Money Talks with Abra’s CEO, Bill Barhydt [Aug 20, 2021]

Money Talks with Abra’s CEO, Bill Barhydt [Aug 20, 2021]

[Music] [Music] [Music] all right boom good morning good afternoon good evening depending on where you are uh bill barwide here founder and ceo at abra welcome to a super exciting episode of money talks i actually don’t know if we’re going to get through this in an hour we’ve got a lot i’ve got my list here we’ve got a lot to talk about today so a couple of things uh i’m going to talk about some news um but before i get to the crypto news uh you know we’re so fortunate that we get to work uh in the crypto world uh but you know i’d be remiss if i didn’t mention what’s going on in in haiti i’ve got a lot of friends in haiti i’ve spent a lot of time there over the years and working on mobile money projects and and others uh other projects and so uh you know it not what this country needed right now uh another actually a bigger earthquake than the one that hit them uh over a decade ago and fortunately it wasn’t in the capital or near the capitol like the last one was but still i’m hearing over 2 000 people dead and and and probably going to be get worse before it gets better not to mention huge storms so thoughts and prayers going out to the people and friends in haiti and if you can donate uh please do uh afghanistan what a disaster um what can you say about what’s going on there uh i i was just looking at the pictures uh from the airport it looks like a refugee camp and it’s the airport um so just just heart-wrenching uh and then of course here in california i’m looking outside right now and the sky is a little bit orange i don’t know if this is going to be a common august occurrence it was much worse last august where you couldn’t even go outside but um it’s back again the fires are back and uh they’re not very close to where i live here they’re they’re probably 100 miles away but still there’s an orange tint to the sky here that’s not supposed to be there and i was in sf last night and and the moon was was basically a blood red orange uh you know right out of some apocalyptic you know novel again but anyway um maybe we can escape the world for uh for 58 minutes here and uh have a little bit of fun uh in the midst of all of this insanity i’ve got a super exciting guest who i’ll be talking about uh charles in in a few minutes uh but before that uh let’s get to some some news uh we’ve got just another crazy week in crypto land so let’s bring up our our screen share here and i’ll i’ll uh i’ll get to some news actually it’s on me to start the screen share so let me get to that sorry about that if i can just uh you know i’ll learn tech someday and then uh all will be good all right but in the meantime you have to deal with me so um you don’t want to see me so so so here’s the screen share so you know blackrock wow so blackrock is is like going all in on crypto from what i understand uh a lot of my inside friends saying they’re looking really heavily at different aspects of the crypto space but they’re definitely holding about half a billion now upwards of 400 million plus in uh myriad mining stocks which is uh which is super interesting to me the u.s market has just reaped a big windfall from the chinese uh shutdown of the of their mining industry uh i i i think i mentioned i’ve seen myriad friends in the mining space in the us over the past few weeks and they all just are basically grinning from year to year basically the chinese government has thrown free money at them what do i mean by that so as the hash rate came down right so how does bitcoin mining work well a whole bunch of computers are trying to solve a problem a game at the same time in order to win bitcoin and when those computers come offline which is what happened in china it’s for a while it’s easier for the remaining um for the remaining computers to win and because there’s less competition the ones in the u.s are winning more bitcoin than before it’s very simplified explanation but some of them have seen 30 40 percent uh you know windfalls not to mention the price going up which we’ll obviously get to in a moment so so blackrock getting into that space uh actually makes a lot of sense because they can do it via via public markets um i get a lot of questions online about this one what do i think about finance and so look i think that binance has been basically playing with fire for three years now plus and basically uh you know the the gig is up right they’re going to have to comply um they’re going to be no different than any other regulated exchange that manages custody all of the european governments are coming down on them and and look i i have no problem with with binance as a company except i want a level playing field meaning whatever you have to do with abra to be compliant uh as as a user you should have to do with any other service that offers overlapping products and they do and so many of you actually use binance and then bring your crypto over to abra for earn for example and uh you’re going to find that now you’re going to have to basically do the same kyc process that you do with abra kyc meaning know your customer uploading your id id verification uh et cetera et cetera so you know my take is is that uh like i said everybody is going to have to do this regardless of where you are in the world it’s table stakes for playing in crypto get used to it right and binance should be no different than any other company a couple of things on the coin front so uh i don’t know how you pronounce it but i say ciscoin i don’t know if you’re familiar with this actually maybe you should ask charles about it when we get into it it’s an interesting project that i talked about a few weeks ago um they’re up like 50 in the last 24 hours i actually don’t know why i’ve been trying to figure out why i don’t know if it’s just because the float is so small or the where the the liquidity is is is pretty small but one of the things i find really interesting about this project is they have this notary feature um that enables token issuers to basically use external data sources uh that have some type of like um i guess as a notary feature you’re basically using an external validator of some kind and i want to talk to charles about that because i always see i see kind of the oracle function or external data sources as being a weak link in uh in this smart contract model so we’ll get into that in a few minutes but but uh ciscoine on a tear and we’ll get to the charts in a moment and lastly are our our weekly comments from our illustrious sec chairman here in the us now i actually somewhat agree with him on these comments i actually wish that they would just go away but that’s not going to happen uh and and it’s actually probably going to get worse before it gets better and when i say get worse i think for most of you and i get this feedback online because i actually posted the question and unfortunately you didn’t take it as a rhetorical question a lot of you answered it my question is how many of you or what my question was how many of you actually say to yourselves gee i wish the sec cftc and other state regulators would come in and give me more protection because i don’t feel protected enough from a financial services perspective now obviously i sound like a smart ass when i ask that question because i’m being facetious but i also i’m saying it that way because i already