Transcription Episode 7

Hello everyone and welcome to Living on Blockchain. Today we will be talking to Alex Masmej. He is a crypto entrepreneur.

He is working in the Ethereum space. He was a part of the Metacartel, an organization which was investing in crypto projects initially. He was then the founder of Rocket, a lending platform, and post that he created the first personal token called Alex in which he legit tokenized himself.

So I’m very excited for this conversation. Hi Alex, I’m so grateful that you could take out the time to talk to us. How are you doing today? Yeah, I’m doing great.

Thank you Tarsha for inviting me. Oh lovely. So you know, please tell our listeners a little about your background and how you got into the blockchain space.

Yeah, sure. So I graduated from a business management degree in 2017 and I spent a year exploring what technology should I focus on because for me, tech is the best vehicle to make progress in the world. And so there was for me three main tech, one was blockchain, the other one was augmented reality and virtual reality, and the third one was of course artificial intelligence, AI.

And I thought to myself, I think that the blockchain space has the most room to grow in the next 10 years. So that was a huge point. And also it was the lowest barriers to entry.

So as a young person just graduating, it was probably the best choice to do for myself and my career and it’s been working well so far. Wow, okay, wonderful. That’s lovely.

So tell us a little about what you’re working on currently. You were, you know, one of perhaps the first person to tokenize himself. Yes, yes.

So yeah, that’s a crazy story and I can talk about it. Right now I’m working mostly on my new startup, which will help kind of bridge the gap between crypto, you know, people and like crypto native, almost nerds, right? Different from the consumers. And so I’m trying to build a product right now because I think there’s too many protocols and there’s not enough products that use these protocols and make it simple for normal consumers.

So that’s the thing. And then, yeah, I can talk about my personal token, Alex, that I’ve done. So it’s a cryptocurrency that kind of represents my community.

And it’s super interesting and I’m still doing this on the side. Okay, wow, wonderful. So, you know, if you could perhaps elaborate a little on what you’re working on currently and how our listeners can perhaps get access to your platform.

Right. So my current startup right now is yet to be announced. And so it’s not live yet.

Oh, okay. It’s in stealth right now. Right.

It’s kind of like in stealth, but it’s also because we’re preparing and a lot of things I would say right now will likely change in the future. But we want to do a financial services app that will enable people to access the top crypto DeFi cutting edge technology. Uh, but in a much, much simpler version, um, for anyone to access it.

Oh, wow. Okay. So, okay, that’s, that’s wonderful.

So will this particular platform also have like an inherent token? It will probably have a token because right now we are seeing that the best practice, uh, after the ICO boom where, you know, token would not be useful. It was a less liquid form, um, of money pretty much. And so now we are seeing that tokens that can accrue some of the protocol value over time can be great because basically people will speculate on the future value of the protocol, kind of like discounted, uh, prison value in accounting terms.

So this is why, um, yeah, we want to do a token because people will be incentivized to use the app. Uh, you will earn the token by using our app. So trading, exchanging assets, um, paying your friends and also just saving on a savings account.

Uh, so yeah, this is, we, we actually want to raise the token. And I think, uh, in the coming 12 months, this is going to happen on a large scale and we’re just seeing the start of the bull market right now. Yeah.

Yeah. That’s, that’s what I, that is actually going to be my next question. Like what’s your outlook towards the market? Everybody’s saying about how we are going towards the bull market again.

Uh, so what would be your perspective? Yeah, definitely. Uh, so in 2017, the bull market was led. So as, as I said, by ICOs, uh, but definitely right now what’s happening is that we found a better model, which is a token isn’t just a worst form of money.

It’s actually, um, share of the dividends of a protocol and later many more things like artists or even people like myself. And this is why I’ve done the Alex token, uh, partly. And so, yeah, I think the bull market is going to be about incentivizing people to use a product.

And so those early users get the shares of the future protocol revenue. And I think it’s a much, uh, fair and better and revolutionary concepts, right? It’s like if the early Airbnb users or Uber users got the shares of the company that they were working on. Uh, I think that’s, that’s wonderful.

It’s a better way of distributing wealth and also, uh, the token now as actual future value. So, um, it started with compound, which is the leading app in lending and boring what that took in comp. And so they’ve done liquidity mining because the incentive here is to put liquidity.

But I think this is going to be for, uh, not only just the defy and finance, but it’s going to be also more consumer apps as well that use that model. Yeah. Yeah.

