Web3 brands, NFTs racing for global adoption with Animoca’s Yat Siu | Chain Reaction Podcast

He everyone it's jacine melanic welcome To chain reaction a show that unpacks And Dives deep into the latest trends Drama and news breaking things down Block by block for the crypto Curious this year we're doing monthly Series diving into different topics and Themes in crypto and to start things off This month we're focusing on nfts I'm Interviewing some of the biggest nft Players and Founders about how they've Weathered the booms and bus in the Sector what they're focused on and what Could be next for the industry hope you Enjoy today's guest is yatu co-founder And executive chairman of Anoka Brands Yat co-founded Anoka in 2014 and since Then has invested in over 400 web 3 Projects across a range of sectors like Defi education infrastructure Marketplaces blockchain gaming and Metaverse to name a few Anoka also has Its own nft collections blockch chain Products and games like it's web 3 nft Based Community mocha verse the Blockchain game and nft collection rev Racing and the sandbox a decentralized Virtual world with over 40 million Mobile installs in addition to all of This animoca has worked with other Well-known Brands and personalities like Disney WWE Power Rangers The Walking Dead Formula E and Snoop Dog hopefully You know some of those names with all of

That said there's a lot we can discuss Here so yeah welcome to the show thank You for having me it's a great pleasure To be here yeah and to start you've met A lot of people you work with a lot of Companies so I'm excited to hear your Answer on this one but can you tell us About one of the most interesting people You've met in crypto in the past 12 Months and what did you learn from them Oh interesting people in crypto well I Would say first like I think everyone in Crypto is kind of interesting because to Be in a space you kind of have to be a Little bit sort of cookie and wild and Sort of rebellious shall we say so I Would say that generally speaking I Think everyone in the space is is Interesting I think one of the people That I would say that probably was a lot Of fun to talk to is probably Arthur Hayes he was he was a lot of fun just in The sense that he kind of has a sort of A Dean mentality obviously very smart About the space as well no holds SP kind Of conversations and also in you know we Most recently had a a round table Conversation that was fun as well so Yeah so you know I would say generally Speaking I mean there's so many people So I I don't really want to single Anyone out in particular but he's the First person that comes to mind just Because of his personality and

Everything he's been through yeah for Sure I met Arthur as well and he's a Very interesting person so if you don't Know who he is go look him up but we've Spoken in the past yet about all the Themes I mentioned in the intro and I Know there was a lot there and there's Many ways we could drive this Conversation but I wanted to begin by Asking you more about your perspective On what digital property rights are and Why does it matter and how do nfts play Into that and then we could go from There well I mean digital property Rights for us we think is fundamental uh In a sense that it is something that we Weren't able to do before in the world World of I guess web 2 and even web 1 Meaning that we now have a way in which We can really own our digital assets and If you think about and which in Consequence also means our sort of Ownership in our digital time and Attention and the things that we do and We kind of think of it from the Perspective of what is really ours like In a physical world we used to think That what was ours is obviously not just The place we live in but you know the Work that we do and the craft that we Create and the items that we make and so It's physical in nature and then you Know in a kind of classic lock in sense You could say that what we craft with

The hands is sort of our own our own Creation but of course you know Lock's Idea is about you know hundreds of years Old actually more like 4 500 years old So really when we're thinking about sort Of the context of today we no longer Create things with the labor of our Hands we actually create things with our Mind with our ideas with our time and Attention and that actually creates Really large quantities of valuable data And that valuable data however although It ought to be ours isn't actually ours Anymore in the world of web 2 because we Willingly give it away because we don't Actually quite know how to Value it and So what's happened is is that we've been Farmed for a time and attention and we Don't have any of these rights that We've created in terms of the data that We create for the platforms so we think That every time you use Instagram or the Every time you use Tik Tok you're Actually working for the platform and You're not really getting paid much of Anything for it at all and so that in s Sense we think we live in a kind of Digital feudal age and that to us is Kind of the world that we exist in right Now and so web 3 solves that because in The same way that you your Bitcoin which Is sort of I guess you could say the First innovation of how you can really Own a sovereign digital asset regardless

Of its value we can now do this with all Of our things in the digital online World and I think nfts are particularly Valuable in this case because they are Non-fungible meaning that they're unique And in our physical life everything Really around us is unique in a sense The clothes we wear the identity you Have the weddings we have you know like All these things we customize our homes Right we make them ours we we create our Stories and our culture around them and So nfts are these digital stores of Culture that we can then transfer on and When you have ownership it means that Actually people can start to compose Freely on top of them as we do in the Physical world the example we always Give is when you actually own a car I Can come to you as the owner of the car And say let you make a baby seat for you Or let me hire you a driver can I go a Service for you you know can I wash your Car right like I do all these things and I don't have to talk to the creator of The car for permission to do any of this Or pay a tax but I mean it's kind of Like today in the web to world it's like If I want to wash someone's car I got to Pay Volkswagen maybe a 30% fee or I got Pay Tesla a 30% fee or whatever platform Fee that they generate because you know We don't really own it right that's what Apple and what Facebook and these