know the answer and the answer is none of you in the crypto space feel that you need that uh you also most of you are smart enough to understand what you’re getting into and so let’s leave that aside because that’s an unrealistic perspective the realistic perspective is is the sec the cftc and the state regulators and everybody else in banking they’re here to stay there’s going to be more regulation coming not less and uh this past week sec chair gensler uh again as a reminder former mit professor who taught a class on blockchain i’ve lectured in front of him before he knows what he’s talking about in terms of how crypto works how blockchain works we probably don’t agree um you know more than 50 percent on on the current state of regulation but he knows what he’s talking about in terms of how it works which is very different from a lot of his colleagues and he astutely makes this point that most d5 projects right now aren’t really d and i’m using d and air quotes because you know that’s they call themselves decentralized finance or d5 projects but to me the litmus test for d5 has always been is there an off switch can you shut it off well if you can shut it off which in most cases you can how can it be defy and so this is going to become a problem for a lot of these uh d5 projects in the coming months because the sec is looking at these projects as basically either you know security trading platforms or security issuance platforms with their governance tokens some combination of the two um and i i’ve made this case to uh friends in the space that hey you need to be aware that just because you’re calling yourself d5 doesn’t mean that the sec will see it that way right it’s just the word that you made up and they can make up their own words to describe what you’re doing and i think they’re going to and so it’s going to be interesting to see uh if and when the hammer comes down on on d5 okay so um interesting comments there let’s talk about uh bitcoin uh and ethereum before we get to the topic of the day which is which is cardano so uh on the bitcoin front let me go to my charts here all right so bitcoin on a tear so uh we’ve got we’re up four percent in today’s trading day higher in the last 24 hours so yesterday’s trading day was four percent today we’re only about uh let’s say about 60 through the trading day and up another four percent so it looks like bitcoin wants to retest 50k it’s pretty obvious not a magician we’re at 48.7 right now now i fully expect bitcoin to bounce off of of somewhere around 50k and have to test it a couple of times could be wrong it could plow through it like it did a few times in the past but but um given you know the resistance that we’ve seen look i’m holding i’m not day trading bitcoin i feel like the sentiment is is slowly turning and that to me is extra bullish right because i don’t want euphoria right euphorium to me says okay this is not realistic and we’re going to have one of these sharp pullbacks very quickly i’m not sensing euphoria right now and that’s awesome all right uh ethereum similar uh i remain you know probably in the short term at least more bullish even on ethereum uh just from a price perspective i wouldn’t be surprised if we see 10k ethereum this year which would be an insane run-up uh well not compared to cardano but certainly given where ethereum is right now uh looking really bullish the um the 1559 upgrade went really well and i think i read that there were a few days where ethereum was actually in a deflationary state uh for uh for at least um a few days and i don’t know if that’s still the case uh but it certainly did happen as far as i can tell and and when i say a deflationary state that means that there’s more ethereum basically leaving circulation in that moment than actually coming into uh circulation that’s because of this uh base reward and we’ll talk about uh uh staking in mining with uh versus mining with with charles um in in a moment so uh super bullish on on ethereum and of course uh as a segue into our topic of the day and our guest of the day let’s let’s talk about cardano for a second look at this so so basically this trough here on july 20th uh dollar uh peak recent peak here 250 so that’s that’s basically uh the two and two and a half x run up so 100 more or less 150 up over 30 days absolute tear i believe it’s the number three cryptocurrency in terms of market cap right now why is that happening well the reason that’s happening is that uh uh people are super excited about this smart contract upgrade going on with cardano they they recently uh or earlier uh migrated to uh staking and and recently announced that on september 12th uh they would be launching their smart contract platform so uh you know apparently it’s a it’s a good time to own cardano so um as a segue let me uh let me bring on our our illustrious guest for today uh charles hoskinson is the founder of the cardano project uh i don’t know he’ll probably correct me and a super uh brilliant guy if you haven’t listened to any of his youtube videos i strongly recommend it um charles good morning or good afternoon based on where in the world you are how’s it going hey bill it’s good to see you i’m out here in warm sunny colorado all right we’re out in california yeah i’m in silicon valley welcome to money talks we’ve got a lot of people online here across twitter periscope youtube twitch facebook a bunch of other channels um this will be obviously up on um on youtube afterwards so we’re getting tons of questions already i’ve got questions teed up from twitter yesterday and on the live stream now yeah um so i got so many questions for you okay so let’s start with some basics right because we don’t have a uh this is not a uh developer audience okay so let’s start with some basics uh you’re talking to my grandmother who who has no idea uh she’s heard of bitcoin because i brag about it all the time what is cardano and and why should people care well the easiest way of understanding cardano especially when you’re talking to an audience that’s not familiar with cryptocurrency is to kind of start from bitcoin work your way forward and ask well what’s the point of bitcoin what what problem did it solve so for over 25 years all these cypherpunks were trying to figure out how do we create this concept of decentralized money you know or decentralized movement of value some sort of network where no one’s in control no one’s in charge but then somehow some way you can create an instrument in this case bitcoin that you just teleport anywhere in the world it’s like email for money you can send value to people so that came out in 2009 and it took a few years for it to percolate but then eventually it got to a point where people said hey this is useful in and exciting the problem is bitcoin doesn’t do much uh in its current design it’s a little slow there’s no programmability it’s kind of like the internet when we just had the web browser but no javascript you could build these beautiful static websites uh and you put nice pictures and good fonts but you can’t have amazon you can’t have facebook you can’t have youtube so right around 2013 people started saying well why don’t we have programmability so instead of just having one system that’s decentralized and you can teleport value around why don’t we make that programmable so that you can do all kinds of crazy things like icos and stos and nfts and d5 and so forth