Gasless Crypto, Finding Narrative Market Fit, and Surviving Hype Cycles | Jack O'Holleran, Skale

Transcript

tokens need to have properties that let that help them capture value right and so scale one there's a staking component you can buy scale tokens stake in the network get rewards participate in fees um from chains you don't have the resources no matter how big you think you are to be totally general purpose so you need to go after that first bowling pin it knocks over the second two knocks over the last ones and then you get so big you can knock them all over we're in the top five of all blockchains almost every single day in terms of unique active wallet and transaction volume all right everyone welcome back to Empire uh fun episode we're sitting down with a longtime friend Jack ohin o'herin longtime friend but I don't know

how to pronounce your last name at this point so uh I'll give the background in a little bit but Jack welcome to the show man hey hey pleasure to be here you know it's one of those real simple Irish names easy to pronounce so I've got like a Jewish polish last name you've got the like like the the the Jewish Polish people don't know how to pronounce the Irish names you know you're lucky you got the Yano I I'm missing that I could be like Oho maybe but it's not as cool oh oh what did your friends call you as a kid Jack Jacko Jacko there you go um all right guys so so um for the listeners for context um known Jack for a while Jack is um CEO of scale Labs scale Labs developed the scale Network and scale

blockchain for anyone who's around in and Jack correct me if I'm wrong on any of this but for anyone who's around in the like 2017 2018 2019 bare Market scale was one of the like big uh and hopefully I'm not offending anyone here Jack like one one of the big companies and uparts uh upstarts like your co-founder Stan brilliant technical guy was working at um what was it Alamo labs and doing like crypto uh cryptography and Quantum resistance stuff in the 90s just crazy gigin developer um and then I feel like in the last couple of years you guys have actually not really like taken off in the what I'd call the crypto Twitter narrative so I wanted the context of this episode I just wanted to

have Jack on to like catch up with a a a friend but also a co-founder of a network where I feel like they've been building for several years but haven't really taken off in the narrative so Jack hopefully that is not an offensive way to tee up here no no I actually I love that because you know someone said to me the other day is like scale has the best product Market fit a developer told me this like you have the best product Market fit in the entire industry like you're leading like everybody picks all these developers pick skill love skill but we have the worst narrative Market fit and so I think it' be kind of fun to talk about narrative Market fit today and and you know and one of our strengths and weaknesses is we've just been so committed to making the best product and

helping developers and that's a strength it's also weakness if you're not following the narrative Market fit and uh but you know sometimes the the the tortoise wins the race so um I'm I'm as optimistic forever or as ever um you know about scale you know continue to win the developer market and um you know and having a stronger presence how is scale Evol so maybe so I'd love to talk about that maybe just give us a little bit of context because I think people will probably they know the salanas of the world and the arbitrum and the optimism and for folks who don't know scale as much like can you just give me the backstory and also maybe the pre-scale backstory as well yeah yeah well let me let me tell you one thing that like the AHA whenever

I people like well what's going on with scale I haven't seen you in a year or two I'm like oh well we're in the top five of all block chains almost every single day in terms of unique active wallets and transaction volume we had 88 million onchain transactions last month uh we've had over 600 million onchain transactions in the history of the network um we're averaging around four million unique active wallets a month um so we're nailing it so like people here hear that like whoa well how come I'm not hearing about you every day and it's like well if you're a game developer a blockchain game developer you hear about us every day if you are a you know developer in AI doing a web 3 application you know all about scale um our developer awareness is really really

strong so you know and and so are onchain metrics because we have 250 some projects that have you know signed to build the network and you know uh only like you know only like a certain fraction of those already live and producing those metrics so I think you know we have those and so back to your question like that's the oh aha like this matters it's not just the story it's this is a top five category leader in two major categories of blockchain but we started back in 2018 I I come from Enterprise software um uh worked in machine learning and AI as a Founder since 2008 worked in Mobile cryptography before that and you know B2 be Enterprise software entrepreneur and built you know really successful

companies my co-founder Shan cladco also like really successful scientist uh turned researcher you know at Stanford and turned entrepreneur as well and you know we were trying to solve a problem for oursel we were trying to solve the problem of scalability of ethereum so we didn't build scale to follow Trends or narratives we actually built it for us as developers that each of us had applications we wanted to build and Stan deserves a credit for coming up with that architecture and vision but um that's really our Genesis and how we got here and what we're doing and we've never really fit in a category because I think we have a bit of a hybrid solution but that hybrid Solution that's what happens if you put 10 people in a room you know and they can't hear or see what