Companies do and and we've really come To a world where in web 2 we exist in These platforms as you know they're Rentier networks they're basically Platforms where we constantly pay rent Just to exist on them so we don't own Anything and in web 3 basically we can Have that ownership and It ultimately Balls down to us about ownership of data And the derivative that data creates Because if it wasn't for our data we Wouldn't have chat GPT we wouldn't have Open AI we wouldn't have self-driving Cars and yet all of this activity that We or value that we generated how much Do we get and the answer is nothing so So this is sort of why I think web 3 is So important especially given the fact That AI is going to become such a imp Prevalent part of our lives and yet we You know have no control or ownership Over any of it well don't you think in a Way that ownership is kind of I mean It's nominal in web too we see it with Like X Twitter whatever you want to call It they give back ad Revenue to some Creators Tik Tok does that YouTube has Some things like that even Spotify you Know gives music creators some Percentage and yes it is smaller than What web 3 would typically give but how Do you kind of see that bridge closing Between the two the fundamental of any Property rights regardless of what it's

Digital physical is that it's Sovereignly yours as it's your Sovereign Ownership and you decide what to do with It and you decide to fees and you decide What you can or cannot sell it and all The rights attached to it and the Problem in web 2 is you don't have any Of these rights and the other problem of Course is that if you think that you own Your Instagram handle or your ex handle Think again I mean the person who used To own the ad music handle just lost it Just because Elon said I want to go into The music business the person who owned The ad X handle he lost it too and for Those of you who may not remember the Lady in Australia who used to own the Metaverse handle when Facebook renamed Of meta she briefly lost her handle as Well because you know Facebook was Accusing her of impersonating a company Which had just renamed itself literally The month before so it's impossible yeah Yeah exactly and and you know when the Largest game company one of the largest Game companies in the world epic in this Case can't even launch their app on the App store because Apple says they don't Basically don't like their commercial Terms or whatever it is and I don't Think we exist in the world where we Actually have any property rights Whatsoever I think there a very Fundamental difference payment aspect

Aside right and that means also that we Don't have a market right so the point Of property rights is that you actually The foundation of of capital ism is Property rights and so the irony of Course that right now actually in web 2 You could argue that actually we no Longer have a free market either because We don't get to decide the prices we Don't get to decide what is discovered In fact when you're thinking about sort Of the discovery of Spotify from a music Standpoint it recommends music to you Not necessarily just based on what's the Best taste for you but maybe what makes Most money for Spotify and the kind of Ads that you see or the kind of sort of You know products that being promoted to You are not necessarily the ones that You really want or create a market is Actually the ones that the platform Thinks are most beneficial including the Kind of news that you should see that Create maybe the most clicks or the most Reactions or whatever that might be so So I don't think um we have any property Rights in web 2 I think there's Fundamentally a very very big difference Between web 2 and web three put another Way if any one of these platforms have a Change of heart in what you do in terms Of you know we've experienced this Ourselves I mean all of our apps at one Point got removed from the app store

Because Apple didn't like something About us and we don't you know we never Actually really got a full answer Actually any answer as to what that was Right and I don't think anyone of us Want to live in a place where our homes Can literally be taken away and our Property can be removed just because we You know not because we've done any Crime or anything just because someone Doesn't like it and and that's exactly The way that we live in web 2 and that's Why I think web 3 is is so important I Agree with you on that and I think Property rights are so important and Being able to like own your brand and Have it on a platform without losing it Is so significant too like whether it's The app store or Twitter wherever it may Be and I know in the past you and I have Talked about building a brand and it's Hard to build a brand I'm sure without a Community and this is something that a Lot of crypto projects day in and day Out have to deal with and cultivating a Community launching a project Cultivating community and all of these Different things to build a brand is Kind of in my opinion what makes some Companies or nft collections whatever it May be stand out and as someone who has Invested in hundreds of projects I'm Curious what makes nft projects stand Out to you when there are thousands of

Nft collections out there especially During the hype of it all people were Trying to get in how do you decide which Nft projects to invest in and look at so Actually we've done over 450 Investments So far and that continues to accelerate And one of the big reasons why we Believe the strategy of investing the Way that we do make sense is because we Believe in the shared network effect That web 3 can provide and that comes From the basis that all of us actually Can become our own platforms and because We have property rights attached to them Now when you have property rights to Whatever it is that you do you actually Become a platform of your own sometimes The example I give is that of a Restaurant you know you could be McDonald's which is a really really big Platform or you could be a michion star Restaurant which could be a platform for Just a thousand people they charge me Higher fees but there are a platform They own the product they own the brand It is you know you go there for the Experience that is you know the one that You want to have with that individual or That group of people and you don't have To go through an intermediary and pay a Tax every time you basically share that Experience and so nft projects exist in The same way so when you whether you Look at land and sandbox or you look at

Mooche or whether you look at a board AE For instance when you own one board a You're member of that entire community And the ownership of all of these nfts In that Community or subset of that Community becomes a platform in and of Itself and it becomes a platform because I'm able to tell its value in the market Because it is an open market for Instance I might be prepared to you know Give more benefits or special services To someone who owns a board a because I Know that you know he has assets between $50 to $100,000 and in the same way that if you Were able to Target every Rolex owner or Every Lamborghini owner for instance Directly and you knew how to do that you Probably give them special discounts or Benefits or Services as well because you Want to attract that customer one of the Problems we have in web to is that you Might have I don't know a million Followers on the Rolex you know brand Page and you want to Target those guys But we definitely know that there's not A million people who own a Rolex right You know all the people who are actually In the Rolex Facebook page or Instagram Page don't actually have one maybe you Don't even know if if they're serious About it yeah it might just be into them Exactly exactly so how do you actually Address the ones who really own it or