so that’s where ethereum came from and that was kind of the second generation of cryptocurrencies they said we like the decentralization we like the the kind of the austrian economics or this concept of finite value but then at the same time we want programmability so that came out created all these revolutions and then people started saying things like well hang on a second here this doesn’t work so well with millions to billions of people hang on a second here there’s thousands of these things we need standards and interoperability we need to move value between the systems we need oracles we need metadata hang on a second here these things are really hard to govern if you remove a central actor and you need to update and modernize and upgrade these systems who pays for that and who decides so that problem of scalability uh interoperability and sustainability we term the third generation cryptocurrencies and now a whole new class of blockchains are coming out that do the things ethereum did so you got your smart contracts and programmability and the things that bitcoin did you’ve got your decentralization and that ability to teleport value everywhere but they’re also sustainable and scalable interoperable so those are the solanas and the eoses and the harmony ones and the cardanos and the tasos and the polka dots and the algorands it’s a very diverse ecosystem what makes us unique is that we didn’t just start and say here here’s a paper we think this works we were very uh science-minded so we started from first principles back in 2015 and 2016 2017 were the two big years for this where we just went got a bunch of labs at university of wyoming in edinburgh and athens and texas exited me in tokyo tech and we hired all these scientists we just wrote papers we wrote 111 academic papers we went through enormous amount of peer review the standards of the computer science world through conferences and uh then we started building a high assurance version of those papers using a a kind of a military-grade language it’s called high school and was that your intent to to basically slowly peer review individual pieces of this and say okay we have the pieces let’s bring it together and and and basically make the point that okay this has been mathematically proven to be correct as we go was that by design or did it just work out that way because it was really hard in 2015 to know what’s real and what’s not real like for example we don’t know if proof of stake is possible or not right right we said let’s go ahead and build out a scientific corpus and we’re either looking for what’s called an impossibility result where we prove it can’t be done right or we show how it’s going to be done and then you’re just asking about trade-off profiles so so can i can i dig in on that for one second because we have a lot of uh people from the bitcoin world here who are very skeptical on uh proof of stake what do you say having gone through this this peer review process what do you say to people who say hey proof of stake is basically the equivalent of central centralized government money uh and has no place in a decentralized cryptocurrency how do you respond to that okay so you’re always doing the same three things whether you’re proof of work or proof of stake you’re deciding who’s in charge the person who’s in charge has to do something and then the network has to accept that thing so the problem is that first step that’s where everybody gets caught up that first step in proof of work is the mining process and that’s what consumes all the energy with proof of stake it’s synthetic so if you have 25 of the supply on average 25 of the time you get the right to do something and you can do it yourself or you can give it to somebody that’s the difference between a peer proof of stake and a delegated proof of stake system so the question is who should be in control and this is one of those exogenous endogenous questions exogenous is mining someone outside of the system is doing something to be in control of the system advance the system build the system okay the endogenous is somebody within the system is actually doing that and so the question is which is better and i think there’s trade-offs to both when you deal with an exogenous system you have something that’s connected to the physical world you have something that’s connected to things like electricity and minors and those people aren’t directly connected to the price of the asset they’re not collected to the protocols operations they’re just there to do something okay now the problem with that model is as the price of the asset goes up competition goes up and there’s an economy of scale phenomena so what ends up happening is you go from lots of minors and i used to be one back in 2011 mine was gpus and these things two vertically integrated data centers that are cost hundreds of millions of dollars with subsidized power and private asics so over time you get smaller and smaller sets of participation of the people who are in charge so the system gets more federated the other problem is there’s no incentive for power reduction why because any gains you get you just build more miners because it’s the opposite so you end up consuming more electricity right the thing is if you have two proof-of-work chains that are roughly the same price and the same mining power you actually have a perverse financial incentive to destroy one of the chains short-sell it and then move your miners over to the other chain if they have the same algorithm so there’s this winner’s take all mentality of proof of work where there can only be one for it to not be vulnerable to goldfinger on the proof of stake side you have a plutocratic mechanism where those who have more have more say so some people aren’t quite comfortable with that but that’s how shareholder theory tends to work for all of our our publicly traded companies and there are all kinds of things you can do to mitigate that if if desired it’s really just about the resource so you can invent the proof of merit you can have multiple resources so multiple tokens in the system with different economics behind them that doesn’t necessarily invalidate the system the other thing is if you hold the token you tend to want to care about its price appreciation and its stability or else you’re destroying your own money so whereas the other system they’re disconnected from that token or mercenary the other system they only work within that system okay the other thing is it’s a virtual resource so we saw recently with the china mining crackdown it’s very expensive time consuming in some cases impossible to move your physical resource from one country to another country and proof of stake it’s a virtual resource so you can redeploy it at a click of a mouse from one system to from one country to another country so there are philosophical differences here and what we did over the last six years and others like al goran and and so forth is we kind of built up this big scientific corpus and saying are there things that are unique to proof of work that can’t be replicated in proof of stake or are they equivalent and what we’ve discovered over the last six years of scientific research is that they’re equivalent in terms of utility from everything from random number generation to time keeping to the ability to bootstrap from genesis there’s papers that are peer-reviewed cited hundreds of in some