pay like point one e to do a transaction but like because i'm

denominated underneath right i'm like ah like it's the same amount it's just that it's worth a lot more right a new person coming in is like i have dollars and you're telling me it's gonna cost like a thousand dollars to do this transaction like that's just not viable for me and so we saw for the first time i think in like 2021 the emergence of like genuine organic non-ethereum defy communities right and yeah a lot of it was like rug coins and copy pasta stuff and like a lot of nonsense but there actually was genuine activity and i think a lot of us were oblivious to it what's now happening is we've finally gotten our [ __ ] together and gone scaling of ethereum to a point where we can

make a credible case to a new engine in the ecosystem that it is viable for you to transact within the ecosystem again right other than polygon there was really no option right stockwear yes but like it's very much a silo thing um we didn't have like a composable defy substrate on which to build on for a while because it was just too expensive and now we've got arbitrarium we've got optimism we've got you know there's multiple different roll-ups that are that are coming out um stark nets getting closer i think in the next like three to six months we're going to have this ethereum d5 renaissance where like all of the best builders no offense to people in the salon ecosystem whatever are still building on ethereum it's just that we couldn't attract users because it was

too [ __ ] expensive to actually use that cool stuff that we were building right and now all of a sudden you know you're gonna you're gonna have uh like erp you know 4844 that's going to bring transaction costs below that of like bsc right and it's going to be cheaper to actually transact on you know optimism and and arbitrarium than it is to go on bsc or avalanche or whatever and so all of the cool stuff that we built that very few people are aware of over the last like six to 12 months is going to have this like huge moment where everyone's like wow this is amazing and we didn't realize this was happening they're gonna there's gonna be this you know uh whatever um you know repatriation of all of these new users who came into crypto who don't know about like what the

ethereum d5 ecosystem really looks like and so i think that that's gonna be the story of the next six months is is people rediscovering ethereum defy um on roll-ups and and on layer two um scaling solutions and it's just going to suck the air out of a lot of these old l1's and and you know bring people back into the ecosystem i gotta throw this over to uh to robbie next because of course robbie uh immutable is building a uh you know of roll up of the type uh kane was just describing you know the scalability story is really what cain is saying so a lot of quiet building going on the defy side we just haven't had cheap enough transaction fees we haven't had the scalability to onboard the next cohort of users in order to get us you know

more and more mainstream what are you seeing on the mutable side would you say that is sort of the defining uh era that we're in we're just kind of scaling right before the next cohort of users what would you add to this i think we have scaled mostly um especially for nfts i think d5 has a way more to go because it's more it's it's trickier right you require composability from day one you have some costs involved and the costs really have to essentially go to zero from a user experience perspective for things to become mainstream um we did uh 2 million nft transactions over the last month ethereum l1 did 1.1 um so already like this is you know l2 is is kind of outperforming at the scale

people want to trade at um we've seen since the launch of immutable gods on chains players go from like 20 000 to 200 000 weekly actives to be like the third largest blockchain game in the world um you know we now have massive brands building from from kind of gamestop to dc comics to disney and to alluvium and uh i think what we're seeing is in the nft space it's it's there the user experience still needs some mining out we need to make it magical for people who don't even need to know it's an nft um but in in terms of actual all scaling i think it is there and the reason i'm so bullish in particular on things like stark debt or or kind of the way we approach the uk is we're able to make those costs zero um

which is so important for businesses doing nfts on mass like d5 is much more fundable token based and so like gas is a different beast um composability can be more important pat we have a kane and robbie talking about how we need to reduce fees so we can onboard users but also there's an angle here about how when you reduce fees you can actually build out new applications that you couldn't have if you were only confined to the to the to the layer one and i think that's been some of your experiences over at tracer can you just speak about the importance of lowering fees down to the absolute minimum not to only unlock users but to also unlock developers as well yeah for sure as you just said the

cheaper the gas the more you can really compute on chain and the more complex applications you can put together which is only going to add more and more value um on the gas front and just the transaction free front but i also think 2022 along with the layer 2 and scaling piece will certainly be a big push around things like identity and ux that will like enable what currently somewhat exists as a uh a bit of just its own isolated ecosystem with within d5 and start to bridge the the divide between what currently exists within decentralized finance and

