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This is epicenter episode 398 
with guests, look as for 

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building and Cassidy daily from 
centrifuge. 

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Welcome to episode of the 
podcast where we interview 

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crypto Founders, Builders and 
fault leaders. 

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I'm Ryan from Ukraine. 
And I'm here refrigerator Ernst.

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So today we speak with Lucas 
Vogelsong and Cassidy gaily who 

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are respected, CEO and 
co-founder, and reading talking 

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sign in research at centrifuge. 
So, but before we talk with 

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Lucas and Cassidy about 
centrifuge, we'd like to talk 

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about our sponsors. 
Minute. 

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So first of all, Exodus Exodus 
is an easy-to-use wallet, we 

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support hundreds of assets and 
as native apps for all the 

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platforms including IOS and 
Android, it's fully 

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non-custodial, wallet and the 
firm Believers in the not 

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Yuki's, not your coins mantras, 
so you can go to Exodus to come 

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and give it a try, and then 
secondly Solana's. 

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As long as the Next Generation 
blockchain with Superfast 

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blocks, very cheap, feast, and 
scalability is the single 

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biggest challenge. 
I think that, you know, we're 

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facing Criminal. 
So today and so Solana has 

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really optimized are failing to 
provide the most performance 

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blockchain. 
So you can go to salon.com App 

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Center to learn more. 
And that De Paris will Up 

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Periscope just came out with a 
huge update. 

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That's even faster and more 
liquid. 

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It's cheaper than unislope and 
comes with a new gas token that 

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can cut your gas fees by up to 
50%. 

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Periscope is now Mighty chain 
and has expanded to polygons and

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finance matching start trading 
at Periscope dot IO / epicenter.

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Cool. 
I'm with that. 

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Let's get into centrifuge. 
Well, let's start at the 

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beginning. 
Can you share with us a bit? 

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Like, you know, how did 
centrifuge come about and what's

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the vision for the project? 
So sorry fuge came about when we

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started looking at how we expand
sort of this new world that 

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we're building in crypto to 
businesses to users all around 

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the world and how we allow them 
to use their existing assets 

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that they have. 
So we looked at how we actually 

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allow a business to use say and 
in an unpaid invoice that they 

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have, or a real estate investor 
to use their property to get 

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liquidity. 
From defy instead of banks back,

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when we started actually defy 
didn't even really exist. 

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We just said, okay. 
Well what if people could use 

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crypto to pay for this instead 
of s is defy ecosystem 

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developed. 
We sort of refined our idea and 

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our mission to focus really on 
how we tap into this liquidity. 

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How we allow users to use it for
stuff that exists outside of the

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world of truly crypto native. 
It's and so what, what's in your

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future does today is we allow 
users to borrow money? 

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Usually stable corn. 
You most most often die against 

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any kind of real world acid. 
We work with, I mentioned real 

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estate trade Finance to bring 
those assets on chain. 

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Allow investors to invest in 
them, earn a year. 

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Earn yield on a stable asset but
to do so fully in crypto 

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centrifuges live on maker as the
first real asset. 

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Youth Silver's our first asset 
originator that got a 5 million 

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die. 
Debt ceiling that they're using 

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to actually mint. 
The first die in the world 

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that's backed by real estate. 
Basically, bringing really wide 

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assets to the web three. 
I can imagine there's a lot of 

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different challenges to 
overcome. 

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What were those to you? 
This hinges are slightly 

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different. 
But in a lot of ways is similar 

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to kannada on chain stuff that 
we do. 

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Well, the biggest issue for us 
that we started working on was 

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actually, how do we bring 
liquidity in these assets? 

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Unlike say ether other tokens 
that have liquidity that are 

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fully fungible. 
A lot of these Assets in the 

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real world are non fungible. 
Right? 

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Like, your house is not the same
as mine, your invoice your 

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credit, if you want to borrow 
money, that's the did. 

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From Red credit risks. 
And if I want to borrow money, 

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and so if you try to build a 
build, a marketplace, where 

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investors and bars, come 
together, always, this is 

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something that he's much easier 
to do if we're all borrowing and

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then do the same thing. 
And that's why you see like 

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money markets like Ave and or 
blending protocols like maker, 

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that just work with fully liquid
assets, actually picking up and 

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becoming sort of successful 
building out their use cases, 

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much earlier than lending on, on
fungible asset. 

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It's and so the approach we're 
taking there is, we allow these 

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real assets to be bundled into 
different pools. 

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That the word that are the 
concept that exists in the 

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traditional world is 
securitization. 

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Meaning, you take different 
different assets. 

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You put them into one, one 
entity one pool is what we call 

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them. 
And then you allow investors to 

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buy shares of that pool. 
And so that gives you the 

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advantage that now instead of 
having to And a borrower that A 

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lender that wants to invest in 
exactly that house. 

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And then at the right time, the 
right amount and and on the 

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other side, finding a bar doing 
this matching, you can actually 

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notice throw all of these assets
into pool and as an investor, I 

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can just say, oh I want to 
invest in real estate and I can 

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buy tokens from this real estate
pool or I want invest in trade 

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Finance. 
I wanna invest in companies that

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are growing and knee, grep, need
money for their, for operate for

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funding their operations. 
So I put money into that pool. 

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Right, and then the other side, 
there's more borrowers. 

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And so that sort of solves this 
this coordination challenge. 

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So we've seen an indie fire that
their problems with listing 

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things as collateral in terms of
making sure that this is a 

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trusted asset and there is a 
good price feed for it. 

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And basically, a lot of people 
actually have to collude to 

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actually make this go south. 
I could imagine that this is 

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even more difficult with real 
word acids. 

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I mean, basically, as you said, 
my house not the same as your 

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house and my car's not the same 
as your kind, even when you 

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bundle things together. 
How do you protect yourselves 

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and users against spam or fraud?
So there's a few things for 

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we're doing. 
We already have implemented and 

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there's a few things were we're 
still working on a mile of. 

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Hopefully we can talk a bit 
about both. 

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So sort of the this, the problem
here is is, of course, like, how

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do you know, what exists out 
there in the real world? 

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Very simple thing. 
We do. 

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I mean, it's actually rather 
complicated but it was the first

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layer of defense is well, we do 
make sure that there's legal 

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recourse and so in case all else
fails, Obviously, if you're 

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investing in one of these pools,
you there is a legal recourse, 

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you can go and you can sue. 
The person that tries to walk 

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away with your money. 
And so like this is not Ruby, 

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don't live in a completely 
Lawless world, right? 

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And so like you can rely on that
as an ultimate backstop, but 

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then really the second level of 
Defense, maybe that we have is I

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talked about, we bundle 
different assets into pools and 

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What we give investors. 
As we give investors to choice 

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to invest in. 
Actually two different tranches.

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It's a each pool has two 
different tokens where if you 

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want high risk High return, you 
can invest in what, what is 

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typically called the Junior? 
Eight, but you're protected by 

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the Junior and maybe to just 
give you a very quick example. 

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Say we have, we have 1 million 
dollars from that investors 

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invest 900,000, invest in the 
senior and a hundred thousand 

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invest in the junior. 
You have a million dollars in 

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assets on the other side, right?
Maybe that's 20 different loans,

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say one of those 20 different 
loans, worth $50,000 defaults. 

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So you now have only nine 
hundred fifty thousand dollars 

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left. 
That means actually, that is If 

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you're a senior investor, you're
not suffering anything. 

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Because you have those Junior 
investors covering the first 

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hundred thousand on the other 
side. 

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For the junior investors. 
They would see a 50% loss 

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because there are losing 50,000 
on the hundred thousand that 

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they invested. 
And so, what does that actually 

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gives you the gist two different
kinds of investors? 

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Two different kinds of products 
that they both actually like 

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more, right? 
If I'm the lending protocol or 

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I'm just like some retail 
investor. 

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That's why wants to put money 
into Savings Bank. 

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Don't thinking much about like 
your Score exactly what these 

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assets should be then I know 
there's like other investors 

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that effectively want to 
leverage their position. 

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They want to have more risk 
exposure and make more money and

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they're they're taking that risk
for me. 

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And so that structure is it 
gives you insurance that if 

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there's like a single default, 
if there's, there's issue with 

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the different assets that that 
is covered by, by sort of these 

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200 Masters. 
And so that's that's very 

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crucial part. 
And For example, maker in the 

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example of new silver. 
They are investing in the senior

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tokens. 
Whereas other investors that 

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really know that they're real 
estate market. 

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I'd like like to have these high
these higher yields are 

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investing in the Junior. 
And ultimately this is sort of 

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where we're developing the 
product to it's actually that 

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these Junior investors become 
more important over time. 

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And actually maybe I want to 
hand over to Cassidy to talk a 

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bit about what we have in store 
there. 

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Yeah, one of the most exciting 
things that we have in store and

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are working on, we're calling 
the underwriter token. 

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And really it's actually just 
these ten tokens that these more

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advanced either Junior investors
or Underwriters would be able to

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actually give a more accurate 
assessment of the risk of these 

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assets. 
So more accurate because it is 

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distributed and they're going to
be a lot of different entities 

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participating in this. 
Today in traditional systems. 

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This is generally either just a 
bank that you're working with or

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a credit agency and the 
incentives are really not 

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aligned for either of those 
parties either. 

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You're a bank. 
That's just trying to make the 

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best return that you can. 
And so they're not necessarily 

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incentivize to price the risk as
accurately to the borrower's 

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favor and the credit agency 
almost has the opposite because 

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they're just paid directly by 
the business in most cases. 

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Has. 
And so they're just looking to 

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make money and are also not 
really aligned with the 

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incentives of accurately pricing
this risk. 

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So the idea here with this 
underwriter token model is that 

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by holding the tin token? 
You actually have skin in the 

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game as an underwriter or Junior
investor here and that aligns 

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the incentives. 
A lot more closely to actually 

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have something to lose if you 
were to price this risk in 

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accurately. 
I think there's still a lot of 

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work that we have to do there 
and making that system work. 

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Well, but super excited to move 
that forward. 

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And I think that's one of the 
next big pieces that we have 

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here in centrifuge. 
Let's get to our sponsor, Exodus

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Exodus is a fantastic crypto 
currency wallet, that strikes 

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00:11:41,700 --> 00:11:45,200
the right balance between 
ease-of-use security, and great 

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00:11:45,200 --> 00:11:47,800
features. 
You can get Exodus on the iPhone

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00:11:48,000 --> 00:11:51,200
desktop app. 
Web app, Android, whatever 

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00:11:51,200 --> 00:11:54,400
platform you use. 
It's a non-custodial wallet. 

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That is so critical. 
Because what's the point of 

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crypto? 
If you don't control your own 

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00:11:58,800 --> 00:12:03,300
assets with Exodus, you always 
do the old school and they've 

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00:12:03,300 --> 00:12:08,600
been around since 2015 over 1.2 
million users rely on Exodus. 

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00:12:08,600 --> 00:12:12,200
So, you know that they've stood 
the test of time, they have 

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00:12:12,200 --> 00:12:16,500
support for over 100 different 
crypto acids and remove in 

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Exodus. 
You can easily exchange one 

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different. 
To the otter. 

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00:12:20,900 --> 00:12:24,300
The also allow you to buy crypto
with Fiat and they even have a 

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00:12:24,300 --> 00:12:28,000
great offer where you can buy up
to $500 worth of crypto to the 

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00:12:28,000 --> 00:12:33,600
IOS app and Pages $1 in fee. 
So go to Exodus.com epicenter 

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00:12:33,600 --> 00:12:36,800
and check out their wallet. 
We want to thank Exodus for 

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00:12:36,800 --> 00:12:38,800
their amazing support of 
epicenter. 

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00:12:40,800 --> 00:12:43,600
I can give a bit of an picture 
bit more, what the underwriters 

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actually will do because I do 
think they really tackle this 

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problem that you mentioned 
Federica. 

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Tariqa, which is like, how do 
you price these real-world 

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assets, right? 
Because they exist outside of 

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crypto and you need to know okay
what it is, what it is? 

