Unlocking the Potential of Web3 With EMURGO’s Nikhil Joshi | Blockcast 30

This episode of Blockcast dives into the convergence of traditional finance (TradFi) and blockchain technology. We explore Nikhil Joshi's journey from Barclays to EMURGO, and how his experience bridges the gap between these two worlds. We discuss:

• The rise of blockchain: Nikhil shares his insights on the evolution of the blockchain industry and the inspiration behind his career shift.

• Cardano Explained: Nikhil sheds light on his role at EMURGO and the unique aspects of the Cardano blockchain platform.

• Web3 revolution: We explore the potential impact of Web3 technologies on various industries and the future of decentralized finance (DeFi).

• The future of digital assets: Nikhil offers his predictions on emerging trends and potential disruptions in the digital asset and blockchain landscape.

Additional Resources:

• EMURGO Website: https://www.emurgo.io/

• Cardano Website: https://cardano.org/

🎙️ Hey there, Blockcast listeners! 🎙️ This podcast provides commentary and discussion on cryptocurrency and related topics. It is intended for informational and entertainment purposes only and should not be construed as financial advice. Guests appearing on this podcast may discuss companies or strategies, but these discussions are not recommendations to buy, sell, or hold any particular asset or pursue any specific strategy. The hosts and guests are not financial advisors, and listeners are urged to consult with a qualified professional before making any investment decisions. Investments in cryptocurrency are inherently risky, and you could lose money.
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Transcript

SPEAKER_00: 0:00

Hey there, Crypto Curious gang. It's time to plug in and play with the Blockheads at BlockCast. Strap in for a weekly whirlwind tour through the blockchain jungle, where NFTs, shiny coins, and crypto titans tango. Serve that with a side of spicy insights and the crunchiest bits of the digital sphere. Let's dive into the decentralized deep end. BlockCast is live in three, two, one.

SPEAKER_02: 0:35

Hello and welcome to BlockCast, your go-to show for exploring the world of cryptocurrencies and blockchain technology. You join me, your host, Kohan, with fellow Blockhead co-founder Tim Misser, and our esteemed guest this week, Nikhil Joshi, the COO of EMURGO, the founding entity of Cardano. Prior to his stint at Emurgo, Nick Hill spent 15 years at Barclays in London and Singapore, improving capital efficiency for New York and London structured credit desks. He then took on the role of CEO at a Singaporean startup focused on solving trade and supply chain woes using hyperledger fabric and corda. He now oversees the bill side of Emurgo's fintech media and education products, as well as its incubation arm. Welcome,

SPEAKER_01: 1:13

Nicol. Thank you. Thanks, Jones, for having me. Nice to be here. So maybe just as a bit of an introduction to myself, you touched on the summary of my career to date, but just to give you a bit more color on that. Yeah, I am the COO of EMURGO. We are a co-founding entity of the Cardano blockchain. We're headquartered here in Singapore, and my role is effectively to make sure we have a strategy and execute on that strategy, which is mainly around the commercial adoption of the Cardano blockchain. Prior to EMURGO, most of my life has been in traditional finance, within banking, and then moving into the blockchain space. When was that? When did you make the transition? Quite late. So I'm actually a newcomer. I was in banking for 15 years and prior to that, I'd actually qualified as a chartered accountant in London. So very kind of middle of the road type stuff, right? I moved to Singapore in 2013 and from about 2015, I could tell that my time was up. I couldn't find any other role. There wasn't a product. There wasn't another bank. It was all just much of a muchness to me. So from about 2015, I started looking for something else, but I couldn't quite figure out what that was. I don't think I came across the word Bitcoin until about 2017. And I had no idea. Like someone explained, oh, it's a new currency. I was like, right, why do we need a new one? So it probably wasn't until about 2018. that i then started to really grapple with it and understand okay what is this what is blockchain 2019 i think is when i when i actually moved out right and went from banking into the startup space trying to figure out what is blockchain sorry how might it be used and really exploring a real spectrum of use cases that come with it

SPEAKER_03: 2:55

so you've been to been through like to bull and bear markets, so not really a newcomer then.

