CHARLES MAX_WOOD: Gotcha.
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CHARLES MAX_WOOD: So I'm a little curious as we dive in, I know that you were on in, I think the summer of last year, and you and AJ and Steve talked a bit about blockchain and just like why in the heck would anyone ever use it. And I know you got kind of the contrarian treatment there, but. Can you just give people kind of a thumbnail sketch? Because I think people hear blockchain. I think people kind of have a general idea of mining a block on the chain and the ledger and all that stuff. Or maybe they've just heard some of the terms. But can you just explain really briefly how a blockchain works so that when we start talking about what people can do with it, that they won't be entirely lost?
MAX_KORDEK: Yeah, I think it's better to focus what the blockchain is than just explaining how it works because it's so complicated. And this would be the entire episode, but what is a blockchain? So essentially the blockchain or a blockchain as a decentralized ledger, meaning that you have a ledger with entries, which can never be altered, manipulated, deleted again, once they're in that ledger. And it's all decentralized, meaning it runs not only on one computer or on the server farm from one company, but rather all over the world. And everyone can participate in securing that decentralized ledger. And that opens up a wide number of use cases, which we're discovering over the past 10 years one by one. And yeah, happy to talk more about that today.
CHARLES MAX_WOOD: Yeah, it's interesting to kind of dive in and talk a little bit about blockchain, what it is and how it works from the sense of people, you know, they hear about a ledger. And to be perfectly honest, when I think of a ledger, I think the correlation that I give people is kind of a... database or a spreadsheet type storage deal that you have in your blockchain. And you can, from what I've been able to tell, store information in the ledger however you want, mostly. You can do it in JSON, you can do whatever. Right. And then the rest of it, right, as you kind of run through, usually ledgers is a, like a tally of tokens or things like that, right? So people think of like Bitcoin, right? And so there's a tally, there's a ledger or a database of transactions that if you run all the way through the ledger, right, at the end, you have a total of who has what, how many tokens, right? How many Bitcoin and this, yeah,
MAX_KORDEK: this is the case in blockchain systems, which are based on incoming and outgoing transactions. Where, yeah, like you explained, you go from the first block of the blockchain to the current block and always check what went in and what went out of an account and this leaves you with the final balances.
CHARLES MAX_WOOD: Right, and a lot of the ledgers have a balance column as well. So you don't have to go run through the whole blockchain to get the information you want, right? There's some form of final information in there.
MAX_KORDEK: Yeah, essentially when your local client is syncing with the blockchain data, it checks the incoming and outgoing transactions and always of course has like a final state, probably like stored in memory so that the API can access that quickly. Newer blockchain systems like Ethereum or Lisk, they are based not on this ingoing and outgoing transaction system, which is called UTXO, but rather on an account based system where the balances are just directly stored in the database.
CHARLES MAX_WOOD: Oh, interesting. Okay.
MAX_KORDEK: Yeah. And then it's much easier to directly check what the balance is of an account, but this involves also other kinds of information, of course.
CHARLES MAX_WOOD: Right.So effectively what we've got then is we've got kind of this ongoing state that we're tracking as we go. And then there are rules for how we form consensus. For example, if it's distributed, which most blockchains are, right? If it's distributed, then, you know, if I put something in and you put something different in, you know, how does it get reconciled? This is where it starts to get complicated. But there are mechanisms for all this stuff. And...one of the core features of blockchain is that nobody actually technically owns or controls the data. And so you can operate without necessarily having to trust some central authority to tell you this is the truth in this system, right? It's everybody's, you know, contributing either by validating the truth in the system or participating in whatever consensus operations or things like that that occur within the system.
