1 00:00:00,080 --> 00:00:03,680 Speaker 1: You're listening to Bloomberg BusinessWeek with krol Messer and Tim 2 00:00:03,680 --> 00:00:05,840 Speaker 1: Stenebek on Bloomberg Radio. 3 00:00:06,120 --> 00:00:08,399 Speaker 2: Imperfect for this. I was kind of doing some search 4 00:00:08,440 --> 00:00:11,639 Speaker 2: through some Bloomberg stories. Ola Karif and Nate Lanson of 5 00:00:11,640 --> 00:00:12,240 Speaker 2: Bloomberg News. 6 00:00:12,240 --> 00:00:12,959 Speaker 3: They report it. 7 00:00:13,119 --> 00:00:15,160 Speaker 2: They are great in early twenty twenty two about how 8 00:00:15,200 --> 00:00:18,919 Speaker 2: crypto enthusiasts dream not only revolutionizing money, they want to 9 00:00:18,920 --> 00:00:22,000 Speaker 2: reinvent the Worldwide Web as well. Their vision, which goes 10 00:00:22,040 --> 00:00:25,599 Speaker 2: by the name Web three, is a decentralized environment built 11 00:00:25,600 --> 00:00:29,680 Speaker 2: on cryptotechnology, which swarms of independent collaborators take back control 12 00:00:29,720 --> 00:00:32,199 Speaker 2: of the Web from giant tech companies. So it's a 13 00:00:32,280 --> 00:00:37,800 Speaker 2: threatned him to the likes of Meta Potentially platforms Twitter, 14 00:00:38,840 --> 00:00:40,560 Speaker 2: These are the ones that maybe are at risk. 15 00:00:40,840 --> 00:00:42,760 Speaker 1: So with that in mind, there's a new book out 16 00:00:42,880 --> 00:00:45,040 Speaker 1: and it gets into Web three. It's all about quote 17 00:00:45,120 --> 00:00:49,600 Speaker 1: charting the Internet's next economic and cultural frontier. Here to 18 00:00:49,640 --> 00:00:52,080 Speaker 1: talk about his latest book back with us. We're very 19 00:00:52,080 --> 00:00:54,800 Speaker 1: pleased to have Alex Tapscott. He's also the co author 20 00:00:54,880 --> 00:00:58,160 Speaker 1: of Blockchain Revolution and he's the co founder of Blockchain 21 00:00:58,280 --> 00:01:01,960 Speaker 1: Research Institute. He's right here in our Bloomberg Interactive Brokers 22 00:01:01,960 --> 00:01:03,640 Speaker 1: studio Alex, how are you. 23 00:01:03,880 --> 00:01:05,040 Speaker 3: I'm terrific. Thanks for having me. 24 00:01:05,240 --> 00:01:08,800 Speaker 1: It's good to see you again. I'm not trying to 25 00:01:08,800 --> 00:01:09,640 Speaker 1: be rude. 26 00:01:09,880 --> 00:01:11,240 Speaker 2: Okay, you're gonna be harsh. 27 00:01:11,920 --> 00:01:14,000 Speaker 1: I'm going to be harsh right off the bat. The 28 00:01:14,080 --> 00:01:16,320 Speaker 1: kind of joke this year is like, you know, we're 29 00:01:16,319 --> 00:01:19,000 Speaker 1: not talking about Web three or the metaverse anymore. We're 30 00:01:19,000 --> 00:01:21,880 Speaker 1: talking about AI. Right, So why is this the moment 31 00:01:22,040 --> 00:01:24,600 Speaker 1: to write another book about the blockchain and Web three? 32 00:01:24,959 --> 00:01:27,120 Speaker 3: Well, it's true that there are many different technologies that 33 00:01:27,200 --> 00:01:29,560 Speaker 3: all are emerging at the same time. AI is one 34 00:01:29,560 --> 00:01:31,920 Speaker 3: of them, but there are others, you know, blockchain, the 35 00:01:31,959 --> 00:01:35,240 Speaker 3: Internet of things and extended and virtual reality. And the 36 00:01:35,280 --> 00:01:39,160 Speaker 3: thing is these technologies are not separate. They're actually related. 37 00:01:39,560 --> 00:01:42,640 Speaker 3: In the same way that the term internet went from describing, 38 00:01:42,680 --> 00:01:45,920 Speaker 3: you know, one narrow set of technologies to describing new 39 00:01:45,920 --> 00:01:49,040 Speaker 3: business models, new social behavior, and the whole range of technology. 