cases thousands of times and with real running protocols in market that are securing more than 100 billion dollars of value that demonstrate that these capabilities are equivalent so it’s now a philosophical gap who do you want to be in charge an exogenous mercenary resource or in a dodge it’s internal resource and are you comfortable with those dynamics and for grandma it doesn’t matter okay because he’s a consumer of both she cares about operational costs user experience and reliability in these types of things she doesn’t ultimately she doesn’t want to know it’s there right she just wants to know that the application that that’s using it is is working and she can trust it right right so so before we get on to that topic of smart contracts and what they’re going to do for us just one more question i think we have some you know some basics on on staking explain how the yield model works in cardano when you’re staking uh we get a lot of questions on this just the mechanics of it what’s actually happening well it’s it’s a pretty simple system so there’s time keeping inside the system and we break it down to epics and those are about five days and uh basically there’s a situation where you have proportional elections so if you have 25 percent of the supply on average not not guaranteed but on average depending on how the random numbers work 25 of the time you have the right to do something now you can either give that resource to someone else that’s called delegation or you can host a private pool and consume it yourself so it just depends on the amount you have then if those people show up for when their allotted time comes and make the block they get paid for it because it’s compensation for services and then there’s a yield curve and it decays over time and we parametrized it around 5.5 i think and then every single epic it decays a little bit and then it’ll go on for about 140 years and the emission will go from where we started at 31 billion coins to 45 billion by 2140 and it turns out that there’s actually a pretty good way of running a system uh so you know it’s a multi-layered system there’s the individual holder there’s the stake pools that they actually delegate to and then there’s uh performance metrics and there’s a lot of dynamics about uh trying to create an ideal amount of stake pools in the system so the one of the things that we tried to create is this k factor we wrote a paper out of oxford to kind of try to balance this right but the basic idea is is that the price of eta goes up k increases and k is the amount of ideal stake pools in the system so k right now set to 500 but we actually have over 3 000 but the top 500 actually make the most profit and then as the value goes up you can increase so actually the system gets more decentralized over time uh relative to the price and it’s the opposite with bitcoin so that’s one great dynamic the other part of it is that delegation doesn’t require bonding so that’s a common thing we see with other cryptocurrencies under the proof of stake state space because we did all the research we figured out you don’t need to lock your tokens in order to stake them so you have your wallet you just click a button which pool you like and eventually multi-delegation’s coming next year uh and then uh then you just stake there but you can access it any time and send it to buy an answer to coinbase or pay somebody and whatever’s left over will get uh redelegated other systems actually require you to lock your tokens for some period of time because they’re worried about forks and other problems but our protocol doesn’t suffer from that problem got it super interesting all right let’s segue into the meat of this when i think about the future of of decentralized systems right now i think about you know posts bitcoin or post uh you know um file sharing post bitcoin now i think about obviously stable coins nfts the future of decentralized finance and one to me one of the key yardsticks for that is developer support right and ethereum clearly has had the most developer support up until now which is why all of these projects that are doing nfts and d5 and stable coins basically run on on ethereum which is and then it creates kind of a you know a negative feedback loop and it just gets bigger and bigger and bigger right so so what why will something like cardano smart contracts uh you know break and potentially either break that cycle or create its own cycle uh in parallel so yeah you know it’s kind of funny everybody says well ethereum has all the network effect how are you going to get all their network effect i was like guys is like we’re very small relative to the set of all developers there’s only about 80 000 or so solidity developers there’s over 25.4 million developers in the world right so it really comes down to use utility and markets that you’re playing in so one of the things that we did over the last four years is we built a lot of connections throughout africa and we’ve been systematically on boarding a lot of african customers into our system like for example the ministry of education deal we did in ethiopia five million people there and there’s a potential to grow that to 20 million over the next 24 to 36 months so when we say okay who is actually going to be a real consumer of defy you know is it going to be some kid yield farming in new jersey and it’s mostly ponte like behavior and it’s probably going to get regulated very heavily in the next 24 months or is it a person who doesn’t have a bank account who needs to get a loan and doesn’t want to pay 75 interest totally so when you look at these two demographics long term three years seven years ten years and i know we don’t like to do that in our industry it’s always like when moon and what’s happening tomorrow but if you’re building protocols that you want to change the world with you have to have a longer time horizon then you start realizing that there’s not the right product market fit not the right product market customer fit yet so you proactively first have to bring the right customers in second you have to understand there’s a lot of b to b to c in the adoption of these protocols so for example if you get microsoft as a client you potentially have two billion customers yep so no one’s quite done that yet but the reality is when fortune 500 governments are procuring and going into these spaces they look at things like stability they look at things like assurance because it’s not about rapid growth like silicon valley thinks it’s about protection of the networks they already have they have too much value at risk to risk rapid innovation so you have to say who’s in the position right now to do high assurance software the no one ever got fired for buying an ibm software that’s certainly not ethereum where there’s 600 million dollar hacks you know on a monthly basis and people are in a rush to just get stuff out and everything goes up and down 90 percent too quickly it’s so there needs to be a marketplace for sustainability and for assurance and so forth and that’s underutilized in our ecosystem the other thing is how do you bring those 25.4 million developers on board right well we have three strategies uh we have the pond the island of the ocean that’s what we like called pond is kind of like what ethereum does so hold on a copy of the ethereum virtual machine and be interoperable with the 80 000 solidity developers and you