MAX_KORDEK: financial incentive to make sure that no one else lies. And that means the ones controlling each others, making sure that, well, the blockchain is not only secure, but also its data has integrity, you know, and not being at the mercy of a central authority has a wide array of use cases. If we take, for example, Bitcoin as the first let's say implementation of blockchain technology, then they were just trying to establish a decentralized currency. And obviously, it doesn't scale to what is required of a currency on a global factor. However, if we are now looking at this removal of the central authority, then we can see that Bitcoin has a use case, for example, now in difficult situations where, let's say, donations cannot be accepted in another way besides...Bitcoin or where certain fundings cannot arrive in other countries or other use dictates because the financial system is shut down. For example, we had a case in Canada where there was a certain protest and people wanted to donate to the cause. So they used GoFundMe, but then GoFundMe was blocking the account and instead they used crypto then. And we have another situation in the current war here in Europe, in Ukraine, where Well, basically the crypto community is supporting the country, Ukraine, with crypto donations. And it becomes very interesting because Ukraine itself then even put online crypto addresses to receive these donations, but also promised stuff like to drop NFTs in order to incentivize people further to donate. So here we're seeing where not having a central authority in the middle helps in certain use cases or scenarios.
CHARLES MAX_WOOD: Right, because the two parties, for example, with Ukraine, right, the two parties are Ukraine and the donor, right? And so if somebody's trying to play nicey-nice with Russia, or if it's controlled by another third-party government that is trying to not look so bad on the global stage, right, that's where that central authority becomes an issue. And so if it's just the two parties, then it's a...you know, it's just between you and the person on the other end, which is in this case, the Ukrainian government or the organization that's organizing meals or whatever else, you know, that you're donating funds to.
CHARLES MAX_WOOD: And that's the nice thing.
MAX_KORDEK: Yes. Everything runs decentralized on a protocol which is just neutral. And this obviously has many positive advantages, for example, donating money for a cause, but of course, also sometimes some negative ones, like...in the early days of Bitcoin, many drugs were bought with Bitcoin and still to today people are using that as an example that Bitcoin is bad, you know. However the protocol is neutral. You can just transfer value from A to B and I think that's the beauty of it.
CHARLES MAX_WOOD: Yeah, I mean I would assume that you can set up a blockchain for example where there was some kind of central control or where you set up the mechanisms by which it's governed in such a way to where you could control things. But I would also then imagine that people might be a little bit leery of that, right? And so if a state entity set one up, for example, as a digital currency for their country, I would imagine that they may set it up in a way that they can manipulate it, just like the central bank here in the US, the Federal Reserve manipulates our currency now.
MAX_KORDEK: Yeah, that's why for that example, basically only Bitcoin is being used because it has proven itself as a network which is, let's say, secure enough to be not being able to be manipulated, you know, and governments even trusted by now, make it legal tender in their countries because they see that Bitcoin is that decentralized and that's here that no one can manipulate it. However,
AJ_ONEAL: I'm jumping in here hot not having the full context, but Bitcoin is absolutely manipulated all the flippin time. It has got to be the most manipulated of all of those because it's the one that people are most interested in gaming in order to make money. How do you think it got to $50,000? It wasn't because it's got some sort of inherent worth. It's because investors are playing games against the idiots who are just putting money in and investors are watching the curves. And then they've got these fake companies set up that will do a big sell on the network to make it look like people are buying.
CHARLES MAX_WOOD: I'm going to jump in here for a second, AJ, because what you're talking about is. Again, I mean, people play these same games on the stock market and stuff like that, right? What we're talking about is that there's no central authority that favors one party over another. It's, you know, what you're talking about is people manipulating it through, or manipulating the value through investment and things like that, and playing other games in the way that they, you know, talk about it and build it up in order to make it work. But at the end of the day, the exchanges happen without interference from a third party. And Its value is mostly driven by what people perceive it to be worth.
MAX_KORDEK: Yeah. We're not talking about price manipulation. We're talking purely on the protocol layer and there it has proven so far that no one can manipulate it and Bitcoin, like I said before, is like one of the first implementations of a blockchain and we thought at least we can actually use this technology and apply it to some other use cases. We got inspired there initially 2016 from, for example, Ethereum, which introduced smart contracts to this world, which for the first time enabled developers to implement something else on the blockchain, something else than just sending or transferring value from A to B. And at Lisk, we thought that's pretty amazing. You can use this technology now for other things. At that time, really, no one really...knew what it can be used for. So our strategy there was then, how about we are introducing a blockchain software development kit, which enables developers to build their own blockchain so that they can figure it out. Because ultimately, experimentation leads to real use cases. And that's basically also how this came to be. And yeah, what is or what has been our journey so far.
