1 00:00:10,080 --> 00:00:14,480 Speaker 1: Hello, and welcome to another episode of the Odd Lots Podcast. 2 00:00:14,520 --> 00:00:18,759 Speaker 1: I'm Joe Wis and I'm Tracy Alloway. So, Tracy, you know, 3 00:00:18,840 --> 00:00:23,119 Speaker 1: there's this really big story in markets these days and 4 00:00:23,160 --> 00:00:26,480 Speaker 1: in finance and it's tech, and we kind of haven't 5 00:00:26,480 --> 00:00:30,880 Speaker 1: been covering it very much. I'm scratching my head because 6 00:00:30,920 --> 00:00:33,800 Speaker 1: I feel like we've been covering a lot in markets. 7 00:00:33,920 --> 00:00:36,720 Speaker 1: Do you mean on add thoughts or no? Yeah? Yeah, 8 00:00:36,760 --> 00:00:40,400 Speaker 1: sorry on the podcast. Like every time every time I 9 00:00:40,440 --> 00:00:43,680 Speaker 1: tweet that we have like some new episode, there's like 10 00:00:43,720 --> 00:00:46,240 Speaker 1: there's one topic out there. They're like, when you guys 11 00:00:46,360 --> 00:00:49,320 Speaker 1: going to talk about X, and you must have gotten 12 00:00:49,360 --> 00:00:52,279 Speaker 1: it right. I think I have an inkling of what 13 00:00:52,360 --> 00:00:54,480 Speaker 1: it is. But we had didn't you do a whole 14 00:00:54,480 --> 00:00:57,920 Speaker 1: episode on this by yourself? And I wasn't there. Yeah 15 00:00:57,960 --> 00:01:01,160 Speaker 1: we did, It's true, So I guess that sort of 16 00:01:01,280 --> 00:01:04,959 Speaker 1: ends the suspense. It was a good effort, joke, good 17 00:01:04,959 --> 00:01:07,520 Speaker 1: effort we had, like the whole Bubble series of course, 18 00:01:07,560 --> 00:01:09,920 Speaker 1: remember that, of course, And every time we would like, 19 00:01:09,920 --> 00:01:12,479 Speaker 1: oh and today we're talking about another bubble, and someone 20 00:01:12,560 --> 00:01:15,240 Speaker 1: on Twitter like, oh, you're finally going to be talking 21 00:01:15,280 --> 00:01:19,120 Speaker 1: about tokens and initial coin offerings and every time we 22 00:01:19,240 --> 00:01:22,400 Speaker 1: did it, they're disappointed. But it is true. You know, 23 00:01:22,560 --> 00:01:24,800 Speaker 1: we've written and there's been a lot of Bloomberg coverage 24 00:01:24,800 --> 00:01:28,480 Speaker 1: about initial coin offerings, but they've become such a phenomenon 25 00:01:28,840 --> 00:01:30,600 Speaker 1: and so many people are taught about I c o 26 00:01:30,720 --> 00:01:34,520 Speaker 1: s and tokens and cryptocurrencies that is kind of like 27 00:01:34,760 --> 00:01:36,640 Speaker 1: it feels like we have to talk more about them 28 00:01:36,800 --> 00:01:40,880 Speaker 1: on odd lots. Okay, if if you insist, I've been 29 00:01:40,880 --> 00:01:43,280 Speaker 1: trying to avoid the topic. In fact, I did such 30 00:01:43,280 --> 00:01:45,080 Speaker 1: a good job of avoiding it that when you did 31 00:01:45,120 --> 00:01:47,120 Speaker 1: that whole episode of I c O S, I wasn't 32 00:01:47,160 --> 00:01:51,560 Speaker 1: even there. But for ourt listeners who don't know what 33 00:01:51,640 --> 00:01:55,160 Speaker 1: they are, who've been living under a rock, I guess 34 00:01:55,240 --> 00:01:58,040 Speaker 1: give us a recap of what exactly we mean. Well, 35 00:01:58,080 --> 00:02:01,480 Speaker 1: basically everybody by this point is heard of like cryptocurrencies 36 00:02:01,560 --> 00:02:04,240 Speaker 1: and if they don't understand them, like you know, bitcoin 37 00:02:04,320 --> 00:02:07,080 Speaker 1: and so forth. But what we've seen an explosion of 38 00:02:07,160 --> 00:02:12,680 Speaker 1: in the last year really is organizations and companies trying 39 00:02:12,720 --> 00:02:16,240 Speaker 1: to launch their own coins and sell launching some new 40 00:02:16,280 --> 00:02:19,320 Speaker 1: network with the idea that you would buy this coin, 41 00:02:19,840 --> 00:02:22,239 Speaker 1: and buying the coin would fund the creation of a 42 00:02:22,280 --> 00:02:24,680 Speaker 1: new network. You would have to use the coin to 43 00:02:24,840 --> 00:02:27,760 Speaker 1: use the network, and if everyone