SPEAKER_01: 3:01

Well, I think when you first come into it, there's so much to think about. I think the word currency can be a bit of a misnomer. Understanding the cyclicality now, I mean, you have no sense of that when you first come into it. And to be fair, I think, I'm not sure if any of us had enough data points at that point, around 2017, 2018 or so, to understand how that cyclicality works. But be it macro correlations, be it the technology I'm not a technologist by background. So all of that was a very steep learning curve. And then, you know, there's a bit of a spread when you say the words Bitcoin or cryptocurrency. There's a bit of a spread on cryptocurrency. What that means for people economically, philosophically, ideologically. So there's a lot to make your way through, right? And by no means would I profess to say that I'm an expert on each of those things yet.

SPEAKER_03: 3:53

Right. So you were in traditional finance for a long time, 15 years, and you said you kind of felt your time was up. So what does that mean really? And what pushed you to make the jump over to the blockchain or crypto industry?

SPEAKER_01: 4:06

Yeah. Well, okay. So I'll go back a step. So even prior to... being in banking, you know, my sort of natural default setting, if you like, is more arty and creative. So I did a French degree, for example, right? And I naturally focus on French philosophy and Renaissance literature, right? So that's kind of what I enjoy. Deciding to become a chartered accountant was not really by design, but just more out of laziness and wanting to stay in London rather than move back to where I originally came from, which was Manchester. And then once you kind of qualified and you get those letters behind your name, everyone at that point, so this is around 2003, everyone either went went to investment banking or private equity you know and I didn't know what private equity was because I'm too lazy to figure it out so I just went to a bank because that's where all the hiring was happening so in a way felt like a square peg in a round hole from day one right but then you kind of you learn skills you learn how to navigate an organization the politics of it you you acquire skills right and and you learn to sustain I guess a change is as good as a rest and I had the opportunity very fortuitously I think to move from London to Singapore about 11 years ago And that was great and really opened my eyes to basically how fun life can be outside London.

UNKNOWN: 5:18

Right.

SPEAKER_01: 5:19

And away from the arrogance of London as well, I'd say.

SPEAKER_03: 5:21

I think Corwin has the same experience moving from

SPEAKER_01: 5:24

London to

SPEAKER_02: 5:25

here as well. Yeah. Are you happier here? Yeah, I think so. Yeah. How long have you been here? Three years now. I've come up to almost

SPEAKER_01: 5:31

three years now. Oh, excellent. Welcome. I think you get this sort of cyclicality, right, in Singapore as well. I think the good thing about Singapore as you can leave, right, and get to other countries really easily. But ultimately, this region is a real melting pot of different thoughts and ideas and languages and cultures. And this is, again, plays to what I naturally am very interested in.

SPEAKER_02: 5:55

It seems much more fast-paced, especially in the space that we're all in, this Web3 space, compared to back home in the UK, right? I don't know if you feel the same.

SPEAKER_01: 6:03

Yeah, I'm not sure if I can compare like for like. I mean, back in the UK, I can only associate with with my traditional finance days, and certainly crypto, Web3, blockchain is all hyper-paced. When I was here in traditional finance space, it felt a lot slower paced.