40 00:01:49,280 --> 00:01:51,840 Speaker 3: I actually view the term web three as being the 41 00:01:51,920 --> 00:01:55,120 Speaker 3: term that best captures where we're going, what that's next 42 00:01:55,120 --> 00:01:55,880 Speaker 3: digital age is going on. 43 00:01:55,960 --> 00:01:58,240 Speaker 1: Okay, so before we get to that, you should explain 44 00:01:58,280 --> 00:02:00,000 Speaker 1: Web one and Web two for the uninitiated. 45 00:02:00,280 --> 00:02:02,760 Speaker 3: Yeah, for sure. So Web one basically was a medium 46 00:02:02,800 --> 00:02:05,200 Speaker 3: for the presentation of information on static websites. 47 00:02:05,280 --> 00:02:07,960 Speaker 1: So think like dot coms, So think like the New 48 00:02:08,040 --> 00:02:11,480 Speaker 1: York Times deciding to put their newspaper on the Internet. 49 00:02:11,560 --> 00:02:14,880 Speaker 3: Yeah, exactly like a way that you can access information, 50 00:02:14,919 --> 00:02:16,760 Speaker 3: but you can't interact with it. You can't collaborate, you 51 00:02:16,760 --> 00:02:19,079 Speaker 3: can't post your own content. It's pretty static. It's one way. 52 00:02:19,320 --> 00:02:22,840 Speaker 3: And though it was it was relatively simple, it's still 53 00:02:22,840 --> 00:02:26,239 Speaker 3: revolutionized things because it was this first digital medium for information. 54 00:02:26,840 --> 00:02:29,160 Speaker 3: Web two, which came about around this sort of early 55 00:02:29,200 --> 00:02:31,880 Speaker 3: to mid two thousands, took one leap forward, which is 56 00:02:31,880 --> 00:02:34,440 Speaker 3: the web became social, it became interactive, It became a 57 00:02:34,480 --> 00:02:38,280 Speaker 3: platform for people to communicate and to collaborate online. And 58 00:02:38,360 --> 00:02:41,440 Speaker 3: after Facebook, enter Facebook and the mobile app store, And 59 00:02:41,480 --> 00:02:43,399 Speaker 3: in a way, it also became kind of two point 60 00:02:43,480 --> 00:02:45,640 Speaker 3: five dimensional, right. It went from this thing that we 61 00:02:45,680 --> 00:02:48,440 Speaker 3: accessed on desktop computers to a thing that kind of 62 00:02:48,520 --> 00:02:50,840 Speaker 3: traveled with us in the world. And you know, a 63 00:02:50,840 --> 00:02:52,600 Speaker 3: lot of people in the Web three world are very 64 00:02:52,639 --> 00:02:55,280 Speaker 3: bearish on Web two, and I think that the track 65 00:02:55,320 --> 00:02:57,240 Speaker 3: record is a bit more mixed. So you know, when 66 00:02:57,240 --> 00:02:59,359 Speaker 3: it comes to Web two, it's undeniable that it created 67 00:02:59,400 --> 00:03:02,040 Speaker 3: tons of value you, certainly for shareholders of companies like 68 00:03:02,240 --> 00:03:06,480 Speaker 3: Google and Facebook, but it also expanded internet connectivity to 69 00:03:06,600 --> 00:03:09,000 Speaker 3: billions of people and in a way gave gave a 70 00:03:09,040 --> 00:03:11,359 Speaker 3: voice to sort of marginalize people. People who didn't have 71 00:03:11,360 --> 00:03:13,280 Speaker 3: a voice had a way to publish content and information 72 00:03:13,520 --> 00:03:14,600 Speaker 3: that change, you know. 73 00:03:14,560 --> 00:03:16,480 Speaker 2: Right, we talked about the Arab spring and different things 74 00:03:16,840 --> 00:03:18,680 Speaker 2: as a result of social media. 