wants to use the network, 44 00:02:27,840 --> 00:02:30,079 Speaker 1: then the coins would rise and value and everyone can 45 00:02:30,120 --> 00:02:31,959 Speaker 1: make a fortune. At least that's sort of the idea. 46 00:02:31,960 --> 00:02:34,200 Speaker 1: And we've just seen, you know, day after day, it 47 00:02:34,200 --> 00:02:37,360 Speaker 1: feels like there's dozens of these new coins being launched, 48 00:02:37,639 --> 00:02:41,760 Speaker 1: and the question is is this a new funding paradigm, 49 00:02:41,840 --> 00:02:45,160 Speaker 1: Is this a new way that markets will incentivize the 50 00:02:45,240 --> 00:02:48,680 Speaker 1: creation of new platforms and networks, or is this just 51 00:02:48,720 --> 00:02:51,480 Speaker 1: a bubble slash, a get rich quick scheme And there's 52 00:02:51,520 --> 00:02:53,800 Speaker 1: really nothing there, and it feels like this is one 53 00:02:53,840 --> 00:02:56,920 Speaker 1: of the biggest debates happening right now. Yeah, more like 54 00:02:57,040 --> 00:03:00,160 Speaker 1: I see oh ha ha ha ha ha. I been 55 00:03:00,200 --> 00:03:03,320 Speaker 1: saving that one. No, but there's in all seriousness, there's 56 00:03:03,320 --> 00:03:07,000 Speaker 1: a subtlety here because you're talking about um initial coin offerings, 57 00:03:07,000 --> 00:03:10,440 Speaker 1: which are often these sort of new digital coins that 58 00:03:10,480 --> 00:03:15,480 Speaker 1: are attached to the Ethereum blockchain network. And there's also tokens, 59 00:03:15,600 --> 00:03:20,480 Speaker 1: which are usually a sort of system created to exchange 60 00:03:20,680 --> 00:03:24,760 Speaker 1: services basically, so there's two different things as they currently exist, 61 00:03:24,800 --> 00:03:27,960 Speaker 1: but they all have a similar sort of goal, which 62 00:03:28,000 --> 00:03:30,680 Speaker 1: is to get people interested in create this big network 63 00:03:30,720 --> 00:03:33,560 Speaker 1: effect as you mentioned totally, and they all have some 64 00:03:33,639 --> 00:03:38,320 Speaker 1: of the same language and ideology about decentralization and subverting 65 00:03:38,400 --> 00:03:41,320 Speaker 1: existing organizations and stuff like that. So there's a lot 66 00:03:41,400 --> 00:03:44,520 Speaker 1: to dive into. Today, we have a guest I'm very 67 00:03:44,520 --> 00:03:47,120 Speaker 1: excited to talk to. We're going to be talking to 68 00:03:47,560 --> 00:03:52,240 Speaker 1: Elaine Oh. She is a software engineered global financial access. 69 00:03:52,240 --> 00:03:55,200 Speaker 1: She is a contributor to Bloomberg View, and she has 70 00:03:55,240 --> 00:04:00,920 Speaker 1: been following the initial coin offering and cryptocurrency space herself 71 00:04:01,400 --> 00:04:04,320 Speaker 1: for many years, both on her blog and in her 72 00:04:04,360 --> 00:04:06,480 Speaker 1: career and stuff like that, and I think it's a 73 00:04:06,560 --> 00:04:09,720 Speaker 1: perfect person to talk about some of the technical aspects 74 00:04:09,760 --> 00:04:13,800 Speaker 1: and the economic aspects of initial coin offerings and sort 75 00:04:13,800 --> 00:04:16,800 Speaker 1: of hopefully guide us to an understanding of whether there's 76 00:04:16,800 --> 00:04:19,159 Speaker 1: something real here or whether this really is just sort 77 00:04:19,160 --> 00:04:21,839 Speaker 1: of a get rich quick scheme or a bubble that 78 00:04:21,880 --> 00:04:24,360 Speaker 1: will all come crashing down. I remember some of the 79 00:04:24,520 --> 00:04:28,520 Speaker 1: Lane's really early work on this topic, so I'm very excited. 