CHARLES MAX_WOOD: whether the cryptocurrency is worth what it's worth or this, that, or the other, you know, whatever. This is a programming show, right? It's like, what can I do with it, right? What are the opportunities that this presents? And then what I also want to talk about, you know, where maybe the hype cycle is pushing people to pick this technology instead of a technology that may work better for them. Because I think that they're both going on. And I think there are incentives to use it and to not use it. And I think they're just...We're going to have to make a judgment call, but yeah, what kind of apps are well suited to the blockchain?
MAX_KORDEK: Yes. So in the last few years, thanks to a lot of experimentation, which was going on, like a few clear new industries were being formed. One of them is DeFi, decentralized finance, which essentially replicates the entire traditional finance industry onto the blockchain. That means it's possible to exchange assets from one into the other, it's possible to lend assets away to other people. It's possible to, well, do all of these things, but without the middleman, you know? So many of the, yeah, basically use cases, the banking sector or the finance industry had before you can now use in a completely decentralized and trustless way. And that was a little bit of a hype, which came about a few years ago. And everyone jumped onto that. So these protocols grew massively. And as part of that also massive hacks have like been conducted because it's very tricky to develop a secure smart contract. But that's one of the use cases which were discovered, I would say, to replicate finance use cases onto the blockchain. Another one is what received a lot of hype recently is GameFi, meaning like decentralized gaming, where essentially the idea is that everything you do in a game... is actually a real economy behind it. So if you have a Swartz, the Swartz is actually, well, a non-fungible token, a unique item, which really belongs to you. Same as a Bitcoin would belong to you. And has on the, because of this, a real value associated to that. So GameFi basically introduces economy and finance into games. And that's a question on that. Yeah.
AJ_ONEAL: How is that different and I mean this seriously how is that different from what was already being done with World of Warcraft from a practical standpoint? I get that the technology is different technology, but how is that different from people just e-banging things on world for world World of Warcraft? I think that was the game where people are doing that right that in Second Life.
MAX_KORDEK: Yeah, sure so for example, let's say you have an avatar on World of Warcraft and In the early days of World of Warcraft, it was not possible to switch between different servers. So that wasn't even be discussable to move your character then from one server on World of Warcraft to another server where maybe your friends were playing. But at one point they introduced it for a cost, all good. However, what is if you deeply associate yourself with that said character and would like to move it over to an entirely different game? Or you have a game item which you would maybe also want to take with you. And that's a little bit where the journey is going to right now. For example, one of the most, let's say...popular and biggest and most expensive NFT collectibles is the board ape Yacht Club and one board ape goes for like three hundred thousand dollars right now and what they're now well at least according to a leaked document and vision is to build somewhat of a Meta RPG game where you can then take all your different collectibles either avatars or items into that new RPG. However, you can also take it into other games developed by other studios and basically be still yourself, be the avatar you identify with and take the items you use in the other games with you as well. So it's all connected, you know?
CHARLES MAX_WOOD: Well, the thing that I'm seeing here is that this then just manages the marketplace. It's still up to those games then to implement the rest of it right so that I can use my item in their game, you know, maybe with the same effects, maybe with different effects or whatever, right? What we're talking about here is just..sort of that central place where my avatar and all of my avatar possessions all live in my wallet for lack of a better way of putting it.
MAX_KORDEK: Yeah. There are also like other scenarios, for example, in this case of bot apes, they've just introduced a token, the ape coin, and airdropped it to everyone holding one of these NFT bot apes. And with that, what they're basically doing is with the NFT, they're building a a community, so to say, because nowadays people deeply associate themselves with, for example, an NFT or a digital avatar. And with the coin they introduced, they're basically introducing sort of a governance mechanism so that their community can decide what happens next. Should they fund a game development or should they use the funds to start a merchandise store? So that's where with NFTs you can... pretty easily create communities and then with the token on top of it, basically make the community the stakeholder and let them make decisions as well.
CHARLES MAX_WOOD: So I guess the other question that I have is, couldn't you just build this using more traditional methods, right? Where instead of using smart contracts and things like that, I could just build it with database on the back end of microservices.