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Exactly. 
And so I we have what we have in

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these pools is we have these 
investors that have skin in the 

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game that take first loss. 
And so they actually, what they 

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can do is they can they need to 
Actually decide, they need to be

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able to know if this loan that 
were giving here to borrow that 

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00:13:15,600 --> 00:13:18,300
wants to buy a house if they 
don't should be priced at 5% 

229
00:13:18,300 --> 00:13:21,700
interest per year or 8% through 
the mechanisms that we're 

230
00:13:21,700 --> 00:13:25,700
designing now is effectively. 
We're creating for we're 

231
00:13:25,700 --> 00:13:28,600
enabling these pools to actually
have logic where different 

232
00:13:28,600 --> 00:13:33,300
Underwriters can stake some of 
their tune your tokens to assets

233
00:13:33,300 --> 00:13:36,300
that they like meaning assets 
that they think are priced 

234
00:13:36,300 --> 00:13:40,100
correctly are valued correctly. 
So in the example of a house, 

235
00:13:40,100 --> 00:13:41,700
right, you The value of the 
house. 

236
00:13:41,700 --> 00:13:45,600
Is it worth $500,000? 
Or is it worth $600,000? 

237
00:13:45,900 --> 00:13:50,000
And should the borrower pay 5% 
or eight percent interest. 

238
00:13:50,200 --> 00:13:54,100
And so if a borrower comes and 
says, they want to borrow money 

239
00:13:54,100 --> 00:13:58,800
for us to house these different 
Underwriters can stay towards 

240
00:13:58,800 --> 00:14:00,800
that. 
The loan proposals that they 

241
00:14:00,800 --> 00:14:06,900
like, so 500,000 at 8% or 
400,000 at 5%, the pool, then 

242
00:14:06,900 --> 00:14:10,200
we'll just sort of Select. 
Only the assets that get the 

243
00:14:10,200 --> 00:14:12,800
most. 
Endorsement by these different 

244
00:14:12,900 --> 00:14:17,600
Underwriters, the psych you have
now a as Cassidy mentioned in 

245
00:14:18,100 --> 00:14:22,300
way to decentralize this pricing
challenge, so you can now build 

246
00:14:22,300 --> 00:14:24,900
sort of a system where anyone 
can come in and underwrite these

247
00:14:24,900 --> 00:14:26,600
assets. 
They can pull an external data 

248
00:14:26,600 --> 00:14:29,000
sources. 
They can look at historic, real 

249
00:14:29,000 --> 00:14:31,500
estate market data. 
They can look at credit rating 

250
00:14:31,500 --> 00:14:34,600
information. 
They can go and look, check out 

251
00:14:34,600 --> 00:14:37,700
the house themselves and see if 
it actually exists and like talk

252
00:14:37,700 --> 00:14:40,400
to talk to the or look at which 
neighborhood. 

253
00:14:40,500 --> 00:14:42,700
You might have the most 
potential for development. 

254
00:14:42,700 --> 00:14:44,600
Right? 
So you have all these different 

255
00:14:44,600 --> 00:14:47,500
things that you can bring in and
ultimately to these different 

256
00:14:47,500 --> 00:14:52,700
Underwriters can collaborate to 
then come up with the best 

257
00:14:52,700 --> 00:14:56,500
credit rating or the best sort 
of pricing of this asset and for

258
00:14:56,500 --> 00:14:58,800
us, what does actually the best 
pricing mean? 

259
00:14:58,800 --> 00:15:00,800
Right? 
Like we're trying to build a 

260
00:15:00,800 --> 00:15:04,000
fairer and the more efficient 
Financial system, and that means

261
00:15:04,100 --> 00:15:05,900
we're not overcharging the 
borrowers. 

262
00:15:05,900 --> 00:15:08,200
We're also not undercharging. 
And that means, it just needs to

263
00:15:08,200 --> 00:15:12,800
be the price needs to be more 
than A deep, the risk of default

264
00:15:12,800 --> 00:15:15,100
but not too much more and that's
exactly where like them. 

265
00:15:15,100 --> 00:15:18,000
These Underwriters are 
incentivized to take towards 

266
00:15:18,000 --> 00:15:20,800
these assets. 
Such that such that de poule, 

267
00:15:20,800 --> 00:15:23,800
ultimately lends out money at 
these rates. 

268
00:15:24,000 --> 00:15:27,100
And that's sort of the idea of 
where we see actually solving 

269
00:15:27,100 --> 00:15:29,200
this. 
All of these challenges with 

270
00:15:29,200 --> 00:15:32,400
real assets, not with just 
oracle's and serve trying to 

271
00:15:32,400 --> 00:15:35,200
pull in data more but creating 
actually incentive system around

272
00:15:35,200 --> 00:15:38,600
that. 
It seems that going from from 

273
00:15:38,600 --> 00:15:43,800
what you just said, that if an 
underwriter and a borrower 

274
00:15:44,200 --> 00:15:48,400
collude, so, basically, they, 
I'm, I have a house and I want 

275
00:15:48,400 --> 00:15:52,400
to have a mortgage on it on 
centrifuge, but the house is in 

276
00:15:52,400 --> 00:15:54,700
absolute dump. 
And basically, I really 

277
00:15:54,700 --> 00:15:56,900
shouldn't be getting any money 
for it. 

278
00:15:56,900 --> 00:16:01,400
But I have an underwriter who's 
willing to signal that. 

279
00:16:01,400 --> 00:16:03,800
They looked at the house and 
that it's fine. 

280
00:16:04,300 --> 00:16:06,500
The underwriter would never be 
out. 

281
00:16:06,700 --> 00:16:09,600
As much as I could potentially 
gain, right? 

282
00:16:09,700 --> 00:16:13,400
So do you have some sort of 
reputation and system to combat 

283
00:16:13,400 --> 00:16:17,100
that? 
Yeah, this is this is, this is I

284
00:16:17,100 --> 00:16:20,600
think the one important part, 
what we do by bringing by 

285
00:16:20,600 --> 00:16:24,300
bringing in Underwriters that 
actually vote on chain, right? 

286
00:16:24,600 --> 00:16:27,400
Is that we start creating a 
track record of these 

287
00:16:27,400 --> 00:16:29,800
Underwriters that is verifiable 
on chain, right? 

288
00:16:29,800 --> 00:16:33,900
If you're borrowing against a 
house here in Germany and you're

289
00:16:33,900 --> 00:16:37,200
borrowing against are you have a
loan in the US and like 

290
00:16:37,300 --> 00:16:38,600
different people doing this 
stuff. 

291
00:16:38,800 --> 00:16:41,300
There's it's going to be 
impossible to to, like, build up

292
00:16:41,300 --> 00:16:43,500
this, this reputation. 
And so, like, for borrowers, 

293
00:16:43,500 --> 00:16:47,500
this is very challenging but 
With Underwriters them being on 

294
00:16:47,500 --> 00:16:49,100
chain. 
They actually do have a 

295
00:16:49,100 --> 00:16:51,800
reputation that goes beyond just
a single transaction. 

296
00:16:52,200 --> 00:16:55,700
And so you can extract, you have
these, you have these 

297
00:16:56,100 --> 00:17:00,000
game-theoretic issues that you 
mentioned, and you tackle those 

298
00:17:00,000 --> 00:17:02,400
with reputation, and you tackle 
them with giving exactly that. 

299
00:17:02,400 --> 00:17:05,400
Transparency, right? 
So an underwriter that has done 

300
00:17:05,400 --> 00:17:09,000
underwriting for months or years
and has done that on many 

301
00:17:09,000 --> 00:17:13,500
different assets and now 
effectively has a reputation, 

302
00:17:14,200 --> 00:17:16,800
they will Will attract Capital, 
right? 

303
00:17:16,800 --> 00:17:20,099
Because we're now changing the 
Dynamics of as an investor. 

304
00:17:20,099 --> 00:17:22,200
Do I invest in real estate in 
the US? 

305
00:17:22,200 --> 00:17:26,900
Or do I invest in real estate in
Germany to actually which fool 

306
00:17:26,900 --> 00:17:31,000
has reputable Underwriters that 
have a proven track record and 

307
00:17:31,000 --> 00:17:33,600
have a significant amount of 
money at stake. 

308
00:17:33,600 --> 00:17:36,000
Right? 
And so now actually, if they 

309
00:17:36,000 --> 00:17:39,100
start doing these kind of, if 
they did one of these deals 

310
00:17:39,100 --> 00:17:41,400
where they were colluding with 
the borrower, then they would 

311
00:17:41,400 --> 00:17:44,000
give up all of that, all of that
reputation. 

312
00:17:45,100 --> 00:17:48,500
Would would ultimately lose out 
another important part of how 

313
00:17:48,500 --> 00:17:51,700
you can counteract. 
That is, of course, you don't 

314
00:17:51,700 --> 00:17:53,800
want to have just one 
underwriter in the pool. 

315
00:17:53,800 --> 00:17:56,000
That's sort of the single point 
of failure that you don't want, 

316
00:17:56,000 --> 00:17:57,500
right? 
The minute, you have to 

317
00:17:57,500 --> 00:18:01,600
Underwriters and generally they 
agree on which loans should be 

318
00:18:01,600 --> 00:18:03,000
added. 
But then there's one lone. 

319
00:18:03,000 --> 00:18:06,300
That doesn't, that doesn't get 
the boat or sort of slight 

320
00:18:06,300 --> 00:18:08,500
signal of confidence by the 
second underwriter. 

321
00:18:09,000 --> 00:18:10,500
That would be very detrimental. 
Right? 

322
00:18:10,500 --> 00:18:12,900
Like they would clearly signal 
something's wrong. 

323
00:18:13,100 --> 00:18:17,300
And so that this, so So by 
actually allowing Underwriters 

324
00:18:17,300 --> 00:18:20,400
to sort of do their work 
independently, verifying all of 

325
00:18:20,400 --> 00:18:22,400
this off. 
Chains stuff themselves. 

326
00:18:22,900 --> 00:18:26,600
We add this second protection 
here besides reputation. 

327
00:18:26,600 --> 00:18:31,900
We also add redundancy. 
And just to build on that the 

328
00:18:32,100 --> 00:18:35,300
second, third or fourth 
underwriter there, they're 

329
00:18:35,300 --> 00:18:38,300
incentivized to check that 
information from that first 

330
00:18:38,300 --> 00:18:42,100
center writer because they would
stand to lose first if those 

331
00:18:42,100 --> 00:18:45,300
assets were to default. 
So having that skin in the game 

332
00:18:45,300 --> 00:18:50,200
provides that incentive to 
really deter, the sort of 

333
00:18:50,200 --> 00:18:53,200
collusion in both of those ways 
that Lucas mentioned. 

334
00:18:53,400 --> 00:18:57,000
And then on the flip side of it,
one could actually question. 

335
00:18:57,200 --> 00:18:59,000
How do we make sure that there's
enough? 

336
00:18:59,100 --> 00:19:03,100
Enough competition as well that 
they're not overcharging these 

337
00:19:03,100 --> 00:19:06,800
borrowers as well. 
And I think that's where having 

338
00:19:06,900 --> 00:19:11,100
a transparent system comes into 
play as well because you then 

339
00:19:11,100 --> 00:19:13,700
have borrowers that are able to 
look at lots of different 

340
00:19:13,700 --> 00:19:18,200
sources for financing and 
actually having the underwriters

341
00:19:18,200 --> 00:19:21,800
be able to compete on a good 
rate for the borrower on the one

342
00:19:21,800 --> 00:19:25,300
side, but also being the first 
to lose on the other side. 

343
00:19:25,300 --> 00:19:30,800
And if some acid were to 
default, Is it minimum value on 

344
00:19:30,800 --> 00:19:33,900
which I can borrow on? 
I mean, we just talked about 

345
00:19:33,900 --> 00:19:36,200
houses, right? 
So basically, houses, I can, I 

346
00:19:36,200 --> 00:19:41,400
can see how alone on a house 
would sustainably, Finance 

347
00:19:41,400 --> 00:19:44,300
Underwriters, a couple of 
Underwriters to actually keep 

348
00:19:44,300 --> 00:19:47,300
the system stable. 
But I'd say, I want to take out 

349
00:19:47,300 --> 00:19:51,300
a loan on my car or say even my 
reputation or, you know, 

350
00:19:51,500 --> 00:19:54,200
something else. 
Would that work as well? 

351
00:19:55,700 --> 00:19:57,900
So you can take out a loan on 
your reputation. 

352
00:19:57,900 --> 00:20:01,100
If someone's willing to trust 
it, right? 