80 00:04:38,560 --> 00:04:41,800 Speaker 1: Without further Ado Atlanto, thank you very much for joining us. 81 00:04:42,120 --> 00:04:45,919 Speaker 1: Thanks Joe. What our initial coin offerings or tokens like? 82 00:04:45,960 --> 00:04:48,560 Speaker 1: If someone asks you, how do you describe what's going 83 00:04:48,600 --> 00:04:51,880 Speaker 1: on right now? A token is basically a native asset 84 00:04:52,279 --> 00:04:57,720 Speaker 1: in a network protocol that is used to I guess 85 00:04:57,760 --> 00:05:00,880 Speaker 1: represent some transferable value. It's break it down a little 86 00:05:00,920 --> 00:05:04,279 Speaker 1: bit further. You say, a network protocol a native asset, 87 00:05:04,839 --> 00:05:07,039 Speaker 1: What is that? What does that mean specifically? Like and 88 00:05:07,120 --> 00:05:08,719 Speaker 1: sort of spell it out a little bit more. What's 89 00:05:08,720 --> 00:05:13,120 Speaker 1: been going on? In simpler terms, it's just an imaginary 90 00:05:13,160 --> 00:05:15,599 Speaker 1: thing that people are selling to raise lots of money 91 00:05:15,839 --> 00:05:20,120 Speaker 1: in hopes of building a future product. That's pretty simple, 92 00:05:20,200 --> 00:05:23,000 Speaker 1: isn't it. How about this give us the history of 93 00:05:23,120 --> 00:05:25,120 Speaker 1: i c o s, because it feels like they just 94 00:05:25,160 --> 00:05:28,839 Speaker 1: sort of exploded into the public consciousness this year. But 95 00:05:28,880 --> 00:05:31,560 Speaker 1: I'm sure you know someone actually came up with the 96 00:05:31,600 --> 00:05:33,880 Speaker 1: idea at one point in time and they were trying 97 00:05:33,880 --> 00:05:39,000 Speaker 1: to solve a specific problem. There were a number of 98 00:05:39,040 --> 00:05:42,280 Speaker 1: i c o s back in uh two thousand, two 99 00:05:42,279 --> 00:05:45,880 Speaker 1: thousand fourteen. They weren't as prevalenta as the ones today. 100 00:05:46,240 --> 00:05:50,200 Speaker 1: Probably the most well known I c O was Ethereum. 101 00:05:50,279 --> 00:05:55,880 Speaker 1: They sold their ether tokens before ever building anything, and 102 00:05:55,960 --> 00:06:01,360 Speaker 1: they collected bitcoin in exchange for their future ether. So 103 00:06:01,520 --> 00:06:06,200 Speaker 1: the creators of Ethereum collected bitcoin to create this new 104 00:06:06,839 --> 00:06:09,840 Speaker 1: You could call Ethereum a coin itself. Now, what we've 105 00:06:09,880 --> 00:06:15,480 Speaker 1: seen in seventeen quite a lot is people collecting Ethereum 106 00:06:15,520 --> 00:06:19,679 Speaker 1: to create new tokens that ride on the Ethereum network. 107 00:06:19,760 --> 00:06:22,680 Speaker 1: So explain how that works and explain like if there 108 00:06:22,720 --> 00:06:24,840 Speaker 1: are some specific ones, like you know, what do people 109 00:06:24,839 --> 00:06:29,200 Speaker 1: actually proposed they'd be used for. I think Ethereum raised 110 00:06:29,360 --> 00:06:32,280 Speaker 1: eighteen million dollars worth of bitcoin back when they were 111 00:06:32,320 --> 00:06:37,799 Speaker 1: doing their token offering. And Ethereum runs basically decentralized apps. 112 00:06:38,160 --> 00:06:41,360 Speaker 1: These are just little software programs that run on computers 113 00:06:41,400 --> 00:06:44,920 Speaker 1: all around the world, and the most popular app that 114 00:06:44,960 --> 00:06:48,520 Speaker 1: people are running on these computers is a token app. 115 00:06:48,960 --> 00:06:52,400 Speaker 1: And a token app is basically just a ledger that 116 00:06:52,520 --> 00:06:55,960 Speaker 1: keeps track of who owns um which tokens. So by 117 00:06:56,040 --> 00:07:00,600 Speaker 1: sending ether, which is Ethereum's native token, to one of 118 00:07:00,680 --> 00:07:04,760 Speaker 1: these token apps, people receive an allocation of token in return. 119 00:07:05,200 --> 00:07:08,120 Speaker 1: What are some of the more esoteric or what's the 120 00:07:08,120 --> 00:07:10,240 Speaker 1: word I'm thinking of? I guess unusual I c o 121 00:07:10,360 --> 00:07:13,200 Speaker 1: s that you've seen, because I remember a couple of 122 00:07:13,200 --> 00:07:18,440 Speaker 1: people mentioning specific examples like um synthorn, which is a 123 00:07:18,520 --> 00:07:23,880 Speaker 1: token ized synthetic rhino horn afrodisiac. I'm not even sure 124 00:07:24,600 --> 00:07:26,200 Speaker 1: what that means. But you know, if you go to 125 00:07:26,240 --> 00:07:28,640 Speaker 1: one of the websites that lists all the active i 126 