can use all your ethereum tooling at cardano that’s just in english so that means that if i have an erc20 contract uh for a stablecoin or some other token or an nft 721 contract in theory that will be literally compatible you can run it because it’s like running the job a virtual machine there’s one on android and there’s one on windows and so they’re different virtual machines but your java code will run in both environments that’s that’s part of the pond approach that you’re that’s that’s the pond that vitalik created this cambrian pond that does all these things and then the island is what we do with plutus and haskell and that’s for high assurance software for the big guys the fortune 500s the aerospace industry you know places where if it screws up you lose billions of dollars or people die and that is underutilized in our marketplace and you know we think we can make great strides there and the oceans the 25 million developers the c plus plus developers the c developers the java developers all these other people so you have a great piece of technology we built out of university of illinois urbana-champaign with runtime verification called yellow which is basically like taking llvm something that’s been around apple created in 2003 and bringing it into the cryptocurrency space and there’s already tons of compilers and other tooling that exist in that world that we can gradually port over and that means over time we can support mainstream programming languages and libraries and tools so that regular developers can actually build applications in our ecosystem right now as an industry we don’t have demand for that quite yet but the next 24 36 months we’re going to see exponential growth in that demand and right in that time horizons when that tooling comes in so i think you need all three and you need also predictable cost and you also need the ability to understand how you’re going to scale these things and run these things off chain as we talk about a dap ecosystem it’s not tenable to go and say hey i know you have trillion dollars worth of software living in this paradigm go rewrite all of it and you know re-express it in our system we’ve been trying to do that with banks and mainframes forever right they’re still stuck there there’s still cobalt code there’s still fortran code for heaven’s sakes it’s crazy instead what you need to do is say let’s add a service or new capabilities to your application that enables something like account creation or a better way of doing payments and it’s it’s basically something that you bolt on to an existing application so you need a system that works off chain as much as it does on chain yeah and that’s one of the things that we designed cardano specifically for and it’s it’s something that they kind of discovered in the ethereum ecosystem that they needed to do and they created web3 and all these other things to be able to accommodate it we built that right into the language and right into the ledger itself to be able to have a very graceful on-chain off-chain exchange we think that is also a key component to being competitive over the next three to five years addition to the product market fit in addition to the island ocean pond and all these other things so so before we get into specific applications to kind of summarize here so it seems to me that the weak link in these decentralized systems is external data sources right we often refer to this now as the oracle problem uh because you’re introducing a trusted third party into what effectively theoretically could be a trustless solution how do you think about that and do you think about that differently than other kind of layer one blockchain application systems yeah i mean the oracle problem is the single hardest problem in our industry and it’s it’s part of that interoperability part of the third generation it’s like how do you move value people and information between existing cryptocurrency systems and legacy systems i can write a smart contract that say if the denver broncos win the super bowl you get a thousand bucks right who tells the smart contract that the denver program gets to decide that they won that’s right yeah exactly and so that’s the single hardest problem with these types of systems and that’s exogenous data so there are all kinds of approaches like what chain link is doing and dozens of others are doing and really that marketplace is a layer two marketplace it’s the connecting tissue between our industry and it comes down to uh basically the value at risk and the level of veracity you demand in your information is it okay to be partially true does it absolutely have to be true all the time that’s why bloomberg is such a big company because that was the market that they sold for the fintech industry so the legacy players are going to come into our industry at some point because there’s enough value on the table some unsuspected ones and the usual suspects and then we’re also going to be building other protocols well the key about cardano is that when you want to do that we’re interoperable and can become easily interoperable with the standards that are already emerging with ethereum but then also we have a service layer in the system because of the stake pools which is really new and interesting so whenever you want to do something complex usually what ends up happening in biology for example is you have cell differentiation you go from a single celled organism to a human you have eye cells and nerve cells and heart cells so your cells have the same dna but they do different things well similarly when you talk about complex systems for example cryptocurrency where you need oracles and smart contracts and random number generation these types of things well what if you actually have some nodes that do specialize things we’re already starting to see that in the proof of stake revolution where now we have a class of nodes that are stake pools and they’re always on they’re always available and that heterogeneity means that you could reuse them for services like you could have those pools come together and become a federated oracle you could have those pools come together and offer off-chain services you can have them with bitcoin for example you have lightning nodes and those are basically aboriginal too so you can crowdsource the truth um and get closer to a kind of decentralized solution in many cases or decide to trust the single source of data depending upon what the application is exactly and then and the smart contract developer and the consumers of the smart contract ultimately have to decide their trust model yeah it could be as simple as here’s the public key that’s providing and whatever they say is god it could be we’re gonna have a weighted oracle that’s connected to the uh to the state pools we could be an existing protocol like chain link and it’s an open system and so you know we support all of these approaches and we’re kind of rolling them out over time and the community is building these things as well there’s several oracle projects that are community sourced and as soon as smart contracts go live they’re going to start turning things on and playing with things and some will fail and some will succeed and ultimately the market is going to decide and the point of interoperability is you have the capacity whatever that wi-fi moment is for the movement of data and the veracity of data the market will basically