353
00:20:02,000 --> 00:20:04,300
There are, I mean, there in the 
real world, there are many 

354
00:20:04,300 --> 00:20:07,700
places where where you do that, 
if you're building a company and

355
00:20:07,700 --> 00:20:10,700
you convince, you convince 
people to give you money to 

356
00:20:10,700 --> 00:20:12,300
build that company. 
Sure. 

357
00:20:12,300 --> 00:20:14,400
They're investing in there, 
getting shares in that company. 

358
00:20:14,400 --> 00:20:17,000
But ultimately, they're trusting
that you actually want to build 

359
00:20:17,000 --> 00:20:19,500
this. 
And so that does happen in the 

360
00:20:19,500 --> 00:20:22,700
real world. 
I think sort of the what we want

361
00:20:22,700 --> 00:20:28,500
to get to is a place where it's 
Always easier to to lend money, 

362
00:20:28,500 --> 00:20:32,700
to two people to users when 
there's some like data 

363
00:20:32,700 --> 00:20:36,300
available. 
So like in the case of real 

364
00:20:36,300 --> 00:20:40,400
estate, you can verify and check
what's in the land register or 

365
00:20:40,400 --> 00:20:44,900
like what real estate pot forms 
say that certain properties are 

366
00:20:44,900 --> 00:20:45,900
very Worth. 
Right? 

367
00:20:45,900 --> 00:20:48,800
Sort of looking at all that. 
I generally wouldn't say. 

368
00:20:48,800 --> 00:20:51,800
We want to limit it to anything.
I'd love to. 

369
00:20:51,800 --> 00:20:54,900
I'd love to find a way that this
can be done safely and I do 

370
00:20:54,900 --> 00:20:58,300
believe It can write because if 
if, if you assume that people 

371
00:20:58,300 --> 00:21:02,100
are generally honest and you 
price the dishonesty correctly 

372
00:21:03,000 --> 00:21:06,900
and then you can actually make 
money lending to dishonest 

373
00:21:06,900 --> 00:21:09,700
people. 
This is a bit of a, not to 

374
00:21:09,700 --> 00:21:12,100
generally honest, but maybe some
dishonest people and that's 

375
00:21:12,100 --> 00:21:15,700
that's the truth in every, in 
every asset class. 

376
00:21:15,700 --> 00:21:18,600
I mean, even in crypto, right? 
Like by the point, by the time, 

377
00:21:18,600 --> 00:21:22,400
your onboarding and ERC 20 token
of a major D5 project into 

378
00:21:22,400 --> 00:21:25,200
another defect protocol. 
Well, like there's a fair amount

379
00:21:25,200 --> 00:21:29,700
of Rest in that leadership or 
the sort of the team behind that

380
00:21:29,700 --> 00:21:32,200
certain D5 project is actually 
not just kind of disappear the 

381
00:21:32,200 --> 00:21:34,800
next day, right? 
And so like heading get, there's

382
00:21:34,800 --> 00:21:38,100
obviously they will never work 
completely without trust and 

383
00:21:38,100 --> 00:21:40,900
that, that, and or some some 
amount of honesty and some 

384
00:21:40,900 --> 00:21:44,200
amount of good intention, but 
you need to price it and do need

385
00:21:44,200 --> 00:21:46,700
to make sure that you protect 
yourself as much as possible 

386
00:21:46,700 --> 00:21:51,700
from fraud here. 
In terms of a strict minimum, 

387
00:21:51,700 --> 00:21:55,300
the other part of your question 
Federica, we don't have strictly

388
00:21:55,300 --> 00:22:01,000
speaking a minimum of how much 
you you need to borrow per se 

389
00:22:01,000 --> 00:22:05,900
but that said and 10 like is 
live on aetherium right now and 

390
00:22:05,900 --> 00:22:11,100
guess these are fluctuating, but
sometimes too high prohibitively

391
00:22:11,100 --> 00:22:14,600
high for, you know, lower than a
certain amount. 

392
00:22:14,600 --> 00:22:19,200
So, I don't know if we've seen 
any fine assets Finance for Less

393
00:22:19,200 --> 00:22:21,600
than a thousand. 
Yeah, 2008. 

394
00:22:21,600 --> 00:22:23,100
But makes sense already. 
Yeah. 

395
00:22:25,600 --> 00:22:28,700
Now, let's talk about Solana. 
We all know that scalability is 

396
00:22:28,700 --> 00:22:31,400
one of the most important issues
facing the blockchain industry 

397
00:22:31,400 --> 00:22:33,800
today. 
The Solana blockchain has been 

398
00:22:33,800 --> 00:22:37,200
engineered from the ground up 
optimizing for performance and 

399
00:22:37,200 --> 00:22:40,600
scalability to network supports 
thousands of transactions. 

400
00:22:40,600 --> 00:22:43,800
A second with 600 milliseconds 
block times and over 500 

401
00:22:43,800 --> 00:22:46,600
different validators. 
It's not a shorter blockchain 

402
00:22:46,600 --> 00:22:49,600
but a single box chain hyper 
optimized for performance. 

403
00:22:50,100 --> 00:22:53,100
And that makes it easy to 
maintain composability between 

404
00:22:53,100 --> 00:22:55,200
the apps on Solana. 
So they work together. 

405
00:22:55,400 --> 00:22:59,700
Seamlessly the salon ecosystem 
is growing at a rapid pace and 

406
00:22:59,700 --> 00:23:02,500
it's a great place to build your
project and get involved with 

407
00:23:02,500 --> 00:23:06,700
the community to go this Lana 
outcomes episode to learn more. 

408
00:23:08,300 --> 00:23:11,700
We've talked a little bit sort 
of like on like what type of 

409
00:23:11,700 --> 00:23:14,500
acid but I would actually love 
if you're going to zoom out a 

410
00:23:14,500 --> 00:23:19,300
little bit here and talk a bit 
about, you know, like to use 

411
00:23:19,300 --> 00:23:23,700
case and the problem, you know, 
how big of a problem is this 

412
00:23:23,700 --> 00:23:26,200
like globally in like Where is 
the problem? 

413
00:23:26,200 --> 00:23:28,300
Is it in particular types of 
assets? 

414
00:23:28,300 --> 00:23:30,600
Particular Industries? 
Is it like geographically 

415
00:23:30,600 --> 00:23:33,000
distributed? 
And like what do you think are 

416
00:23:33,000 --> 00:23:34,900
the? 
The use cases were like 

417
00:23:35,000 --> 00:23:37,200
centrifuge can make the biggest 
difference? 

418
00:23:39,200 --> 00:23:43,500
Yeah, so I mean the Global 
Financial system right? 

419
00:23:43,500 --> 00:23:48,400
Is if is quite the monster and I
think for a lot of I mean at 

420
00:23:48,400 --> 00:23:52,900
least when I entered the space 
that was a very big motivation 

421
00:23:52,900 --> 00:23:54,600
was to say, okay. 
Well actually we can build this 

422
00:23:54,600 --> 00:23:59,700
better and and I think I mean 
the idea of Bitcoin and and then

423
00:23:59,700 --> 00:24:02,800
also like if you're em and I 
think it's that's pretty much a 

424
00:24:02,808 --> 00:24:06,400
shared ideology. 
I think sort of, and this is 

425
00:24:06,400 --> 00:24:07,700
really what? 
Excites me so much. 

426
00:24:07,800 --> 00:24:11,600
Much about defying where I see 
like very much, the idea and 

427
00:24:11,600 --> 00:24:15,100
sort of a vision aligned is with
what's any future is doing as 

428
00:24:15,100 --> 00:24:16,900
well. 
It's like defies transparent and

429
00:24:16,900 --> 00:24:19,400
it doesn't have any barrier of 
Entry is, right, like the code. 

430
00:24:19,400 --> 00:24:23,900
Your code doesn't doesn't care 
about where who you are or what 

431
00:24:23,900 --> 00:24:26,000
you do. 
If you have one, he's you can go

432
00:24:26,000 --> 00:24:28,400
to maker and you can borrow. 
If you have one use you can go 

433
00:24:28,400 --> 00:24:31,600
to oven borrow like right same 
rate, same terms. 

434
00:24:31,600 --> 00:24:35,900
Sorry, everything is accessible 
if you they actually sort of 

435
00:24:35,900 --> 00:24:40,500
before even defy came, right? 
Like Ico's in 2017, very much 

436
00:24:40,500 --> 00:24:42,800
where it's sort of it was the 
same idea. 

437
00:24:42,800 --> 00:24:46,700
It was like, you can do an IPO. 
You can sell your company on 

438
00:24:46,700 --> 00:24:48,300
NASDAQ or New York, Stock 
Exchange. 

439
00:24:48,300 --> 00:24:52,100
You can spend millions in legal 
fees and go through this entire 

440
00:24:52,100 --> 00:24:55,000
like system with. 
But a bunch of intermediaries 

441
00:24:55,000 --> 00:24:59,200
all trying to extract value and 
likes a bunch of Regulation and 

442
00:24:59,200 --> 00:25:03,600
mostly unnecessary paperwork to 
sort of get to having your 

443
00:25:03,600 --> 00:25:06,600
company be traded and everyone 
being able to buy it on Robin 

444
00:25:06,600 --> 00:25:09,200
Hood. 
And I co said no actually all 

445
00:25:09,200 --> 00:25:11,100
you need is you need to do Point
Arc 20 token. 

446
00:25:11,100 --> 00:25:14,300
Convince people that this is 
like a token that will become 

447
00:25:14,300 --> 00:25:19,000
something cool and people will 
want to buy and and I think sort

448
00:25:19,000 --> 00:25:23,000
of them like continuing defies 
to richest like trying to build 

449
00:25:23,400 --> 00:25:26,100
sort of apply the same idea of 
no barrier of Entry is no 

450
00:25:26,100 --> 00:25:28,900
transparency. 
Like radically lower cost to 

451
00:25:28,900 --> 00:25:31,400
like all these different 
Financial products that exist 

452
00:25:31,400 --> 00:25:33,700
right? 
Ico's yoga, first ones, lending,

453
00:25:33,700 --> 00:25:36,900
protocols, all this stuff. 
What 10 you should just doing, 

454
00:25:36,900 --> 00:25:39,400
we're trying. 
To build the same thing we're 

455
00:25:39,400 --> 00:25:40,000
saying. 
Okay. 

456
00:25:40,000 --> 00:25:42,100
Well now we have this defy 
ecosystem. 

457
00:25:42,100 --> 00:25:43,900
How can we apply to other 
assets? 

458
00:25:43,900 --> 00:25:48,500
That are not truly crypto native
to real-world assets and the but

459
00:25:48,500 --> 00:25:50,400
the benefits are ultimately the 
same, right? 

460
00:25:50,400 --> 00:25:54,000
And so, who do these benefits, 
who profits most from these 

461
00:25:54,000 --> 00:25:57,200
actually, it's the smaller 
borrowers, right? 

462
00:25:57,200 --> 00:26:00,000
If you're and this is, these 
numbers are actually pretty 

463
00:26:00,000 --> 00:26:03,600
mind-blowing. 
But if Google Google last year, 

464
00:26:03,600 --> 00:26:06,700
borrowed money, ten billion 
dollars at half a percent 

465
00:26:06,700 --> 00:26:07,900
interest rate per year. 
Ear. 

466
00:26:08,100 --> 00:26:11,200
So they issued a bond and sold 
it on the market at the same 

467
00:26:11,200 --> 00:26:17,400
time, small businesses were 
paying around 10 to 15% apy on 

468
00:26:17,400 --> 00:26:20,800
their sort of short-term loans. 
So that means that Google is 

469
00:26:20,800 --> 00:26:23,600
paying 30% blessed for their 
Capital, right? 

470
00:26:23,600 --> 00:26:26,200
And capital is like it's one of 
the most important ingredients 

471
00:26:26,200 --> 00:26:28,700
to building a business. 
So they have like a 30X 

472
00:26:28,700 --> 00:26:32,600
Advantage here at the same time.
If you look at default rates 

473
00:26:32,600 --> 00:26:35,000
smes in the u.s. 
Like they, there's like a 

474
00:26:35,008 --> 00:26:37,100
default rate of about 2% per 
year. 

475
00:26:37,400 --> 00:26:39,500
So if Look at that, you're like 
wondering, like why? 

476
00:26:39,500 --> 00:26:43,800
Why is an SME paying ten to 
fifteen percent when the risk of

477
00:26:43,800 --> 00:26:48,400
default across? 
The whole us is like 2% and 

478
00:26:48,400 --> 00:26:49,900
likewise Google paying so 
little. 