00:07:28,800 --> 00:07:31,880 Speaker 1: c o s, you can find some really odd things 127 00:07:31,920 --> 00:07:34,960 Speaker 1: on there. I mean, people will basically do an i 128 00:07:35,080 --> 00:07:38,360 Speaker 1: c O for anything that will raise money. I mean, 129 00:07:38,360 --> 00:07:41,840 Speaker 1: there are i c o s for tokens that claim 130 00:07:41,880 --> 00:07:44,880 Speaker 1: straight up that they're not getting anything in return. It's 131 00:07:44,920 --> 00:07:48,760 Speaker 1: just an experiment to see whether people will send money 132 00:07:48,800 --> 00:07:51,720 Speaker 1: to a blank token, like there was early on the 133 00:07:51,720 --> 00:07:55,760 Speaker 1: Ponzi coin. Then there was the well I mean, there 134 00:07:55,840 --> 00:07:59,640 Speaker 1: was an f word token where basically you're just getting 135 00:07:59,680 --> 00:08:05,320 Speaker 1: a a token named the efford. Okay, but wait, there 136 00:08:05,360 --> 00:08:09,080 Speaker 1: are some actual ones that sound fairly legitimate, in which 137 00:08:09,120 --> 00:08:13,240 Speaker 1: it appears that a new application or a distributed application 138 00:08:13,640 --> 00:08:16,600 Speaker 1: might solve some problem and a token and in a 139 00:08:16,760 --> 00:08:20,360 Speaker 1: native token might be of value. So, for example, there 140 00:08:20,360 --> 00:08:24,320 Speaker 1: are ones that offer a distributed cloud storage. So we 141 00:08:24,400 --> 00:08:27,480 Speaker 1: all know about you know, existing cloud storage, but if 142 00:08:27,520 --> 00:08:29,880 Speaker 1: you have stuff that's maybe more sensitive and you don't 143 00:08:29,920 --> 00:08:32,480 Speaker 1: want it all with companies, you can have it distributed 144 00:08:32,520 --> 00:08:35,920 Speaker 1: across a network of computers and then you pay them 145 00:08:36,480 --> 00:08:40,920 Speaker 1: in that native token for the service of hosting your documents, 146 00:08:40,960 --> 00:08:44,679 Speaker 1: which on the service sounds reasonably legitimate. What I want 147 00:08:44,679 --> 00:08:48,440 Speaker 1: to understand is how does in theory, how does the 148 00:08:48,480 --> 00:08:52,200 Speaker 1: token facilitate this? So if I want to, uh, you know, 149 00:08:52,520 --> 00:08:55,520 Speaker 1: store something very sensitive. Let's say I'm working on some 150 00:08:55,640 --> 00:09:00,280 Speaker 1: subversive organization and a you know, and an oppressive authoritarian country, 151 00:09:00,400 --> 00:09:04,000 Speaker 1: and I want to store my organizational documents across all 152 00:09:04,040 --> 00:09:07,599 Speaker 1: these different computers and nobody can shut me down. Explain 153 00:09:07,720 --> 00:09:10,840 Speaker 1: how in theory these I c O s or tokens 154 00:09:10,840 --> 00:09:14,920 Speaker 1: could facilitate that. Well, a token is supposed to represent 155 00:09:15,040 --> 00:09:19,240 Speaker 1: a transferral blastset with a market price and UM. In 156 00:09:19,720 --> 00:09:23,600 Speaker 1: return for storing someone's files, UM, the person would pay 157 00:09:23,640 --> 00:09:27,640 Speaker 1: you in these UM file tokens, And since these file 158 00:09:27,679 --> 00:09:30,400 Speaker 1: tokens can then be sold on the open market, you're, well, 159 00:09:30,480 --> 00:09:34,400 Speaker 1: you're getting compensated for storing someone else's files. So it's 160 00:09:34,440 --> 00:09:37,960 Speaker 1: a sort of incentive engineering. Although there are other services 161 00:09:37,960 --> 00:09:41,400 Speaker 1: like bit torrent that do offer decentralized file storage already, 162 00:09:41,960 --> 00:09:45,400 Speaker 1: h you mentioned bit torrent Elaine, so on your blog 163 00:09:45,480 --> 00:09:48,880 Speaker 1: you came up with a really good historical example of 164 00:09:48,920 --> 00:09:54,120 Speaker 1: a previous attempt to provide a sort of token based service. 165 00:09:54,240 --> 00:09:58,959 Speaker 1: Can you walk us through what that historical parallel was right. 