Act for True interest and that's Basically what nfts do they they provide That authenticity that ownership and That sort of authentic layer of knowing That he's a real person for which day They can receive benefits and then what Happens is that because you know it's a Real user the benefits come to you as Opposed to you having to use a middleman To basically try to find a way to reach Them which you know what's happening um In the web 2 world today so in gaming You know which is a big space focused on It it's a perfect example gaming spends You know like I think CPA or CPI ads uh Were something like hundred billion doar Last year which is a lot of money for 2 Billion dollar industry and what's Interesting about that of course is that We know that when they spend all this Money in advertising less than one or Two or 3% actually really convert into a Paying customer which basically means That a huge amount of money as we know In the premium space is basically spent On people that actually you know don't Have any real value we don't even know How to address them and how many times Have you seen the same ad over and over Again right so the point exactly so the Point is that the platforms live off the Fact that we actually advertise Inefficiently and they don't really want To Target you directly whether it's op

Or not that doesn't really matter right So now what happens in web 3 you know in The form of air drops or free nfts what Actually happens is they say hey if You're a true owner of a Sandbox land or True owner of Aur or Bard ape I'm going To give you a freebie now the whole Point of the freebie whether it's an nft Or whether it's tokens or whatever that Is isn't just hey let's give out free Money it's an incentive to bring the Customer to you to become your customer Potentially and actually you're paying Money to the person or you're giving Value to the person you want as opposed To using a platform in the middle that Takes a giant fee and of course they say Oh but we only take 30% or 40% of the Fee but the reality is they're actually Taking much more because it's so Inefficient whereas if I really know it And you have that nft you can you know Do your claim and now I can at the Moment you do your claim I can teach you About my product and I can attract you And you're happy to do it because Instead of me having paid thousands or Tens of thousands of dollars to Google I End up basically paying that kind of Value to the end user that I really want To attract and that's basically where The whole world of you know targeting Advertising marketing that sort of Append itself because at the end of the

Day every nft platform every individual Actually has the ability to become a Platform by themselves and when you look At for instance even what Facebook does With Instagram every time you have your Followers in Instagram yet you don't Know who all these followers are but Actually you are a platform you've Created a social platform whether it's Between the friends you know or the Network around you except that they've Disintermediated sufficiently such that You can't actually take your users with You because you're stuck there and so Actually all you did was enriched their Platform And next thing you know suddenly you Become dependent on their platform Because when you leave you have not just Impossible switching cost you actually Lose your entire business right so so This is actually a problem that happens In the web web to space and another Thing I want to sort of highlight as Well and I think this is the biggest Problem we have in web 2 is that when You think of all the money that's spent On these platforms you know be it Apple Facebook Google Microsoft whatever you Know they charge a platform for you Which is like 30% and then they charge You all this advertising which you have To pay for all this value How much of that money goes back into

The ecosystems which empowered them the Answer is almost nothing you know of the Billions of dollars that we spend on Advertising in these platforms how much Of them go back into the gaming industry For instance does Apple or Google or Facebook invest in the gaming industry And the answer is of course no right in Fact they don't invest in their own app Store ecosystem which I think is Ridiculous right so what do you think Would be the solution for that then the Solution to that is that in web 3 anyway Because you are part of the same network That regardless and sort of very much Antim monopolistic qualities what Happens is that even if you don't have Success in your own product the fact That you s someone else succeeds on the Ethereum network or polygon or whatever The system may be the entire network Shares in that Network effect as a Result and we've seen this effect by the Way with axi infinity and pixels on the Ron in chain for instance right you're Basically building on a shared network And the way that you we think that the Right approach is therefore you can't Expect sort of a zero some outcome in Fact we think the days of 07 web 3 are Basically gone right you can't have a Single winner because everyone in the Platform wins as a result of being a Member of that platform which is kind of

How we think it should work and I think The the model of course is that in the Web to world or the corporate world this Idea that you make it you know you Maximize your profit but actually you're Not putting back into the ecosystem is a Bad model you know take a look at for Instance Apple's cash balance but $163 Billion doar you know it's some crazy Yeah it's a lot whatever it is I was Reading somewhere that the top 13 the Big 13 biggest companies in the are Sitting on about a trillion dollars of Cash a trillion dollars of cash right Yeah and so the question we have to ask Ourselves is that trillion dollars is it Productive or what is it doing and it's Sitting somewhere in Ireland tax Optimized with some you know traing Interest rates but the reality is that If they even took just 10% or 5% this Take 5% of the cash and reinvested it Into the ecosystems that made them right We think things will happen one the Investments will actually be more Valuable than the cash deployment itself Because of course when you think of Apple and if they had invested in many Of the earliest you know companies that Succeeded in the app store they would Have made more money than the capital That they would have invested but number Two they would have created a healthier Ecosystem a more balanced ecosystem and