479
00:26:49,900 --> 00:26:51,900
And like, where's where's this? 
Fred going? 

480
00:26:52,400 --> 00:26:56,100
And so like this financial 
system that we live in today, 

481
00:26:56,100 --> 00:27:00,700
right, is really just geared 
towards making it very efficient

482
00:27:00,700 --> 00:27:06,800
for the largest players and is a
sort of put this in place. 

483
00:27:06,800 --> 00:27:09,400
Where, like, now Bang We're not 
really incentivized to try to 

484
00:27:09,400 --> 00:27:12,600
lower the cost of capital, make 
this system cheaper to use and 

485
00:27:12,600 --> 00:27:15,600
make it fair to use for others. 
And I think that's what, what 

486
00:27:15,600 --> 00:27:18,200
defy can do for a lot of our 
users. 

487
00:27:18,400 --> 00:27:23,000
And so who we we see, like, 
using centrifuge and, and it's 

488
00:27:23,000 --> 00:27:26,800
super exciting to see, is a lot 
of, like, what you call, what we

489
00:27:26,800 --> 00:27:29,900
call fintech startups. 
So companies that want to build 

490
00:27:29,900 --> 00:27:33,700
new lending products, and don't 
want to rely on these banks that

491
00:27:33,700 --> 00:27:37,300
screw them over on fees are not 
really interested in negotiating

492
00:27:37,300 --> 00:27:39,600
with them. 
So they're like themselves worth

493
00:27:39,600 --> 00:27:43,700
billions of dollars and they 
look to defy as a solution that 

494
00:27:43,700 --> 00:27:46,000
gives them more optionality. 
It gives them like different 

495
00:27:46,000 --> 00:27:51,000
sources of capital and it allows
them to sort of get rid of this 

496
00:27:51,000 --> 00:27:55,800
whole Legacy world. 
Yeah, I know if he knows how 

497
00:27:55,808 --> 00:27:59,400
great a great explanation and of
course, you mentioned, as a 

498
00:27:59,408 --> 00:28:05,000
comparison, your Google and at 
u.s., you know, SME that can 

499
00:28:05,000 --> 00:28:08,600
borrow ten to fifteen percent. 
But then I think in, you know, 

500
00:28:08,600 --> 00:28:11,100
in a lot of the world, it's way 
more. 

501
00:28:11,100 --> 00:28:14,700
Yeah, I did Flame or even even 
it's just not available, right? 

502
00:28:14,700 --> 00:28:17,100
Like, you just cannot get access
to credit. 

503
00:28:19,600 --> 00:28:22,700
Yeah, I think that's another 
large problem that we're trying 

504
00:28:22,700 --> 00:28:26,000
to Target is access to credit at
all. 

505
00:28:26,500 --> 00:28:31,800
And I don't think it's 
necessarily Bad Intentions by 

506
00:28:32,000 --> 00:28:37,500
the Global Financial system. 
And a lot of cases with banks. 

507
00:28:37,500 --> 00:28:40,600
It's more of an issue of whether
this would be profitable for 

508
00:28:40,600 --> 00:28:43,200
them or not. 
It's just so much leg work for 

509
00:28:43,200 --> 00:28:49,500
them to do the kyc. 
Terry do the analysis necessary 

510
00:28:49,500 --> 00:28:52,900
to give a loan to one of these 
smes, especially in different 

511
00:28:52,900 --> 00:28:56,900
areas of the world. 
And I think bringing that on 

512
00:28:56,900 --> 00:29:00,500
chain and bringing the level of 
transparency that we can with 

513
00:29:00,500 --> 00:29:03,200
web three changes. 
The game there. 

514
00:29:03,500 --> 00:29:06,600
It makes it a lot more, this 
information, a lot more 

515
00:29:06,600 --> 00:29:13,000
available that not only banks, 
but any investor could actually 

516
00:29:13,000 --> 00:29:17,000
start financing these different 
Assets in a way that just did. 

517
00:29:17,400 --> 00:29:21,900
And feasible before. 
Yeah, I mean before before 

518
00:29:21,900 --> 00:29:24,400
crypto. 
I one point worked for about 

519
00:29:24,400 --> 00:29:27,200
eight months for this 
Commodities Trading Company and 

520
00:29:27,200 --> 00:29:30,600
I think that that is sort of 
like it's remember remained very

521
00:29:30,600 --> 00:29:33,300
much as a use case. 
That seems like such a good fit.

522
00:29:33,500 --> 00:29:35,200
And I mean just there were 
several reasons for it. 

523
00:29:35,200 --> 00:29:38,200
You know, one was just the 
execution of this thing of like,

524
00:29:38,200 --> 00:29:41,700
you know, some company buys from
the other company and then, you 

525
00:29:41,700 --> 00:29:44,400
know, they would have some banks
that would go in between and you

526
00:29:44,400 --> 00:29:47,300
know, they use this archaic 
instrument letter of credit and 

527
00:29:47,500 --> 00:29:51,800
mail documents around and it was
it like Refik process, but the 

528
00:29:51,800 --> 00:29:56,100
other thing that stood out to me
is that this was a pretty big 

529
00:29:56,100 --> 00:29:59,100
company medium-sized to large 
companies. 

530
00:29:59,100 --> 00:30:01,700
So they might have had like, you
know, 500 million dollars worth 

531
00:30:01,700 --> 00:30:06,600
of like, you know, Goods 
shipping around and or like 

532
00:30:06,600 --> 00:30:09,100
invoices receivable for these 
Commodities. 

533
00:30:09,100 --> 00:30:12,400
They would be like selling 
across the world, but they could

534
00:30:12,400 --> 00:30:16,100
only go to like their bank and 
they could say, look I have this

535
00:30:16,100 --> 00:30:20,300
like huge pool of things and you
know, it's like Five hundred 

536
00:30:20,300 --> 00:30:22,900
million dollars worth of that. 
We will receive. 

537
00:30:22,900 --> 00:30:25,900
So can you give working? 
Can you like give some credit 

538
00:30:25,900 --> 00:30:27,900
facility? 
And then the bank would be like,

539
00:30:27,900 --> 00:30:29,600
okay. 
This is like 500 million Euros 

540
00:30:29,600 --> 00:30:32,400
so we can give you like, 300 
million or something like that. 

541
00:30:32,700 --> 00:30:35,500
But actually, it wasn't granular
at. 

542
00:30:35,500 --> 00:30:36,800
All. 
Right, you could only go to 

543
00:30:36,800 --> 00:30:40,500
their Bank to give like, you 
know, it kind of all of it and 

544
00:30:40,500 --> 00:30:44,500
you couldn't collateralize T 
individual receivable, right? 

545
00:30:44,500 --> 00:30:47,500
Because I think that was just 
impossible to do from a, from a 

546
00:30:47,500 --> 00:30:49,800
process perspective. 
And, you know, they wouldn't 

547
00:30:50,000 --> 00:30:53,400
Live long enough, but I think 
the idea when you can actually 

548
00:30:53,400 --> 00:30:57,000
turn each of them in, in doing 
it, in an individual asset, and 

549
00:30:57,000 --> 00:31:00,500
then allow anybody to go in and 
finances. 

550
00:31:00,500 --> 00:31:03,500
It's just like, it's extremely 
powerful. 

551
00:31:04,800 --> 00:31:08,600
Yeah, I mean this is where like 
I think when we talk about a 

552
00:31:08,608 --> 00:31:11,700
bank underwriting, the risk of 
like an individual asset like 

553
00:31:11,700 --> 00:31:15,100
that, like like if you don't 
fall into one of their like 

554
00:31:15,200 --> 00:31:18,900
hundred product lines, like 
you're you're an individual 

555
00:31:18,900 --> 00:31:22,300
wanting to buy a house and you 
getting a mortgage here, like 

556
00:31:22,300 --> 00:31:25,700
one of their large corporate 
clients and you have an existing

557
00:31:25,700 --> 00:31:28,200
relationship and they're just 
going to put you into this risk 

558
00:31:28,200 --> 00:31:30,700
bucket here, right? 
Like this is how I get bank will

559
00:31:30,700 --> 00:31:33,400
work. 
And so the same way like Google 

560
00:31:33,400 --> 00:31:37,000
can go and say we're Ten billion
dollars, secured Bond issuances 

561
00:31:37,300 --> 00:31:39,700
will get the money on the market
and people will be bidding for 

562
00:31:39,700 --> 00:31:41,800
it. 
But if I'm the, if I have this 

563
00:31:41,800 --> 00:31:46,000
like one invoice that is giving 
me even a hundred million 

564
00:31:46,000 --> 00:31:50,200
dollars in like money in the 
next couple of months, right? 

565
00:31:50,200 --> 00:31:52,700
And it's relatively small for 
the financial system that sort 

566
00:31:52,700 --> 00:31:56,800
of that we know of today, people
miss out or sort of our don't 

567
00:31:56,800 --> 00:31:58,700
fit into one of these buckets 
all the time. 

568
00:31:59,100 --> 00:32:03,100
And this system today is not 
really operating at that scale. 

569
00:32:03,100 --> 00:32:07,000
And I believe that defiance Sort
of getting sort of defining all 

570
00:32:07,000 --> 00:32:09,800
of this in code building the 
underwriter system, right? 

571
00:32:09,800 --> 00:32:12,900
We're like now, an underwriter 
can actually come and look at 

572
00:32:12,900 --> 00:32:15,300
your hundred million dollar 
invoices for that may be because

573
00:32:15,300 --> 00:32:18,500
they are very tech-savvy and 
they're very efficient. 

574
00:32:18,500 --> 00:32:21,700
They use data sources that may 
be banks will never use. 

575
00:32:21,700 --> 00:32:23,900
So they have this. 
They have the system in place 

576
00:32:23,900 --> 00:32:26,600
that they can be made more 
aggressive at underwriting 

577
00:32:26,600 --> 00:32:28,500
assets. 
That may be a banquet, never do,

578
00:32:28,800 --> 00:32:31,700
and this will then, open up give
these assets the quiddity, which

579
00:32:31,700 --> 00:32:35,000
they wouldn't have seen before 
and giving these The quiddity 

580
00:32:35,000 --> 00:32:37,400
means. 
Now, there are able to tap into 

581
00:32:37,400 --> 00:32:41,100
similar pools of liquidity with 
similar cost of capital that 

582
00:32:41,100 --> 00:32:44,100
like some of these very large 
businesses can tap into it 

583
00:32:44,100 --> 00:32:46,500
today. 
And that, that is then, what is 

584
00:32:46,500 --> 00:32:49,500
truly changing? 
The system we have today where 

585
00:32:49,500 --> 00:32:54,600
Google pays 50 basis points and 
and is SME pays ten, twenty 

586
00:32:54,600 --> 00:33:00,100
percent to like this difference,
being being much, much smaller. 

587
00:33:00,100 --> 00:33:04,000
And ideally really just the 
closer to the risk of default 

588
00:33:04,000 --> 00:33:06,300
right instead. 
Said of the paying for this rat 

589
00:33:06,300 --> 00:33:10,500
tail of processes, that your 
legacy financial institution has

590
00:33:12,600 --> 00:33:15,700
when you want to trade tokens on
ethereum, make sure to consider 

591
00:33:15,700 --> 00:33:18,000
para swap. 
Paris drop is a decentralized 

592
00:33:18,000 --> 00:33:21,600
exchange aggregator so that you 
can get the best price across 

593
00:33:21,600 --> 00:33:25,400
multiple ethereum dex's. 
And now, Paris, Rob has just 

594
00:33:25,400 --> 00:33:28,600
been integrated in Ledger life. 
This means you can swap tokens 

595
00:33:28,600 --> 00:33:31,400
using your Ledger directly from 
The Ledger Lite app. 

596
00:33:31,600 --> 00:33:34,500
No third parties involved. / 
swap is also. 

597
00:33:34,600 --> 00:33:38,400
Chain and available on polygon 
and finance, Mart chain, give 

598
00:33:38,400 --> 00:33:42,300
Paris Opera, try at Paris. 
Rob dot IO, / epicenter. 

599
00:33:42,700 --> 00:33:45,900
We'd like to thank Paris or up 
for their support of epicenter. 

600
00:33:47,500 --> 00:33:51,500
I think I somewhat understand 
the borrower segment now, so 

601
00:33:51,500 --> 00:33:53,100
let's talk about the lender 
segment. 