the other people are doing you're going to probably have 10 you know different answers if you have nine of them in a room and they're all like you know collaborating with each other and these other ones are not in the room and they're just building what they think the best thing you might have nine similar things and one dissimilar thing and that's really part of a story of scale okay so you were actually the first person to ever kind of pitch me the idea of this like what so um I'm going to reference other blockchains because people know them well like like what what op what optimism is doing with like the op stack or arbitrum is doing with like l3s and stylist and stuff like that like you were actually the first person to pitch me that idea which was like ethereum Network here scale Network

here you've got like the validator network and then you've got the scale chains up here built on the scale Network which really I mean I'll be honest at the time I didn't fully understand it but it looked cool on the Whiteboard and now I'm seeing everyone doing it and I'm like oh my God that was what Jack was pitching me many many years ago so what do you think you guys have gotten right over the years and what do you think you've gotten wrong over the years yeah that's that's a really good question so if you think about what what scale is it's and I'll try to keep this as simple as possible it's many many blockchains that actually all share one unified validator set so one validator set but at any given time there's a different committee or set of those validators that are working on each of

those chains and and guess what it's also anchored into the ethereum main net so there's added security because there's a lot of network functions it's almost like an igen layer where these scale nodes are getting Security based off a staking mechanic in the eth main net okay and so you have the secondary Network that that gets security from ethereum because that's where the staking operations live and also assignments around hey which no work together but at the end of the day we have lots of these chains and that can horizontally scale and they are all based off one pooed security one one set of validators and so people be like oh side chains aren't secure well they're right because you just have this like kind of small set of validators scale chains one of the biggest things we got

wrong people like oh it's a side chain well they didn't understand it's actually this entire modular network leveraging pooled security principles Leever leveraging containerization Tech like you see in like igen lay and other you know networks that have come after the fact um networks like Celestia like leveraging horizontal scaling and modularity which we've been doing this since 2020 and so what we got right is I think we were early in in seeing where the future was going we also used to have you could have a small chain a medium chain a large chain and we come from Enterprise software right where I was you know I built a company that was a world leader in the AI machine learning category and across the entire life science biotech category and enter software is all about configuration and

you know making things like fit for you know that's what you need that it's so sophisticated so what we got right was the structure what we got wrong was like the world wasn't ready for sophistication guess what was successful just like one single proof of stake side chain and one monolithic layer one and we're like we could have launched that easily back in 2020 and then then continually like added these features or introduced them and you know we kind of went but we saw this world we're like hey well that's not going to scale and we lose security properties if we don't do ABC things so in a way in the short term we made mistakes because we were so true to our vision for the best product um in the long term I think that's going

to serve the network and all the you know participants in the network very well but you know it was an interesting lesson that being better is not as good if you're more complicated yeah do you wish fit in category do you wish you just got to Market faster and just said look let's I mean like you tried to build the Lamborghini uh instead of just trying to maybe get the Toyota out to Market and then like expanding on that that's a probably a horrible analogy but um like do do you wish you just got to Market faster and then built and built and built and built uh as opposed to maybe like waiting and trying to build this Lamborghini like in the work well and I think I think we what we built we built we built fast yeah um I think it would have been whatever we we would built

even faster if it were just you know like just the engine and the wheels and the and the steering wheel um and some brakes instead we built you know so we could have got a market faster the other part was the communications there wasn't a category for us right and so it was an interesting thing and I know a lot of people listening are are really on top of narratives and like this narrative Market fit but um you know as a builder and somebody who's like been an entrepreneur in the tech space for a long time like I look at all these things I'm like wow like these are like very simple things that people are just grocking and we're building this you know next step and what you know everyone's going to need and you know for us success is going to be really

dependent on can we take advantage of the first mover Advantage right are we gonna are we gonna fumble the ball are we going to like take it in the end zone because when you have horizontal scalability when you have modularity when you have cost Effectiveness and high security it's amazing for developers but you have to build market share and at some point you've got to inject yourself back in that narrative be part of that and that's one of the reasons why we just brought on a new CMO who was a former CMO of arbitrum you know we're we're we're boosting our game in different areas as a you know as a as a project and as a core team and and but yeah these things are very critical but yeah it would have been you know in retrospect we should have been communicating a Toyota because everyone

