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The future of DeFi doesn't belong to Ethereum (feat. @fuserleer of @radixdlt) #CHAINREACTION
Recorded: April 16, 2025 Duration: 0:55:02Space Recording
Short Summary
In a recent episode of Chain Reaction, the hosts discussed significant trends in the crypto market, including the current decline in prices, the potential for future growth, and the evolving landscape of DeFi. Key insights included Coinbase's bearish outlook, the impact of geopolitical factors on Bitcoin, and the innovative developments at Radix aimed at enhancing user experience and scalability.
Full Transcription
Thank you. Thank you. We're a little bit late starting, but we have troubles with X more or less every day.
They need to improve spaces, but we're here now.
Welcome to the Chain Reaction, the daily show for Cointelegraph here every single day on X at 2 p.m. BST, 3 p.m. Central European time and 9 a.m. New York.
Now, we've had a very big week, very big stories and very big guests, and we are continuing that today.
But first, you may be familiar with me. Soon enough today. But first you may be familiar with me
soon enough you're going to just be familiar with me because of this but if you are familiar with
my name it's probably because of Ryzen Crypto the predecessor for this show which was a daily
podcast for Cointelegraph which we've moved live so we can have guests and a better conversation
and then my co-host is head of multimedia content managing editor and general
globe trotting cryptopian gareth jenkinson who is also currently in a swiss airport uh his
his internet is going to be dubious at best i think but let's try it out gareth can you hear me
okay hey i can hear you rob how's going, everyone? Welcome back to the show. Thumbs up if you can hear me. Yeah, we can hear you. We can hear you loud and
clear. You're actually very good. Yeah, for now. I'm about to start moving through the airport,
but yeah, greetings from Malpensa Airport. I was actually in Lugano for a couple of days.
I met with Tether CEO Paulo arduino we had some very interesting
conversations um but that is not a topic for today's show um i'm gonna let you i'm gonna let
you do the talking rob how dare you tease that um we will come back to that though don't you don't
you worry uh and then obviously we have the the third man in this trio, which is Zoltan Vardy, markets wizard, general legend, here
to give us a breakdown of the past 24 hours in the markets, which would be boring in most
financial markets, but in crypto, honestly, he could do his own show just on that alone.
So it's chaos.
And then we have guests, which you can probably see from the title and the other speakers but
we'll go our usual route with structure we're going to start with the markets breakdown with
Zoltan and then um Dan and Radix we're going to come over to you next so Zoltan um it's red today
we don't like red what's uh what's happening yeah markets have been rather um red robert and i think um i think part of that
may also be because uh because of a little extra uncertainty um kind of uh um coming into the
markets and part of that um could be because of a new institutional report from coinbase
um which actually suggests that the crypto market has entered the bear market for the moment
which actually suggests that the crypto market has entered the bear market for the moment.
And they are basically citing the old coin market cap,
which fell over 41% since the peak in December 2024.
So they are actually calling this an intermittent crypto winter
due to the quote-unquote extreme negative fear
and the onset of global tariffs that could present further escalation points.
We've actually seen even higher tariff threats imposed on China from the United States,
which once again may have a lesser diminishing effect on Bitcoin, but nevertheless, they're
still adding to the uncertainty and to the lack of risk appetite. Now, the caveat here, or I guess the silver lining is that Coinbase does expect the crypto
market to rebound in the third quarter of 2025.
And I guess this third quarter rebound is kind of in line with, for one, historic market
cycle expectations to Nansen's data, which also suggests an incoming recovery once tariff negotiations is.
And thirdly, I guess just general liquidity conditions in the fiat world that are set to improve.
However, one interesting thing to note here is that while the old coin market has fallen 40% since December,
Bitcoin is still trading above 83k.
So from one perspective, I'd say it
would be difficult to cool the bear market, just considering that Bitcoin is above its previous
cycle highs and is trading quite robustly. Now, just a quick Bitcoin update here, Robert.
We did talk about the closing yesterday. We did unfortunately see a close below the Trump tariff double top, which is just above 85.2K.
We've actually closed just above 83.6K, which suggests that we'll still remain under this double top formation we've seen with the tariff announcement.
top formation we've seen with the tariff announcement. So once again, as long as we
don't see a daily close above the 82.2k range, sorry, 85.2k range, we will most likely be limited
in upside. And as long as Bitcoin remains above 82.4k, we will avoid 1 billion worth of cumulative
leverage long liquidations. And I feel very optimistic as long as we avoid this 82.4K mark.
Now, this will obviously depend on tariff announcements a lot.
The recent escalation actually just came out in the last hour when we went on the show.
So I do feel like market trajectory for the rest of the day will really depend on how
the US is digesting this
escalation. And this escalation could mean a tariff of up to 245% on US imports from China.
So nearly double the previous figures. Once again, we'll have to see how US markets react.
best markets react.