75 00:03:18,840 --> 00:03:21,079 Speaker 3: So Web three takes us where in your view, Web 76 00:03:21,080 --> 00:03:23,160 Speaker 3: three takes us to a new layer of the web, 77 00:03:23,200 --> 00:03:25,240 Speaker 3: which is what we call the read write own web. So, 78 00:03:25,240 --> 00:03:28,320 Speaker 3: without getting into the technical jargon, the keyword there is own. 79 00:03:29,080 --> 00:03:31,240 Speaker 3: What Web three enables is for people to be able 80 00:03:31,280 --> 00:03:33,720 Speaker 3: to own the asse class of the digital age, to 81 00:03:33,720 --> 00:03:36,560 Speaker 3: own their own data, their own identities, and their own 82 00:03:36,640 --> 00:03:39,320 Speaker 3: digital creations and their own digital goods. And so what 83 00:03:39,360 --> 00:03:42,680 Speaker 3: that means, Like any previous technology, it's going to be 84 00:03:42,880 --> 00:03:45,800 Speaker 3: big for business, but it's also going to in my opinion, 85 00:03:46,000 --> 00:03:48,560 Speaker 3: change culture and society. Why is it big for business, Well, 86 00:03:48,560 --> 00:03:52,680 Speaker 3: it's big for business because blockchains and Web three represent 87 00:03:52,840 --> 00:03:54,880 Speaker 3: sort of the first digital medium for value, a way 88 00:03:54,920 --> 00:03:56,880 Speaker 3: to move value peer to peer without the need for 89 00:03:56,920 --> 00:03:59,280 Speaker 3: an intermediary or a middleman. And so what I think 90 00:03:59,280 --> 00:03:59,880 Speaker 3: that's going. 91 00:03:59,720 --> 00:04:02,520 Speaker 2: To be also says it cuts out a lot of business. 92 00:04:02,160 --> 00:04:06,120 Speaker 3: Too well potentially, But there are always as with any technology, like, 93 00:04:06,160 --> 00:04:09,640 Speaker 3: there are always just as many opportunities for reintermediation as 94 00:04:09,680 --> 00:04:12,680 Speaker 3: there are disintermediation in my in my opinion, and one 95 00:04:12,720 --> 00:04:15,080 Speaker 3: great example of this that we see happening right now 96 00:04:15,440 --> 00:04:17,400 Speaker 3: is in the world of stable coins. So these are 97 00:04:17,400 --> 00:04:21,120 Speaker 3: in the news because PayPal just launched the stable Well 98 00:04:21,279 --> 00:04:24,000 Speaker 3: we can get to that in a second. PayPal just 99 00:04:24,040 --> 00:04:27,559 Speaker 3: launched a stable coin visa is enabling merchant to merchant 100 00:04:27,640 --> 00:04:30,240 Speaker 3: settlements with stable coins, and you know, they had to 101 00:04:30,279 --> 00:04:32,280 Speaker 3: wait to see that this business could grow to the 102 00:04:32,320 --> 00:04:34,159 Speaker 3: point where would impact them. And today, you know, the 103 00:04:34,160 --> 00:04:36,800 Speaker 3: stable coin market is well over one hundred billion dollars 104 00:04:37,000 --> 00:04:40,000 Speaker 3: and companies that issue stable coins make a lot of money, 105 00:04:40,040 --> 00:04:42,120 Speaker 3: and they do it in a relatively boring way which 106 00:04:42,120 --> 00:04:44,920 Speaker 3: would be familiar to any Bloomberg Radio listener, which is 107 00:04:44,960 --> 00:04:48,039 Speaker 3: basically that when someone wants a stable coin, they're usually 108 00:04:48,279 --> 00:04:50,640 Speaker 3: depositing money. They're getting a stable coin, which is this 109 00:04:50,760 --> 00:04:53,200 Speaker 3: digital medium to move money all around the world, and 110 00:04:53,240 --> 00:04:55,440 Speaker 3: then the issuer can just take that money invests at 111 00:04:55,480 --> 00:05:00,200 Speaker 3: risk cree Now in the like Silicon Valley Bank, and now, 112 00:05:00,200 --> 00:05:02,039 Speaker 3: of course they'd be wise to keep a lot of 113 00:05:02,080 --> 00:05:04,640 Speaker 3: that in you know, short term treasuries rather than elongated 114 00:05:04,640 --> 00:05:07,320 Speaker 3: treasuries to avoid duration