nfts to the broader system so we've had we've seen millions of dollars being invested into a variety of different wallets to improve ux and we've had a lot of research going into like zero knowledge identity systems and kyc and such that you can trade and transact with these layer one or smart contract systems with similar privacy um measures in place and similar pseudonymity measures in place such as the same d5 experience we all know and love but it can then scale out into the broader uh either traditional finance system or just neo-banking applications where you're serving millions and millions of users versus people that are currently being onboarded just through being attracted and hearing about some

yields and then getting getting onto metamask and navigating through the variety of different bridges and the ux just just really isn't there so i think the defining trend is certainly consistently going to be around those barriers being broken down and and what we know is defy just today becoming what we what we what we understand as finance generally moving forward uh sid we talked about scalability of course a major theme pat was just talking about ux and some of those building blocks what else do you see as some of the trends for d5 ahead of us from your perspective yeah i was going to try and offer um a bit of a different perspective there so i think scalability is definitely important it's one of the one of the things that we need to um to get more

people on board um but i would also say that we we definitely need more supporting infrastructure like particularly what we see maple's obviously a bit more of an institutional focused product um and so what institutions need to really bring huge dollars into uh into d5 is things like the ability to on-ramp in size really easily um in a way that they don't have to like hire you know a team of three just to manage on-ramping of fiat into uh into stable coins to participate in default the other one is kind of uh custody whether this be self-custody solutions like fire blocks where you can implement policies a lot of institutions seem to favor this um or the use of third-party custodians like uh like anchorage so i think these are kind of picks and shovels things

that will help bring a lot more dollars into d5 and then the other one is of course you need to have products that could have like um permissioned tracks so that some of the institutions had maybe more conservative um risk parameters around participating in d5 could still do so and then the final element i'll say is just more primary products so a lot of um a lot of the products and protocols that kind of came about after d5 summer kicked off were ones that capitalized off the use of liquidity mining and yields um but what i think will will need for e5 to have sustained growth is that in a world where yields are a little bit lower than what they were during d5 summer do you have primary products that people are coming in and using just

because the product itself has more utility that actually solves a need for customers rather than just an ability to participate in yield farming guys i want to change gears just a little bit as we kind of wrap up in the last 20 minutes of the show well i got to talk about some prices gotta talk some price action uh i actually want to talk about uh snx first because uh defy summer was a fun time there was a lot of yield farming going on and snx had this meme of every single yield farm had an snx relevant farm towards it it was the it really just won d5 summer just because it you could almost farm anything with snx yet defy tokens have been down versus east basically ever since defy

summer and so leaning into what's going on with the resurgence of of the renaissance of e5 coming on to layer uh layer twos i have a question for the panel is what's next defy season or east season because each season seems it could be ahead of us because of the the merge the issuance reduction but then also defy season could also be ahead of us with the cambrian explosion of possibility with defy apps so kane what what say you defy season or eighth season what's next ah it's a tough one i i think um you know with the merge coming up uh i look at the the eid ratio obviously is is you know the primary way that i i measure um you know most of the things in my

portfolio and like the eve maxi and me feels like eve is just gonna rip up and and you know kind of leave some of the stuff behind um including snx and and what have you that said i think the um the erosion in the eat ratio with eight d5 that's happened uh is is structurally probably coming from the the kind of uh emergence of nfts as as a me as the dominant theme right um because as people got into nfts that was one of the only reasons to kind of stay in ethereum right like most of the cool nfts were still on ethereum there was there were these kind of small

nft you know uh economies that were growing and alternative l1 but really it still held on and dominated um in that respect um in a way that i don't think it did for d5 and so i think as the merge happens and as you know each scaling becomes obvious and as you know we get layer two tokens like optimism and arbitrary and you know stock where as as that kind of happens we bring all these people back i think there's no question that eid rips up it just has to right um you know so like 810k to me like you know if sasano were here we wouldn't let him say it but um you know i think if 10k is so inevitable to me it's like just laughable right that you know we're not going to get there um but then the

question is okay can a lot of these d5 projects the d5 blue chips you know the the kind of core protocols that really delivered the initial utility within the ethereum ecosystem can they hang on right like even if the eath ratio kind of doesn't erode even if it just holds on i think that all those projects will do really well and so i think outperforming each for for a lot of d5s probably feels a little bit unlikely in the short term like in the next like six months um but if you know all of these d5 projects can just kind of cling on to that ratio that they've got right now i think they're going to be you know all pulled up and i think that will have a compounding effect as we find some new equilibrium price for eve in the market