Oh, a lot to unpack there.
Firstly, altcoins, what do you make of the situation?
It feels to me in the past, I don't know, maybe 14, 15 months, every time someone says
altseason, they tank further.
I hadn't realized they'd fallen by, what you say 42 percent since december was that was
yes sir exactly 40 42 percent and it either has actually declined declined the 60 percent from
from its december peak of 4.1k so definitely it's it's slightly concerning however one one thing
that old coin investors can take comfort in
is simply thinking about the fact that altcoins have yet to have their moment. Actually,
Bitcoin's rally was very much ahead of the historic rally by over half a year. So I really
think that Bitcoin is currently just resynchronizing with the historic four-year cycle. That's also
something Rekt Capital has been predicting. And once we see bitcoin resynchronize and we see it above its
current all-time high of 109k i feel like old coins could really have some more room to grow
but one last topic on this that i really want to explore in the next two quarters is whether the
holistic bitcoin um the holistic old coin sector will have a rally as during previous cycles,
because a lot of analysts are actually just expecting set utility tokens to rally,
not altcoins as a whole, as we've seen when crypto markets were during more immature cycles.
Yeah, I've always felt like there's the calls for altseason are primarily people like me who have
bags from the last cycle they would quite like to remove, which would then getting the way of any sort of alt season.
I have one more question for you, which is about Bitcoin.
The one thing I read that has worried me a little bit, I mean, I see a lot of talk about bear markets.
about bear markets. I see a lot of talk about crypto winters, as you've discussed. It doesn't
I see a lot of talk about crypto winters, as you've discussed.
particularly feel like that, even though, you know, the fear and greed index, crypto fear and
greed index is bottoming out and has been for a while. Bitcoin's price is still, to me, it's still
pretty good, all things considered, particularly with the tariff war. But speaking of the tariff
war, it looks like China might be trying to offload their Bitcoin. Now, there's been rumors
a lot about them starting their own strategic reserve of Bitcoin like the US has. And I know
a lot of people in China were pushing for that, particularly crypto prominent figures were pushing
for that. Now it looks like they might be trying to offload it to rebalance their coffers perhaps in
in you know the wake of the uh trade tariff war perhaps a bigger picture who knows but they have
a rep i think they have a hundred and um this could well be off but i think they have 194 000
bitcoin um which is phenomenal outflows if they start getting really a bit like Grayscale 2.0.
If they start selling, is that something people are worried about Zoltan?
People are definitely worried about that.
However, I feel like it's really hard to imagine China selling such high Bitcoin holdings during
this time, just before the historic peak of the four year cycle and just before macroeconomic
conditions are expected to improve.
So I feel like in case they will be selling,
they're going to miss out on a huge chunk of profit,
as we've seen with Germany selling last year.
They most likely regret that.
That's something that we've reported on.
One thing, though, I'm curious about,
even if they do sell,
it's hard to imagine to see them selling in over-the-counter trades.
So meaning that they could be selling these large batches to whales, and that may not have such a drastic impact on Bitcoin price as over-the-counter trades.
Because let's be honest, just to sell these on centralized exchanges would take a lot of time and a lot of liquidity.
And selling that much would probably tank their own holding significantly.
So I think that even if they're selling, they would have to be moving this through batches and most likely not true over-the-counter trades.
But obviously, China's blockchain transactions are pretty hard to navigate.
We have very little public information from them.
So we're operating with relatively little certainty when it comes to their selling patterns yeah uh it's always a difficult one but then if there's any sort of
entity that holds a lot of bitcoin they can put you on edge when they're in a sticky position
also i wonder what would happen if they were trying to sell over the counter we might get
the juiciest story of the year with michaellor buying from China. Would that upset Trump? Would it make him happy? Who knows? Okay, amazing. Thank you,
Zoltan. You mentioned the decline of Ethereum, and I think that is the angle we're sort of
pushing here. I've used my title for today's space, The Future of DeFi Doesn't Belong to Ethereum,
case the future of DeFi doesn't belong to Ethereum is from I'm sure Dan recognizes it I found it while
deep diving Radix and I found it from a post in 2022 and I just I love that that sentiment so
that's the title I went for generally we're going to be speaking about DeFi in broader terms but
let's start with you personally Dan Dan. Welcome to Chain Reaction.
It's great to have you here. How are you and how did you end up in crypto, I guess, is the best
place to start? Hi, I'm very good. Thank you. And thank you very much for having me on your
wonderful show. So, yeah, I'm glad you like that article. That was quite a while ago now. So regurgitating some of that information, I might have to refer to it for my own material so we can get to this conversation.
But a bit about me, I'm the founder of Radix.
And my journey in crypto started all the way back in 2012.
12 discovered Bitcoin. I mean, there really only was Bitcoin then. Very interested in the
I discovered Bitcoin.