SPEAKER_02: 6:19

And

SPEAKER_01: 6:21

I've not had any meaningful, long exposure to the crypto space in London, right? So I wouldn't be able to compare like for like, but I always say to people that, you know, I left banking in 2019, right? I was 42 then. And I feel younger now than when I arrived in Singapore, kind of halfway through my banking life. Coming back to your question that as I got here, I could see that, you know, that there was a real, that square peg in a round hole really started to jar. And I couldn't figure out how do I get satiated intellectually, you know, financially, you know, people refer to the glass ceiling within the banking world, usually in the context of, you know, females not being able to get, you know, over a certain level. I think that applies across the board, especially a large bank, you know, with over 100,000 people, you're simply in, I felt at least very much a cog in that mechanism. And so I started looking for different ways to entertain myself, basically. Past the initial exploration of Bitcoin and blockchain, I think really it was that NFT summer. not that I was buying the idea of NFTs and JPEGs and whatnot, but I could definitely see that that functionality for something like a loyalty exercise or a creator economy would have huge, huge benefits. And that's, I think, really where the dots started to join in my mind about what the real application could be to not just make things better for the existing products in market, but actually tapping untapped markets or untapped utility that can be monitored monetized in some way.

SPEAKER_03: 7:54

You know, a couple of episodes ago, we spoke to a recruiter in the Web3 industry. And, you know, he was talking a lot about, especially now with the current, I guess, fervor, bull market, lots of people wanting to make the jump from TradFi to Web3 again. I guess it happens in cycles and then, you know, they move back. But for you, what have your experiences been, the challenges of moving from, you know, a big multinational bank like Barclays to the world of blockchain, where things are a bit more, I guess, fast paced, loose and, you know, always innovating?

SPEAKER_01: 8:24

That's a great question. So I think the pros of moving are for sure that, and this is number one in my mind by a long distance, there is real innovation happening, right? People are trying to do things that moves the needle as opposed to the, and I'm not talking about my individual employer, but that as an industry, the lip service paid to the idea of innovation, right? And so, I mean, even if you go to Singapore FinTech Festival, last year, the biggest room, The biggest hall there was made up of all the large names. And every single booth had digital assets, digital assets, digital assets, right? Peppered all over their branding and whatnot. And I'm super cynical about that. I think it's very much a marketing campaign on their part to make them look as if they are front-footed on real innovation. And yes, they may well be to some extent, but not always. like this space. And part of that is, I suppose, owing to a certain lack of regulation. I'm not saying regulation's bad and we should not have it, but there's definitely a time lag between what people are up to and the regulation being able to catch up. I do think a key difference is that the mindset in this space is one of better to seek forgiveness than ask for permission upfront, right? And that old world that I came from was completely the opposite, is we're going to ask for permission on every single thing that we do. And that I think is a big reason for the cultural mindset of risk, basically risk aversion when it comes to innovation.

SPEAKER_03: 9:55

You brought up an interesting point about the SFF and, you know, all these, I guess, legacy names coming into this world or at least realizing that they need to get up to speed or be left behind. Could you share a bit more about your perspective of how you see blockchain, you know, potentially integrated with traditional finance going forward? And I mean, are these two worlds going to be at loggerheads forever or, you know, is there, you know, is one going to overtake the other?

SPEAKER_01: 10:22

Yeah, so I don't see them as mutually exclusive at all I mean we talk about TradFi and again I think some of the way we label these things lends itself to creating somewhat of a binary argument and I think so talking about traditional finance well finance is just finance right so if you want to borrow if you want to lend if you want to hedge yourself against something that's just finance now the way in which you do it may differ and that's what we actually mean when we're talking about TradFi versus whatever the opposite of that of that would be be that DeFi or crypto native. So I think if we separate Bitcoin from blockchain, so Bitcoin serves its purpose, its value as a function of supply and demand, everything from Ethereum onwards and Cardano obviously being an example as a third generation layer one. I would like to think of it as simply a tech stack. Now, how do you want to use that technology? So everything comes back to what is your motivation and what is fit for purpose. So there's definitely aspects of DeFi, intrinsically smart contracts and so forth, that will improve a lot of the way things work in traditional finance today. does that mean that all of traditional finance will now be replaced with a bunch of DEXs, right? For example, no, it doesn't. But there will be components that I think the traditional players will gradually over time start to adopt. And so you can think of it in almost like three verticals. There'll be those players that simply never want to adopt and they perhaps don't need to because whatever they're doing is fit for purpose. Then there's a middle vertical, which would be those players who embrace aspects of blockchain or aspects of crypto. Here, I'm typically talking about public, public permissionless blockchains, right? Private side, I think is a different matter. And then there are those who will want to and need to play in truly crypto native or DeFi spaces right with those tools so I think there are quarters where there are loggerheads at the moment but I think that that will start to erode over time as in the blocker will erode and there will be a much better appreciation of it's not an all or nothing question it's what parts of this can I use that will improve the way I do things but coming back to the point about the ideological spread you'll always have people who say no screw this and to the bank, screw the bankers. Fiat is useless. We should just be in a truly crypto space. Fine, then that's your thing. But again, I don't think it's a scale with only two opposite ends. There's a large fat middle, which I think will lend itself to greater adoption. A large part of that is, of course, getting the regulators over the line.