understood Toyotas and we could have even been keeping the Lamborghini a little bit like behind the product marketing lens uh you know if I had a if I had a you know magic wanted I could go back and do it all over again but I I think we're great where we are to be honest I you learn from your mistakes and you're better and stronger for them so yeah tell me more about um it's funny even even with block works like we we we've seen us be in the narrative and out of the narrative over the LA we you know we launched them seven years ago it's like sometimes you know we were this like institutional media brand as the institutions were coming in and then like the institutions left in a bare market and was like oh well maybe don't people don't care about the institutions

anymore so it's like these narratives change all the time but I think you have to try to build for this the end game what tell maybe you could tell me more about this narrative Market fit that you see by by the way we met we met little history for people we met in 2018 at The multicoin Summit in New York and you guys like I gotta say just hats off to you for executing but I think it's a great example of like staying true to your vision right all of a sudden there was an Institutional market and people that were you know smart people that wanted to learn and that market wasn't there for a while it was like well how do I just you know help these like novices and you know understand basics of crypto and you guys are like no there's there's a sophisticated Market

there's smart people that want deep rich information and you know you stuck to your guns and that's that's what we're doing and I you know so I I so I appreciate the kind words Jack using that maybe as a kicking off point I'll change my question what is the so if block works for Block work is this institutional crowd that is X for scale like that is web 2 developers that is Gamers like what is the thing that you guys have been building for that maybe hasn't come into the market but is just starting to come into the market if that if that question makes sense yeah and you know we kind of we've we it's we call them hpds that scale High perform high performance daps okay it's kind of a dorky name but it's what happens when

you work in software for too long you start making acronyms and um and so think about it like what applications care about like having zero gas fees what applications care about like incredibly fast finality um you know instant finality with like incredibly fast time def finality with high throughput you know High transaction volume it's it's games it's AI applications it's web through social applications it's deep in applications all right um and these this category was not you know it's still not well represented and like the metrics around it are not appreciated I think um you look at you know hey I think part of that there's a reflective element that if you buy crypto tokens you probably are involved in Defi and what's the main

category use you use Defi and if you go look at the defi llama top 100 almost matches the top 100 market cap you know not to talk too much about prices but you know I so I think there's an element of uh for us we're building for developers we're not you know we're building for to solve a problem and I think there's an element where this Market you look at Amazon back in the day like oh well you're building this well who wants that well people really severely underestimated The Tam of that market and the product Market fit for what they're brain and you know I think people like scale and other similar projects that are chasing this you know High trans High you you know lots of users lots of transactions not big transaction size low size and sometimes

zero more smart contract execution for you know different values that you're for onchain mechanics that impact money and value transfer like this thing is still you know a little bit you know Under Wraps tell me more about this narrative Market fit that you think maybe you guys haven't fully nailed and maybe why like I think other people like uh salana or arbitrum or an igen layer or Celestia like they're they're in the narrative right they're on crypto Twitter they're very much in the narrative like what do you think why do you think that happens like that yeah I think there's there's two reasons um number one one like things are Made Simple um for people to understand so back in the day

it was like you either had to be a layer one or a layer you had to be an eth killer layer one or a layer two and we were hot back then but all of a sudden it was like no you're not a layer two unless you do a rollup and if you have a different integration model where scale still brings a lot of value back to ethereum but it doesn't it's not a rollup and because it it just brings way too much cost to the end user and to the developer and so for us we made decisions not to optimize the value capture of eth in the short term but to optimize value capture for developers and players and users of applications and so the layer 2 Community was like you're not a layer two if you're doing finality and consensus in your chains whether it be

your app chains or your side chains or your you know shards and so we kind of were not involved in either of these categories so you have Market leading Cate like reports of who's leading each category and we just weren't even in them so that's one is that people need like simple clear boxes to put things in the other one is if you think about it there's always continuing investment from Venture firms okay and what are they good at like driving awareness oh news cycle so and so just raised at this valuation oh around this thing and then token goes live and token goes live at billion dollar billions of dollars valuation and people are hunting airdrops and so what's happening is Venture firms are funding the next categories and they're also you know