MAX_KORDEK: Yes, totally you could. But one example would be just now both, I think, like stopped access for all Russian citizens. So if you had a counter strike skin worth thousands of dollars, which they are currently, some of them, that would all be gone. So here we are going back to the core basic principle of, for example, Bitcoin, that you really own the assets you're holding. While at World Warcraft or involved, you wouldn't. It's all up to the company to decide what happens.
AJ_ONEAL: Well, I'm gonna argue on that a little bit. First of all, I wanna agree which is unusual for me. I actually agree in the whole community model, basically establishing a GDP and that that point is worth what it's worth because the people in the community believe what it's worth and they're kind of bought into it. You're creating a micro nation. So I agree with that. Now we've already seen with, I think it was Mastodon and then two sub networks, we've already seen that it's perfectly possible and easy for someone to create a block list and say, hey, we're going to track these assets, we're going to distribute it among the servers. And anybody who, and when I say asset, I don't just mean coin, I mean digital identity. I mean, anything that's stored in a quote unquote decentralized system. You know, we're just going to distribute this block list and then we're going to agree as a community that we're not going to honor that anymore. So in the case of something like Russia, I think, I think most people, and I could be wrong about this, but I think most people have enough, I don't know what the word would be, but introspection or, or. that they can understand that Russians themselves are not evil people. The Russian government is doing something that we don't understand and that looks to be very wrong and probably is very wrong. And I'm not making any argument against that, but the Russian people themselves are people just like you and me. And there's no reason to hurt them any more than there's reason to hurt the people that are on the Ukraine side of things. Cause these are just people that are caught in the middle of something that they didn't want. So In the case of that, I don't think that that would necessarily happen, because I think that the people that are involved in these types of communities can see and understand that, can see past, dare I say, the evil word nationalism. But in the general case, we have seen that these communities group together and start banning individuals based on ideology or whatever it is. So I don't think that that is guaranteed that you get those freedoms, that you can keep those assets in a usable way. But I do like the idea that different from the other systems, this one kind of gives you a history because if you're just selling stuff on eBay, you can't know how many people have owned this thing. And if maybe a fewer people have owned it, maybe that makes it worth even more. But yeah.
MAX_KORDEK: Yeah, totally agree. So people like, let me rephrase here. What is better? If a government makes the decision, if something is forbidden or not, or if it's the people thousands, hundreds thousands making that decision. I think that's at least an improvement by further decentralizing it. However, like discussed initially on the protocol level, that would never be possible because these networks are that decentralized, at least Ethereum for example, is that decentralized that the community couldn't band together anymore in order to stop the assets of being transferred from A to B. But I would like to take one example here again from these board apes. So just yesterday or something Um, a investor who, who held three bought apes got tagged online through a phishing attack, uh, which caused his three bought apes to be transferred away from his wallet. So he lost three apes, which is around $1 million. And the community quickly banded together and said, okay, hey, wait a moment. We have to somehow communicate that message to everyone so that no one buys these apes and that they essentially cannot be used anymore. However, the hacker was that quick that he was able to sell them off for a bit of a cheaper price but still a lot, probably something like 7, 800,000. And that was. So the hacker was quicker than the community could react. And now it's of course more like a philosophical question. Should these three board apes be just ignored and they should be somehow seen as blacklisted, even though it cannot happen on the protocol level, but certainly on the user level it can be? Or should...they just stay neutral because they are assets on blockchain. Someone else bought them from the hacker and should just be treated as that.
AJ_ONEAL: Well, this, this was the whole split between Ethereum and Ethereum classic. Code is law or morality is law. And one group decided code is law and the other group decided clear distinguishable morality is law.
MAX_KORDEK: Yes. And, and,
AJ_ONEAL: and these board apes are on an Ethereum sub-chain. Are they not?
MAX_KORDEK: Well, yeah, luckily this was when was it? 2016, 2017. The world has really moved on from here on and I don't think that something like this would be possible today. However, yeah, that early on it was possible to split the network because some people had a bigger interest in other people or more power or whatever. But like I said, I don't think that something like the DAO could happen in 2022.
CHARLES MAX_WOOD: Yeah, I think that what you're getting at though is interesting, right? Because what we're talking about here is, yeah, you know, on a protocol level it's at least theoretically not possible to block those, right? Nobody can go and insert into the protocol all of a sudden, that hey, we can't sell these board apes assets, right? But because of the way that distribution and consensus work within the blockchain, if everybody agreed not to recognize the transaction that moved them, then they would never move. But you would have to have basically 51% or 50 plus one, you know, 50% plus one nodes, you know, never acknowledged that particular transfer of asset. And then I would imagine that that's somewhat hard to come by.