I mean, there really only was Bitcoin then.
more technical solution that Bitcoin offered at the time to do with, you know, the Byzantine
General's problem and how a permissionless network had, you know, how that had been solved,
right? So Satoshi's solution was elegant um and it made a lot of sense
and so very quickly went down that bitcoin rabbit hole from a you know a technical computer science
perspective um and then also appreciated that this new paradigm of money um could be very disruptive
um and have significant impact in the way that we trade, the way that we interact
with our money, the self-sovereignty and all of those wonderful things that Bitcoin gave
rise to.
And that's kind of where my journey started.
But then over the course of maybe six to 12 months, my nerd hat on spent quite a bit of time digging into the operation
of Bitcoin and what it would mean if 8 billion people suddenly started using it and what
issues would it face?
How would it scale?
How would you avoid centralization and all of these things?
And after trying out a bunch of things came to the conclusion that maybe Bitcoin is the first,
but if you're thinking really long-term in terms of DeFi and millions of people using it and AI
and IoT and all of those things that are now converging and using Bitcoin and blockchains as
a kind of conduit of trust, I guess.
How would those issues be solved?
And that's kind of where the Radix journey started.
And we spent a long time trying to solve,
I guess, what is essentially the trilemma,
which there isn't a solution for,
but you can push it to such a degree where the trial limit becomes essentially redundant in a sense.
And that's where a lot of our R and D has been over the past.
Wow.
Yeah.
Like 12 years, been doing this for a long time now.
Um, so that's a little bit about where I started, uh, and what we've been
trying to do at Radix, you know, scalability, but also developer
experience and the user experience, which i think as a whole are still generally lacking in in the industry but over the past
12 months a lot more attention being spent on those which is good to see wow yeah i didn't
realize you were just so early to the space obviously 2012 very little was was in place
and perhaps i don't have the timeline perfect now. When I was researching
Radix, I wrote down that it looks like you've been building Ethereum, but if Ethereum was designed
specifically from DeFi from the get-go. Now, I can't remember if that was my own thought or I
stole someone else's, to be honest with you but how accurate is that um can tell us
a little bit about what radix solves the problems it solves yeah sure so I mean you're pretty close
right um so defy is obviously going to be a kind of use case anchor for this technology right so
whether it's ai agents or iot or content creation or all those kind of use cases they are
all going to overlap in in the broad d5 sense in some way right um because really what these
networks are more than anything at least presently are networks of value right they move value from
one place to another and a whole myriad of different ways and use cases but essentially you're moving value and value is DeFi right and one of the one of the main things that we identified was
that one of the issues with the EVM and the model that was adopted there is that assets
aren't first-class citizens of the network as such? So hence the need for the ERC-20 token and the ERC-20 specification,
allowed you to make tokens on top of Ethereum and then all of the extensions
that followed on from that.
And the problem with that, of course, is that it makes it much more complicated
to manage the lifecycle of tokens because the underlying protocol isn't
aware of what a token can or can't do, right? So, you know, the basic principles of if I have a $10
note in my pocket, it can't be in your pocket at the same time, right? And those concepts, even
those most fundamental concepts are not well captured in the EVM. So as developers, you end up creating a lot of boilerplate or importing these behaviors
from elsewhere.
And it can get quite complicated if you try to do something novel and new.
And the more complicated it is, the easier it is to make mistakes.
And then you have all the issues like wallet drains and re-entrancy attacks and all of
those things.
So one of the primary approaches that we took was,
okay, how would you build a smart contract model
where assets are first-class citizen?
And if you can immediately move that burden from developers,
then the whole experience should be a lot simpler and safer.
and safe. Interesting. It seems like Radix is fundamentally different from platforms like
Interesting.
Ethereum in a number of ways that people might not be aware of. I certainly wasn't until I started
looking a bit deeper into it. I see you're not using Solidity. You've got your own language,
and you've got a completely different smart contract platform.
Why did you decide to go that route? Is Solidity not efficient enough? I'm not a coder,
so perhaps go for the simplest way of explaining it. Yeah, really for us, the mandate was how do you enable developers to quickly build very secure smart contracts and dApps to the degree where even if they are not experts, expert developers, they
can still approach their business idea and at least get it off the ground as a
MVP or a prototype, right?
And that's extremely hard to do with Ethereum.
There's a very steep learning curve there with the EVM.
And what we really wanted to try and capture was,
you know, like how like with the web,
somebody with no coding experience
can very quickly put together a basic website.
They can read some tutorials on HTML and JavaScript.
And even though it might not be the most polished thing in the world, with a couple of days of
reading and playing around, somebody can build a basic functioning website for whatever it
is that they're trying to do.
And that's kind of what we wanted to enable from a Web three point of view, right. Um, where the model in which you're developing kind of hold your hand quite a bit, um, and
puts guardrails around the things that you definitely shouldn't be doing and abstracts
away a lot of the complex tasks into the protocol itself or into the execution engine so that
you, as a developer, you don't need to be an expert programmer.