I totally agree with you. I think, uh, you know, the wave, this, this particular wave is going to be all about defy. So just for, you know, our users, because we, uh, like, you know, sort of, um, making, uh, these concepts a little easier and jargon free, how would you, uh, perhaps explain defy to somebody who’s just getting into the crypto space and, uh, you know, how, how, how do you think they should perhaps, uh, start? So these are two questions, but yeah.

Sure. Sure. So, uh, yeah, like for people who don’t know too much about crypto, um, you know, Bitcoin is a great, uh, store of value, at least speculatively.

So like maybe in the future, Bitcoin would be a great store of value because there’s only 21 million units. And so that’s great, but you can’t do much more than like have this kind of, you know, government free store value. And so what defy is trying to do is that we’re trying to pretty much replicate the entire financial industry, but instead of doing it with the traditional way, which was built by our grandparents with like the, the legacy financial system, we’re like, you have to trust banks and you have to pay a lot of fees.

And it’s depending on your country here, we are building an open global financial system where anyone can access it. Um, and since all the middlemen are cut, the fees are actually much, much lower. And so that means that more money is given out to lenders, borers, and all these types of things.

And so we’re seeing in the past 12 months, basically all the financial infrastructure in the world being replicated on Ethereum, whether it’s lending, borrowing, options, derivatives, insurance, um, prediction market, which is like pretty much betting. Um, and so all of these things are much better. Yeah.

It’s cheaper. Uh, anyone can trust it. Uh, it’s accessible via a mobile phone or a computer.

It’s still a bit hard technically to understand, but, uh, it’s getting easier and it’s actually, so it’s cheaper. It’s faster. It’s global from day one.

And it’s a huge revolution for me. Uh, it’s long overdue that finance is software, right? Just like you said to someone, why wouldn’t you send money or a loan the same way? It’s weird that it’s still databases, um, in banks. And so I’m looking forward to that future.

So this is kind of like what DeFi is. It’s trying to be the single world’s biggest financial infrastructure and replace the existing legacy system. Yeah, absolutely.

I think that is what, you know, ultimately that, that was a, that was a good explanation. I think that is what DeFi is doing. It’s basically dismantling the traditional monetary system, which is there in place, which does not work.

We have seen a time and again that banks fail and people’s savings get wiped out and not just banks in general, like, you know, all monetary instruments like, you know, in 2008, when there was a financial crash. So, you know, CEOs were there, which, which kind of created that whole, um, pyramid, which crashed and burned so many economies around the world. So I think, uh, DeFi in a sense, because we are decentralizing it, making it more efficient, as you said, it’s cheaper, it’s faster, it’s more transparent.

It actually gives power back to people. So, you know, it’s, uh, helping effectively. It’s actually, uh, helping, you know, a bank be unbanked, right? Yeah, exactly.

Uh, I’m personally like almost unbanked myself and, but right now it’s a tiny minority of people, because as you said, there’s a lot of jargon. Um, it’s really hard to understand and it feels a bit like the early days of the internet, but I’m so confident that, you know, there’s all of these investment strategies in DeFi where you can get, you know, almost a hundred percent return a year on your savings. Uh, and there’s dozens of ways to do that.

But I think that if we repackage it in just one simple offering, it could be a huge consumer product. Absolutely. I think that is like, that is the whole point of creating all of these, you know, consumer products that, uh, they, they, you know, easy accessibility.

They give, give users who might not be very tech savvy, uh, also a glimpse into this alternative world, because I think everybody, uh, sort of, you know, needs, uh, to look into DeFi and give themselves, uh, and their future selves a chance by actually investing in this space because, uh, you know, just going by the traditional, um, you know, the monetary system that is in place, wealth creation does not really happen. Right. Oh yeah, for sure.

Uh, the traditional financial system has so many problems, whether it’s, uh, inflation that’s not controlled by the community and, and yeah, like there’s some perverse incentives, but it’s not really due to anyone in particular. It’s more like the system and the technology that’s in place that like has some, uh, loopholes and it’s, it’s just really hard. Right.

And the money is not picked to anything. The dollars, right. We left the gold standard a long time ago.

And so the fact that yeah, money doesn’t really mean much. Uh, it’s so hard to find the perfect supply and all the economic rights that of course humans get it wrong. But if we can power the crowds, which enabled wonderful things in open source software, or even like normal websites like Wikipedia, which is sourced by the crowd, if the crowd can figure out a, uh, a better financial system, I think it’s, it’s huge.