Everyone would be much more happier Paying 30% fees to Apple or Google Whoever it is that they pay because They're putting back into the ecosystem Right it's not so entirely extractive And so we think think that's the model For web 3 which is also the reason why We make so many Investments and we don't Stop doing it because we think of it in The same way which is that if we make Money from the ecosystem the way that we Create value isn't only by sort of you Know like taking money out of the system That's actually we think bad but Actually by reinvesting in ecosystem we Win both ways because even if the Business or two that we invested in did Not succeed actually the entire Ecosystem ended up benefiting as a whole Now we're not the App Store so the way That we created this network effect for Ourselves is we invested so broadly in The space that we're effectively almost Like a web three index because we with All the L1 and l2s so we can be a sort Of chain agnostic but in Apple's case Right I mean imagine if they took 10 Billion right of their cash hord and Decided to reinvest it in building the App Store ecosystem especially the Indie Developers to help grow that you would Create a flourishing ecosystem as Opposed to one that basically died no Indie developer will tell you that he

Can make money on App Store anymore he Doesn't have a way of being discovered He's kind of hidden somewhere he doesn't Have the marketing dollars to do any of That right right and I think this is a Big problem we have in the world broadly Speaking and one of the reasons why I Think web3 and crypto is also so much Rising the way that it is because it is The only way in which the you know let's Call it a person who isn't privileged Actually has an opportunity today I mean Even with AI think about sort of the Credible opportunities that AI purport To give us how can anyone except the VCS In the world participate in that Opportunity and the answer is they can't Like we can't invest I mean being the By being the user guess what we get some Benefit by using the service but we give So much more back into the system with Our data with our prompts where the Questions right so actually these Systems are designed to farm us right And that I think and again I think you Know web 3 is really the only answer to Create a world that's more fair and Equitable which is um which comes from The fact that we can have property Rights the foundation of that is that we Have actual ownership of our things and Then we can decide the market prices and The value for it as opposed to the Platform that basically just dis

Intermediates us that was a lot yeah I Loved it and I think it it stemmed Originally from the brand conversation And I'm still thinking about what you Said where it's like you could be a McDonald's or a Michelin company and you Know both are equally maybe not equally But they're both important to different Audiences and communities and I know in The beginning I mentioned that Anoka has Worked with like Disney Snoop Dog The Walking Dead other big companies I'm Curious why would you do that do you Think it's to get those communities into Web 3 and how important is it For web to do the if they have you know The fund to do so so generally speaking We're most excited about what we call Wave three native Brands right so if you Look at our investments actually we Invested with it's cool cats or ulabs With bord Apes yeah basically all of These direct communities you know sord Tokyo like those are the networks that We're super excited about because we Think that they're actually going to Really make a difference because also The brand IP is co-owned by the Community which is really exciting as Well so we think that's the better Future but we also work with the big Brands because one they're really hungry To enter the sort of the the web 3 space You know because they obviously see

Opportunity but the second one also is Is that they have the trust of the web2 Community who don't actually know much About web 3 and so we can bring them in And it's interesting that the fashion And luxury Brands curiously enough are The ones that actually understand the Space the best and in my talks I often Give the comparison between a board ape And a birken b and you know for a lot of People they often get confused by that And it's and then when I tell people Well do you broken bag you know to put Stuff in it and then people go oh yeah Now I get it now I understand why you Know the value of an nft you know for Status and for social identity for Access to membership in the community And for culture right that's when people Start to get it because actually if you Think about probably most of what you Buy in the physical world how much is it For its raw utility I mean we don't buy Cars to take us from point A to point B Like expensive items right even you know Relatively cheap items I mean I think When you look at shoes like whether it's From Adidas or whether it's from Nike Whether it's from Kuma or from aex I Mean these are utility shoes you could Say they roughly priced the same not Talking about the expensive ones right But we attached to the brand some people Only buy Nike and some people only buy

Puma or whatever that is and it's not Expensive but it's an expression of who They are right they're like oh I'm a Nike guy whatever that means or I'm a Puma guy or I'm aex guy and some people Like to wear expensive stuff and some People actually don't right they shun That they're little bit like oh you know I'm going to wear not so expensive stuff To tell people that I'm not like that Right in fact if you tell people like That to say oh would you like to wear a Gucci they go no way in hell because it Doesn't fit their brand so the point is That we're all purchasing things to Actually express our identity in one Form or the other and it doesn't always Mean that it has to be expensive right And so I think the digital world is Where we express ourselves most of the Time especially the younger generation You know it's more important what skins We have or it's more important how we're Viewed in the digital world it's more Important how many followers and how Many likes we have on Instagram that it Might be where we were physically seen Or the places we've been because of the Fact that that's where our social status Lies so the traditional Brands however They understand that virtual aspect very Well particularly fashion brands and so They've been one of the first movers Into the space but you know working with

The big Brands is also a marketing Method right it's and frankly that's how They how they make money they work with The brand to attract the trust of the Customer and then they basically they Come in Into the Web 3 world and I have To say you know it has Mixed results right Brands who work with You well the success has been very Strong and I think we've seen early Examples of that like for instance when Daer labs and you know worked in one of Our other portfolios worked with the NBA For NBA Top Shot that was sort of one of The first moments and where you know a Mass audience started to understand oh Wait a second what's an nft what does it All mean right but I think we've evolved Since then right and we work closely With Brands like Moto GP and Formula E To sort of try to replicate similar type Of scenarios we also do you know Advertising so we've had some big Billboard advertising on sort of some Moto GP race Billboards for instance who Try to promote to a wider audience you Know we don't do this necessarily Because we think they are directly Revenue generating we do this sometimes Just for broader awareness uh as well Just to try to you know basically get More people into the space and and make Them aware of that so I think that's you Know something that all of us have to do