You don't need to be able to
understand all of the concepts of, you know, coding design patterns and reentrancy and all of
these things that make it complicated. We're really trying to capture the essence of you can
spend more time building your DAP and less time making sure that you haven't screwed something up
basically that later on causes you an issue um and so just really wanted to try
and facilitate the the funnel i guess and reduce the amount of friction required for somebody to
come in and start building so in our ecosystem there is a number of daps um that have been
developed and been launched by people who have never coded before in their life. And they've just used our development model, the language, read the docs,
and got started in essentially no time at all.
And some of these applications are very well made.
They've been around for a long time.
And it all started somebody who had coded very little or even never previously.
So that's what we were trying to capture.
And it seems like we at least were able to do that to a significant degree.
Do you think that lowering the barrier of entry for devs to get started on a platform
transfers across to the barrier of entry for users of DeFi.
Because the reason I ask this is yesterday we had Gracie Chen, the CEO of BitGet on,
and we were discussing DeFi and centralized exchanges and why people go to DEXs.
But really centralized exchanges have the bulk of particularly new users.
And it's because the barrier of entry to use decentralized finances is generally higher than downloading Coinbase app and just buying something very quickly.
So do you think this perhaps helps with that problem?
Because that strikes me as one of the biggest problems for DeFi at the moment is new users have to have a degree of understanding when it comes to crypto to really get anything out of it.
Yeah, I think for sure the two go hand in hand, right? If you have a better developer experience,
that doesn't necessarily automatically lead to a better user experience. So you've got to
try and move both of those needles as much as you can at the same time. And so the user experience that we've implemented is a lot, it's less techy.
It's more self-explanatory.
It's very clean.
And it's integrated in such a way where the developers are, once they get used to this
different paradigm of developing smart contracts and dApps and stuff. It suddenly becomes quite intuitive to them.
I think one of the main problems that we have faced over the last couple of years is that
people get very much entrenched in the mindset of what you do on an EVM and how you do things.
And then when they transition to trying to build something on our stack,
the learning curve seems much steeper than it really is because you've essentially got
to forget everything that you've learned and how you would do something on say the EVM and then
switch into this new mindset, which kind of explains why those people I was just talking
about who have never coded anything, they can just get straight in and, and, you know, get started and
start cutting code and building prototypes because they don't already
have this mindset that they've got to almost divorce themselves from, uh, and
then start fresh.
Um, but then if you couple the two together, it allows the developers
building these dApps to also build an intuitive user experience because the tooling and the kind of standards, if you like, on how to do that on Radix and the wallet backs up those standards as well.
And there's like human readable transactions in the wallet.
So it's very clear what it is you're doing, what the transaction is going to do, what tokens you're going to get back or how much in a swap you're, you know, you're swapping what the slippage is going to be and stuff. It just, you put those two things
together. And you end up with very intuitive developer and user experience on both sides,
which essentially lowers, maybe not so much the friction, because there's still a learning curve,
like I think we're still a long way away from a completely streamlined user
experience because there's still a lot of primitives that are needed to be
developed just in the space in general.
But it definitely lowers the anxiety level that people have because it's
presented in such a way that's a lot more human rather than, you know,
blind sign and all just some hash on metamask that you have no clue what it
refers to, especially if you're not technical at all.
So the two definitely complement each other.
And I think that you've got to work on both simultaneously in order to get the maximum effects from each.
I want to look at the dev side of this equation a little bit further.
a little bit further you mentioned um exploits and i think this is an interesting topic because
we've i mean we've seen billions stolen from hacks and exploits in defy and while you were talking i
was thinking well if you've got as you put it guardrails up and you make it easier for people
to avoid basic mistakes then that should prohibit some of the more basic exploits, I guess.
But then another part of me thinks, if you're installing these guardrails and
making it as easy as possible for non devs to dev, then does it add to the risk your end?
Like if you make a mistake, or you you leave a vulnerability, I haven't spotted
something, then it will be more prevalent in the apps built on Radix.
Do you know what I mean?
Yeah.
I mean, sure, there's always a risk of that, right?
But we, as the protocol developer, overlook something.
Unfortunately, we're not all super advanced AI robots.
We are all still humans ourselves and
things can be overlooked um but we take a lot of care and effort to make sure that what we are
building and what what we are deploying um is safe and secure um so you know sometimes people
might claim that we go a bit too slow um but i don't think that you should move too fast when you are building
networks that potentially secure hundreds of millions if not billions of of value right um
but then on the opposite side of that we've also had two audits um done on our code base and we got
10 out of 10 in both um i believe that our stack is the only one to get 10 out to 10 from both of
these, uh, audit companies.
So we, you know, mistakes can still happen, right.