where you know maybe it's 10k or 15k or something like that then the d5 projects will have a chance to outperform and and really demonstrate that they're providing utility they're generating revenue etc so that's kind of my my next like six to twelve months i think it's like cling on to eat for dear life um and hope that uh i hope that you don't get left in the dust that's it i saw you chuckling a little bit when i asked that question so what say you defy season or east season next d5 season i'm i'm definitely defy maxie um i think and and this is based on you know i'm seeing just so many conversations happen with with companies that didn't look at d5 12 months ago or 12 months ago the narrative was like tell us why this is not a scam to now let's

tell us how we can do a project in d5 you know what can we be doing on on ethereum and so i think the projects the d5 projects themselves are kind of poised to capture a lot of that value that comes into define and so i think you know you probably have a bit of an ecosystem shakeout where you have you know a few sort of temple projects that are maybe or hub projects that then enable sort of uh spoke or satellite projects around them that kind of provide supporting features and composability which is after all one of the strengths of d5 is that we can be composable with each other um and i think uh yeah so i think that will that will drive out performance of d5 over the next six to 12 months patrick what say you how are you playing in the next uh six to 12 months

he's in defy season what's gonna happen yeah i think with anything there's there's gonna be shining stars and and some stars that sort of crumble along the way as well but i think overall um when you're talking about d5 that's settled and cleared beneath you obviously need need either to transact and and to to to settle it and block so i think we're definitely going to see the growth of both um i'm i'm in both camps there i'd say but certainly look forwards to to seeing a lot of growth within the user base of d5 i think that's certainly going to accrue to a variety of different protocols that are pushing the edge robbie last but not least defy season or

e-season what's happening next um so d5 and alts are always gonna be way higher beta so i think we'll see breakout hits um and i'm mostly interested in what will be the first big utility driven use cases because still even up until now it's either been hypothetical or a group of 100 000 to a million rich users kind of creating cool pieces of concept which is awesome but the first time we're going to truly see sort of 100 billion dollar defy coins um breaking up built on top of ethereum is when they start to really take chunks out of the real world um so definitely excited about that and all that as we say will funnel down to eighth um through the the transference of value mechanisms even economic bandwidth let's talk about the form

yeah what will that perform bobby what do you think ah look i um i personally hold a lot of dfi because i don't know which particular um one will i mean i'm a fan of snx and and uh it is a good chunk of my portfolio so there you go uh let's talk about this so we're kind of in a in a rut uh lately in the global markets right a lot has happened this year commodity prices you know sky high we've got uh conflict war in ukraine um this has brought the price of equities down worldwide this has also brought the price of crypto down worldwide um some people are now calling this a bear market and say that this is going to be sort of a repeat of of um you know

2018 2019 others are still calling for the super cycle like you know crypto doesn't have these long persistent bear markets any longer we've grown beyond that we've matured what are you guys seeing i guess in the trenches uh does this feel like a 2018 2019 period to you or does this feel like a maybe a mild dip before we we resume up only uh super cycle territory kane i know you've lived through many of these years uh what do you think honestly it feels like 2016 to me like so much like 2016. and i think for the people who are around in 2016 like 2015 was

super painful because it was this like sideways thing that just kind of kept going forever and you felt like this just this slow erosion of hope right like there was just this slow sense of like is this just decaying to zero in in slow motion right um and then 2016 happened and basically 2016 was like up only right like there were a couple like little spikes and like a couple little pumps and then crashes and stuff but you know i think most people who were in the space and had been in space for long enough like were kind of a bit immune to that and a bit of neural to it they were kind of like okay this is fine but if you look at the chart of 2016 it

literally is just like it starts here and it ends there and you know like the bitcoin chart is like i don't know 400 like 700 right so it's like a laughable amount of money that that went up but like percentage-wise it almost done right then i think that was true for the entire crypto market cap at the time right through 2016. and it just feels like there's always going to be macro headwinds like you can't avoid it there's just going to be dumb [ __ ] that happens in the world that you know makes people a little bit hesitant crypto still will risk on asset um but throughout 2016 just the momentum kept building right like and yeah a lot of it was from icos and from but like every single month there was like something that was just like building up