In one form or the other but we are Mostly excited about sort of wave three Native Brands and sort of the new Businesses and and you know I'll close With this thought which is I think that Nfts allow us and the whole digital Property right space allow us to create A much more diverse ecosystem because Now you can actually have a sustainable Web3 business even if it's small whether It's an nft collection whether it's a Gameing system that might only have Thousands or tens of thousands of Customers I mean just think about some Of the nft collection that are out there They don't have a million customers Right in web two you can't succeed Unless you have 10 million customers but In web three you can be a sustainable Business with thousands or tens of Thousands because there's more value in This share because you have Capital Formation and that's kind of the example If you're you know you might be very Happy creating very Exquisite sort of Experiences for a thousand customers we Do not complain going to a Michin Star Restaurant paying the kind of fees that We do because we cherish the experience As ridiculous it might seem but why Would you spend that much money for a Single meal but it Delights us you know We enjoy that culture and we come out Somehow enriched by it and the same is

True for nfts right when you talk to People who own nfts they don't think of It purely as utility they think of it as Culture and community and access and I Think that will'll be we'll have many Many thousands more of these Brands out There that can now flourish because of Nfts yeah I also think with the Michelin Not it's like something you could put on Social media say you've gone there Experienced things right expose yourself To new things and same applies to nfts I'm curious what other characteristics Do you think nfts have that other crypto Sectors do not use and should adopt yes One of the biggest areas that we been Pushing strong on nfts and we we've Started doing this with teachers and Educators is around creating essentially Contract rights that allow essentially For intellectual property protection and Intellectual property Capital formation So one of the biggest problems that we Have in you know the physical property Rights space is that in order to have an Asset that can have Capital formation And value creation it needs to be a Certain size so maybe like a house or Maybe a music that makes like a million Dollars a year or something that's worth It because you have to you know hire a Lawyer they have to sign a contract they Have to protect it they have to defend It they have to all these things to make

Sure that the asset is worth protecting And investing in which means that only Things that have a certain dollar value Can actually be turned into Capital Assets but what if you live in a place Like Venezuela or like Philippines where Your a monthly salary is maybe 10 or $15 And you might create some content or Asset that actually might give a yield Because people will use it like what we Doing with teachers like with tiny Tab And open campus where they're making Maybe $10 or $15 a year in addition now That's a nice sighting income but you Can't do Capital formation with this in A traditional sense as a yield Instrument because no lawyer will do That work because it'll cost way too Much money for a lawyer to do the Contract then the actual asset is worth But with an nft you could do all of that In a single transaction the IP rights Intellectual property rights where the Money goes everything can be done in a Transaction that's less than a dollar so That means that when you have something That's worth1 or $15 a year you can now Sell it for $50 to $100 because now it's An asset that I don't know 10 15 maybe 20% yield depending on what it is and We've seen that effect when teachers in These countries have started making Assets where they're making you know a Small yield and then investors from all

Over the world have said hey you know I'm going to buy this I can make more Value out of this but either way I think It's valuable because it gives me a 10 Or 15 or 20% yield actual yield that's Happening and so we think that kind of Encapsulation of Ip rights can actually Extend you know not just for teachers And Educators but just for everyone Who's creating intellectual property There's a large amount of intellectual Property that can't be capitalized and Protected because it wasn't worth it but Now with nfts you can I give you one More example for instance with one of Another portfolio called Dance fight They are actually protecting their IP Rights with dance moves now that sounds Almost like Whimsical and funny you know Like you know Street Dancers basically Protecting their rights into dance moves But you know one of the creators he Shared a story and he said you know he Loved to play fortnite and then one day You know his dance move which was on Tik Tok was became an emoticon I make came An emoji and a move on fortnite and he Didn't pay fortnite basically stole his Dance move and he couldn't prove it Because they just took it on Tik Tok and He couldn't prove that he created or the Data was minted or whatever it was and So now with you know blockchain you can Make a dance move you can immortalize it

As an nft at the date in which you did It so that you can no longer argue well When was it created I don't know if you Really to create it what's the Background because now the you know an Onchain Dynamic proves when you did it How you did it and what it is that you Did so that if someone afterwards was Going to say they took that then at Least you can you know have a trademark Or copyright claim you know in places Like the US you don't have to go to an Office to do that if you can prove Original creation so these are other Ways in which you can basically start to Defend your rights that really sort of Empowers everyone to do that and I think Again in this age of AI it's so much so Important because you know how do you Verify whether this art is really from You how do I verify that I'm actually Talking to the true Jackie for instance Right as an example Exactly right you know when you can Forge it and so easily with you know Basically AI today and so this is where Blockchain and nfts are important Because now I can tell if it's really You because there's a hash there's a key There's a signature attached to it and Also royalty rights if I use an AI and I Generate something new out of the value Of a thousand people or 10,000 people or Say even a million people right actually