tell it and you support the standard and then we all have that it’s a commoditized product yep so september 12th uh is the day is the magic date when smart contracts turn on is that a staged launch what happens on september 12th and are there other dates that we need to be aware of after that so uh one of the magics of cardano’s we kind of built it with upgrade ability in mind uh you know all these other guys when they have hard forks they’re like oh god hard fork what do we do it’s so stressful do i have what do i do with my coins with us we have something called the hardcore combinator so there’s an actual update system built into cardano so what happens is if you trigger the update system uh the prior epic uh so every five days we have an epic then basically it just auto updates all the ledger rules and the clients update and then they support the hard fork and basically it’s a super set of the prior rules so the first release of cardone was byron we can still validate byron transactions and rules the next release was shelley we did that last year and you can still validate shelley and come uh september 12th gogan is here and suddenly uh with that hard fork you can do go you can do shelley you can do byron and gogan and gogan includes smart contracts so not a lot’s going to happen from the user or the exchange perspective they just have to update nodes but then immediately thereafter you now have programmability in the system so people can deploy smart contracts and build applications and so forth and what will happen is the same thing that happens with all these systems an application ecosystem will be developed now one of the advantages we have is plutus the language we’re launching with is deeply connected to haskell a language has existed since the 1980s so as a consequence there’s 30 years of tools that exist there so we don’t have to build everything from scratch we can borrow the quick check stuff and we can borrow all the libraries and these other things for application development and really what’s going to happen is a small group probably 500 to 1 000 of very evangelistic developers are going to build some cool exciting sexy things over the next few months and those launch applications will really showcase the platform and then what will happen is the next cohort will come in we’ve already trained 3000 people actually it’s called the police pioneers program we’ve been running that for the last four months but the next cohorts will come in and then they’ll build on top of that and the next cohorts will come and they’ll build on top of that and each layer will you’ll get more and more accessibility better tooling better development experience you know etc etc and you know there’s plenty of funded applications ready to go to compete with dexes and stable coins and oracles and nft marketplaces and so forth it’s going to be really exciting that happens super interesting um okay before i let you go i i have to ask you this so um do you raise buffalo i do i have 500 of them you’re kidding me so so you got to explain this i i i said when i heard this i said uh it’s one of those crazy things that’s obviously not true so so go ahead well i got a ranch up in wyoming i’ve got about 11 000 acres it’s 18 squares for you you you europeans that’s 54 square kilometers it’s uh it’s quite a big piece of land and uh it came with bison and i said i guess i’m a bison rancher now i mean i i have i have cattle and geese and chickens and lots of dogs and all these you know i run a farm in colorado so i was pretty familiar with that but i’d never raised bison before and the problem with bison is they breed so when i bought the ranch it had 400 of them now there’s 500 of them go for the multiply okay and uh and so i i if you ever want some bison meat i’m sure we can work something out i love it i i there’s a place in in los gatos here uh where i live and and they have this bison burger i think they call it it’s fantastic and by the way we’re going to get them on the blockchain we have a great partner actually out in sundance i knew that i knew there was going to be a segway i just oh yeah we’re going to do an nft game called crypto bison and then are also going to get the bison on the blockchain so we have a partner called beefchain they’re based in sundance and they’ve already gotten about a thousand cattle on the cardinal blockchain all right you have a parallel chain called sheep chain you can guess what they put on the blockchain there and so it’d be really cool to have bison chain and uh get them on the uh get them on the card on blockchain and it seems like a novelty but what’s really cool about it is that there’s a lot of problems in uh meat supply chains especially abroad like you go to mongolia or african nations it’s really hard to understand is this high quality meat or if there’s a disease that breaks out what was the origin so it turns out getting these things into a supply chain is is very necessary for export tariffs and also health and safety so it’s really cool to be able to run pilots in my backyard at a low cost that we can then eventually port to africa and southeast asia i love how you refer to that as your backyard by the way that that’s awesome um wow amazing all right well i’m going to take you up on that uh in the meantime um i think i’ve asked you a bunch of the key questions that that people have been asking here i could talk to you for for hours about you know where this is going it’s super fascinating in the meantime i know you’ve got a ton of video out there uh on your youtube channel uh people can find you i already linked to your twitter handle as people can follow you there any any if people um here want to really dig in on on cardano what’s the best place for them to go right now yeah the we created cardano.org is kind of the entry point and whether you’re a developer or you want to be a state pool operator or you want to get funding through catalyst by the way there’s over a billion dollars available for their catalyst it’s the largest decentralized organization in the world and it’s completely controlled by the cardinal community last round we had 33 000 people vote 154 ventures were funded already got another round up four million dollars available here soon so if you’re interested in participating doing something cardano.org is the entry point and it’ll get you where you need to go there’s hundreds of links and there’s documentation there’s github repos and so forth but we wanted that as the one-stop shop as the routing point and then uh you know there’s great channels like reddit and telegram and uh our we have a cardano forum and so forth and there’s a wonderful community it’s over a million large and they’re super friendly and super excited they’ve been very patient and if you’re friendly back you’ll have a wonderful experience with them awesome all right man well thank you so much for uh joining us we’d love to have you on again in a few months just to see how it’s going talk about some of the killer apps uh that you see out there and um you know i i’m a big fan of of you and the work that your team has done and um you know thank you so much for doing this and we have a summit uh next month uh september 25th 26th cardano summit i think it’s cardanosummit.org i can’t remember the website but yeah yeah or summit.cardano.org but anyways it’ll be advertised there awesome we probably will have twenty to