166 00:09:59,120 --> 00:10:03,040 Speaker 1: So in yearly two thousand's uh, there was a company 167 00:10:03,080 --> 00:10:06,120 Speaker 1: called mojoor Nation, and I mean the intention of no 168 00:10:06,320 --> 00:10:10,840 Speaker 1: mojor Nation wasn't really to create a token for people 169 00:10:10,920 --> 00:10:15,920 Speaker 1: to trade, but to incentivize people to share their extra 170 00:10:15,960 --> 00:10:20,319 Speaker 1: computational resources. The tokens were designed to incentivize this sharing, 171 00:10:20,400 --> 00:10:25,080 Speaker 1: but they ended up adding unnecessary complexity and um, it 172 00:10:25,160 --> 00:10:30,440 Speaker 1: was a distraction from the underlying service, which was offering 173 00:10:31,040 --> 00:10:37,480 Speaker 1: extra storage space or CPU cycles. So people in theory, 174 00:10:37,559 --> 00:10:40,960 Speaker 1: mojo Nation was supposed to encourage people to share their 175 00:10:41,000 --> 00:10:44,920 Speaker 1: extra CPU cycles and then they would get paid in 176 00:10:45,040 --> 00:10:47,720 Speaker 1: this token, but it didn't work and as you say, 177 00:10:47,760 --> 00:10:51,439 Speaker 1: the token added extra complexity. But then what came out 178 00:10:51,480 --> 00:10:55,040 Speaker 1: of mojo Nation or sort of the successor organization, was 179 00:10:55,080 --> 00:10:58,680 Speaker 1: actually a huge success. To explain that when you create 180 00:10:58,920 --> 00:11:02,800 Speaker 1: a transferable resource like a token, then people who have 181 00:11:02,920 --> 00:11:05,960 Speaker 1: the tokens want the tokens to be scarce, and in 182 00:11:06,040 --> 00:11:08,880 Speaker 1: order for a service to be widely adopted, I mean, 183 00:11:08,920 --> 00:11:12,840 Speaker 1: you don't want the token holders too also want the 184 00:11:12,920 --> 00:11:16,480 Speaker 1: tokens to be scarce. The reason why Bittorn was so 185 00:11:16,559 --> 00:11:19,440 Speaker 1: much more successful than emog nation was well, not just 186 00:11:19,520 --> 00:11:24,200 Speaker 1: the simplicity, but also they didn't try to introduce artificial 187 00:11:24,240 --> 00:11:27,720 Speaker 1: scarcity with these tokens. The earliest version, people were who 188 00:11:27,840 --> 00:11:33,720 Speaker 1: uploaded files were given priority in downloading the same or 189 00:11:33,840 --> 00:11:36,320 Speaker 1: downloading other files, so it was sort of a tip 190 00:11:36,360 --> 00:11:41,120 Speaker 1: for tat um protocol rather than actual like accounting and 191 00:11:42,280 --> 00:11:56,000 Speaker 1: trying to transfer resources that they had gained. So this 192 00:11:56,040 --> 00:11:58,680 Speaker 1: really gets to the heart of the question I think, 193 00:11:58,800 --> 00:12:01,800 Speaker 1: which is that the theory behind all these tokens is 194 00:12:01,840 --> 00:12:04,760 Speaker 1: that if you create a monetary incentive to join a 195 00:12:04,840 --> 00:12:07,960 Speaker 1: specific network, then people will give up their you know, 196 00:12:08,000 --> 00:12:11,320 Speaker 1: computer resources or something, and then the network will form. 197 00:12:11,360 --> 00:12:14,040 Speaker 1: But history shows us that at least maybe not every 198 00:12:14,080 --> 00:12:18,280 Speaker 1: time it works like this, but sometimes the monetary aspect 199 00:12:18,280 --> 00:12:22,320 Speaker 1: of it can create a level of confusion and difficulty 200 00:12:22,400 --> 00:12:27,040 Speaker 1: and um and friction that actually impedes the creation of 201 00:12:27,040 --> 00:12:30,280 Speaker 1: the network and undermines the goal. Right you can see 202 00:12:30,320 --> 00:12:36,120 Speaker 1: this happening with bitcoin right now. Bitcoin is a payment system, 203 00:12:36,160 --> 00:12:40,720 Speaker 1: although there are far more people hoarding bitcoin than actually 204 00:12:40,760 --> 00:12:43,280 Speaker 1: using it for payments, and I mean that that's okay, 205 00:12:43,280 --> 00:12:45,160 Speaker 1: people see it as a store of value as well, 206 00:12:45,679 --> 00:12:50,920 Speaker 1: but um, it's also something that makes bitcoin less usable 207 00:12:50,960 --> 00:12:53,680 Speaker 1: that the fact that people are hoarding it rather than 208 00:12:54,280 --> 00:12:58,480 Speaker 1: spending it. Are there anyways for people running I c 209 00:12:58,679 --> 00:13:02,400 Speaker 1: O s now to kind of overcome that fundamental tension 210 00:13:02,559 --> 00:13:06,240 Speaker 1: between you know, early adopters who want tokens to be 211 00:13:06,360 --> 00:13:11,520 Speaker 1: scarce and the needs of creating a large network relatively quickly. 