creating a system of hype around those categories and so I think this is something that's going to be changing in the market where there's going to be more focus and narrative attention back to fundamentals as opposed to okay what's hot and new and shiny and because in in typical software you're you're no matter how good and how on narrative you are in Enterprise software and other C you know software infrastructure categories you're going to have to post metrics you're have to post Revenue you're have to show product Market fit you're going to have to do all these things and to get that you need to be 10 times better than the prior solution for companies to you know rip out what you have and in crypto people are like well this is iteratively better this is 1% better 2% better because this firm did

this and these firms hey I I friends with a lot of these firms we have 14 of them that you know participating in scale and I'm an LP in a lot of these funds they've got to deploy capital and you know and hey we're all it we're all you know there's great projects that are being funded but that's also capturing narrative and so one answer is like also like continually raising money and like getting you know the flywheel going by getting those voices but um yeah those are I think two reasons long answer to your question can you fix it well I think markets naturally fix themselves okay um when we talking about the problem can scale fix it position I think we're in a phenomenal position now

so I think markets fix themselves and I talked about like this you know push back to fundamentals well what happens is when when the you know we have like the weekend like we just had right this is not a fun weekend like anybody you got up Saturday and you're like oh that was bad you got up Sunday and you're like what happened you wake up Monday and you're like K all worse you know it was a horrible weekend in the markets like things like this uh actually end up driving more value into fundamental proof right and so and we look at these Market Cycles when you look at the Cycles we've had like well no the cycle will repeat itself on these schedules well the reality is each time on those schedules there's been really clear data points that smart people running funds

like oh look at the metrics of defi for example in 2020 look at the utility look at these things happening we have confidence in these things right and these things where people could have like provable confidence brings in big institutional money um and hey like meme coins are great and I think are going to do a lot of things for Community Building they're almost like the more accessible version of nfts um so not to knock them but a lot of that is not you know there's no fundamentals and other than like community and you know and hopefully they evolve and they start doing more things that drive fundamentals and I think they will um but that's a long way of saying that like markets have a natural way of driving I saw you know I started my career in the mid the mids and

definitely saw that happen following like the 2000 bust and the 2008 bust and you know you just see this like you know attention back to Value capture the only push back I'd have there is that in crypto for one reason or another and for better for worse price tends to drive narrative and and narrative at this ear because the industry is so nent it's like price drives narrative narrative drives fundamentals so what I mean by that is like token starts going up narrative becomes this this thing is hot this category is hot whether it's modular whether it's reaking whether it's the return to monolithic chains and then user like developers start building on

that thing build better applications and then more users come in and then the fundamentals happen again for better for worse for one reason or another maybe it doesn't always look like that but if you think about that in context of like a scale maybe the because then you weren't plugged into a narrative the the price of the token didn't go up so then maybe the excitement didn't happen which didn't cause the develop right that flywheel kind of broke down so I don't yeah and and I'll just say one uh yeah so two things so one I think I'm looking at this or know I'm not talking about scale I'll address scale in a second and also when it comes to scale I like even for lots of reasons I can't talk about any price things but I'll talk more

about our you know our narrative but and because I just don't address don't address price but um so when when we look at uh you know when I look at this I think crypto in 10 years is going to be far more boring okay and the analysts and the type of things you see in traditional you know equities and securities market right there's a lot of like less sexy things that are driving you know Market appreciation right people are like and I think in 10 years crypto is going to be looking a lot more like that because you know these blood in the markets and maturation in general is going to be driving more and more value now I is it going to happen overnight no and I think

I just but I do think like the pendulum swinging back or not swinging back it's moving now into a point of fundamentals but it not entirely like we're not going to get a 10-year shift in in 60 days so so for projects that like you know hey are weak legally and for all these reasons like you know and we're we're a decentralized project we just focus on fundamentals and but big piece of that is how many Community PE uh how many people do we have in our community how big is our following how many people are staking and participating in the network governance right so we need you know we we're not focused on pricewood WE focused on these other things around awareness and so those things you need narrative Market fit and so for us I

think you say can we fix I think you know we it's almost like a a movie where like we were hot and then all of a sudden we weren't involved but all of a sudden like we stuck to our guns and the narrative is naturally moving back to us and that's you know but you can't just wait for that to happen you have to do marketing you have to do awareness programs and that's why we hired Andrew Saunders the former CMO of arbitrum to go and make that happen um because there's a lot of things we weren't doing and I have to I look back and I'm like in in a lot of ways our project was you know I I think a little naive and that we just you know we just thought not build not building therec come but like build it grow it get real fundamentals