fifty thousand people attend that all right maybe i’ll make my way to where is it it’s gonna be a well it’s a online and physical event uh physical it’ll be in uh wyoming at laramie alongside a few other places and then also online we we partnered with active theory so we built this beautiful little digital world and uh you guys can have a little avatar and run around and attend and watch the presentations that way wow super cool charles hoskinson founder of the cardano project thank you so much for joining us and uh we’ll hope to see you again on on money talks and please follow charles on twitter and uh check out cardano.org thank you very much thank you so much all right so thanks to charles so let’s get back to um some abra updates um thanks again to charles that was super interesting what a smart guy um yeah wyoming wyoming i i i can’t say too much except i’ve been spending some time on uh on wyoming all right um so chris uh you beat me to the punch uh chris here asking the question uh any update on cardano yes we have an update on ada staking on abra so first big announcement is we will be launching uh ada cardano on abra earn uh so yay all right finally um i didn’t get the exact date i was hoping for before today but i did get confirmation uh that it will be turned on soon so i’ll commit to saying highly likely in the next 10 to 14 days and i’ll certainly have an exact date for you either next friday or uh online on social media before that uh but we will for sure um turn on uh cardano in abraharn uh in the coming days okay so look for that we’ll send out an email push notifications the normal messages to make everyone aware of the exact launch okay second thing i wanted to show you uh and i’m gonna bring up my my demo here in a second so a lot of you have been asking about security features and two-factor authentication in uh the abraham so um just to be clear when we talk about two-factor authentication if you’ve ever used google authenticator or authy or microsoft’s version then you know what i’m talking about so let me share my screen here give me one second share screen there we go as i said sometimes uh even though i have a degree in this stuff i am somewhat technology challenged and i don’t see it on my share so let me unshare that cancel that share again [Music] and i still don’t see it okay so oh there it is i see it all right so um nope it’s not working all right so let me just describe what we’re doing here uh and then uh maybe uh i’ll figure it out in the meantime so um we are launching a 2fa feature uh within uh the abra app so you go to let me explain again what i mean by 2fa feature so today when you go into the abber app you you have to authenticate yourself to the phone then you use your pin code for the app now you have this option of going to wallet security turning on 2fa and then you will have to basically use a google authenticator or authy or microsoft authenticator code whenever you want to do a a withdrawal it and you have the option of turning it on uh once it should be on for everyone uh sometime next week uh and i strongly strongly encourage you uh to um to use um uh 2fa once it’s live uh next week okay so um so really excited about that it’s been a very common request uh from all of you and uh yeah so let me know uh if you have any questions about that and um let’s see what else so we talked about cardano staking which is coming soon and [Music] um let’s see [Music] yeah cool idea i agree um when will we be able to deposit usdc into abra you can deposit usdc into abra today uh we support uh deposits for um all the stable coins usdc usdt tether true usd dye uh all the major stable coins you can uh you can deposit and withdraw actually so let’s say you have bitcoin you want to sell it and then withdraw usdc you can do that as well or you can deposit usdc uh and uh and convert it to um uh convert it to bitcoin or whatever you want uh so no problems there uh just click on the add money function in the abra app and then uh you’ll be able to see uh all of the currencies that you can uh you can deposit okay it’s it’s super cool very very easy i do it all the time so let’s see what else um a lot of questions here uh thanks for the the positive feedback for charles um you know we’re super excited to get them on and we’re going to do more of this we’re going to have other leaders from uh from the crypto crypto space uh people are asking about the interest rates i don’t know what the interest rate is going to be it’ll probably be an uh similar to what the current staking rates are i would assume but i don’t i don’t know the the the current rate uh and and what it will be at launch but uh it’ll be a good one i see bill smiling very very hard yeah i’m i’m really happy about uh getting cardano and amber earned so yes i’m smalling hard about that one um kick ass interview well thank you very much um let’s see so so the other really cool thing about abern is that it just it just works and we hide the complexity so you put the in this case the ada or the eth or the bitcoin into avern um and you know we handle the complexity of earning that interest for you and it just shows up and and i love monday mornings now because i get those push messages into my abra wallet and like i said it just it just works right and um who doesn’t love getting push messages saying you’ve got uh free bitcoin free card nano free ethereum uh in your in your abra wallets uh let’s see um fosse says he’s moving to the u.s to buy himself a farm why not uh i’m definitely gonna be spending some time in in wyoming um um let’s see so a lot of people asking me about privacy and fungibility you know i i actually do worry a lot about this and i’ve been pretty public that i think that fungibility and privacy is probably the biggest um uh the biggest challenge that that bitcoin faces today is this kind of lack of fungibility and what i mean by that is is that because of the way bitcoin manages debits and credits you’ve heard this phrase utxo which which means unspent outputs it’s actually easy to track which inputs and outputs are getting spent if and if you don’t know what you’re doing and and most people don’t and so it it basically is all out there for everyone to see and that also means that every bitcoin is not the same so you can have a situation where bitcoins that flowed through iran are worth less than bitcoins that were mined in the united states and that shouldn’t be the case all of these bitcoins should be worth exactly the same okay and that’s what i mean by fungibility and and privacy on top of that guarantees that not only do i not know where the bitcoin came from or i can’t know and it’s truly fungible and so all this talk about regulation in terms of being able to track where crypto comes from should go out the window because it should be built into the base uh uh protocol layer as it is with uh you know z cash and other privacy coins like monero that it’s simply uh completely fungible completely private and i hope that at some point that makes its way into all of the the top crypto currencies so that we have this aspect of privacy and fungibility at the base layer okay so people asking if we support native cardano yes you can just deposit uh you can go into the ad money function like i mentioned before for all of the cryptocurrencies we support you can deposit native crypto directly into the abra wallet okay you can withdraw directly