212 00:13:12,760 --> 00:13:16,360 Speaker 1: I mean, the incentives are basically at odds with each other. 213 00:13:17,080 --> 00:13:20,600 Speaker 1: Part of having the initial token sale is that you 214 00:13:20,760 --> 00:13:24,080 Speaker 1: distribute the tokens to people who will be evangelists for 215 00:13:24,160 --> 00:13:27,120 Speaker 1: the service, but then it sort of turns into a 216 00:13:27,160 --> 00:13:29,480 Speaker 1: pump and dump because these evangelists try to drive up 217 00:13:29,480 --> 00:13:34,360 Speaker 1: the price and then they sell off their tokens. Right. 218 00:13:34,400 --> 00:13:36,840 Speaker 1: This seems to be sort of the heart of why 219 00:13:36,960 --> 00:13:39,200 Speaker 1: like people think that there's a bubble, because what you 220 00:13:39,280 --> 00:13:44,199 Speaker 1: have is the theory. Okay, the tokens facilitate the networks, 221 00:13:44,240 --> 00:13:46,280 Speaker 1: but when you look at it, it doesn't look like 222 00:13:46,360 --> 00:13:49,480 Speaker 1: any real networks are being formed. But you do have 223 00:13:49,679 --> 00:13:53,600 Speaker 1: a massive amount of speculation and trading and as you say, 224 00:13:53,679 --> 00:13:56,240 Speaker 1: pump and dump, so it looks like you know that 225 00:13:56,400 --> 00:13:59,800 Speaker 1: it's really it appears from my side, and that the 226 00:13:59,640 --> 00:14:01,720 Speaker 1: as they the card is coming before the horse. There's 227 00:14:01,720 --> 00:14:05,000 Speaker 1: no real they're there with any of this stuff. Yeah, 228 00:14:05,080 --> 00:14:09,080 Speaker 1: and it's unfortunate because there are people trying to develop 229 00:14:09,280 --> 00:14:12,440 Speaker 1: legitimate technology, but the legitimate ones are going to get 230 00:14:12,480 --> 00:14:15,520 Speaker 1: lost in the noise and be seen as a scam 231 00:14:15,600 --> 00:14:20,480 Speaker 1: just like the other ones. Are there specific applications or 232 00:14:20,520 --> 00:14:22,600 Speaker 1: like uses for i c O s that you think 233 00:14:22,640 --> 00:14:27,600 Speaker 1: are better suited to the format than others, Like for instance, 234 00:14:28,080 --> 00:14:32,000 Speaker 1: I met Yobi Benjamin randomly in Abu Dhabi last week. 235 00:14:32,040 --> 00:14:35,080 Speaker 1: He used to be uh CTO for city and he's 236 00:14:35,160 --> 00:14:39,479 Speaker 1: running an i c O that provides services or exchanges 237 00:14:40,480 --> 00:14:45,280 Speaker 1: basically video game services and something like that. I can see, 238 00:14:45,360 --> 00:14:48,160 Speaker 1: you know, playing video games is kind of a fun 239 00:14:48,240 --> 00:14:53,360 Speaker 1: thing that people do. Uh, it's not necessarily critical to 240 00:14:53,520 --> 00:14:57,560 Speaker 1: your everyday life, at least for some people. So maybe 241 00:14:57,600 --> 00:15:03,120 Speaker 1: something like that a token makes sense. Well, ultimately a 242 00:15:03,200 --> 00:15:06,720 Speaker 1: token is going to If a token is widely adopted, 243 00:15:06,760 --> 00:15:09,680 Speaker 1: it becomes like a currency. And I mean the reason 244 00:15:09,760 --> 00:15:14,080 Speaker 1: why we have um things like the US dollar or 245 00:15:14,280 --> 00:15:16,880 Speaker 1: currencies in general is to solve for the coincidence of 246 00:15:16,960 --> 00:15:21,960 Speaker 1: wants problem. And if something has or actually has a 247 00:15:21,960 --> 00:15:24,080 Speaker 1: token or native token that has value, like you might 248 00:15:24,080 --> 00:15:28,920 Speaker 1: as well just pay in bitcoin or either. So is 249 