and everything takes care of itself and that's just not the way things are so you do have to get out and inject yourself into narratives and do the things you know that you can do in a compliant fashion to drive drive your awareness and I think we're doing a lot of that and naturally you know you look at scale scale is a modular modular pooled security blockchain with horizontal linear scalability like we meet a lot of these like really sexy themes we also have this gas-free nature that I think is going to be you know we're going to have a ton of competitors trying to do this almost like decentralized SAS model for for you know chain payments and and you know gas subsidies yeah that so that's actually

the next thing I was going to go into is maybe we could talk about this gas free idea because I I feel like gas free has been thrown around for a while it's like you get the users to pay so right now the users pay for gas right everyone knows how that how how the current model works I think your guys's ideas is I understand it is you get the developers to almost subscribe to scale in what feels like a B2B SAS model in a sense and that covers the the gas fees of the user so I think I I don't know how much I'm curious if you guys have metrics on like how much gas you've covered over time for users I I don't know if that exists but yeah maybe you could just tell us about this this model and like why is this the best

model to make users like not feel the pain of gas yeah yeah well one metric that's so big it's almost unbelievable is if you look at the gas consumption on the scale Network we have saved if all that was spent on the ethereum network it's over7 billion dollar in gas fees saved okay it's a high number um now but it's it's a little apples and oranges because guess what gas just costs less in scale because there's not you know there's not finite capacity the other thing that makes scale that I think makes a True Gas free network Every Chain has the ability to essentially use utilize what are called Rel layers where

you can subsidize gas so at the wallet level um I can you know you're playing a game like oh I'm not paying any gas stes guess what someone's paying it but what's happening is the unit economics suck because the validators still are getting paid for each transaction in scale the unit economics are really really good because what happens is developers rent a part of a chain okay like oh I'm going to I got to buy scale tokens I'm going to deposit it into this contract stake it in this contract and then over time you know I buy a 12 months well one 12th every month that I put in is going to go to validators and so you're actually renting a piece up front now it's like running a car and instead of like paying by the mile you're paying by the month well you

might not even drive the car or you might drive at full speed the entire time you pay the same amount and so the unit economics end up being really good because people are validators need to compete with each other to make like get paid on each transaction they're actually getting paid by running their server in the network and they all they work together in unified validation where they're all actually monitoring each other and everyone that like meets the score and is a good actor equally splits the pot and and the thing is so this is you know one of our challenges at scale we do a lot of things and imagine back in 20120 where it was like oh you're like a layer one or a layer two and we're like oh we're doing all these sophisticated things we're not really well understood um but that I

think is the biggest strength of the network and that's why you know if you go in you're like oh we're x amount faster and we do this x amount better and then you talk to a developer and they're like well what happens after the my gas Grant subsidy runs out they're like oh well then it costs this amount and on scale they're like we're like well what happens when you know your gas subsid is going to run out from a gr from this other other chain that's offering you a grant and they're like oh well it's going to cost this amount like well on scale it's only going to cost this you know what it'll cost so you can just the unit economics are so much more Superior for high performance applications how is that economically viable for you guys then tokens need to have properties that let that help them

capture value right and so scale one there's a staking component you can buy scale tokens stake in the network get rewards participate in fees um from chains now instead of having a gas fee what happens is a developer says hey oh it costs this amount I'm going to go rent this chain space now they may be paying it might be one 100th you know of you know it might be one tenth of salana or one 1,000th of ethereum but the way the network works in the economics it's still economically viable um and the more and more applications that come and the more the network is congested in the

sense of how many chains there are the more the higher price the chains are so there's actually a linear a linear scaling curve for the economics just like writing an Uber or lift like surge everybody wants to ride guess what the price goes up you know what more drivers come and the The Surge gets pushed back down because they're like oh it's surging I better get out there and stop my coffee break well in scale there's a certain amount of chains in the network and if we're over that we the F the price per chain is set at a 50% load if the Network's at 80% load it's going to cost a lot more than the net than a chain space rented at 50% load it also incentivizes more validators to set up more nodes it drives the price back down to the medium

so that Medium price is was set for like you know years of e we hired economic phds we had Wall Street people working on it we had Deli digital did a big back when they before they were doing their other stuff they were an analyst firm and they uh had a lot of really smart modeling people and you know that is that's how the token captures value is an intelligent and accurately set median price point to ensure that the price is good for developers and there's Big Value captures still for validators and stakers curious to think uh Curious to hear how you think about like the ecosystem developing so I feel like different networks chains l1s l2s whatever you want to call it have