You know which mechanism exists today in Web 2 where you can actually properly Account for that in an open and Transparent manner where nobody will Question the value that's generated and Again onchain Dynamics is the best way Of doing that because it's fully Auditable and you can share the value According to whatever algorithm you've Designed for everyone to see so there's A lot of reasons why I think you know Blockchain technology will help solve Many of the world's biggest problems That are you know uh incoming why do you Think it hasn't been adopted yet though Do you think it's the negative Connotation that has come with the word Nfts or just the web 3 space as a whole Or is it a lack of understanding and Accessibility education I mean there's a Lot of ways we could like say why it Hasn't but I'm curious where you stand On it couple couple things I mean I had A interesting several conversations with Actually Simon syic about this and he Well he said one of the first things we Probably should do as an industry is Drop the word nft and probably drop the Word meters we have heard this many Times yeah yes and and I think there's a Good reason behind that because you know It's it's a classic example of sort of You know putting a technical term you Know after all non-fungible token

Doesn't really describe our industry Very well but I think also there's this Little thing that the word itself has Been tainted and has been confused so When we talk about the metaverse for Instance you know we talk about digital Property rights meta or Facebook talks About VR you know Microsoft talks about Something else you know Apple says Metaverse is you know rubbish we talk About sort of you know spatial Computing Like whatever whatever the terms might Be there is no common framework of Agreement around sort of what that word Is so in some ways I think as an Industry we probably need to sort of Find a new term that sort of Inc Capitulates really what it means which Is why we've been focusing a little bit More on sort of so much more on the Topic of digital property rights but Property rights in and of itself does Sound a little bit sort of you know Again a bit Technical and and so Something that most people might not Fully appreciate in Asia though N ifts And blockchain is actually very much More adopted it's much more popular and It doesn't have those negative Connotations so adoption is much faster Compared to the West partially it has a Little bit to do obviously with the Scandals of the past and the problems About the industry and the fear that

This sort of generated but I would say One of the bigger issues that I'm seeing Particularly when it comes to gaming you Know when people are rejecting nfts in Gaming in the west as opposed to in the East where it's welcom you notice that The reaction isn't a logical one it's a Very emotional one right I mean there They're sort of seething from the mouth Right they're angry they get red right They talk about you know they they talk About it like it's like the worst thing Ever you know if they don't care who Cares like in some ways you could argue If you don't like nfts it's okay no skin Off your back why would you be so Bothered by it right but it's very Personal to them and I think one of the Big reasons why it feels so personal is Because of the fact that it involves Money and of course everything in the World involves money but in this sense It feels like digital capitalism come Home in a very sort of big way and in America for instance I think you know we See this with you know the political Movements as well that especially Amongst Young Americans a large group of Them they've become fairly anti- Capitalist in their perspectives and you Know now even you know which way you Swing in terms of the Socialist dire C It's become a political platform because Capitalism hasn't done well for you and

Hasn't done well for most people of the Younger generation and money and capital Starts to feel feudal as in if I have Money I make more money I have power I Have access supposed to someone who Doesn't right so in the same way that People were very negative towards people In the finance industry if you remember How people talk about bankers and so on They kind of talk about people in crypto In the same sort of group which is Ironic because actually the people in Crypto are actually the rebels of that Industry right they're the ones who Basically sort of railed Against The Establishment and basically created an Alternative system precisely because They were Against The Establishment That's how it actually started and now We've got the establishment back in but That's the point great great exactly Right and and now they establish back in Exactly but I think this is the part Where the reaction comes from right so I Think it's more of a reaction towards Broadly the negative views on capitalism And the fear right and many comments say I don't want my game fancified you know I don't want money in the game I don't Want it to pervert the game play in some Ways especially sort of Premium gaming In the western world is probably one of The very few places where it appears That you know you can have sort of a

Meritocracy if I'm good at the game I Can have social status I can succeed and I don't necessarily need money at least That's what they think but they don't Realize is that their time and attention Is heavily financi fied and monetized Off the back on an industry that makes $200 billion a year plus right and of Which you get nothing for it even though You help contribute value to that Ecosystem but because they don't see it They are arbitraged out of this and by The way this is what happened in you Know in web one when people were Arbitraged out of their knowledge of Trades Goods that they could trade you Know farmers in Asia didn't know what The real value of their goods whether It's rice or vegetables or whatever was Sold in America right and so they were Always exploited and they thought life Was good and then they saw the internet And the internet is like oh wait a Second my product is being sold for 100x Of what actually I'm being paid wait a Second I should be paid more you know And that gave rise to the alib Babas and The ebays and the Amazon of the world as A way to sort of create value there and Then of course it allowed for Intermediaries to come in to say you Know if this guy is not willing to pay You a fair share I will because there's Still money to be made right so so this

Is now what's possible in web 3 with Data and so I think this is again the Thing that people don't understand that It's not about the money it's about the Transparency of the ecosystem the entire Financial ecosystem and the trade of Whatever assets that happen inside a Video game for instance now becomes Available for everyone to audit and see So I can see what the game items are Worth I can see who's paying for it I Can see who's playing more on it I can See what value is generating which then Means I can share value or I can trade With you something along along line so It's creating more transparency in the Ecosystems and because I think a lot of People don't understand how money works That's the other problem I would say the World is mostly finan illiterate they Have a bank account but they have no Financial literacy they don't have an Investment Portfolio they don't teach it In school they don't teach it in school You know and and so as a result they're Ignorant and you know what's their first Experience student debt right which Which leads especially with these Interest rates to another kind of Indented servitude over time how many Years do they have to spend to repay Their debt right that's the relationship They have with money so you can't really Say blame them for being so negative