Yeah, that’s, that is what, that is what I said, you know, uh, earlier that, you know, it’s kind of giving back the power to people. And I think that in itself is very wonderful. I think we’re seeing decentralization, uh, happening in almost every sector in some way or another, obviously it’s a very new technology and beginning the new technology.

There are, uh, you know, people who kind of, uh, have a certain mistrust, uh, regarding it because they don’t understand it well enough. But I think that that can be solved with people like you and me, if we are talking to, uh, more people, uh, regarding this and, you know, creating consumer facing products that are easy to use, uh, that problem kind of goes away. Yeah, for sure.

And so we have a lot of work. It’s really, really hard to, um, make it easy for people in consumers because there are so many layers of, uh, complexity and software and browser extension and like converting, uh, normal fiat government currencies to the cryptocurrencies. But, uh, I think step-by-step we’re going to make it.

Yeah, absolutely. I think Rome wasn’t built in a day. So, you know, everybody, uh, everybody, all the stakeholders in this particular ecosystem that every, I see everybody is working so hard to sort of, you know, build something that’s going to solve a problem for, uh, you know, a nameless faceless person on the other part of the world.

So I think that is what makes this technology really exciting, the kind of impact and the potential of impact that a blockchain does have. Yeah, for sure. Yeah.

Okay. So, uh, coming to my next question. So do you, uh, you know, would you recommend any particular thought leaders, uh, in the blockchain space who, you know, our readers should definitely follow.

Right. So in the blockchain space, I really like, uh, so there’s Anthony Pompliano. So he doesn’t really like Ethereum per se.

Uh, but I’ve talked to him and now he’s actually more into DeFi and he’s looking more into DeFi, but he’s a very great source because like his personal opinions aside, um, he interviewed a ton of people in the space from all diverse, like, uh, areas of the industry. So I would say his podcast is great. Then there’s this awesome, um, um, website by Balaji and I don’t know his last name, but he’s very famous on Twitter.

Yes. I think so. Like the CTO of earned that then got acquired by Coinbase.

And, uh, yes, exactly. Yeah. That person.

And so, uh, is an awesome resource. Yeah. Introduction to DeFi article by Linda Xi.

Uh, she’s really amazing. And so that will give you a great background on DeFi and is just a really quality, uh, articles. Anyway.

And then I would say the defiance by Camilla Russo. Yeah. Most famous, uh, Ethereum reporter in, in like the entire industry.

And every day she covers some news. She was previously at Bloomberg. So she has experience, uh, making it simple for people to understand, but at the same time you can remain at the cutting edge of the industry.

Yeah. Yeah. I think Camilla is absolutely doing a wonderful job.

She was actually one of our guests, um, before her book came out. Uh, so, you know, her book, uh, is called the infinite machine. It recently came out.

And I think that’s also a very wonderful read. If somebody’s trying to get into DeFi, I don’t know if you’ve read it. So talking about books, are there any books that you would recommend to our listeners? Uh, yeah, I’ve read the infinite machine.

Uh, it’s an awesome book and, uh, yeah. Um, Camilla Russo is an amazing journalist. Uh, so books, I don’t think so because I think the problem, so apart from the infinite machine, which is an exception because, uh, Camilla is like such an involved journalist.

It’s really hard because the space is just moving too fast. So I would say the defiant is a great newsletter. Then there’s also, um, if you’re a bit, so after reading, you know, a bit of background, like on or listening to pump or listening to some defiant article, then there’s bankless, which is great.

It’s still very consumer friendly for people who are just starting it, uh, to be in this space. And so bankless is a podcast by Renishon Adams. It’s also a newsletter.

That’s pretty nice. And then when you really feel like, you know, about Ethereum, there’s week in Ethereum and there’s also Ethub, which are two great resources, uh, to learn more about the topics. But I would say, yeah, if you just starting out, I think the defiant and bankless are really great resources.

Yeah, I think, uh, those are absolutely wonderful resources. So, uh, what would be perhaps, you know, uh, some projects that you feel really bullish on currently right now? I’m super excited about Ave. So they, uh, was at the start, it was supposed to be, uh, like the second competitor after compound.

So it’s a boring and lending market. And so, you know, it’s open to anyone it’s, uh, cheaper, um, in fees and also it’s uses pools, right? So you’re not lending to someone peer to peer tool. So it’s much more liquid and it’s a much better system.

And what’s really insane is that they just today passed compound and maker to become the largest by volume, uh, defy application in lending, boring, and like any category combined. So, uh, I know the team because they’re based in Europe and it’s an amazing feet. And also we just learned this week that they acquired a e-money license in the UK by the FCA, I think, or FDA.