this match. But they can make 115 00:05:07,360 --> 00:05:09,400 Speaker 3: a lot of money, so you know, in my view, 116 00:05:09,600 --> 00:05:12,120 Speaker 3: like a company like PayPal, which was a pioneer in payments, 117 00:05:12,160 --> 00:05:14,080 Speaker 3: but it's seeing all sorts of outside pressure from like 118 00:05:14,120 --> 00:05:18,320 Speaker 3: Apple and Shopify, now has this very unique opportunity to 119 00:05:18,360 --> 00:05:21,240 Speaker 3: reach into the Web three toolkit, pull out this new 120 00:05:21,320 --> 00:05:23,520 Speaker 3: thing called a token in this case of stable coin, 121 00:05:23,720 --> 00:05:25,560 Speaker 3: and potentially you know, save their business. 122 00:05:26,480 --> 00:05:29,600 Speaker 1: So are they still doing that given that we're still 123 00:05:29,600 --> 00:05:32,240 Speaker 1: in this crypto winter? It seems like interest around this 124 00:05:32,320 --> 00:05:35,480 Speaker 1: has died down so much since we well, I mean, 125 00:05:35,680 --> 00:05:36,919 Speaker 1: stop talking about crypto. 126 00:05:37,120 --> 00:05:40,039 Speaker 3: Yeah. Well, I think that from the outside looking in, 127 00:05:40,400 --> 00:05:44,360 Speaker 3: every technology revolution looks like an overnight success story. The 128 00:05:44,400 --> 00:05:47,520 Speaker 3: reality is that they're usually decades in the making. And AI, 129 00:05:47,640 --> 00:05:49,400 Speaker 3: I think, is a good example of that. You know, 130 00:05:49,440 --> 00:05:50,120 Speaker 3: the first AI. 131 00:05:50,160 --> 00:05:51,880 Speaker 1: Would you consider AI part of Web three? 132 00:05:52,000 --> 00:05:54,640 Speaker 3: I would consider AI technology that's foundational to the Web 133 00:05:54,640 --> 00:05:57,359 Speaker 3: three era. So you know, I think the term Web 134 00:05:57,400 --> 00:06:02,080 Speaker 3: three still mostly comes to the in like blockchain related applications, 135 00:06:02,279 --> 00:06:03,760 Speaker 3: but I think over time, we need a term that's 136 00:06:03,760 --> 00:06:06,280 Speaker 3: going to help us to capture all of these transformations 137 00:06:06,320 --> 00:06:09,159 Speaker 3: that are happening. And I think also what's interesting to 138 00:06:09,200 --> 00:06:11,359 Speaker 3: me about this era that we're in is that people 139 00:06:11,400 --> 00:06:14,200 Speaker 3: think of these all as discrete areas, right, I mean 140 00:06:14,240 --> 00:06:16,200 Speaker 3: even the nature of your question is want I get 141 00:06:16,240 --> 00:06:18,080 Speaker 3: a lot, which is it's not about Web three, it's 142 00:06:18,080 --> 00:06:19,880 Speaker 3: about AI. It's like, well, it can actually be about 143 00:06:19,920 --> 00:06:21,080 Speaker 3: more than one thing at once. 144 00:06:21,680 --> 00:06:25,080 Speaker 2: No, that's fair. I agree, Like evolving innovation technology, they 145 00:06:25,120 --> 00:06:27,280 Speaker 2: tend to kind of crisscross each other. How do you 146 00:06:27,400 --> 00:06:32,760 Speaker 2: though scale it? I mean, right, Web three its foundation 147 00:06:32,920 --> 00:06:35,919 Speaker 2: is being decentralized, so how do you scale that? 148 00:06:36,200 --> 00:06:38,680 Speaker 3: Yeah, it's a great question. So in Web three, I 149 00:06:38,720 --> 00:06:42,599 Speaker 3: think there are missionaries, there are mercenaries, and they're pragmatists. 150 00:06:42,640 --> 00:06:43,479 Speaker 2: How do you know the difference. 