prioritized different things and that's led to almost different cultures of the chain so like some chains and have focused on gaming some have focused more on Enterprises some have focused really strong on dpin or or defi how do you think about uh BD and like ecosystem growth yeah and I think you know you like uh crossing the chasm is one of the like it's an old book but it's like one of the best books of all time around like you know how to build a market how to build a product how to you know how to how to go to market and and there's something called the bowling pin approach right like you don't have the resources no matter how big you think you are to be totally general purpose so you need to go after that first bowling

pin it knocks over the second two knocks over the last ones and then you get so big you can knock them all over okay and and so for for scale I think and for other projects you have to look at what are your strengths okay what are what is your chain better at than other chains then you have to say Okay well how does that match up to Industry segments and you know types of developers types of applications for us we're like wow lots of users lots of transactions and that first pin is is gaming um scales consistently in the you know top you know one two or three in the gaming core metrics um there's over 120 games that have signed up on scale I think only you know less than half of those are live today every quarter huge

amount uh come and join the ecosystem and you know so that was our big bowling pin and I think as others are like wow like we have high fees but we've got a lot of DJ gen community and you know but we have some good security guarantees let's go after defi but that same di project trying to support gaming it's impossible right it's like literally impossible um you look at rollups and rollups are going through a similar thing they're like really strong in defi but you know even if you have a one penny or a half a penny transaction in gaming you're you're toast there's no way any game that's going to be publishing things on chain wants to pay half a cent or Penny and you know so there's Promises of let's give you this

grant for some period of time and then the more and more people start using it the more transactions the less you know greater the cost for Trans or the lower the cost for transaction so that is a it's a bet but it's a bet some people aren't willing to take as a developer and they're like well let's just go where we know the fees are low and the performance is good and the security is high but I think you're right like we're seeing this kind of you know maturation where we have industry specific builds because of those reasons and because of the philosophy Jeffrey Moore is crossing the cow philosophy if you could only pick two out of three of these so I'll give you um onchain gaming uh very like speculative Crypton native like defi meme coin crowd um and

then like the Enterprise crowd um that you know people were kind of lusting after in the 2021 2022 days what would you if you had to have two of those kind of move on to scale and start building on scale one of them says I'll build somewhere else how would you prior that you know what um the way we look at it is we look at you know high performance applications like gaming web3 social apps which we all know I think are still failing to deliver web 3 AI applications there's 14 of them building on skill already I think there's going to be some real winners there that build great things get users integrate the power of blockchain and II together and not like hey like doing decentralized inference or other really

sophisticated like deep Integrations but High Lev app level Integrations where you use gen and you know tokenization and smart contracts together to build really cool you know user acquisition strategies and and products um I think those those categories are like really sought-after and then we think about defi as this foundational base to support them you need to have this like minimum viable dii to let people swap in all these ecosystems without needing to bridge out okay and then I think our defi approach is actually backwards most people let's start with defi let's go really heavy into defi for us we're like hey let's go really heavy into gaming web 3 AI Etc and then you know peel back

and now there's a huge you know Sushi just went live on scale there's a big big push there's all these rewards and incentives and but the goal isn't to be a top 10 chain in defi it's to be minimally viable to like have really healthy dii but defi that's not a circular reference of people trading it's supportive to actually like you know millions of users using applications needing to swap needing to bridge needing to you know do other activities now enter Enterprise I happy to Pine on Emer Enterprise but go ahead and I think yeah what's your what's your take on uh Enterprise worth the is the juice worth the squeeze so I think I I worked in Enterprise my whole career and before crypto like up until 2017 I have a lot of like friends that

are in web 3 Enterprise and one of the one of the terms is pilot we're stuck in pilotis like oh let's try this let's do these pilots and to me one of the issues for advertise adoption is that decentralization is one of the biggest values of a blockchain right and a crypto and if you're just selling on the fact that you have like programable money and smart contracts immutability trustless transparency Enterprises don't care as much about that okay and so I think the good the best enterplay Enterprise play right now is B to B to C it's the Enterprises and that's like blockchain to businesses to Consumers so blockchains that are targeting Enterprises that are targeting consumers