Um, but we try to ensure to the best of our efforts that the protocol, at least,
um, there is no holes there that can be easily exploited if at all.
Obviously we can't prevent like business logic errors.
So, you know, if, if someone's math for distribution of tokens is off,
there's not really much that we can do to protect against that, but all of the
common failures that you generally see at the smart contract level, you know, re-entrancy or,
uh, blind sign in or the authorization model is wrong and all of these kinds
of things, they are the things that we can protect against both from a user's
perspective and a developer's perspective.
So there is a limit to what you can do at protocol because a lot of the times it
doesn't have the context of what the DAP is trying to do, but all of the kind of, you know, fundamental primitive
functions of what the DAP is interacting with at the protocol level, we can put
some guardrails around that.
Yeah.
I mean, I wasn't trying to catch you out on anything there.
It's really just, I like the hard question.
So it's all good.
Yeah.
I mean, I was just thinking because, you're the more you help someone, the more you're sort of absorbing responsibility, if you know what I mean.
And and that puts a lot of pressure on Radix in these situations.
And I just wondered how you handled that when, you know, two 10 out of 10s shows how you handle that.
But this this does bring me on to my next question.
Like, and again, this might come across as a hard question.
I don't intend it to be as hard as it sounds sounds but you guys are crushing it in a lot of ways but as can be said
of almost all but one in defy uh ethereum still has over half of total value locked how do we
dethrone ethereum from um this how well they're doing in d5 how do you dethrone them
yeah i think i think ethereum will slowly bleed away that influence um from and i like ethereum i i love what what they what they pioneered i remember reading the yellow paper and being
like okay yeah this is like an obvious next step, right? After Bitcoin.
And they've, they've done a real good job. But I do think that there may be starting
to lag behind a little bit. And the main area I think, which is probably accelerating the
potential demise of Ethereum as as number two, let's say uh is the scaling roadmap right um i think we've been
we haven't had the tsunami of users that i thought we would have had by now and i think that's
probably a good thing because there aren't really any protocols out there that could handle that level of scale.
There are some on the horizon.
Obviously, we are also focused very much on scalability and providing a more scalable network protocol.
But I think once those floodgates really happen
and there are use cases and you have retail users
who maybe aren't so anxious about using crypto because
the user experience is better and the developer experience has improved.
So you're not hearing about these exploits almost 24 seven.
I think that will be when Ethereum really starts to bleed out its dominance.
And that value will move to other protocols that can
support those users and those use cases that are required. And,
you know, I think, I think we sometimes lose sight of the fact
that this industry is still very small in terms of, you know, the
total value lock that's here, right? I mean, you know, you
pick any of the top 10 hedge funds or banks and the total value lock that's here right i mean you know you pick any of the top 10 hedge
funds or banks and the the total value market of crypto is almost a rounding error on their
balance sheets and stuff right so we haven't really seen mass adoption yet and when that comes
um i think that's when you will start to see Ethereum really start to bleed out.
And people always say about network effect and mindshare as well.
I get that to a point, but what you've got to remember with crypto is that it's also incentive driven.
So if there is an opportunity, you know, somebody comes out with a killer app on
if there is an opportunity, you know, somebody comes out with a killer app on
Solana or, or Radix or some other unknown chain, and it's an absolute killer app.
Nothing can, you know, it's, it's brand new.
It can't easily be developed anywhere else because that protocol has some
primitives that enable it there and maybe there only.
And it's a huge opportunity.
It gets traction.
It gets by virality.
You will see a hemorrhaging of liquidity move away from the top 10
into whatever that app is.
And if then it starts to get mainstream adoption as well,
then that just essentially amplifies that exodus, right?
So I think Ethereum's got its work cut out to stay relevant.
And I think the main nail in its coffin will be its scalability roadmap because it's just not sufficient.
Yeah, it's funny you were saying about the sort of mass exodus.
I've heard this before in the last cycle, people talking about everything just gravitates towards Bitcoin and Ethereum.
And I was pretty outspoken about how good Solana was back then in certain applications.
And it wasn't, you know, growing as fast as Ethereum was.
And then it feels like since about 2023, we've seen exactly what you're saying play out.
Because look at TonChain.
It had nothing.
And then it had things like Hamster Combat pulling.
I mean, I'm not a fan of it particularly.
There wasn't much to it. But amount that was a that was a viral hit without question i mean the number the numbers
they were doing was just phenomenal so people aren't really as tribal about the the ecosystem
they're in as they once were it did feel a little bit like you pick your l1 and you stay with it but
yeah it was horrible i mean i didn't like it at all because i think most people will just
gravitate toward the apps they like and what they they want to to use um one thing i do i do want to
ask you about is how you see this sort of recent regulatory shift,
particularly in the US, obviously,
and how that might incentivize people to start using DeFi.
I know I've mentioned this on so many spaces, and I know our listenership changes episode to episode,
but I don't like repeating myself.