MAX_KORDEK: Yeah, exactly. I mean, the entire network is worth several billions of dollars and just for one broad ape worth a few hundred K, no one would risk the integrity of the entire blockchain. In the case of now, back in the day, it was like a massive percentage of the entire market cap. And I guess some very...powerful people lost a lot of money as well. So it was like pushed through. But nowadays like we've seen DeFi hacks worth a hundred millions and nothing happened. No one even thought about trying to rewind the blockchain or something like this, because it's just not possible anymore.
CHARLES MAX_WOOD: Right. Well, and as far as I can see, I mean, that's both an asset and a liability in the sense that, yeah, you know, if somebody hacks it and moves ahead, I guess maybe you can get a court action for them to transfer the digital asset back or something. I don't know exactly how that would look, but the flip side is, is that since no one can manipulate it, nobody can manipulate it. Right.
AJ_ONEAL: Well, this is where the idea of trustless kind of goes out the window because you, you have to have trust with most of the things that you would be doing on a blockchain because there is no arbiter or there is no recourse. So if you do not trust the person that you're clicking, the send X to button, then you... And there are smart contracts that if all the assets are digital, for example, the gaming example, the smart contract, if you're savvy enough to be able to interpret a smart contract and know that it does what it's supposed to do, not what's presented to you, then you could send money in and you could be guaranteed that the other asset gets released out. But for anything that's not pure digital and where...the way that the smart contract is being exposed to you is not by a party you trust to interpret it. You don't have trustless.
CHARLES MAX_WOOD: Yeah, I'll let you say your piece, Max, and then I'll have another question.
MAX_KORDEK: Perfect, thanks. Yeah, I agree with that, and that's why what we see is that these new industries being formed around blockchain all purely digital, and they're new industries, kind of, where only blockchain is not only at its core, but...basically everywhere like DeFi, GameFi. They don't even have links to a centralized service or traditional segment anymore. They move entirely within crypto. Cause back in the day, everyone said like supply chain is going to be the next big use case for crypto or automotive is going to be very big for crypto, you know, but it's just not going to work. I think whatever we find or discover in terms of blockchain use cases has to move within like entirely within the digital realm. That's what just is happening. Like NFTs are purely digital. Um, if it's an NFT for talker photo, then that's just a digital photo, like some kind of painting or so could have happened, but it never really got big, you know, so whatever we see in crypto is always moving purely digital.
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CHARLES MAX_WOOD: Okay.
AJ_ONEAL: But isn't the whole reason NFTs are valuable is because kind of like Pogs or yo-yos or...
CHARLES MAX_WOOD: Did you say Pogs?
AJ_ONEAL: Yeah, Pogs.
CHARLES MAX_WOOD: I feel old. Go ahead.
AJ_ONEAL: Well, I don't know what the new thing is, but it seems like no one will care about NFTs in five years because they won't be cool anymore. The whole purpose that they're cool for is that they're new and that only some people are smart enough to make them, so that makes them rare. But if I go on OpenSea and I upload some assets, so for example, I just tried an experiment. I tried to sell one of my most popular NPM repos and nobody cares, right? You have to do the marketing. You have to have hype around something because if you join a platform where anybody can make an NFT, no one's going to care about your NFT unless it hits a podcast for being controversial because the board, yacht, club or whatever. They're bad pictures. It's not art that you'd actually want in your home. That's one of the things it's ironic because it's arguably, you know, it's, I don't know. It's kind of like that. What is it? Andy Warhol where he just takes pictures and then puts them in four different colors in a square. You know, it's a novelty item, not something that is going to be cool and interesting in five years from now. Right. Or am I wrong?
MAX_KORDEK: Well, I would take an Andy Warhol today for 10 bucks, like, but they preserve their value. And you could argue everyone can paint that or many people could actually paint such a painting. I think it's around the demand you create for your art or for your NFT. And nowadays this is being done by forming or creating communities around them and giving them more stuff to do than just owning and holding an NFT. Like what we discussed before with the Apecoin being able to decide certain governance aspects of the whole ape ecosystem or developing some kind of a meta RPG, so you can even join a video game with the character. So that's all to preserve utility and to keep the community engaged so that the demand stays and the price stays as well.