602
00:33:53,100 --> 00:33:56,700
So, who do you expect to lend to
these institutions? 

603
00:33:56,700 --> 00:33:59,400
I heard the word investor many 
times. 

604
00:33:59,400 --> 00:34:04,200
Now, even heard securitization 
is their regulatory barrier 

605
00:34:04,200 --> 00:34:05,800
here. 
Because it seems like this 

606
00:34:05,800 --> 00:34:12,600
should be caught under SEC dose.
Yeah, so these assets are 

607
00:34:12,600 --> 00:34:15,900
clearly Securities and we've 
always, we've always operated 

608
00:34:15,900 --> 00:34:18,900
under that assumption and made 
sure that sort of each pool is 

609
00:34:19,100 --> 00:34:21,400
issuing. 
A regulated security, is this 

610
00:34:21,400 --> 00:34:25,300
done with a legal framework that
we have that is based out of the

611
00:34:25,308 --> 00:34:29,800
u.s. 
So you go through kyc you go, 

612
00:34:29,900 --> 00:34:33,699
you sort of make sure that you 
followed your path anti-money 

613
00:34:33,699 --> 00:34:36,900
laundering laws. 
Then you can get approved a way 

614
00:34:36,900 --> 00:34:40,699
to invest in these pools and 
participate by supplying by to 

615
00:34:40,699 --> 00:34:42,500
the contract. 
But there is there's mandatory 

616
00:34:42,500 --> 00:34:48,600
kyc which is unfortunately 
unavoidable until we can start 

617
00:34:48,600 --> 00:34:53,199
lobbying the the the Global 
Financial system to maybe become

618
00:34:53,199 --> 00:34:56,199
a bit more sane about kyc laws. 
That's that's really out of our 

619
00:34:56,199 --> 00:34:57,800
control. 
Oh, yeah. 

620
00:34:57,800 --> 00:35:00,800
So so there is there's a bit of 
a barrier of Entry. 

621
00:35:01,000 --> 00:35:08,200
I think ultimately this is Not 
really making crypto making or 

622
00:35:08,200 --> 00:35:10,800
breaking for crypto. 
I fundamentally believe that. 

623
00:35:11,100 --> 00:35:14,100
I mean, if crypto really deal, 
if the only Advantage was that 

624
00:35:14,100 --> 00:35:17,400
you didn't have to do kyc that, 
I think it would be a very, very

625
00:35:17,400 --> 00:35:21,600
bad you sp for crypto because 
there's really so much other 

626
00:35:21,600 --> 00:35:24,500
cool stuff and so many other 
benefits that I think totally 

627
00:35:24,500 --> 00:35:26,300
make worth it right outside of 
that. 

628
00:35:26,300 --> 00:35:27,900
So, yeah, we have facing a 
camera. 

629
00:35:27,900 --> 00:35:30,100
See framework, you go through, 
go through that. 

630
00:35:30,200 --> 00:35:32,000
Once you pass it. 
Then you're really free to 

631
00:35:32,000 --> 00:35:34,400
operate in that as you wish to 
cancer. 

632
00:35:34,600 --> 00:35:37,800
Liquidity. 
You can remove liquidity and and

633
00:35:37,808 --> 00:35:40,100
then also sort of one thing we 
are doing. 

634
00:35:40,100 --> 00:35:43,400
And this is a bit where now it 
gets unfortunately, really 

635
00:35:43,400 --> 00:35:46,300
complicated. 
But of course they are goal. 

636
00:35:46,300 --> 00:35:50,700
Is that investors are not just 
individuals like you and me, but

637
00:35:50,800 --> 00:35:53,500
we also want to bring this at 
these assets to other D5 

638
00:35:53,500 --> 00:35:57,400
protocols because these other 
defense, Protocols are very much

639
00:35:57,400 --> 00:36:02,200
unknown to the law as of today. 
There's obviously there's a lot 

640
00:36:02,200 --> 00:36:06,200
of work that has to be done to 
make sure we find Find a legally

641
00:36:06,200 --> 00:36:10,600
compatible set up so far, we've 
done that with maker where we 

642
00:36:10,600 --> 00:36:13,000
actually are now on boarded. 
And in the coming weeks. 

643
00:36:13,000 --> 00:36:16,000
You should have four more going 
for more assets going live. 

644
00:36:16,000 --> 00:36:18,800
There. 
We are just announced. 

645
00:36:19,200 --> 00:36:22,400
So if to the or he's just 
published it obvi request for 

646
00:36:22,400 --> 00:36:25,200
comments in the Ava Community to
launch a money market. 

647
00:36:25,200 --> 00:36:30,100
Where investors can supply 
liquidity to real-world assets 

648
00:36:30,400 --> 00:36:32,500
and borrowers. 
So these different pools can 

649
00:36:32,500 --> 00:36:35,800
then borrow depending on where 
there's Instead of having to 

650
00:36:35,800 --> 00:36:39,300
pick whether you want to invest 
in real estate or invoices and 

651
00:36:39,300 --> 00:36:42,100
you need to manage the liquidity
in one pool and another like the

652
00:36:42,100 --> 00:36:45,300
oven Market will basically just 
give you will be by supplying. 

653
00:36:45,300 --> 00:36:47,800
The quiddity to that, you will 
give it to whoever has the 

654
00:36:47,808 --> 00:36:49,700
credit needs. 
Acquitted you right now instead 

655
00:36:49,700 --> 00:36:53,500
of this, the benefits of the the
out of money market concept. 

656
00:36:53,500 --> 00:36:56,500
Yes, you're right. 
So so those are the next steps 

657
00:36:56,500 --> 00:37:01,300
and server sort of on this 
mission of like making working 

658
00:37:01,300 --> 00:37:04,200
out these compatible legal 
Frameworks like make working 

659
00:37:04,200 --> 00:37:06,800
out. 
A technology to go and sort of 

660
00:37:06,800 --> 00:37:09,300
extend D5 with these real-world 
assets. 

661
00:37:10,200 --> 00:37:13,300
Can you explain a little bit of 
like how does this work under 

662
00:37:13,300 --> 00:37:15,900
the hood? 
Like, what are the processes 

663
00:37:15,900 --> 00:37:19,200
that nasty goes through in the 
steps that somebody has to take 

664
00:37:19,200 --> 00:37:23,800
to issue and borrow against such
an asset using centrifuge. 

665
00:37:25,000 --> 00:37:27,500
The simplest description of 
what? 

666
00:37:27,500 --> 00:37:29,900
What each pool is. 
It's like a non chain credit 

667
00:37:29,900 --> 00:37:32,600
fund, right? 
So, you have assets on one side,

668
00:37:32,600 --> 00:37:34,000
you have investors in another 
side. 

669
00:37:34,000 --> 00:37:36,800
And what we do is we actually 
taught we couple a legal 

670
00:37:36,800 --> 00:37:42,100
structure to the smart contract.
So we deploy the you deploy pool

671
00:37:42,900 --> 00:37:46,200
along that you actually create a
legal, SPV special purpose 

672
00:37:46,200 --> 00:37:48,800
vehicle. 
That's a company a Delaware 

673
00:37:48,800 --> 00:37:53,100
company that then effectively 
signs the paperwork with all 

674
00:37:53,100 --> 00:37:55,700
these different borrow. 
Hours and gets the legal 

675
00:37:55,700 --> 00:37:57,400
recourse against these different
assets. 

676
00:37:57,400 --> 00:38:00,400
And investors that invest in 
this pool is a sign. 

677
00:38:00,400 --> 00:38:03,400
Some general terms for 
subscription document. 

678
00:38:03,600 --> 00:38:07,700
That means that when they Supply
and die to that pool, they get 

679
00:38:07,700 --> 00:38:10,800
certain rights, right? 
The rights to receive the 

680
00:38:10,800 --> 00:38:13,600
payments from from those 
real-world assets. 

681
00:38:14,300 --> 00:38:18,900
And so, that's the basic legal 
setup that has to happen both 

682
00:38:18,900 --> 00:38:22,300
Technical and legal setup and 
then sort of based on that. 

683
00:38:22,300 --> 00:38:23,900
The acid originator does a lot 
of work. 

684
00:38:24,200 --> 00:38:27,200
Of explaining the kind of 
assets, they want originated and

685
00:38:27,200 --> 00:38:28,700
how they want to structure the 
pool. 

686
00:38:29,200 --> 00:38:33,300
So in case of new silver, new 
silver talks about how they make

687
00:38:33,300 --> 00:38:35,600
sure that all the borrower's 
that they want to work with 

688
00:38:35,600 --> 00:38:36,700
that. 
They are actually going to 

689
00:38:36,700 --> 00:38:38,400
repay. 
What the credit risk is that 

690
00:38:38,400 --> 00:38:40,900
they're going to take on what 
the interest rate is. 

691
00:38:40,900 --> 00:38:43,400
How much the junior token 
holders. 

692
00:38:43,600 --> 00:38:48,300
So what this incident this 
buffer is a 10% is a 20% and 

693
00:38:48,300 --> 00:38:50,700
then sort of once that step is 
done. 

694
00:38:50,700 --> 00:38:53,900
Then investors can come in and 
starts. 

695
00:38:54,000 --> 00:38:57,600
Applying liquidity to the pool. 
And so, as the liquidity basic 

696
00:38:57,600 --> 00:38:59,700
Isis goes into the reserve and 
the pool. 

697
00:38:59,700 --> 00:39:02,400
That money is then made 
available for gas originator to 

698
00:39:02,400 --> 00:39:04,200
borrow. 
And to, then they can start 

699
00:39:04,200 --> 00:39:08,400
issuing loans, to different 
people that have that, that want

700
00:39:08,400 --> 00:39:12,300
to borrow in new Silver's case 
to buy to buy a house renovated 

701
00:39:12,300 --> 00:39:15,900
house. 
And so then what the asteroid 

702
00:39:15,900 --> 00:39:19,300
inator does is they take this, 
they take the die that they can 

703
00:39:19,300 --> 00:39:23,000
borrow from that pool, turn it 
into dollars and wire. 

704
00:39:23,000 --> 00:39:26,700
That's to the And that in many 
cases actually they don't even 

705
00:39:26,800 --> 00:39:30,700
know about the fact that their 
that their loan is findings by 

706
00:39:30,700 --> 00:39:33,000
crypto or that. 
There's like some maker Vault 

707
00:39:33,500 --> 00:39:37,000
minting die to actually generate
the money that is used to pay 

708
00:39:37,000 --> 00:39:39,200
for that loan. 
But so they're sort of 

709
00:39:39,200 --> 00:39:42,200
completely abstract that they're
like the very sophisticated 

710
00:39:42,200 --> 00:39:44,700
wallet or like a non Fiat on 
off-ramp. 

711
00:39:44,700 --> 00:39:48,000
Right for these borrowers on the
other side investors. 

712
00:39:48,200 --> 00:39:51,700
They they can then just as they 
like either like supplier 

713
00:39:51,700 --> 00:39:54,200
redeem. 
So put more money into the Or 

714
00:39:54,200 --> 00:39:57,200
take money out and sort of the 
smart contracts and manage. 

715
00:39:57,200 --> 00:39:59,600
All these payments from 
borrowers to investors. 

716
00:39:59,700 --> 00:40:03,100
Both interests and principles 
are making sure that that 

717
00:40:03,200 --> 00:40:09,100
everyone gets the share of the 
the interest return and so on. 

718
00:40:10,800 --> 00:40:14,300
Well, let's talk a little bit 
about, so centrifuge has also a 

719
00:40:14,308 --> 00:40:15,200
token. 
Right? 

720
00:40:15,200 --> 00:40:18,900
A CFG token towards the function
of the, I mean, you know, 

721
00:40:18,900 --> 00:40:21,600
besides we talked about dropping
10 tokens, which is different 

722
00:40:21,600 --> 00:40:25,100
tranches, but then there's also 
a centrifuge another token 

723
00:40:25,100 --> 00:40:27,700
called CFT. 
Can you explain like, how does 

724
00:40:27,700 --> 00:40:31,500
this whole thing work? 
And how does it relate to, you 

725
00:40:31,500 --> 00:40:36,500
know, this process? 
Yeah, so we have centrifuge 

726
00:40:36,500 --> 00:40:40,100
token CFG. 
That is the token that power 

727
00:40:40,100 --> 00:40:43,200
center views chain. 
So, centrifuge chain is the 

728
00:40:43,600 --> 00:40:48,200
special purpose chain that we 
built using substrate and that's

729
00:40:48,200 --> 00:40:52,100
really specialized to this 
centrifuge specific use case. 