I have a friend that works for a hedge fund
that does a lot of crypto stuff.
He's told me they can't touch decentralized exchanges.
They can't really touch DeFi because
they can't report all the things they need to report to be compliant. Now we're looking like
we're getting some regulations in the US, the UK. Who knows? We're usually behind the US and these
sorts of things. Do you think this shift will really promote DeFi and perhaps push it to the next level?
Oh, yeah, absolutely. So what I feel has been lacking in this space a little bit over the past
few years is innovation, right? So, you know, go back to 2013, 2014, even up to like 2017, 2018,
there was a constant innovation in this space. Innovation, not just on
the protocol side and the consensus mechanisms that are used, but in the kind of applications
that are being built. You know, people were trying out different things. Many of them didn't work,
but a few of them stuck, right? And the ones that stuck became huge, like AVA, for example,
right? Uniswap and stuff. And I feel like there's been a definite
downtrend in innovation since the US took that very strong anti-crypto approach, if you want to
call it that. And this almost 180 degree pivot, I think will definitely lead to a resurgence in
innovation. I've spoken to a resurgence in innovation.
I've spoken to a lot of people over the past few years, you know,
at conferences and various meetings and things and online that have had really cool ideas for very innovative applications,
but they just didn't want to build them because of the uncertainty around
regulation and, you know,
all the kind of horrible things that were happening
let's say um but with that kind of threat i suppose mitigated to some degree if not gone
um i do think that we'll start to see people get bullish about innovation again and and some of the
builders will start to build some of these incredible applications that just i know about
right and i'm sure there's there's thousands and thousands of builders out there
with a good idea that they just thought, you know what,
I'm going to leave this for a little while and just see where all this stuff plays out.
So I do think over the next 6, 12 months,
we'll definitely see a resurgence in innovation.
And I don't think it'll even matter if we're in a bull market
or a bear market or whatever.
You know, there's that mantra of builders build in a bear market.
And that's very true.
But I think this is such a breath of fresh air and an opportunity for all of these builders that have maybe had their handbrakes on.
I think we'll see innovation regardless over the next 12 months.
the next five months and I think it will be beautiful.
And I think it will be beautiful.
Yeah, it's we had a few weeks ago, we had Caitlin Long, founder and CEO of custodial bank on and we
discussed debanking, which is, you know, the other side of this coin in a way, and how much that's
affected businesses I spoke about my own company was debanked continuously, just for being a block
producer of a blockchain last cycle um and it
does it makes you question whether like one of one of my co-founders basically said oh i mean i don't
know if i want to do this anymore it's it's horrendous like every single week is so stressful
and there's so many talented people out there that are looking to build things and take you know
blockchain technology and see what they can do with it and like you say that they're probably dissuaded by the fact that they could end up accidentally breaking some law or regulation
and getting in trouble over it and they might as well just wait and see how things play out so
it definitely feels like we need uh the foundations in place so that people can start building on
them and on that note uh you say you know it's going to be great in sort of 12 months
time. But what do you see DeFi looking like in five or 10 years time? And I'll caveat by saying,
obviously, no one can know because this space is wild in terms of which directions it goes.
I think it will be prolific at that point. You know, many years ago I've said this on a few spaces now, I made a presentation
where I essentially stated that AI, VR, AR, IoT, they would all converge and
utilize permissionless networks as a means of not just transferring value
across those separate domains, but also as an anchor of trust as well.
So that a lot more stuff can be autonomous and you have a permanent record of what happened
and what's going to happen.
And agents in these different domains can refer back to that, that anchor of trust and
that permanent record, i.e. a blockchain.
And you know, they all trust but verify, right.
And I think that's only going to grow. But then
you also have these kind of side industries like RWA is going to be a slow, steady, but very long
burn over the next five to 10 years. There's a lot of infrastructure required external to just,
you know, blockchain itself to be able to bring, you know, assets on mass on chain, especially real world assets, you know, like property or land and all these things.
Um, there's a lot of moving parts there just in the same way where I think, what was it 2015 supply chain was all the rage and then nothing really materialized during that cycle. And in a supply chain, there's a lot of moving parts involved, a lot of
infrastructure needed outside of just the blockchain piece.
Um, but again, I think that will come over time.
I also think that creative, uh, like, you know, videos, artwork, music, all of those
things, this is all very well geared towards the creator economy as well.
So I think over the next five to 10 years, that will start to get very, very big as well.
And centralized platforms like YouTube and all the rest, I think, will have a bit of a challenge
on their hands to remain relevant.
This technology isn't going anywhere at all.
It's moving fast from our perspective, but I think in the broader perspective,
it's really moving about as fast as it can.