AJ_ONEAL: But then it's more about, again, it's more about the community, it's more about the hype chain, the marketing, than it is about the product, like Pogs, right? So if somebody recreated digital Pogs, I bet they'd sell like crazy, you know,some BuzzFeed article would pick it up. People would say, oh, go to this website. You can buy NFTs of the pogs you loved as a kid. It'd be what? For a weekend. And somebody would make millions of dollars.
CHARLES MAX_WOOD: I think the issue here isn't so much, hey, this is what people are doing with it now, right? What's funny is, is I'm part of a mastermind group that meets every Monday, and I'm probably one of the youngest guys in the group. And they were all talking about NFTs. And where you tie it into something else like ownership or like where there's some recognizable capability or recognizable asset that actually will appreciate in value, right? I mean, yeah, it's possible. I have artwork for my kids. It's not gonna be worth anything to anybody else, right? But I keep it around because it has some value to me. And then there are other things like a deed to my car or my house that could also conceivably be represented by an NFT that allow me to use it in particular ways, do certain things with it or sell it. And so I think it's interesting the directions that the ideas around NFTs can go in without necessarily having to be all in on, yeah, I'm going to go buy some crappy video game artwork that really isn't video game artwork.
MAX_KORDEK: Yeah, I think the long-term value of an NFT can be seen exactly the same as the long-term value of any other item. If it maintains the value or not, it's up to the demand. And if the demand stays the same, then it's up to the game is up to utility or community or the use cases surrounding that item. Right.
CHARLES MAX_WOOD: I think that's a good way of putting it, is it's down to the demand on it, right? The demand for it. The value people attach to it.
CHARLES MAX_WOOD: Yeah, I find it really interesting kind of the way you're putting it. I will say that I can't argue that it's not a fad right now. And it sounds like you're not really trying to either. But yeah, it is bringing people in to consider how this technology can be used. And a lot of times that happens with technologies where it kind of gets used for all kinds of things and then people figure out, hey, this isn't the ideal solution for 80% of the things we tried it for. And then it really just hits that sweet spot for the other 20. And so who knows? Who knows what the possibilities are? But it's definitely interesting. I will also, though, challenge the idea that it's only bringing in younger people. Because like I said, the group that I was talking to, they're all businessmen. I mean, I'm the lone tech guy in there, and these guys are all 20 years older than me, and they're talking about NFTs. So I think it's bringing in a lot more people to at least pay attention to, if they don't understand the technology, pay attention to, hey, there's this space over here where people are making money, or where people are doing this interesting thing or that interesting thing. But yeah, I don't know. In the long term, how blockchain actually winds up fitting into anything, I have no idea. But...It is interesting from the standpoint of there are some things that I value, like the decentralized, trustless ideas around value, so that I don't have to trust a central bank or a central government or anybody else. And I can generally get certain types of value or certain types of things done. And so I'm really curious to see where it goes.
MAX_KORDEK: Yeah, me too. Like if I look towards our community. Because our SDK exists since 2019, but our platform on which you can then deploy your apps is only launching towards the end of this year. It's still all pretty early days and there's not a huge chunk of innovation happening at this point. However, I think talking about this modularity of our SDK on Ethereum, you call it composability of smart contracts. I think all kinds of use cases being discovered or the general discovery process is growing exponentially. And if we are just like, I started 10 years ago with crypto and 30 years old today. So one third of my entire life, I'm doing crypto. I've never done anything else. And you just early days and early days, no one knew what is going, what this technology can be used for. And then they started to look around searching for use cases. And then at one point, Ethereum came to be in smart contracts. And then DeFi, DeFi was the first big thing. And since DeFi, which was just, what was it like three years ago, the use cases were exploding. And today you have hackathons every month where like 300 different submissions were submitted. So 300 different applications implemented every month. And this is just talking about Ethereum hackathons. There are like 10, 20 other like infrastructure development platforms like Avalanche, Cosmos, Polkadot, Lisk, whatever, which are doing exactly the same thing. So we see so much activity and use cases just exploding like crazy. So I think from a time, there's no better time to get involved. There's a lot of money available. There are many experiments going on, but also just use cases being found and the space is so rapidly being developed. That's...Well, there are opportunities left and right. So if someone here listens to that podcast and thinks, okay, how can I get involved with blockchain development? Well, my, my suggestion is to just check out different projects offering SDKs or smart contract tooling and just play around with it and then get involved in different communities to see like what's missing, what kind of problem can I solve? And I think that is a pretty interesting journey for anyone no matter young or old to take and to be involved with essentially a new paradigm. So yeah, I think everyone should jump on this and just start experimenting, you know.