730
00:40:52,500 --> 00:40:56,300
So, the centrifuge token is used
there for paying for transaction

731
00:40:56,300 --> 00:40:58,800
fees. 
So, sort of, like, guess on the 

732
00:40:58,800 --> 00:41:01,900
theorem is also used for the 
chain security. 

733
00:41:02,000 --> 00:41:06,700
So right now that's Staking by 
validators and dominators as 

734
00:41:06,700 --> 00:41:12,900
well as as a governance token. 
So see if G is used to Photon 

735
00:41:12,900 --> 00:41:17,100
things from runtime. 
Upgrades to probably eventually 

736
00:41:17,100 --> 00:41:19,800
a lot more features up coming in
the future. 

737
00:41:21,100 --> 00:41:27,000
Well, I guess you just mentioned
also the polka dotted Arrow, the

738
00:41:27,000 --> 00:41:29,400
substrate chain. 
Actually, I should also mention.

739
00:41:29,400 --> 00:41:32,800
I forgot to mention this in the 
beginning but that like, you 

740
00:41:32,800 --> 00:41:35,700
know, of course, one company. 
I co-founded to be false, been 

741
00:41:35,700 --> 00:41:39,000
running, validator on that chain
and supposed to sort of 

742
00:41:39,000 --> 00:41:42,000
participate in some of these 
Arabic 10, like fools and like 

743
00:41:42,000 --> 00:41:45,900
invested in the project as well.
So mention that. 

744
00:41:46,100 --> 00:41:49,000
But so, can you talk about this 
right now? 

745
00:41:49,000 --> 00:41:52,500
I'd be talking about maker. 
And you know, there's things 

746
00:41:52,500 --> 00:41:54,900
that are happening on aetherium 
where you can take some of those

747
00:41:54,900 --> 00:41:59,200
assets, but then there's also 
this independent at the moment, 

748
00:41:59,200 --> 00:42:02,800
Sovereign substrate chain. 
So like, you know, how do those 

749
00:42:02,800 --> 00:42:06,800
interact and how is that going 
to change in the future? 

750
00:42:08,600 --> 00:42:12,200
So right now, this tin leg tap 
that we've been talking about is

751
00:42:12,200 --> 00:42:16,400
live on aetherium that's been 
great and also given us access 

752
00:42:16,400 --> 00:42:21,000
to the defy ecosystem, that's 
grown there, but gas fees are 

753
00:42:21,000 --> 00:42:24,900
quite prohibitive. 
And so the plan with centrifuge 

754
00:42:24,900 --> 00:42:28,400
chain is to be able to move 10 
leg onto synergies chain from 

755
00:42:28,400 --> 00:42:33,400
aetherium, to make it a lot 
faster cheaper and just 

756
00:42:33,400 --> 00:42:37,500
generally make the DAP more 
accessible for even now 

757
00:42:37,500 --> 00:42:40,800
potentially. 
The lower values of loans as we 

758
00:42:40,800 --> 00:42:45,000
talked about earlier. 
So the first major use case 

759
00:42:45,000 --> 00:42:48,700
there is really powering the tin
linked up for centrifuge chain 

760
00:42:48,700 --> 00:42:52,400
going forward, adding. 
This functionality will also be 

761
00:42:52,400 --> 00:42:54,800
easier. 
Now that we have this chain that

762
00:42:54,808 --> 00:42:58,000
we can really specifically cater
to this use case. 

763
00:42:58,000 --> 00:43:03,800
So we don't have to wait for E 
2.0 which we're still excited 

764
00:43:03,800 --> 00:43:07,100
about. 
But it makes it us a lot more 

765
00:43:07,100 --> 00:43:10,000
Nimble in terms. 
As of dealing with the different

766
00:43:11,100 --> 00:43:14,500
use cases that come up for us, 
that might not matter as much to

767
00:43:14,500 --> 00:43:18,300
the etherium community, for 
example, and so, as, as you 

768
00:43:18,300 --> 00:43:21,400
mentioned, you know, were built 
on substrate and that connects 

769
00:43:21,400 --> 00:43:25,500
us to the polkadot ecosystem. 
And so we'll be launching 

770
00:43:25,500 --> 00:43:29,100
centrifuge chain as a pair of 
chain on polkadot. 

771
00:43:29,500 --> 00:43:35,000
And as sort of a precursor to 
that, basically a live test 

772
00:43:35,400 --> 00:43:38,200
ahead of launching centrifuge 
chain as a pair of chain. 

773
00:43:39,000 --> 00:43:42,400
We'll be launching a different 
network, a different chain 

774
00:43:42,400 --> 00:43:47,100
called Altair on kusama. 
And that's really for us. 

775
00:43:47,100 --> 00:43:50,300
The most important thing there 
is, is having this sort of test 

776
00:43:50,300 --> 00:43:53,500
bed with live value. 
Sober. 

777
00:43:53,500 --> 00:43:57,300
Launching Altair is a pair of 
chain first, which since then Fu

778
00:43:57,300 --> 00:44:01,600
Shan has been live for one year.
It's a we see it as pretty 

779
00:44:01,600 --> 00:44:05,300
important to test that and make 
sure that everything goes well 

780
00:44:05,300 --> 00:44:09,600
with Altair first before we do. 
Do this lunch for centrifuge 

781
00:44:09,600 --> 00:44:12,700
chain? 
And then with that next step of 

782
00:44:12,700 --> 00:44:15,800
moving tin Les contes interviews
chain, that would go on to 

783
00:44:15,800 --> 00:44:20,400
Altair first and if any kinks or
to come up, I am those out on 

784
00:44:20,400 --> 00:44:23,200
Altair before we move that over 
to send a few shame. 

785
00:44:24,100 --> 00:44:26,700
So I think it's going to become 
a really important part of this 

786
00:44:26,700 --> 00:44:31,900
sort of testing process for us. 
I assume you've also looked at 

787
00:44:31,900 --> 00:44:36,200
if your room layer truth and in 
the end then opted for a polka 

788
00:44:36,200 --> 00:44:37,600
dot stashed. 
Substrate. 

789
00:44:37,900 --> 00:44:40,400
What was this decision process 
behind that? 

790
00:44:42,200 --> 00:44:46,100
So, actually, when we started a 
centrifuge chain, there were no 

791
00:44:46,100 --> 00:44:48,000
layered twos that were 
accessible. 

792
00:44:48,900 --> 00:44:52,900
So we were already starting to 
build Center for use chain at 

793
00:44:52,900 --> 00:44:57,700
the end of 2019. 
And so at that time, really, the

794
00:44:57,700 --> 00:45:02,300
only viable alternative was to 
build either using substrate and

795
00:45:02,300 --> 00:45:05,500
the cosmos SDK was something 
that was available but not quite

796
00:45:05,500 --> 00:45:09,200
as accessible for us to really 
start moving forward on at the 

797
00:45:09,200 --> 00:45:11,900
time. 
So, it was actually really. 

798
00:45:12,000 --> 00:45:15,100
That we needed to move ahead. 
We didn't want to wait for 

799
00:45:15,100 --> 00:45:16,600
anything else to become 
available. 

800
00:45:16,700 --> 00:45:19,200
And so, we went ahead and built 
centrifuge chain. 

801
00:45:19,500 --> 00:45:21,600
Now that layer twos are 
accessible on aetherium. 

802
00:45:21,600 --> 00:45:26,100
I mean, that's that's great for 
other defy projects, and excited

803
00:45:26,100 --> 00:45:29,800
to see how those develop. 
But I think at the moment, this 

804
00:45:29,800 --> 00:45:34,900
is going to be a really great 
way for us to scale faster. 

805
00:45:36,300 --> 00:45:39,800
Are there problems with being on
another blockchain entirety? 

806
00:45:39,800 --> 00:45:44,100
So basically you've got, you 
know, Integrations to make and 

807
00:45:44,100 --> 00:45:46,500
most of the defy ecosystem is 
only Theory. 

808
00:45:46,500 --> 00:45:48,500
Mm. 
It does it pose problems for 

809
00:45:48,500 --> 00:45:51,600
you. 
One of the things that we've had

810
00:45:51,600 --> 00:45:55,400
to think about that, I would say
was a complexity maybe not 

811
00:45:55,400 --> 00:45:57,300
necessarily a problem is 
building this bridge. 

812
00:45:57,300 --> 00:46:01,900
So right now we do have part of 
the tin linked up that lives on 

813
00:46:01,900 --> 00:46:04,200
centrifuge chain. 
So those are the anchors for 

814
00:46:04,200 --> 00:46:08,600
these assets and then that is 
using our Chain Bridge, 

815
00:46:08,600 --> 00:46:12,200
centrifuge chain to Theory and 
Bridge to Mint and of t's on 

816
00:46:12,200 --> 00:46:15,300
aetherium and then Finance. 
Those with the tin linked up. 

817
00:46:15,300 --> 00:46:19,000
So that bridge was definitely a 
complexity that we've had to 

818
00:46:19,000 --> 00:46:22,500
worry about. 
About and part of launching 

819
00:46:22,500 --> 00:46:25,900
centerpiece chain, as a pair of 
chain on polka, dot will be to 

820
00:46:25,900 --> 00:46:29,300
access the bridge that other 
teams are working on there and 

821
00:46:29,300 --> 00:46:33,300
sort of Outsource that work, so 
that our team doesn't have to 

822
00:46:33,308 --> 00:46:35,800
worry about those specific 
functionalities. 

823
00:46:35,800 --> 00:46:38,900
And instead, we can focus on our
specific use case. 

824
00:46:40,400 --> 00:46:42,400
Taking a bit of the like longer 
view. 

825
00:46:42,400 --> 00:46:47,300
I believe like defy definitely 
started any Theory. 

826
00:46:47,300 --> 00:46:51,100
Mm. 
I think at this point I would 

827
00:46:51,100 --> 00:46:55,800
say we're not going to the world
is not going to be exclusively 

828
00:46:55,800 --> 00:47:00,400
on his here and many more. 
And so sort of for us as I need 

829
00:47:00,400 --> 00:47:02,800
defy project. 
I think it would be a not in 

830
00:47:02,800 --> 00:47:06,500
your interest to sort of focus 
on one ecosystem and you already

831
00:47:06,500 --> 00:47:09,200
see like so many purchase coming
up between different. 

832
00:47:09,300 --> 00:47:13,200
Systems where you ultimately 
just want to make sure that you 

833
00:47:13,200 --> 00:47:15,100
go where the liquidity is, 
right? 

834
00:47:15,200 --> 00:47:19,300
And unfortunately, like violence
was seeing a lot intention. 

835
00:47:19,300 --> 00:47:23,900
I don't think that's going to 
sustain, but but I think other 

836
00:47:24,000 --> 00:47:26,500
protocols. 
Other layer ones will build will

837
00:47:26,500 --> 00:47:31,400
bring interesting Concepts and 
ideas that I think sort of 

838
00:47:31,400 --> 00:47:35,400
similarly, to how Bonnie 
theorem, there was just insane 

839
00:47:35,700 --> 00:47:38,500
when defy became really what it 
was before through the 

840
00:47:38,500 --> 00:47:41,100
interoperability. 
Right, like nerc 20 token work 

841
00:47:41,100 --> 00:47:45,200
with any other and that meant 
you could use lava lava deposits

842
00:47:45,200 --> 00:47:47,900
as collateral in another Landing
protocol. 

843
00:47:47,900 --> 00:47:51,000
And you could vice versa. 
I mean everything work together 

844
00:47:51,000 --> 00:47:52,100
extremely. 
Well, right? 

845
00:47:52,300 --> 00:47:55,400
And I think in the same way like
crypto and blockchains are going

846
00:47:55,400 --> 00:47:58,800
to succeed by focusing on 
exactly that, making sure the 

847
00:47:58,800 --> 00:48:00,600
quiddity moves where it needs to
end. 

848
00:48:00,600 --> 00:48:03,100
It is available wherever 
necessary. 