I don’t remember. Yeah, exactly. And so that’s extremely bullish because that means they might be preparing some consumer product on top of their protocol and that can be absolutely insane.

So I’m super bullish on Ave. Yeah. Yeah.

You and me both. I think they have a wonderful, uh, platform, a wonderful protocol. And as you said, uh, they have surpassed, uh, you know, they’ve become number one today.

And I think, uh, you know, really like, I’m very excited about what they bring next. So how is, um, do you know the current scenario of blockchain adoption or regulations, uh, in the EU region, according to you? Um, I think it’s actually quite good. I think for a while, uh, Switzerland jurisdictions was the best legal environment, but now it’s more the UK because it’s quite easy and fast to set up a business.

Uh, I think the environment is great. I’m personally more bullish on the U S because I think that there’s more talents for building great companies and protocols eventually in the U S. So I would say the U S is still great. Although the SEC is a pretty strict regulatory aspect, but I think if you want to do the right thing and build a protocol that, uh, you know, makes the world better, like you should not be scared about the SEC because the products you will bring to the world will be reasonable.

It will not be a Ponzi scheme. It will not be a scam by any means. And so I don’t think the SEC is going to go after the good projects, right? So, you know, compound is in the U S Ethereum itself.

The blockchain is in the U S and they have no problem so far. So this is why I think I’m quite bullish on the SEC, because if you want to do a protocol that does good to the world, you probably would not have any problems. Yeah, I think you’re absolutely correct.

So I think people do fear the SEC a lot because there is a, uh, you know, it’s heavy compliance in USA basically, uh, when, when it comes to any kind of a crypto project, but, uh, you know, ultimately, as you said, it’s absolutely wonderful that if you’re really solving the problem, uh, then, you know, you shouldn’t be afraid of sort of complying with the existing laws, because any which way you’re trying to solve a problem, you’re not creating a Ponzi scheme. So I think, uh, that is, uh, like a really, uh, it’s, it’s really valid, but yeah, UK has, uh, done a really good job now that they’ve come up with all of these guidelines. And I think by, uh, the deadline is January, 2021, that all crypto projects need to sort of get that, uh, and become legally compliant.

They’ve given enough time as well. So I think, uh, that should really push, uh, for innovation in the UK. Makes sense.

And that’s actually awesome because I am in the UK right now and, uh, starting my company there. So I hope it’s still that way. Yeah.

Yeah. So they have basically, I think they have set up very straightforward guidelines and they want all projects to be compliant by 2021 January. So I think, uh, you know, because I think policy can be so important.

Like there are governments that dilly-dally on creating policy on crypto. And then that, I think that, that, uh, you know, wishy-washiness, uh, at the government’s part that kind of encourages these scams, like when there is, uh, you know, a regulatory framework already in place, then, uh, that does not happen. What do you think? Interesting.

Yeah. I think it’s great that the UK is trying to be proactive and I just learned it from you. Like I didn’t know about the guidelines.

Um, so yeah, that’s, it’s a tough play between stifling innovation and, uh, you know, encourage like discouraging the bad actors. Um, it’s definitely, uh, hard for regulators, but they want to protect investors at the end of the day. They, they don’t want to, you know, kill entrepreneurship at all.

And so, um, I don’t have much opinions on legal. It’s not really my specialty, but I would say that if you’re doing something that’s, uh, you know, legit and really warrants users, uh, and also is decentralized in governance in a sufficiently reasonable time, because of course, like everything started as a which is centralized. And then as time goes on, it goes more and more.

If it’s, if it’s reasonably decentralized, when it ill, it hits some scale. Uh, I think no one can happen to you because you can just say, you know, I am not part of it. This is like, could I did deploy, but now it’s not, it’s not in my control anymore.

And I’m sure that if the, if the protocol is just a simple lending platform, uh, it should be good to go. Yeah, absolutely. I think, you know, uh, ultimately, obviously regulators want the, uh, investors to be protected.

And I think for that protection to be in place, uh, a clear framework and guidelines, they do help. Uh, and, uh, you know, I think we are on the same page there. So this kind of brings me to my second, last question for today.

Uh, so what are like your top five, uh, blockchain or crypto apps that you have in your phone? Oh, my top five crypto apps. Well, let me check my phone right now, but I would say, so I would say Twitter because Twitter is a huge space to learn about crypto. Uh, it’s how I got to meet the industry.