151 00:06:44,560 --> 00:06:46,720 Speaker 3: Well, you're looking at a pragm with this right now 152 00:06:46,720 --> 00:06:49,040 Speaker 3: as we speak. So there are people who bring a 153 00:06:49,080 --> 00:06:51,680 Speaker 3: missionary zeal to this, and those people are essential to 154 00:06:51,760 --> 00:06:54,680 Speaker 3: any new thing. And I describe Web three as a 155 00:06:54,720 --> 00:06:56,840 Speaker 3: new frontier. And so when you're on the frontier, missionaries 156 00:06:56,839 --> 00:06:58,760 Speaker 3: are good to help sort of lead the charge because 157 00:06:58,800 --> 00:07:01,039 Speaker 3: they're willing to step into the known. And then there 158 00:07:01,040 --> 00:07:02,880 Speaker 3: are mercenaries that want to take advantage of the new 159 00:07:02,920 --> 00:07:04,960 Speaker 3: new thing and maybe make some money. And when it 160 00:07:05,000 --> 00:07:07,479 Speaker 3: comes to Web three or AI, they'll come in and 161 00:07:07,520 --> 00:07:09,279 Speaker 3: out and you know, we won't hear from them again. 162 00:07:09,440 --> 00:07:12,240 Speaker 3: And then there are pragmatists. In order for Web three 163 00:07:12,280 --> 00:07:15,160 Speaker 3: to reach its potential, I do believe that the underlying 164 00:07:15,520 --> 00:07:18,760 Speaker 3: infrastructure needs to be decentralized. But in the meantime, it's 165 00:07:18,840 --> 00:07:22,760 Speaker 3: okay that there are big companies like PayPal or Amazon 166 00:07:23,360 --> 00:07:26,560 Speaker 3: or MasterCard or even City Bank, which just announced it 167 00:07:26,600 --> 00:07:29,560 Speaker 3: wants to tokenize its client assets stepping into this space. 168 00:07:29,640 --> 00:07:31,960 Speaker 3: If you really think this technology is going to make 169 00:07:32,000 --> 00:07:33,760 Speaker 3: a difference, and then you want to see it in 170 00:07:33,800 --> 00:07:35,320 Speaker 3: the hands of as many people as possible. 171 00:07:35,960 --> 00:07:38,240 Speaker 2: Just like the infrastructure, just kind of move to a 172 00:07:38,280 --> 00:07:40,320 Speaker 2: different model, but it's kind of the same model in 173 00:07:40,360 --> 00:07:40,760 Speaker 2: some way. 174 00:07:41,040 --> 00:07:43,920 Speaker 3: Well, it depends when it comes to you know, the 175 00:07:44,160 --> 00:07:47,320 Speaker 3: like tokens, which is one component of Web three. The 176 00:07:47,360 --> 00:07:49,920 Speaker 3: fact that they're a way for people to move in 177 00:07:49,960 --> 00:07:52,440 Speaker 3: store in businesses. I should add, for people in businesses 178 00:07:52,480 --> 00:07:55,200 Speaker 3: to move in store value peer to peer just by 179 00:07:55,240 --> 00:07:59,760 Speaker 3: its very nature, reduces the need for an intermediary. Now, 180 00:07:59,760 --> 00:08:00,320 Speaker 3: I'm it. 181 00:08:00,320 --> 00:08:02,120 Speaker 2: Would be like me doing Venmo. But I don't have 182 00:08:02,160 --> 00:08:04,120 Speaker 2: to have the bank, right, I can just do it directly. 183 00:08:04,240 --> 00:08:05,920 Speaker 3: Yeah, and you'd be able to do it anywhere around that. 184 00:08:05,920 --> 00:08:07,240 Speaker 2: But I have to have a token to do it. 185 00:08:07,560 --> 00:08:09,720 Speaker 3: Yes, well the token can be a dollar and somebody Okay. 186 00:08:09,840 --> 00:08:11,600 Speaker 3: That's the thing about where we are right now is 187 00:08:11,640 --> 00:08:14,080 Speaker 3: that some of the early versions of these, you know, 188 00:08:14,160 --> 00:08:18,640 Speaker 3: new innovations, are foreign to people. But as the technology matures, 189 00:08:18,640 --> 00:08:20,560 Speaker 3: they're going to find product market fit and and in 190 00:08:20,600 --> 00:08:22,600 Speaker 3: a way, like one of the ironies for me of 191 00:08:22,680 --> 00:08:24,960 Speaker 3: Web three is