00:15:28,960 --> 00:15:32,480 Speaker 1: this essentially us going back to a bartering system, but 250 00:15:33,160 --> 00:15:37,880 Speaker 1: I guess a blockchain bartering system. It sounds like basically, yeah, 251 00:15:38,000 --> 00:15:40,320 Speaker 1: when you hear people talk about a bubble or a 252 00:15:40,320 --> 00:15:43,000 Speaker 1: new gold rush, let's say, yeah, yeah, there's a lot 253 00:15:43,040 --> 00:15:46,160 Speaker 1: of speculation. It's a big bubble right now, and it's 254 00:15:46,200 --> 00:15:49,160 Speaker 1: probably gonna burst, but something good will come out of this. 255 00:15:49,240 --> 00:15:53,280 Speaker 1: And they pointed to the Internet, the dot comswood and 256 00:15:53,280 --> 00:15:55,400 Speaker 1: say yeah, that I'll burst. But then we got the 257 00:15:55,440 --> 00:15:58,040 Speaker 1: broadband network and now of course, and and of course 258 00:15:58,080 --> 00:16:00,840 Speaker 1: many of the companies from the late nineties ended up 259 00:16:00,840 --> 00:16:05,640 Speaker 1: being huge deals, like Amazon being the most obvious example. 260 00:16:05,920 --> 00:16:08,560 Speaker 1: When you look at this space, do you think it's 261 00:16:08,600 --> 00:16:11,840 Speaker 1: going to follow the similar trajectory? Is it safe to 262 00:16:11,880 --> 00:16:15,480 Speaker 1: be that confident that something of value will come from 263 00:16:15,480 --> 00:16:19,240 Speaker 1: all the speculative activity that we're seeing. Well, most of 264 00:16:19,680 --> 00:16:24,360 Speaker 1: the things that these um tokens proposed to build involve 265 00:16:24,440 --> 00:16:28,640 Speaker 1: open source software. So there's that aspect in that people 266 00:16:28,640 --> 00:16:31,240 Speaker 1: are building open source software that could in theory be 267 00:16:31,400 --> 00:16:35,480 Speaker 1: used by future applications, even if the tokens themselves don't succeed. 268 00:16:36,280 --> 00:16:39,400 Speaker 1: I mean a lot of them are not building anything 269 00:16:39,480 --> 00:16:44,960 Speaker 1: at all, so that's probably less valuable. It seems like 270 00:16:45,000 --> 00:16:49,040 Speaker 1: an understatement. Joe alluded to this in our intro. How 271 00:16:49,040 --> 00:16:54,320 Speaker 1: do you think the UM the I c O story ends? Ultimately? 272 00:16:54,400 --> 00:16:57,400 Speaker 1: Then do all of these things proved to be you know, 273 00:16:57,440 --> 00:17:02,920 Speaker 1: if not outright frauds, then kind of useless endeavors. And 274 00:17:03,080 --> 00:17:05,359 Speaker 1: while we're at it, how do you think bitcoin ends? 275 00:17:05,440 --> 00:17:08,240 Speaker 1: Because to your point, it's supposed to be a payment 276 00:17:08,320 --> 00:17:11,000 Speaker 1: system UM with a big network effect, and instead we 277 00:17:11,080 --> 00:17:14,440 Speaker 1: have people who are keeping the coins because they assume 278 00:17:14,800 --> 00:17:19,760 Speaker 1: they're going to rise and value. It's two big questions. Sorry, yeah, 279 00:17:20,000 --> 00:17:23,600 Speaker 1: I think the token sales will eventually run their course. UM. 280 00:17:23,640 --> 00:17:27,960 Speaker 1: Even today, Uh, I think we have passed the peak, 281 00:17:28,040 --> 00:17:31,159 Speaker 1: and new tokens that are being launched these days, UM 282 00:17:31,560 --> 00:17:35,399 Speaker 1: aren't seeing the massive influx of capital that the earlier 283 00:17:35,440 --> 00:17:38,879 Speaker 1: ones saw. As for bitcoin, what one of the biggest 284 00:17:38,880 --> 00:17:43,119 Speaker 1: complaints about bitcoin in recent months was that the transaction 285 00:17:43,160 --> 00:17:46,960 Speaker 1: fees are really, really are getting too high. And the 286 00:17:47,119 --> 00:17:49,280 Speaker 1: part of the reason for that is because transaction fees 287 00:17:49,320 --> 00:17:52,520 Speaker 1: are denominated in bitcoin, and the price of bitcoin has 288 00:17:52,560 --> 00:17:57,200 Speaker 1: gone up like five percent this year, so it looks 289 00:17:57,240 --> 00:17:59,919 Speaker 1: like transaction fees have