Uh, I connected with people. So Twitter is not really a crypto app, right? It’s a social network, but this is where a lot of the industry is. Then I would say, uh, I would say then Revolut because Revolut is a normal FinTech app, but they do have a crypto feature.

And I think somewhere like, I think it takes 3% of commission. Uh, so it’s a bit expensive, but it’s an easy way for people who are just starting in this space to get some exposure to Bitcoin or Ether. Uh, then I, then I would say, uh, Blockfolio is great for people who have some assets.

It’s very easy. Uh, and then if you’re a bit more into DeFi, you can download Zerion. Uh, it checks your Ethereum address and see all of your investments in all of the DeFi protocols and applications.

So I’m at four, right? And then the fifth one is Metamask is the most famous extension, uh, for a browser. And so I have it, this is where, uh, most of my activity on Ethereum is, and they have a mobile app that’s, uh, on test flight, but I’m using it and it’s really good so So these are my five. Wow.

Okay, cool. So I didn’t know about Zerion. Interesting.

I, I, you know, if I probably take a, I’ll check it out, uh, post this particular recording and, you know, the rest that you talked about, I think, uh, you know, maintaining a good hygiene when you’re investing in crypto is so good. And if you’re starting off, Revolut is a super easy, such a great interface, uh, that I think anybody can use it. And it gives you a little bit of a peek into the crypto world and a portfolio.

Absolutely. I think, uh, you know, you can put her in, you can, it’s like, you know, checking your entire portfolio in one go. And I think that’s very important because, you know, otherwise it’s also, it’s not consolidated, right? We have assets here and there.

And, um, so brilliant. I think your recommendations are very, very something, you know, that I think I have on my phone as well, except for Zerion, that one, I will check post this call. So, uh, It’s kind of like a, it’s kind of like a portfolio, but it’s only for Ethereum.

And so since like, I only have Ethereum now I’m checking more Zerion, but yeah, either are great. Wow. Okay.

I’m going to do that. That sounds very nice. Okay.

So, uh, you know, we are now coming to my last question. Uh, how would you recommend that our listeners can, you know, start living on blockchain? That is the name of the podcast. And the idea is how can they perhaps get into this space because people find it very intimidating considering it’s a new technology.

How would you recommend for a lay person to get started with this technology or get started with, uh, investing in crypto? Yeah, for sure. So I think starting investing, I would say perhaps, uh, learn about Ethereum and then do your own research and then, uh, perhaps, I don’t know, like invest in maybe Ethereum, like this is not investment advice, but if you learn about Ethereum and you get some exposure to the network, then, uh, this will probably fuel some motivation to go further. And then if it’s like starting getting into the industry, there’s a few paths.

Uh, usually people start by having a job at Coinbase or ConsenSys, which are like two massive, uh, Ethereum, uh, sorry, like blockchain companies. But to be honest, like I didn’t go that route because I wasn’t very technical. So what I’ve done is I just talked to people on Twitter, one.

And the second thing is I am part of Meta Cartel, which is a group on Ethereum that has a shared bank account on Ethereum. Like, as in like a shared crypto wallet, it’s called like a DAO pretty much where people can just deploy some funds. And if you work, you know, if you’re going to have events, if you work for the community, they will reward you and you will have tons of opportunities.

And this is how it got started in the space. So yeah, we’re starting investing. It’s like great.

Uh, you know, learn about Ethereum and you will learn about the new paradigm and this kind of like new internet of finance, et cetera. And then, uh, yeah. Join Meta Cartel if you want to speak to some cool people and I’m happy to chat with you there.

Wow. Okay. This is wonderful.

Great recommendations. I think the really good way forward for people, Alex, it has been so nice to talk to you and so refreshing that, you know, I can, um, there are people who are across the world and, you know, we kind of have, um, we are, we are passionate about the same things. They’re trying to do the same thing.

I am, um, really happy that, you know, you agreed to come here and take out the time and all the best for your, uh, venture, which is in stealth. I would love to try it out when it goes into a beta and, uh, thank you so much. Any parting thoughts? Yeah, no, I’d love to try, uh, your product and yeah, thank you so much for bringing me in and some final thoughts.

Well, uh, yeah, all the best. And I hope, uh, you know, your product will get traction and this podcast will get more traction because I think it will because of the bull market that’s coming. A lot of people are going to get interested in the space.

Thank you so much. So yeah, I, you know, likewise, I want your product to do as well. I think the ecosystem grows, uh, together, like when all of us succeed, uh, you know, that is how we grow.

So brilliant. It’s been wonderful talking to you, Alex. Thank you so much.

Thank you.

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