849
00:48:03,100 --> 00:48:07,300
And for centrifuge, that means 
acid, Originators and 

850
00:48:07,300 --> 00:48:10,400
Underwriters sort of create 
these Spools on sending food 

851
00:48:10,400 --> 00:48:15,600
chain, but then the investors 
right the investors they are 

852
00:48:15,800 --> 00:48:19,600
really just wherever they want 
to be and if that's and if 

853
00:48:19,600 --> 00:48:22,200
there's a need for collateral 
and Maker only theorem, then it 

854
00:48:22,200 --> 00:48:26,300
can be bridged to a theorem. 
If it's if it's a money market 

855
00:48:26,300 --> 00:48:29,700
on Solana, it can be on Solano 
or it can move to another power,

856
00:48:29,700 --> 00:48:33,500
train and polka dot. 
And so sort of from, from that, 

857
00:48:33,700 --> 00:48:38,800
from that view, for us. 
I believe polkadot or substrate 

858
00:48:38,800 --> 00:48:42,500
was like, Very good technical 
solution at the time we started.

859
00:48:42,500 --> 00:48:46,300
And I still see, I still believe
and I mean, extremely exciting. 

860
00:48:46,300 --> 00:48:51,000
Now, sort of the point ecosystem
is that we're just about to find

861
00:48:51,000 --> 00:48:55,100
out like what what the parent 
chains are going to look like in

862
00:48:55,100 --> 00:48:59,800
production in the coming weeks. 
One of the interesting thing is 

863
00:49:00,100 --> 00:49:03,100
has been to see in the polkadot 
ecosystem. 

864
00:49:03,100 --> 00:49:07,400
Is that kusama seems to have 
taken on like a much more 

865
00:49:07,400 --> 00:49:10,300
significant role over time. 
Then maybe initially was 

866
00:49:10,600 --> 00:49:15,100
envisioned and now you also 
starting this Altair. 

867
00:49:15,100 --> 00:49:19,700
So this other kind of centrifuge
like chain on pajama, some 

868
00:49:19,700 --> 00:49:22,100
Curious like how is that going 
to work? 

869
00:49:22,100 --> 00:49:25,700
And how do you think the the 
centrifuge pair of chain and 

870
00:49:25,700 --> 00:49:29,400
touka-sama para llenar going to 
Play together. 

871
00:49:31,300 --> 00:49:34,500
It's been super interesting to 
see how much excitement has 

872
00:49:34,500 --> 00:49:37,000
built around kusama as a 
project. 

873
00:49:37,100 --> 00:49:42,500
And like you said, I don't think
the polkadot team necessarily 

874
00:49:42,500 --> 00:49:46,300
for saw that coming, but it's 
supposed to really great 

875
00:49:46,300 --> 00:49:49,600
opportunity for a lot of 
projects to get excitement 

876
00:49:49,600 --> 00:49:54,500
around their precursors to what 
they would launch on polka dot. 

877
00:49:54,600 --> 00:49:58,700
So I do think at least most of 
the projects that I've spoken 

878
00:49:58,700 --> 00:49:59,600
to. 
Do. 

879
00:49:59,600 --> 00:50:02,500
You see kusama as More 
experimental. 

880
00:50:02,600 --> 00:50:05,900
Sort of test, bed, where things 
can go wrong. 

881
00:50:06,000 --> 00:50:10,300
They can push the limits really 
of what's possible before it 

882
00:50:10,300 --> 00:50:13,100
goes live on their polkadot pair
chains. 

883
00:50:13,400 --> 00:50:15,000
And so, that's exactly what we 
see. 

884
00:50:15,000 --> 00:50:20,000
All Tara's is really a place for
experimentation pushing the 

885
00:50:20,000 --> 00:50:22,700
boundaries of what sort of 
things are possible. 

886
00:50:22,900 --> 00:50:26,800
So draw back to something that 
that we talked about earlier 

887
00:50:26,800 --> 00:50:30,500
today, financing, for example, 
your reputation. 

888
00:50:31,000 --> 00:50:34,100
That's something that's maybe 
pushing the limit a little bit 

889
00:50:34,100 --> 00:50:37,400
of what's possible today and 
asset financing. 

890
00:50:37,600 --> 00:50:40,300
And so that's something that I 
would see as a use case that 

891
00:50:40,300 --> 00:50:43,300
would go live on Altair first 
and really test it out. 

892
00:50:43,300 --> 00:50:46,800
See what happens before it moves
over to send refuse chain. 

893
00:50:47,700 --> 00:50:51,100
So I think for me, it's really 
exciting to use Altair as that 

894
00:50:51,100 --> 00:50:54,700
sort of test bed and try things 
out that maybe we wouldn't 

895
00:50:54,700 --> 00:50:57,000
otherwise be able to on 
centrifuge chain. 

896
00:50:58,500 --> 00:51:01,000
Super interesting. 
I have a question around the 

897
00:51:01,000 --> 00:51:05,800
economic guarantees of having a 
governance token and basically, 

898
00:51:05,800 --> 00:51:08,900
the market cap of that 
governance token and the values 

899
00:51:09,100 --> 00:51:12,500
that It ultimately controls. 
What are your thoughts as to 

900
00:51:12,500 --> 00:51:16,900
this? 
I mean, I think it's super super

901
00:51:16,900 --> 00:51:20,600
difficult to estimate any sort 
of market, cap for governance 

902
00:51:20,600 --> 00:51:25,400
only token and I've seen a lot 
of feces and projects out there,

903
00:51:25,400 --> 00:51:28,700
trying to do this. 
Usually they try to back into 

904
00:51:28,700 --> 00:51:31,600
it, based on some other sort of 
understanding of the token. 

905
00:51:31,600 --> 00:51:35,500
Like another use case that it 
has or how this has worked for 

906
00:51:35,500 --> 00:51:37,400
other projects. 
And then just using that, as a 

907
00:51:37,408 --> 00:51:39,800
comparison, which is really an 
accurate. 

908
00:51:40,600 --> 00:51:43,900
So I think it does add value. 
That's for sure. 

909
00:51:44,700 --> 00:51:48,700
What sort of value dad's I think
is heavily dependent on how it's

910
00:51:48,700 --> 00:51:50,600
used for the project 
specifically. 

911
00:51:50,900 --> 00:51:55,700
So if that governs token is 
instrumental to upgrades for 

912
00:51:55,800 --> 00:51:58,100
that product. 
It's going to be a lot more 

913
00:51:58,100 --> 00:52:00,600
valuable of a governance token. 
That something that's really 

914
00:52:00,600 --> 00:52:05,200
just voting on minor. 
Things like members of the 

915
00:52:05,207 --> 00:52:11,500
council or transaction fees that
of a product that barely gets 

916
00:52:11,500 --> 00:52:14,600
any use at all. 
So, I think There are a lot of 

917
00:52:14,600 --> 00:52:18,500
differences there that can be 
looked at and compared, but in 

918
00:52:18,500 --> 00:52:22,200
terms of a quantitative 
assessment, I think that's still

919
00:52:22,200 --> 00:52:26,200
super difficult to determine 
right now, but that said, I 

920
00:52:26,200 --> 00:52:30,400
would say we've definitely 
looked at valuation models for 

921
00:52:30,400 --> 00:52:33,400
the centrifuge token. 
Not looking at the governance 

922
00:52:33,400 --> 00:52:35,700
aspect of it. 
So really just looking at the 

923
00:52:35,700 --> 00:52:39,300
transaction fees on centrifuge 
chain and modeling. 

924
00:52:39,300 --> 00:52:42,600
What those could look like over 
time and really giving this 

925
00:52:42,600 --> 00:52:45,100
token a use case. 
In addition to that. 

926
00:52:45,100 --> 00:52:50,100
So adding future functionality, 
but I won't mention today just 

927
00:52:50,100 --> 00:52:53,600
so that we don't get ourselves 
in a hot place but it's 

928
00:52:53,600 --> 00:52:55,500
definitely something that we're 
thinking about that. 

929
00:52:55,500 --> 00:52:59,400
This token needs to have future 
use cases, future utilities. 

930
00:52:59,500 --> 00:53:02,900
And certainly not just 
governance. 

931
00:53:02,900 --> 00:53:08,700
I would think The most common 
way that governance tokens on 

932
00:53:08,700 --> 00:53:13,500
ethereum in defy seem to have 
kind of gone towards having 

933
00:53:13,500 --> 00:53:15,600
value, right? 
Would be that there's some sort 

934
00:53:15,600 --> 00:53:19,700
of I guess in this case right 
there could be like some kind of

935
00:53:19,700 --> 00:53:23,400
small percentage of the interest
going not to the investors but 

936
00:53:23,400 --> 00:53:27,600
to some sort of like, you know, 
CFC holders in the, you know, I 

937
00:53:27,607 --> 00:53:31,100
think we see that with something
like your own Finance or like. 

938
00:53:31,200 --> 00:53:34,500
So, is that something that's 
also like possible? 

939
00:53:34,700 --> 00:53:39,800
You think that Desirable at all.
I don't think it makes sense to 

940
00:53:39,800 --> 00:53:43,800
have something akin to what I 
would call a dividend for stocks

941
00:53:44,600 --> 00:53:48,100
for token holders. 
So for example, having a 

942
00:53:48,100 --> 00:53:51,800
percentage of the token Supply, 
go to token holders just for the

943
00:53:51,800 --> 00:53:55,500
fact that they hold the token to
me, doesn't make sense because 

944
00:53:55,500 --> 00:53:58,600
this really should be an 
incentive for providing value. 

945
00:53:58,800 --> 00:54:01,200
And it just holding the token is
providing value. 

946
00:54:01,600 --> 00:54:04,800
Well, I think, I mean, I don't 
think that actually makes sense.

947
00:54:04,900 --> 00:54:08,500
Maybe someone disagrees, but I 
really think that Scent of 

948
00:54:08,500 --> 00:54:13,300
should be built in that are 
rewarding actual active 

949
00:54:13,300 --> 00:54:17,300
participation in the protocol. 
So whether that is being a 

950
00:54:17,300 --> 00:54:20,500
council member and participating
in governance in a very active 

951
00:54:20,500 --> 00:54:25,200
way, or running a validator 
node, or providing underwriter 

952
00:54:25,200 --> 00:54:28,200
services for art in, like, pool 
as an example. 

953
00:54:28,200 --> 00:54:31,400
These are things that are active
participation in the protocol 

954
00:54:31,400 --> 00:54:35,200
that I think should be 
incentivized for the health of 

955
00:54:35,200 --> 00:54:39,000
the entire system, but just 
holding The token in and of 

956
00:54:39,000 --> 00:54:41,600
itself. 
I don't think that deserves any 

957
00:54:41,600 --> 00:54:45,100
sort of incentivization. 
That said, one thing that a lot 

958
00:54:45,100 --> 00:54:49,400
of projects are doing that sort 
of mimics this, but in a 

959
00:54:49,400 --> 00:54:52,300
different way, is a burn rate 
for the token. 

960
00:54:52,700 --> 00:54:56,500
So transaction fees that are 
collected on chain certain 

961
00:54:56,500 --> 00:54:58,300
percentage of those being 
burned. 

962
00:54:58,500 --> 00:55:01,400
That is an effect on the 
opposite side of it, sort of 

963
00:55:01,400 --> 00:55:04,800
like giving out tokens to every 
single token holder because the 

964
00:55:04,808 --> 00:55:07,600
value of their tokens is going 
up effectively. 

965
00:55:08,100 --> 00:55:11,100
You're burning a percentage of 
the token Supply every year. 

966
00:55:11,400 --> 00:55:15,500
So I think for me that's a much 
better way of sort of addressing

967
00:55:15,800 --> 00:55:19,000
not just the token holders and 
their individual value. 

968
00:55:19,000 --> 00:55:23,100
But the value of the entire 
system and I think to me that's 

969
00:55:23,100 --> 00:55:26,400
more fair than just giving out a
sort of blanket dividend to 

970
00:55:26,400 --> 00:55:30,200
every single holder. 
For this is this is the we're 

971
00:55:30,200 --> 00:55:32,000
getting into rent-seeking, 
right? 

972
00:55:32,000 --> 00:55:35,600
I mean, there's maybe some of it
is Justified to like, basically 

973
00:55:35,600 --> 00:55:39,400
payoff reward early backers, and
That's I mean that's the idea of

974
00:55:39,400 --> 00:55:43,600
like like how investors by 
tokens and then you want some 

975
00:55:43,600 --> 00:55:45,600
value cruel in it. 
But yeah, generally I would I 

976
00:55:45,600 --> 00:55:47,900
would agree with what you what 
you said Cassidy. 