About it so I think again I think this Problem needs to be solved which I think Wave three in crypto can actually help Solve on that note yeah we're going to Take a quick break and we'll be right Back and we are back I want to continue The conversation we were having before The break when it comes to finishing the Race to the finish line so to speak Which region do you think is embracing Web 3 the best or more specifically nfts Well definitely the asia-pacific region Is embracing nfts faster than any other Region and you can see is basically know Even from the policy standpoint it's not Even just from the population standpoint You know it's uh Hong Kong itself has Basically embraced digital assets you Know Japan and the Prime Minister Himself has put metaverse and nfts and Web3 on the map right I mean even China Has put out a web3 strategy paper a White paper and you know Xin ping Himself has said how blockchain and web 3 is you know kind of the future of the Internet he of course did not make any Mention of crypto but you know the point Is is that Hong Kong plays a role where You know you can have crypto in Hong Kong northern China and there sort of This Gateway effect that's taking place There so you know take that hint as you Will but the point basically being that There's clearly a push forward in terms

Of pushing web3 Technologies including Nfts and generally sort of digital Assets in this space and the Middle East Is kind of the same as well the Middle East is pushing it heavily as well it's Not just the UAE I mean it's turkey and Now recently with a partnership with Neom and Saudi they partner with us Because precisely because they want to Sort of enter into the web3 world and I Think there's really a couple theat ICS Around here that that drive this the First one obviously is a broad thematic Around sort of not wanting to have too Much dependency on the US economy and on The dollar right so I think that's Something that a lot of countries have Sort of had concern around so I think You know web 3 particularly digital Assets and crypto provide an alternative Towards that and then I think the second One is of course which I think is a Bigger issue is the fact that if you Think about it almost all of the world With the exception the ones that have Closed the ecosystems have beily become Digital dependents on technology from American businesses right so in other Words whether it's Facebook or whether It's Amazon or whether it's Microsoft Whether it's Google you name it apple Right basically you know all of the World you know whether it's Europe or Whether it's you know Asia Pacific has

Actually become dependent on you know Basically these very powerful you know As we call them sort of you know Entities yeah feudal digital you know Entities as it well bigger term right I Say feudal because a couple years ago I Would quote the comment where you know Facebook essentially censored Australian Media effective When Australia said hey you got to pay Us something and oh look what happened In Canada just say a couple weeks ago Right you know I mean the point is that If you can actually censor an entire Nation's basically media output how is That okay like why is there a private Corporation that even feels entitled That it can do that in the sake of Profits as opposed to you know for the Broader benefit this is wasn't possible Before I mean you couldn't do that so I Think this is kind of the situation we Have and I imagine if you have that Happening even in West democracies you Know what happens in other countries Around the world where the interest the National interest of the country is not At all in the corporate interest of the Company in question right so the so so Either you ban them or you basically are Dependent on them and you can ensure That they have a national interest in Mind and so that's another reason why I Think many of these countries are

Pushing web 3 Technologies because they See it as a way to essentially break Themselves free from sort of this web to Dominance and in the sort of you know to The extent that their own businesses That they're building won't necessarily Be the winners in the space because That's not how it works you know by Create by participating in a Decentralized network is broadly a Better outcome uh rather than basically Being in a centralized Network that can Basically make these decisions that are Sort of against your interest right so So that's kind of you know another Reason why countries like Asia are sort Of accelerating in this area because They have witnessed what happened to Them you know in the last 10 years and They don't like it so that could drive It for Asia and the Middle East as you Mentioned but what about the US like What are they getting wrong or not Understanding that is kind of inhibiting Them is it the regulatory environment or Something else I mean I think it's Definitely the regulatory environment Particularly with the secc has not been Helpful it's very clear that the policy Or the lack of policy making shall we Say has created definitely a sentiment Of fear uncertainty and doubt right fud For classic I think that's the effect That they're looking to do because

Because you know one of the biggest Problems you create when you have you Know these elements of you know fear and Then uncertainty is that people start to Self-censor right people start to stop Doing the things they think is right Because they have to start second Guessing is that the right thing to do It's like a CH should I do this I don't Really know and actually the Insidious Part about that is suddenly you're Silencing yourself you know which of Course it's a very unamerican thing but When you're worried about it uh when you Don't know it becomes more serious yeah Yeah becomes more serious and suddenly Becomes part of your culture and Suddenly you're just like you you're Just shy to start and next thing you Know you don't even get up right and you Know we've seen this happen in other Places around the world and it's very Sad to see that you know the us is going Through this at the moment however never Count out the us because because of its History the US is obviously built by People who are pretty feisty pretty Combative and they absolutely for those Who believe that they know what's right They'll fight for it and they'll go to Court they do what ever and that's What's happened right and you have you Know the USS Champions like coinbase for Instance right or the guys at misari or