that one of the first killer apps 192 00:08:25,120 --> 00:08:27,800 Speaker 3: is a US dollars stable coin, which is funny because 193 00:08:27,800 --> 00:08:30,440 Speaker 3: when you think of bitcoin, you think of a technology 194 00:08:30,440 --> 00:08:33,679 Speaker 3: that was supposed to disintermediate banks and reduce the need 195 00:08:33,720 --> 00:08:35,920 Speaker 3: for governments. But the US dollars is one of the 196 00:08:35,960 --> 00:08:36,640 Speaker 3: first killer apps. 197 00:08:36,720 --> 00:08:39,760 Speaker 1: I still think of something like a housing in the 198 00:08:39,800 --> 00:08:42,920 Speaker 1: housing market, like title insurance. Yeah, why does everybody have 199 00:08:42,960 --> 00:08:44,120 Speaker 1: to pay thousands of dollars? 200 00:08:44,200 --> 00:08:46,880 Speaker 2: That makes complete sense. The provenance of a piece of 201 00:08:47,000 --> 00:08:48,840 Speaker 2: art like things like that make completely. 202 00:08:48,480 --> 00:08:50,360 Speaker 1: But like, why are we still in a time period 203 00:08:50,360 --> 00:08:52,040 Speaker 1: where if you buy a new place, you still have 204 00:08:52,080 --> 00:08:55,040 Speaker 1: to pay thousands of dollars rather than this, you know, 205 00:08:55,080 --> 00:08:57,319 Speaker 1: a title being available on the blockchain just in case 206 00:08:57,360 --> 00:08:58,640 Speaker 1: the title doesn't exist, right. 207 00:08:58,920 --> 00:09:00,880 Speaker 3: I completely agree with you. And you know, when it 208 00:09:00,880 --> 00:09:03,720 Speaker 3: comes to those kinds of hard assets, it's a difficult 209 00:09:03,720 --> 00:09:05,800 Speaker 3: problem to solve its. I wish that I could say 210 00:09:05,800 --> 00:09:07,880 Speaker 3: blockchain and web three is going to solve that. The 211 00:09:07,960 --> 00:09:11,440 Speaker 3: reality is that you know, you've got records data about 212 00:09:11,480 --> 00:09:14,080 Speaker 3: who owns what that are stored in you know, the 213 00:09:14,080 --> 00:09:16,760 Speaker 3: records offices of local counties and towns and so forth, 214 00:09:16,800 --> 00:09:19,040 Speaker 3: and so you have to get the data going in 215 00:09:19,120 --> 00:09:21,160 Speaker 3: correct before you can get the outcome correct. But I 216 00:09:21,160 --> 00:09:23,839 Speaker 3: think when it comes to digital assets, and I think 217 00:09:23,880 --> 00:09:27,240 Speaker 3: that digital assets will soon come to represent more assets, 218 00:09:28,120 --> 00:09:30,400 Speaker 3: it's much much easier. And I'll give you just one 219 00:09:30,400 --> 00:09:33,440 Speaker 3: great example which I think fifteen seconds, which shows how 220 00:09:33,480 --> 00:09:36,400 Speaker 3: AI and web three interact. There's a writer strike right 221 00:09:36,440 --> 00:09:38,480 Speaker 3: now going on. We should be able to track the 222 00:09:38,520 --> 00:09:40,440 Speaker 3: IP and who owns it that goes into these large 223 00:09:40,480 --> 00:09:43,160 Speaker 3: language models as a way to ensure creators get paid instantly, 224 00:09:43,200 --> 00:09:43,800 Speaker 3: and there's a way to do. 225 00:09:43,800 --> 00:09:45,400 Speaker 2: That with the companies they work for own it. Now. 226 00:09:46,120 --> 00:09:46,959 Speaker 3: No, in some. 227 00:09:47,040 --> 00:09:49,400 Speaker 2: Cases we're going to have to continue this Okay, so 228 00:09:49,559 --> 00:09:52,280 Speaker 2: enjoyed it. Alex Taps got his new book Web three, 229 00:09:52,520 --> 00:09:55,120 Speaker 2: charting the Internet's next economic and cultural frontier. 230 00:09:55,200 --> 00:09:56,080 Speaker 3: So much more to talk about.