And I think that for these more disruptive side quests,
if you like, where it's not just money,
but it's also world assets, creator content,
all those things. I think we just need to maybe limit our expectations a little, but just be
aware that it will come and it will probably surprise us because all of a sudden it'll be
everywhere. Yeah, it does. I mean mean it certainly feels like that and the creator
economy that was very important to me last cycle in in terms of what i was writing and what i was
talking about um it it still is very important to me and i think a lot of people have lost their
uh i don't know they've they've stopped seeing the value in what it adds, particularly to art and music.
I don't think music has ever really got started in the space.
And that surprises me every time I think about it, that, you know,
independent artists aren't utilizing it more, but perhaps we will say that.
I want to get your thoughts on, so it's a discussion we had yesterday
and it is connected to the mantra OM token crash.
It's one of my favorite questions in the space to ask people.
And it's about centralization versus decentralization.
How decentralized should we make things?
What level is desirable?
Some people want things absolutely decentralized completely, but then that comes with a lot of problems.
But then fully centralized is also very problematic
as we know um the mantra own token crash we're still picking through the wreckage we don't know
all of the um all of the facts yet we had uh jp mullen on the show on monday as everything was
still happening to to explain what they think was going on. And they put a lot of blame on a centralized exchange.
I shouldn't say centralized exchanges,
one particular one for reckless liquidations.
And it struck me as an interesting part of this same debate
about centralization versus decentralization.
I'd love to get your thoughts
on what happened with mantra if you've read anything about it and also what you think about
this problem of of how much we should decentralize yeah so yeah like you said the mantra stuff has
still been picked apart right um and i think there's a little bit too much uncertainty for
me to really make any strong statements on what i think happened um but there's a little bit too much uncertainty for me to really make any strong statements on what I think happened.
But there's a few things about that project which definitely raised an eyebrow for me.
And I think probably the main one was the disjoint between the market cap and the amount of TPL that was on the network.
market cap and the amount of TVL that was on the network.
Um, you would expect a network in the multiple billions of market cap to have,
you know, activity, right?
Uh, transactions of value moving around, um, value being locked into the various
dApps and stuff.
Um, and it was extremely low compared to the market cap.
So that just seemed a bit strange.
So, you know, if you're doing due diligence on a network,
then you should be looking at not just market cap and not just price.
You should also be looking at the activity within that network.
Are the transactions that are moving in that network, you know,
are they of legitimate value?
Or is it just
some tokens being bounced backwards and forwards between a handful of accounts? Are the dApps being
used? Is there volume on the dApps? You know, you start to look at all of these different metrics,
and it becomes difficult to fake them all to a degree where they're convincing.
And if you're in a network where there is this disparity between TVL transaction, legitimate ones, and market cap,
then it doesn't necessarily mean that it's a bad project.
It's just keep your eye on it and just have caution, I think,
is probably the wisest words that I could,
I could give and comment on that. Um, with regard to centralization and decentralization,
I think this is always going to be a bit of a hot topic, right? Um, because you know,
you've got multiple camps here where one is decentralized everything. Um, but I think in a
lot of scenarios, some stuff just doesn't fit the decentralized model very well. Um, so I think in a lot of scenarios, some stuff just doesn't fit the decentralized model very well.
So I think there's always going to be some components of an ecosystem where there are centralized services involved because those centralized services can give the best consumer experience.
It's not necessarily just about security.
It's also about the consumer experience right it's not necessarily just about security it's also about uh the
consumer experience as well what what what the user wants to do how the user wants to do it
um and the user should also have a choice right i think that's probably one of the most profound
things in this space that i realized way back in 2012 or whatever it was was that for the first
time there's actually a choice of what financial system do I use? Do I
want to be in the traditional banking system? Do I want to be purely in crypto and have self-sovereignty
and control over my funds? Or does a mix of both work for me? And I think it's fine if, if, if a
mix of both works, you know, like I can't get a mortgage for a house, for example, in crypto,
a bank is still the best option for me to get a mortgage if I want to buy a property.
But then I may want to use crypto for other things like yield farming or just a store
of value, right?
And consumers need to have choice.
And if you try and take that choice away from them, then it will backfire in your face. So while I agree that there are a lot of things that should be decentralized or at least have a decentralized component, exchanges being one of them.
I've always been a proponent of DEXs and decentralized financial assets and instruments and stuff.
I also understand that for some things, a centralized Web 2
stroke Web 3 service is going to provide a better experience and leave the choice up to the user.
I like that. I'm not sure I've heard it expressed quite in those words before that it's not so much
about trying to decentralize as much as possible, but rather decentralizing what makes sense and
then having a blend of the two and just giving people the choice that I don't think I've really, I've
perhaps not even thought of it in those terms, but having the choice is what we should be aiming at.
I have maybe one or two more questions for you before we wrap up. Firstly, and you're welcome
to reference any apps on Radix, but are there any sort of
lesser known uses of DeFi you've seen that you think are interesting? Because I mean,
most of it is around sort of lending, borrowing, etc. Is there anything more interesting than that
that you can tell us about? Yeah, I mean, the trend follows the trend, I think, at the moment, right?