to a hardware wallet somebody asked me if we support hardware wallets we have probably double digit percentage of our users that don’t keep their crypto on abra they they do their trades and they withdraw to a hardware wallet most of our users don’t do that because they use app or urn to earn the interest but if you want to if you just want to use abra to exchange as a very simple trading model and then migrate to um to your hardware wallet or withdraw your hardware wallet um no problem at all okay all right um let’s see um all right so let’s see what else do we have to do here a lot of questions yep all right so a lot of people asking me about new coins and what’s coming so we did have an announcement about some new token listings uh from a couple of weeks ago so hopefully you all if you’re not on the abra email list you need to go to our website and sign up for the email list it’s super easy we don’t spam you with tons of email it’s important announcements updates on money talks updates on new token listings new features strongly encourage you to do that if you’re not subscribed to our youtube feed please click the subscribe button it really helps us and sends a message that you all support what we’re doing and it actually helps us with google and youtube in terms of promoting the video the more people that subscribe the more promotional uh presence we get okay i’ll take a couple more questions and then call it a day um let’s see so casey says i’ve already earned interest on abra good for you uh can and doug asks can we vote new coin so doug if you press the add button to uh add new cryptos to your portfolio and you don’t see that cryptocurrency there you have the option of um sending a recommendation to abra to add that specific cryptocurrency and we do take that into account there’s a lot of factors that i’ve talked about many times uh in the past that go into token listenings and your wants and desires are one of those um uh one of those uh you know factors okay so take advantage of that and let us know which um which tokens uh you you want and uh we’re always looking into uh adding more adding more tokens okay so hopefully that makes sense uh let’s see what else do we have here i’m going to take one more question that that interview that’s one of the reasons i haven’t done a lot of interviews it’s actually exhausting uh believe it or not it’s not my i’m not an interviewer for a living i run a company and i think interviewing people is more exhausting than running a company that manages lots and lots of people’s money which shouldn’t be the case but um uh is uh well i’ll take two more questions um lewis asks why is abra still not available in canada uh luis abra is available in canada you can use abra trade in canada and i believe um um abra earn but abrabarro is not yet available i may have that wrong but abertrade is definitely available if earn is not live i i know we’re working on getting it live if it’s not already there so so check it out and if that’s not the case and something’s wrong there um you know please uh send an email um you know to uh to support abra.com and and the other question i got is uh is is um uh what do i think about this poly network hack so uh hopefully you well not hopefully but you may have heard that this poly network hack happened and i think something like 600 million dollars worth of crypto was lost and then returned so so look i’ve talked about this many many times i think that um we’re so early in d5 and charles mentioned this people are in such a hurry to launch stuff that you know the way things get tested is just not right we need more code auditing we meet you know we have this concept of a test net in crypto which says we have beta versions of software which aren’t using like your real crypto it’s using effectively fake money and we don’t run these systems long enough on these test nets mostly because people are afraid of being not being first to markets well when it comes to money your most important priority should not be being first to market it should be not losing the money that people are staking in your d5 contracts in the first place and i hope that this perspective starts to change and we see a lot more code audits time for testing uh you know payments for people finding these bugs on test nets before they move to the main net now fortunately in this case my understanding is all of the stolen funds were returned because the developer was trying in this case to show the network that they had a vulnerability in the contracts uh and my understanding is it wasn’t a weakness in in their network but in the contracts i could be wrong on that i haven’t i haven’t spent a lot of time on looking at it but um okay so um all right i’m gonna take a couple more if you don’t want to stick around that’s all good i’ll take a couple more questions is there a plan to reduce the delay when moving tokens from earn to trade so so tracy uh we we try our best to move coins from earn to trade in as near real time as possible uh because um those you’re actually buying different lending contracts to generate that yield uh it’s not always possible to move in real time but the vast majority of movements happen the same day especially during the week and we’re always looking at ways to improve that but um i think for most people uh it works fairly well just recognize that when you’re in abraham right now you know it’s it’s kind of like a you know it’s it’s issued by a trust bank the accounts and it’s like you know treat it like a savings model right and so so in that regard you know it’s not always easy to just move the money in real time depending upon you know how how you’re earning that that interest um let’s see borrow in nevada i actually believe it’s coming if it’s not already live just go to the app and check it out we launched a couple of new states this week and so generally you get an email if you’re in one of those states and so if you click on the borrow button at the bottom of the screen it’ll tell you um uh if ever earned i’m sorry if abrabarro is available in your state if you’re in the u.s and i think we’re live in like 44 states or 45 states right now and the number is going up all the time all right well i’m exhausted and i’m looking forward to the weekend hopefully you are too with all the craziness going on in the world uh maybe um you know maybe we can uh you know relax a little bit and and uh the news will will be a little bit better next week hopefully out of afghanistan haiti and maybe with these california fires there’s fires in greece i saw the photos there it’s horrific uh but um you know as i said we’re so lucky that we get to do what we do uh and it gives us a little bit of an escape from from this crazy world at the same time so with that um thank you all so much as always for joining us on money talks thank you to charles hoskinson it was a pleasure to have you look forward to actually i should say we’ve got an exciting um a little change of pace for next week’s episode i’m not going to give it away now we’ll we’ll announce it online so follow us on twitter at abra global for the announcement about next week’s money talks in the meantime have a great weekend and we’ll see you next week thanks everyone take care
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Money Talks with Abra\'s CEO, Bill Barhydt [Aug 20, 2021]

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