and so you think about big major sports League big major brands people who service millions and millions of people and can utilize nfts uh you know games uh smart contracts programmable money and like kind of these like top layer values of blockchain to really Drive growth on the consumer side sense yeah it does make sense what are your thoughts on I mean you you spent a lot of time in Ai and Silicon Valley and the pre prehype days I would say like what do what do you think about this intersection of AI and crypto yeah um and I you know hey go check out my uh my block Works article oped I wrote on this pretty you know I

think it's great um but you know my thesis there was you know one H AI is going to have this huge support in in blockchain really just helping people build faster so we're seeing this today like a like web 3 is actually a customer of AI in so many ways where I know our you know core Dev team at scale is building so much faster because they're leveraging block blockchain to write code okay number one number two we're going to see these lightweight Integrations where it's more you know you know hey AI models you know interacting at the app level for people that are you know you know building applications to oh hey like you know make your nft and then you know do XYZ

thing and utilize block utilize the AI engine and create like a fun consumer application connecting these things or hey like you know pay in this Marketplace to like train your avatar uh to do XYZ things for you now the deeper level where these things are like the marriage um which is what I you know wrote about in in in Block Works was the marriage of AI in web 3 this like Hey we're having like transparency around the inference models we making sure that you know this AI engine is doing what the community wants it to do and there's transparency around ABC things and we can vote to actually make these things more left or more right or more transparent or more you know ABC like

that like culmination is still a ways off but the second piece I think we're finally getting into this and like I said there's 14 applications on scale that are already blending these things together and I think we're going to see some like big consumer wins in the AI space that that leverage blockchain as like a feature say more about what that means like what like what what are some of these 14 folks doing what is that actually entail so a lot of them are using like you know decentral like using you know chat GPT like or gpts uh you know cores and they're creating applications on top of it if you go to GPT store there's something like there's thousands of applications

now imagine within this I'll just come up with something like let's say I have an application and I want you know it's it's going to uh you know I want people who are like really good creators in certain categories to help train these models for the artwork and it's like you know or it's chefs I want chefs to help like train my how do I motivate them oh the more they participate they're going to like capture tokens by being like core level like deep level creators on the inside I'm going to capture users by having like a tokenization to like you know airdrops effectively to like get people to utilize my product and then I'm G to have like some voting or governance feature so you kind of systematize uh a a loop of of usage and

contribution where you've got like workers and you've got you users um and you've got a system just like a blockchain but within an application but the center that application is you know a large language Model H that's interesting maybe putting on your anything else on like the BD and ecosystem growth side that you want yeah um you know I I just want to say like I as a builder like we have you know over 250 projects that are you know signed up building on scale over thousand developers like um there's a lot like this was like been calling it the Red Wedding weekend you know Game of Thrones it's this is

not a good weekend we just had but you know from a builder perspective like there's more people than ever building and I think they're building in more and more categories and we're going to start seeing breakout use cases um and I think gaming is already breaking out we're not seeing the success of like gaming tokens yet but gaming traction's really growing and I think the other pieces are following you know you look at like dpin I think we're finding more and more use cases like there's one on scale that it's called exord it has you know you know tens of thousands of people all over the world that are like you know downloading this Linux kernel on their computer that effectively is like a localized node um this physical infrastructure that's capturing all this like sentiment data within their realm

like the country they're in and the social media they're in and then then it uses AI to like come up with like Trends and predictions based off this like hyper decentralized you know data capture that's only possible with decentralized physical infrastructure so things like that we're actually seeing these things come to light and uh and you know I'm you know from a BD and go to market like just more and more people building than ever before so it's it's exciting times really positive nice but stuff happening uh what about I guess putting on the founders hat again like I'd love to hear you talk about just macro and running a company in this I mean yeah we had the jobs report Japan like we're recording this August 6

so the market dumped what 20% and then has been rallying a little bit since then but it's I mean just a crazy last 72 hours what are your like how do you think about running a running a company in crypto during this time yeah I think and you probably deal with this too like one you've got to pull your emotions out of it right you know and I think I've learned that from working in the space so long you just kind of like you have to get you have to be emotionally connected over like you know 30 and 90day rolling averages okay you know because you can't just ignore markets and not emotionally have any engagement with them but if you are being pulled around every day by the market and you're trying to make you know long-term plans and like lead people you're not