building up building up building up and that's what this year has felt like it's like oh the scaling solution now finally works so oh this cool thing happened or this big company adopted crypto and it's just like layer layer layer layer ignore the macro and it's just very clearly up only so i think this is this is you know from my perspective we're gonna get to the end of the year and be like what the [ __ ] are we all so worried about like why are we all freaking out like it was fine this was actually a fine year uh but in the in the midst of it it feels like you know it feels scary but i think like you zoom out it's fine we're gonna be fine robby you you're shaking your head up and down a little bit uh what do you

think about this from the nft perspective which is kind of the the world i live in most the time um and in particular business applications of nfts less like luxury art and more like games businesses adopting it the signals could not be more bullish so i think we had 26 billion dollars of nft volume in the first quarter of 2022 which is more than the entirety of 2021. we have 50 billion dollars in vc capital ready to be deployed over the next five years in crypto alone like this is the most insane pouring in of capital in any nasa industry in the history of the world adjusted for inflation um we have like if you look at the two

most leading indicators of of whether an industry will be successful it's like where does venture capital money go because it's their job to be president and it's where do people spend their time because that's what people are excited by and we're also seeing a huge outpouring of talent like every large gaming organization in web 2 all of their people are leaving to web three same for for like financial services we're going to see the same for verticals as they become tokenized um and so like to me the actual nature of adoption um has been crazy like we now have a call with any major web 2 gaming company in the world and they have a desk of at least 20 if not 100 or more full-time people working on their web 3 strategy whereas like 15 months ago they

wouldn't know the word nft that's incredible neither of our panelists uh our two panelists we've heard from sound bearish at all uh sid what does what do things look like from your perspective from the maple perspective yeah i think uh i'm i'm gonna echo this and say definitely bullish on the space um i don't see bearish sentiment at all um i think we we are probably a different fragment of d4 where it's more kind of lending and fixed income and so i think that is naturally kind of correlates with with um there is more interest in it when there's a bit of a risk off environment so we've we've seen a lot of interest in uh you know corporates and treasuries being able to get a bit of a bit of a stable yield um so that's naturally played to our strength but i think

just echoing what robbie said we're seeing you know kind of unprecedented interest from vc funds that are freshly raised that are looking to deploy this in d5 as well as like on the hiring front you know we're at about 30 people now and um every time like every time we post a new role each new role that we post gets kind of like a record number of applicants coming from tradfi as well so if it's like a sales or an operations role it's like you know you'll get more than 50 60 applicants kind of coming from uh from traditional positions i think all this speaks to just increasing interest in the space and i would contrast this with 2018 where there was a bit of a you know a bit of a bit of an error of capitulation on the fundamentals but here it's kind of like

that colorado perez idea whereas maybe like valuations have kind of um declined relative to the momentum that uh has been built up on the fundamental side in terms of what's being built yeah this all sounds incredibly bullish pat what do you think yeah that's been said that um as adoption increases it's pretty hard for the industry not to grow um adoption's just going to keep on increasing that too but i think just on the global macro level and i wouldn't call myself an expert on that fun at all but um i think arthur hayes article recently uh touching on the cancelling of of of russia effectively and

a lot of just the systems and services that um the west is being been able to provide over the last years just being cut off i think that's a bold case for systems like d5 of course uh having infrastructure that um that is neutral in its accessibility and have having that that trusted layer at the base layer that anybody can be interacting with um i think more and more value is going to accrue to these decentralized systems as we see more more of those types of events happen and the global economic control tends more towards individuals being empowered and this this is the infrastructure that we're here for well panelists what a fantastic way to end it this is

the infrastructure we are here for this is certainly if not the year of of d5 decentralized finance and crypto it's certainly the decade and just take a look at what's going on in the world today and look at how many problems are solved by crypto i want to thank each of the panelists for hanging with us on this bankless live stream and also uh you know hello to everyone in australian blockchain week it is great to talk to you guys thank you so much panelists we appreciate you thanks guys it was awesome thank you because we appreciate you guys for everyone who is new to bankless of course david and i live stream all sorts of things on crypto this is all about

the the bankless journey you can find out a bit more about bankless at the youtube just search bank list in youtube also subscribe to our podcast and uh you can hit us up in our newsletter that's newsletter dot bankless dot we want to thank the folks at ftx for making this entire conference possible we appreciate you guys and keep building take care