Those guys who basically you know paying Sort of doing the good fight in the US And pushing the industry forward and now You know with the court Victory on Bitcoin spot ETFs it forced essentially To allow that to happen begrudgingly so One might add I know I think Gary Gensler was very very clear to say just Because we approved the ETFs doesn't Mean we approved of crypto you know like It's not an endorsement of Bitcoin let's Just be clear about that sure okay fine Right and I think that's that is a Beautiful thing about the us that you Can still have disagreement the fact That you know just because one one Entity says no doesn't mean the rest of The entities have to agree right you Know and when the US comes back into Full force which we believe will happen Maybe in the next 12 to 18 months right You know maybe post elections not sure Then you know we should be very wary of How aggressiv the US will move because Of its capital because of its talent Because of its speed and frankly you Know I think crypto and web 3 is about As American as it gets right which is I You know like in terms of property Rights and Liberty and freedom and Everything that it sort of purports for The digital world you know it's very Much in speaking of I would say the Values of the American Constitution and

Sort of the American way of life so I Think once that's fully understood I Think us will have a very big Competitive Advantage because it's I Think in the nature of most Americans But I think there's a misunderstanding Because because of all of the Med and The news and you know something else That I was told as well which I'm not Quite sure but it's some an interesting Comment I think that there is also a Little bit of um a sort of a classist Undertone as well that's happening in The US as well right between people of Let's call them traditional and old Money and the web 3 crypto folks were Really you know frankly new money and Also maybe not from sources that Normally have made money before and they Suddenly emerged with wealth and they Just like oh so I'm now in this social Class but I don't look this way or I'm Not part of that grou right right and You know Silicon Valley went through That experience 20 30 years ago right There was a sort of rejection of oh you Know these guys in sweatpants and sort Of Engineers but now they're like the Top but now but now they're The Establishment right right so so you're Kind of going through these Cycles so I Think I think there's a little bit of That as well right um and I think when We look at some of the democratic uh

Party sort of politics around this you Know you have to wonder sometimes you Know where that translates to in terms Of people's Impressions I mean You know one of the things that always Puzzled me you know when SPF was you Know first got into trouble and I think Everyone in Asia was basically just Riding this guy off as a fraud because It was pretty clear but American Media Struggled so hard for time to sort of Make sense of it right they spoken they They said oh you know it's it's a Chinese because somehow CZ was somehow Chinese or you know it's crypto the Industry is bad and he's just caught up In sort of you know this bad industry He's a good guy it's like why like why Are they trying to sort of you know Justify this criminal and and I think it Has a little bit to do with the fact That he came from I guess that class That was supposed to be the good guys Right he you know his his family was Academic royalty effectively right he Had a background that sort of you know Was endearing to to his experience you Know and all the Experience MIT everything put together How can someone like that you know be a Criminal right how can this happen right It must be something else right so I Think there's a little bit of that Undertone right that that's happened as

Well and I think also America frankly is A little bit of a sou searching of its Own identity I mean the politics that Your country is going through right now From an external perspective seems to Show conversation it's another Conversation but but I think I think I Think these effects are coming out Different ways and and and so web 3 is Caught between that yeah well it'll be Interesting to see how that kind of all Plays out we're almost at time here so I Want to make sure I could ask you our Last question we always us her guess This if there's one piece of advice that You can leave our listeners with what Would that be well I mean I think maybe The one that I generally sort of like to Live by is sort of my own personal Advice right which is that you know Generally speaking I like to live my Life with you know building with impact And purpose and in this sense you know I Mean positive impact so normally in the Past I wouldn't add the word positive Just because of the fact that it would Be implied but you know in this case I Just want to make very very clear that I Mean positive impact right just in case People that misunderstand um but yeah Impact and and purpose I think are Really important for us and I think if You can you know whatever it is that you Do in life it doesn't have to be crypto

It doesn't have to be web three if You're building with a view of something That has impact and purpose then I think Um you know you'll build something great And you may not hit it off the park on Day one right but to me when you're try To build something with impact and Purpose you'll end up building something Or trying to build towards something That is you know greater than you and You know that is a thing that then Allows us to have the kind of energy and Effort that allows us to get out of bed To be excited about the future to build A world you know potentially you know With potential and hope because you know You're building something that's just You know bigger than you and I know it Sounds corny but it is actually Something that sort of gives me energy And you know I'm able to go to all these Conferences and talk to all these people And have all these podcasts late at Night or whatever it is precisely Because I am so excited about the in our Case the prospect of giving digital Property rights to one in the world in The digital context and I also believe That we can save capitalism because you Know we can give people a form of equity In this world because we can now all own A piece of this web three World which You couldn't do in web two and that's Really exciting you know I think we can

All consider ourselves very lucky if we Actually find that purpose and I would Sort of definitely ask everyone if they They want to have an impact to find that For themselves I love that well thank You for sharing that and thank you for Coming on the show today I really Appreciate it my pleasure thank you for Having me We'll be back next week with Conversations around what's going on in The wild world of web 3 with top players In the crypto ecosystem you can keep up With us on Spotify Apple music or your Favorite pod platform And subscribe to Our companion newsletter also called Chain Reaction links to the newsletter And stories we talked about can be found In our show notes and be sure to follow Us at chain reaction on Twitter chain Reaction is hosted by myself Jaclyn Melanic and produced by Maggie stamitz With assistance from Yad karney and Editing by Kell Bryce Durban is our Illustrator and Henry pette manages Tech Crunch audio products thanks for Listening in see you next Time


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