going to do a very good job okay so I think that's that's like one perspective and the other perspective is like there's business strategy it's like I get to tell you like a lot of projects cut cost back in 2022 and the projects you see here today are ones cut costs and you know because the other thing is like you need to play aggressive when markets are up no matter what if you're coinbase or if you're you know a decent fully decentralized Dow based defi project you have a budget to spend on marketing right and customer acquisition and user acquisition but if you spend that into like 2022 like Doom and Gloom you're just throwing that money away you're like burning it on fire right you

need to keep the lights on you need to be doing things and keep spending into tough times they say don't cut marketing and down markets but crypto is very specific right but you need to but if you're spending it then the Market's up and everyone's spending well it doesn't do you any good you're like you're way it's way too saturated so there's a timing element too that I think for anybody running a project has to be really aware of and that gets informed by your emotional like you know sentiment and like analysis and the people you talk to so you always have to be forming opinions so you can make moves on the chest board um and you know for us we're decentralized so we only have a certain amount of like power and control but you know we play a huge role in the project um and we play a role

with our budget at scale Labs Inc um but yeah it's I gotta tell you man it's uh the skill set to do well in your job or my job or lots of jobs a lot of it is like being able to like deal with turmoil and like try to know what's around the corner yeah you ever uh do you ever listen to the founders podcast by David senra uh no I don't it's a good it's a good uh good podcast but um there was an episode the other day on Rolex and I talked about how Rolex was a big International brand but the thing that kind of really boosted them in the US was uh 2008 2009 Market obviously tanks and you get this recession um big Global financial crisis and Rolex doubled down in the United

States on marketing when all the other watch brands pulled back and they started spending more than they'd ever spent and they really doubled down on brand awareness Market marketing uh which I guess was a huge fight internally because everyone said no we need to do Performance Marketing we need to pull back the marketing budget and they they pushed heavier in the in the bare market so uh I don't know yeah yeah it's like you know and it's all bets right it's like when are when's the right time to do it if you do it too early and too aggressiv in the wrong places you just lose it if you do it in the right way at the right pace and at the right time and that's the question because you and hey I'll tell you like even if you're like booking conferences 6 months out or whatever like everything

is twice as expensive for anything you want to get like you're getting advertising you're getting no matter what it is like you've got to be early and you know and so that's I think that's a great story with Rox uh Jackman this this is great chat anything else that you want to cover um that we should have talked about that we missed yeah you know I just uh I think we covered a lot of topics I think you and I always have a fun time chatting it was fun to be able to do it uh publicly now one thing I want to ask about is like give it give us all the update is there going to be a golf tournament at permission permissionless and are we just doing you know uh are we just playing I what are we doing I think we've got it all I mean

yeah the idea with permission list and Shout Out Santiago for pushing me on this was uh you go to all these conferences and you're just [ __ ] wiped by the end of it like heavy drinking shitty food staying inside the whole time and yeah we're trying to make permission list be like a little more Health Centric so we're doing it in Salt Lake lot of great outdoorsy stuff good hiking we the pickleball tournament is live so you can sign up for the we're doing a big pickle ball tournament that's I'm signed up I'm signed up for the pickle ball tournament Andrew and I are well at least we've applied so gotta we can we can get that acceptance pushed through I know a guy who knows a guy um we got a we got a golf scramble Mike was like I'm doing the golf scramble I was

like dude I don't I gotta get in the golf okay I need a I need an invite for the golf golf scramble I got to get in well I told Mike I was like I think we got a conference to run golf is like an all day activity I'm pretty sure you can't just like yeah I think the golf has to happen like the day after maybe the day before or something or like two days before but before would not be good for you guys setting up a conference I'll tell you that that to be fun it's the most excited I've ever been for a conference and it's crazy like I mean it's a always been a conference for like kind of crypto native crowd Founders execs and crypto Builders developer big developer audience that comes a lot of investors both crypto native and non

this is the first year we've ever had a lot of policy makers uh really coming out in droves so from congressmen Senators which we haven't announced anything yet but um it's been cool I'm excited I say it's a great City too because it's easy to get around and it's like beautiful the worst thing about conferences when you have to drive like 45 minutes to go to each leg and you're like you know so I think it'll be it'll be really good to the activities around around the conference don't sleep on Salt Lake so Jack man this has been great I appreciate you congrats on everything you've been able to do at scale um it's fun having you on the Pod awesome thank you cheers man [Music]