Um, one thing that we're way too heavy on as an industry with this much potential, uh,
is speculation, right?
There is way too much speculation and obviously speculation is going to come and speculation,
uh, trading, all that kind of stuff, you know know essentially provides the oil for the broader
crypto ecosystem um but i do feel like we're a bit overbalanced um and something is needed to
kind of compensate that a little bit you know like meme coins and uh nfts and all those things
are very speculation driven which is fine um but for, I think as an industry to be really taken seriously and for that mass
mass market tsunami to finally arrive, I think we also need to think about, okay,
what is real utility?
Like what kind of real utility use cases can this provide?
And I think that that's difficult to really go and sell to mass market until the user experience is much better.
And until the developer experience allows these more innovative and interesting utility apps to be built.
dApps to be built. And I think another friction point here is that to provide real utility,
it's very difficult to think of an application that could be just purely self-contained within
the crypto ecosystem that can provide real world utility, right? If you want to provide real world
utility, then there always seems to be a requirement for a touch point into the real
world somewhere. And that's where you then end up with various infrastructure requirements like you do with RWA
and supply chain and, you know, all these other different kind of sub industries that people have been
trying to gain some traction with in crypto for a long time. And it's that gap, it needs to be bridged,
I think, properly before you'll really
start to see these interesting applications outside of you know dexes and lend borrow and
nft marketplaces and stuff um our industry is very siloed at the moment from the real world
let's say um and so really the only thing that it can do well is speculation and, you know, movement of digital assets that are digital only.
I'm hoping that that will change over time.
You know, I'd love to see some, I mean, this isn't even exotic, really.
It's just I would love to see some real kind of e-commerce business that's integrated into crypto quite tightly,
commerce business that's integrated into crypto quite tightly but has a touch point out in the
real world so that you know you're not completely reliant on amazon for example right um there's a
lot of monopolies out there in the web 2 space that i think a really well built laid out web 3
stroke web 2 hybrid application that has fundamentals in crypto blockchain value.
There's a lot that we can disrupt.
I just think it's going to take a bit longer for us to get there.
So for now, I think we're going to be speculation is the primary use case.
Yeah, I do.
Hopefully, we will start to see some of these projects come to fruition
that are working on this sort of stuff.
I remember in 2021, the ecosystem I was a blockchain block producer for, that blockchain, the company behind it were working on a way.
It was a little bit like RWA.
You could buy collectibles, like physical collectibles.
And rather than receive the collectible you receive an nft counterpart and
the collectible is stored securely and uh in a way that it won't depreciate in value and then
you know you could sell it through there i thought it was a really this was before anyone was even
talking about rwa so it was a really interesting use case but then again it didn't really come to
fruition so it does feel like we're still in that transitional period moving towards people
actually using it in in day-to-day life which which is obviously the goal um we're running
out of time for this episode i have one more question and i should stress this is perhaps
the most important question of the whole show your profile your profile says you're a petrol head
zoltan and i are both petrol heads What is the best car you've ever owned?
And I will judge you more on this answer than anything else you've said.
The best car I've ever owned, I still have it.
And it is a Nissan GTR that has been tuned up to the eyeballs.
You passed the test.
It's currently pushing about 1,200 horsepower.
It blew up recently, and I got it back over the winter, finally.
So I haven't driven it with a vengeance yet because it's UK and wet and cold.
But I am looking forward to putting some miles on that again this summer.
So, yes, I am a petrolhead indeed.
1,200.
It's always the nutters that buy the GTRs
and then push them four-figure horsepower.
It's ridiculous.
Well, thank you so much for coming on today, Dan.
It's been an incredible conversation.
My pleasure.
We'll have to have you back on in the future.
If anything, Braddix does anything particularly interesting,
got any updates, make sure you reach out.
Yeah, for sure.
I'd love to come back on.
Well, thank you also to the listeners. Thank you very much for spending your time as well with us and listening to Dan's insights which has been a pleasure um you can find
us here every single day on x at 2 p.m uh British summertime 3 p.m Central European 9 a.m New York
we have the biggest guests we have the biggest, and we're aiming to be the biggest and best show for you crypto folk on X. So if you enjoy the space, make sure you give
it a like and a repost so other people can hear this conversation and get Dan's thoughts. And if
you have any thoughts on what we discussed today, make sure you comment on this space or tag me in
your tweet and let me know what you think. If you disagree with anything I said, I'm always up for a debate. If you disagree with anything Dan said, disagree
with him. I'm sure he's up for a debate too. Always.
There you go. Thank you very much for listening, guys. We're back tomorrow. We've got an author,
Bitcoin-centric author tomorrow. I won't name him yet, but make sure you join us and we'll see you
again tomorrow.