gone up a lot. Whend non 290 00:18:00,040 --> 00:18:02,600 Speaker 1: need in US dollars. But then in terms of Bitcoin, 291 00:18:02,920 --> 00:18:05,960 Speaker 1: I mean they've stayed fairly constant. One recent change in 292 00:18:06,000 --> 00:18:09,760 Speaker 1: bitcoin was they did a software upgrade that now allows 293 00:18:09,840 --> 00:18:14,480 Speaker 1: for Layer two transactions that don't actually happen on chain, 294 00:18:14,600 --> 00:18:18,320 Speaker 1: but can people can make Bitcoin transactions with lower fees 295 00:18:18,400 --> 00:18:21,480 Speaker 1: off chain and then do netting and batching on chain 296 00:18:21,600 --> 00:18:24,680 Speaker 1: later on. So just to be clear that you think 297 00:18:24,680 --> 00:18:28,560 Speaker 1: that the software is in theory going to be enabling 298 00:18:29,280 --> 00:18:32,600 Speaker 1: it might become more conducive to payments in the future. Yeah, 299 00:18:32,800 --> 00:18:35,800 Speaker 1: I think they will get around that, even though, um, 300 00:18:35,840 --> 00:18:38,879 Speaker 1: I mean bitcoin did see I guess a couple of 301 00:18:38,960 --> 00:18:42,400 Speaker 1: years of complaints where people felt that it was not 302 00:18:42,480 --> 00:18:47,000 Speaker 1: that usable. Right, all right, well, Atlanta, thank you very 303 00:18:47,080 --> 00:18:49,600 Speaker 1: much for joining us. I think that no doubt this 304 00:18:49,680 --> 00:18:52,280 Speaker 1: is going to be a very widely listened to episode 305 00:18:52,280 --> 00:18:54,400 Speaker 1: because I know there's just tons of interest in this 306 00:18:54,440 --> 00:18:59,320 Speaker 1: topic and appreciate your perspective on it. Lano Software Engineered 307 00:18:59,359 --> 00:19:02,400 Speaker 1: Global Finance, Jill Access and a Bloomberg View contributor, Thank 308 00:19:02,400 --> 00:19:16,879 Speaker 1: you very much. Thanks Joe and Tracy. So Joe I 309 00:19:16,960 --> 00:19:20,200 Speaker 1: managed to escape I c O S briefly at least 310 00:19:20,200 --> 00:19:22,960 Speaker 1: on the Odd Loots podcast, but we cannot escape them 311 00:19:23,000 --> 00:19:25,000 Speaker 1: in our day to day markets coverage, and I can't 312 00:19:25,040 --> 00:19:28,959 Speaker 1: even escape them from my personal email accounts. So just 313 00:19:29,040 --> 00:19:31,920 Speaker 1: last week I got an invite for a pre sale 314 00:19:32,359 --> 00:19:34,920 Speaker 1: in a I C O. I'm not going to say 315 00:19:34,920 --> 00:19:36,480 Speaker 1: the name of it, but I will tell you that 316 00:19:36,560 --> 00:19:40,680 Speaker 1: the private pre sale password to participate in this offering 317 00:19:41,280 --> 00:19:45,080 Speaker 1: is participate in success. That gives you an idea of 318 00:19:45,080 --> 00:19:48,000 Speaker 1: the marketing. I don't think we need to say anything 319 00:19:48,280 --> 00:19:51,520 Speaker 1: more than that. That more than anything else, that in 320 00:19:51,600 --> 00:19:54,959 Speaker 1: your private email you got a offer for pre sale 321 00:19:55,000 --> 00:19:57,320 Speaker 1: and that was the password. I kind of think that 322 00:19:57,400 --> 00:19:59,880 Speaker 1: sums it up, doesn't it? Yeah? Should we just leave 323 00:19:59,880 --> 00:20:02,240 Speaker 1: it there? Are we done? Let's leave it there. This 324 00:20:02,320 --> 00:20:04,920 Speaker 1: has been another edition of the All Thoughts Podcast. I'm 325 00:20:04,960 --> 00:20:08,440 Speaker 1: Tracy Alloway. You can follow me on Twitter at Tracy Alloway, 326 00:20:08,480 --> 00:20:11,240 Speaker 1: and I'm Joe wisn't Thal. You can follow me on 327 00:20:11,280 --> 00:20:13,840 Speaker 1: Twitter at the Stalwart. And you can follow our guests 328 00:20:13,840 --> 00:20:18,120 Speaker 1: Elane Oh on Twitter at Elaine except the Ellen. Elane 329 00:20:18,160 --> 00:20:21,720 Speaker 1: is an eye, so it's like Ei so and and 330 00:20:21,800 --> 00:20:26,040 Speaker 1: you can follow our producer on Twitter, Sarah Patterson at 331 00:20:26,080 --> 00:20:28,479 Speaker 1: Sarah Pett With two teas. Thanks for listening.