AJ_ONEAL: Will you define what DeFi is? Cause I don't, I don't know. I just thought anything that was money on a blockchain fell into the sunbred category, but it sounds like you're speaking of it in a more specific way.
MAX_KORDEK: For me, DeFi is everything what comes from finance and is being replicated on the blockchain. So it could be,
AJ_ONEAL: can you, what does that mean? What is, what is comes from finance mean?
MAX_KORDEK: Yeah. For example, just having a currency is for me, DeFi. So on the blockchain, in the blockchain world, having a token or being able to trade one token, like being able to trade one currency for another replicated on blockchain to be able to trade one token for another is the DeFi use case as in the form of a DEX decentralized exchange or being able to end the way your assets in the blockchain space, like for example, your stable coins and earning a yield for that is also coming from the traditional finance sector.
AJ_ONEAL: So how are stable coins not a security? How is that not illegal?
MAX_KORDEK: Well, security is not illegal if it's properly registered and so on. So for example, there's USDC, which is being backed by the biggest players in the industry, for example, Coinbase or Circle and they make sure that it's legal. However, there are two different kinds of stable coins. And you were probably
CHARLES MAX_WOOD: Okay, time out. What's a stable coin?
MAX_KORDEK: A stable coin is basically a token which holds, for example, the value of one US dollar.
CHARLES MAX_WOOD: Oh, okay.
MAX_KORDEK: So you can be sure you have this one token and it's always worth one US dollar. And there are two ways how to implement it either through a centralized authority, because it has this link to the real world. So it needs something in the real world trust. And they would hold a large basket of different assets to make sure that the value they have on the blockchain is always covered in other assets. But there's also another way. It's called an algorithmic stablecoin. And that's basically using very complicated game theoretical aspects and algorithms to make sure the dollar is being held. Like the stablecoin is having the $1 pack. But making things legal has nothing to do with the technology itself. It has more to do with the team implementing it, following certain regulations and speaking to the lawyers to make sure everything's good. And with the USDC, just certainly being done.
CHARLES MAX_WOOD: Cool. Well, I'm going to encourage people to go at least check it out. I mean, I'm seeing more and more things being attached to blockchain. I think it's worth understanding, at least at a fundamental level, what it is and what it does and how you can use it. You know, I don't know that it's necessarily the career path for everybody, but maybe you'll find something there that really inspires you and it will become. Who knows? Is there anything else you want people to know, Max, before we wrap up and go to PICS?
CHARLES MAX_WOOD: All right.
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CHARLES MAX_WOOD: Well, I'm gonna go ahead and divert us into pics. AJ, do you have some pics for us?