977
00:55:49,200 --> 00:55:54,400
I think when, when looking at a 
value of a specific token and 

978
00:55:54,400 --> 00:55:57,400
how that's going to change over 
time, one should really be 

979
00:55:57,400 --> 00:56:00,100
looking at the value that the 
protocol is providing. 

980
00:56:00,400 --> 00:56:04,400
And if that token has real 
utility that, it's being used 

981
00:56:04,400 --> 00:56:07,500
for in that protocol. 
Then it will take on the value 

982
00:56:07,500 --> 00:56:11,300
that the protocol is providing. 
So I think it's really about the

983
00:56:11,300 --> 00:56:15,100
use case of the token and how 
much it's really being utilized 

984
00:56:15,100 --> 00:56:19,000
to perform the functionality 
that is of value to the Users, 

985
00:56:19,500 --> 00:56:22,600
so if it's really capturing 
that, then it will capture the 

986
00:56:22,600 --> 00:56:26,700
value of that utility. 
And so that should really be 

987
00:56:26,700 --> 00:56:29,500
what investors look at when 
they're looking at holding a 

988
00:56:29,500 --> 00:56:33,000
token, is what is the growth of 
this protocol going to be? 

989
00:56:33,000 --> 00:56:34,600
Is it going to provide real 
value? 

990
00:56:34,900 --> 00:56:38,200
And as the token going to 
capture that value rather than 

991
00:56:38,200 --> 00:56:42,300
looking to some sort of blanket 
dividend just for holding the 

992
00:56:42,300 --> 00:56:45,600
token. 
Yeah, I see that. 

993
00:56:45,600 --> 00:56:48,700
That makes a lot of sense. 
Unfortunately, we have were bit 

994
00:56:48,700 --> 00:56:53,100
strapped for time, but I would 
like to zoom out again a little 

995
00:56:53,100 --> 00:56:56,900
bit. 
So if you look at centrifuge as 

996
00:56:56,900 --> 00:57:01,500
a whole, what it allows you to 
do is it allows you to sell debt

997
00:57:01,500 --> 00:57:04,900
or package and sell it at. 
And basically if you frame it 

998
00:57:04,900 --> 00:57:09,200
like that, it sounds a lot. 
Like one of, you know, what, one

999
00:57:09,200 --> 00:57:13,500
of the contributors to the 2008 
financial crisis was namely that

1000
00:57:13,600 --> 00:57:16,600
debt is being paid. 
Packaged in less than 

1001
00:57:16,600 --> 00:57:21,600
transparent ways and people buy 
it without necessarily doing the

1002
00:57:21,600 --> 00:57:23,700
due diligence. 
They should have. 

1003
00:57:23,900 --> 00:57:29,000
So how do we avoid replicating, 
you know crisis. 

1004
00:57:29,000 --> 00:57:34,600
We've gone through on defy. 
And where do you see centrifuge 

1005
00:57:34,600 --> 00:57:38,300
in the very long term? 
So like, say, in 10 years? 

1006
00:57:40,000 --> 00:57:44,100
I think one of the one of the 
goals with giving Underwriters 

1007
00:57:44,100 --> 00:57:47,300
and economic incentive, right? 
Is exactly addressing that 

1008
00:57:47,400 --> 00:57:54,500
standard and poor and Moody's. 
They majorly screwed up in in, 

1009
00:57:54,500 --> 00:58:00,700
in the 2008, prices and walked 
away, not unscathed, but they're

1010
00:58:00,700 --> 00:58:04,500
still around, right? 
And they didn't have really did 

1011
00:58:04,500 --> 00:58:05,900
it. 
They had the reputation a bit at

1012
00:58:05,900 --> 00:58:09,200
stake, but they had nothing 
really monetarily at stake. 

1013
00:58:09,700 --> 00:58:13,500
And everyone and this whole like
Financial system open in like 

1014
00:58:13,700 --> 00:58:17,500
rating agencies could pay to 
give ratings and they just they 

1015
00:58:17,500 --> 00:58:20,600
stamped their ratings on 
whatever they could as fast as 

1016
00:58:20,600 --> 00:58:24,100
possible. 
And that combined with like no 

1017
00:58:24,100 --> 00:58:25,400
transparency at all. 
Right. 

1018
00:58:25,400 --> 00:58:29,400
Is what what I think very much, 
let led to the situation that we

1019
00:58:29,400 --> 00:58:33,700
found ourselves in and so like 
thinking about how we're 

1020
00:58:33,700 --> 00:58:37,800
approaching this. 
We we have to be cognizant of 

1021
00:58:37,800 --> 00:58:41,700
this issue and make sure that We
don't don't design something 

1022
00:58:42,000 --> 00:58:45,000
accidentally, that will end will
sort of end in this in this 

1023
00:58:45,000 --> 00:58:46,700
Behavior. 
I think this is where we're 

1024
00:58:46,700 --> 00:58:50,400
crypto and sort of open block. 
Chains are exactly a huge 

1025
00:58:50,400 --> 00:58:52,700
positive. 
A huge opportunity because it's 

1026
00:58:53,100 --> 00:58:55,500
one of the core ideas of 
centrifuge is to give that 

1027
00:58:55,500 --> 00:58:58,500
transparency, right? 
And have exactly those 

1028
00:58:58,500 --> 00:59:01,700
Underwriters be competing for 
the best. 

1029
00:59:01,900 --> 00:59:04,900
The best way to underwrite and 
sort of make make money on that 

1030
00:59:04,900 --> 00:59:08,500
instead of just having this 
system with like established 

1031
00:59:08,500 --> 00:59:11,800
players, just sort of Work on 
work. 

1032
00:59:11,800 --> 00:59:16,600
However, they like, and that is 
sort of how we hope hope to 

1033
00:59:16,600 --> 00:59:19,100
address this. 
And I think that sort of, in 

1034
00:59:19,100 --> 00:59:23,100
general what defies trying to 
do, but that was the thing that 

1035
00:59:23,100 --> 00:59:25,900
stood out to me a lot us when it
came to this mortgage back 

1036
00:59:25,900 --> 00:59:28,400
Securities, right? 
That, you know, you'd have 

1037
00:59:28,400 --> 00:59:32,400
people by this pool of assets 
without having this ability of, 

1038
00:59:32,400 --> 00:59:35,100
like, what or actually the 
components and where did it come

1039
00:59:35,100 --> 00:59:36,700
from? 
And I think having that stuff 

1040
00:59:36,700 --> 00:59:39,500
all on chain seems like a huge 
opportunity. 

1041
00:59:39,600 --> 00:59:43,000
You have much more efficiency 
and transparency, and like, 

1042
00:59:43,000 --> 00:59:46,000
better risk management, but 
maybe before we wrap up. 

1043
00:59:46,200 --> 00:59:48,300
So we've talked about a bunch of
stuff, you know, as a pair of 

1044
00:59:48,300 --> 00:59:52,900
chain launch and Altair, but can
you tell us a little bit like, 

1045
00:59:52,900 --> 00:59:55,600
you know, what does the road map
look like in the next? 

1046
00:59:55,600 --> 00:59:59,500
I don't know like year two years
and like what can people expect 

1047
00:59:59,500 --> 01:00:02,600
when? 
Yeah, so the roadmap in the next

1048
01:00:02,600 --> 01:00:05,300
two years. 
I've hinted at a few things. 

1049
01:00:06,100 --> 01:00:09,800
We're live on maker with the 
first ask the class, but we want

1050
01:00:09,800 --> 01:00:14,900
to bring many many more and we 
believe that, I mean, defy as a 

1051
01:00:14,900 --> 01:00:18,000
whole is gonna it has this huge 
opportunity to scale with 

1052
01:00:18,000 --> 01:00:21,600
real-world assets, right? 
Like real assets are hundreds or

1053
01:00:21,600 --> 01:00:24,600
thousands of times bigger than 
crypto is today like we're 

1054
01:00:24,600 --> 01:00:28,700
cryptos trillion a trillion, but
like that's that's nothing 

1055
01:00:28,700 --> 01:00:31,100
compared to 2 R 2. 
The real economy. 

1056
01:00:31,400 --> 01:00:34,900
So we want to bring these as 
many of these assets into D, Phi

1057
01:00:34,900 --> 01:00:37,900
and start sort of scaling TBL, 
right? 

1058
01:00:37,900 --> 01:00:42,000
And that's going to be on maker 
on Ava on every other Landing 

1059
01:00:42,000 --> 01:00:44,800
protocol. 
That is interested in sort of 

1060
01:00:44,800 --> 01:00:49,400
expanding their, their use case.
There is second priority for us,

1061
01:00:49,400 --> 01:00:53,900
is really building this 
purpose-built chain of and 

1062
01:00:53,900 --> 01:00:57,800
wealth building out the the 
Tinley functionality to sort of 

1063
01:00:58,000 --> 01:01:03,000
make 10 Lake, truly multi chain.
Meaning Underwriters and acid, 

1064
01:01:03,000 --> 01:01:05,700
Originators sort of use the 
chain two, then channel the 

1065
01:01:05,700 --> 01:01:08,900
liquidity to, wherever it's 
needed and really building out 

1066
01:01:08,900 --> 01:01:13,700
the underwriting system because 
that is where we can go and 

1067
01:01:13,700 --> 01:01:16,900
really attack the cost of 
capital that is like very high 

1068
01:01:16,900 --> 01:01:20,000
and very unfair towards the 
smaller businesses and where we 

1069
01:01:20,000 --> 01:01:23,900
can actually create create these
incentives to to address that to

1070
01:01:23,900 --> 01:01:27,700
bring it down programmatically 
and that's that's hopefully what

1071
01:01:27,700 --> 01:01:32,800
will spend the coming months. 
Months on super interesting. 

1072
01:01:32,800 --> 01:01:37,600
So before we close, where can 
people find out more about 

1073
01:01:37,700 --> 01:01:40,700
centrifuge in 10 Lake? 
What kind of resources do you 

1074
01:01:40,700 --> 01:01:45,000
have available for them? 
So you can go to centrifuge 

1075
01:01:45,000 --> 01:01:47,200
today. 
Oh, but merely the most 

1076
01:01:47,200 --> 01:01:49,000
interesting part. 
I think to start with is tin 

1077
01:01:49,000 --> 01:01:51,400
like Dots and a huge dot IO, 
which is adapt. 

1078
01:01:51,500 --> 01:01:54,000
You can look at all of the 
pools, the different loans. 

1079
01:01:54,000 --> 01:01:57,500
They have you can see sort of 
what's happening there. 

1080
01:01:58,200 --> 01:02:02,600
We have documentation that you 
can read through as well as like

1081
01:02:02,600 --> 01:02:08,900
a discourse server that you can 
join and while telegram Twitter 

1082
01:02:09,400 --> 01:02:13,400
saying fuge on Twitter, that's I
would where I would go. 

1083
01:02:13,600 --> 01:02:17,600
You'll see some of us speaking 
at ECC in a couple of weeks. 

1084
01:02:18,200 --> 01:02:20,900
And yeah, just reach out. 
If you have any questions. 

1085
01:02:21,800 --> 01:02:23,700
Super cool. 
Thank you for coming on. 

1086
01:02:24,600 --> 01:02:27,300
Thank you, both for having us. 
Thanks for having us. 

1087
01:02:29,500 --> 01:02:31,300
Thank you for joining us on this
week's episode. 

1088
01:02:31,600 --> 01:02:33,300
We release new episodes every 
week. 

1089
01:02:33,800 --> 01:02:36,600
You can find And subscribe to 
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1090
01:02:36,600 --> 01:02:39,700
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1091
01:02:40,000 --> 01:02:42,900
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1092
01:02:42,900 --> 01:02:45,000
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1093
01:02:45,600 --> 01:02:48,400
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1094
01:02:48,400 --> 01:02:51,100
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1095
01:02:51,100 --> 01:02:52,200
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1096
01:02:52,400 --> 01:02:55,900
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1097
01:02:55,908 --> 01:02:58,900
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1098
01:02:58,900 --> 01:03:01,300
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1099
01:03:01,300 --> 01:03:03,100
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1100
01:03:03,200 --> 01:03:05,300
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1101
01:03:05,300 --> 01:03:07,800
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