AJ_ONEAL: In fact, in fact I do. All right, let me scroll over here. So first of all, anytime we talk about aches on a yacht, we have to talk about web3isgoinggreat.com. This gal is just, oh, it's hilarious. I think that Dan mentioned it before. I think he might be the reason that I found out about it, but it is hilarious. It is all of the scams that are going on pretty much on a weekly basis compiled into a big long blog. So if you want to see basically every scam, everybody who's lost money, all, all this stuff, um, you can go to, you can go to that blog and check it out. And the, she incorporates one of the apes into her banner. And because somebody had bought the NFT of that, they thought that they had a copyright of it or some such. They thought that it was some sort of legal transaction. And so that became kind of a funny laugh on Twitter because people don't understand what these things are. Typically, an NFT is actually either a URL or a hash of a file. It doesn't contain any useful information in it itself. So you get an NFT. If the URL goes down, you lost whatever your NFT was. Or if the file is deleted and all you have is the hash, then you'd have no way of ever recovering it, right? So typically, NFTs are not what people think they are. And so this kind of plays on that a little bit. And yeah, so I mean, it's unfortunate to the person that thought that he bought a copyright, but it was just kind of funny, the exchange that went down over her incorporation of some of these NFT screenshots and stuff as she does her articles. Then...I actually do believe that there are some use cases for certain combinations of cryptographic technology that happens to be a blockchain, which this is maybe my first or second time saying that on the show ever. And the debate that convinced me of this, I have a link to. So I invited some, it was three against one. I invited people to convince me that there was something worthwhile about any blockchain technology at all, in any space, that in any way it served a better purpose than any existing technology that's in common use. And I was convinced that if there's one... Well, you can watch the debate, but I was convinced that there's a use case and you can hear me right towards the end. I say, okay, I'm on board, which that's a bombshell moment. So I'm still, as you can tell, very skeptical about most of this stuff. I think most of it's just hype. That doesn't mean that you can't make money off of it. It just does, you know, pogs are not useful other than for entertainment. Most of this blockchain stuff is not useful other than for entertainment. But yeah, I think they're there. You can watch that if you're interested in it's called the great blockchain debate and it's on my channel. Another one is the line goes up and this is comparing the speculative market of the house that led to the housing crash and the financial crisis to a lot of what goes on with with blockchain as well as John Richards who has been somebody that I've argued with many many many times about how Well, I guess he's an investor. So he doesn't really care whether it's useful or not he cares whether or not the the line goes up and and He expects that if the line goes up, it must mean there's some utility on the other side and then he on his Facebook, after many years, shared an article that I'm not sure if he's for against it because he always shares things in a way to invite discussion and kind of prompt reaction. So you never know which side he's actually on. But he shared an article about how the crypto story ends, which I mostly agree with. There's some parts in there I disagree with, but it's just an interesting article. It's on Vice, which whatever reputation that has. But it is the person being interviewed as a member of the SEC something, something high up dude who's seen different types of scams and stuff through the ages and is familiar with historical this, that, and the other. And then creeds of craftsmanship. I just added the Zen of Zig to that. So this is where I keep my most up-to-date list that I can have all the great software engineering resources that I find. And so I just added Zen of Zig which if you've seen the Zenith Python and Go Proverbs, there's not really much new to it, but it's just good to see another language making a claim of, hey, this is what we believe in. These are the principles that we identify as good software engineering principles. And then other than that, if you wanna see the little nuggets of good stuff, beyond code bootcamp on YouTube, and then my live streams are twitch.tv slash coolag86.
MAX_KORDEK: Well, my whole life revolves around crypto. So I have only one pick, which is a crypto conference. Beginning of April in Miami, there will be the Bitcoin 2022 happening. And well, I picked that one to attend. So I'm going to be there as well.
CHARLES MAX_WOOD: Nice.
CHARLES MAX_WOOD: Awesome. All right Max, if people wanna connect with you, right? If they're like, hey, Max sounds awesome or Lisk sounds like something I wanna go fiddle with. How do they get ahold of you?
MAX_KORDEK: Yes, so I'm available on Twitter as at Max Kodak. We with Lisk are also at Twitter with at Lisk HQ. Best together. hold of me or the team is also on our Discord server, which you can be added to on lisc.chat. Else, I would say, yeah, just start like evolving yourself or involving yourself on various conferences. We're attending all of them, so you will find us around. But Twitter and Discord are the best resources to get us.
CHARLES MAX_WOOD: Nice. Well, and I have to say that anybody who's been named Max, I mean, they're just impressive people.
MAX_KORDEK: Thank you.
CHARLES MAX_WOOD: My middle name is Max. So, my dad's name was Max. So, I know what I'm talking about. Anyway, thanks for coming Max, this was a lot of fun. Hopefully we've inspired some people to go check it out. I think the skeptical eye that comes in as we talk about some of this too is also useful because then you can kind of go, okay, people are talking about that, but I'm really looking at these use cases and these ways that it might actually benefit me. So. Anyway, we'll go ahead and wrap it up here. And until next time, folks, Max out, or in this case, Max is out. I'm out.
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