SPEAKER_03: 13:05

On both sides, there has been a lot more understanding of each other's position over the past few years. Crypto has also shed a that it's had in the past.

SPEAKER_01: 13:15

Immaturity as well, I think. And to your point, right? Yes, there will be a, or unless you call it a mass migration, but a certain migration, right? From traditional finance to... to this space during this bull market is, in a way, people see the grass is green. It'd be that because there's, you know, so much more money to be made or you're simply working on something that is truly innovative or you don't want to work in a regulated environment or you want to take a bit more of a gamble and a risk. All of those things are reasons why I moved over. And I think that that is a good thing in terms of a certain maturity coming into this space.

SPEAKER_03: 13:48

That's a good segue to the next, I guess, area of discussion, which is, you know, what you're doing at EMURGO. What is EMURGO and how does EMURGO contribute to the growth and adoption of Cardano's goals? So maybe we could start with what are your primary responsibilities as COO

SPEAKER_01: 14:04

of EMURGO? Sure. So as COO of EMURGO, my role is to make sure that we execute on the strategy in the right way. The strategy of EMURGO is to facilitate the commercial adoption of Cardano. The way we do that is we wear two hats, essentially. We're doing things that are for the benefit of the Cardano ecosystem. And then we're doing things which are for EMURGO's benefit. I'll break those down. So Cardano, founded in 2015 by Charles Hoskinson. He was a co-founder of Ethereum. There was some Problems, should we say, and gaps perceived in Ethereum. And so Charles and team then went away to address those for quite some, and took quite a long time to do it, I think is fair to say. But that length of time was done deliberately to make sure that a layer one is built that is robust, right? For whatever purpose you need, you want to make sure that there are no security problems in that tech stack. You want to make sure that problems that may well have existed in Ethereum are addressed up front. Part of the setup was creating a deliberate format of decentralization from the beginning. So rather than having one foundation that does everything, there are actually three co-founding entities or pioneering entities. One is the foundation itself, which is there to propagate the ecosystem. One is IOD which has historically been there to support the research and development side of the blockchain and then there's emergo and i say we are there to facilitate commercial adoption so we will work with projects within the cardano ecosystem and support them for their growth ambitions so as an example we have made a strategic investment in a project called end maker it's an nft platform that allows you to mint your nfts tokenizing diamonds for example and a whatever else you want. They had ambitions to access a Southeast Asian or Asian market to help grow their business. Of course, we're headquartered here. And so we help them with that. On the flip side, we've equally partnered with GSR. which everyone knows. And the idea is there is that GSR will help support Cardano projects with their token listings, market making. They have access to institutional capital that is looking for investments. And so we can marry the two up. We also have an education business. And so there's ways that we can explore how we educate the, shall we call it, the corporate level in terms of facilitating that institutional adoption of Cardano.

SPEAKER_02: 16:42

You touched on it briefly, building a the Cardano blockchain solves things that Ethereum can't solve but what do you think is the biggest advantage of building on Cardano compared to other

SPEAKER_01: 16:51

blockchains? Okay so I'll answer that question but I think that my blanket comment is that all roads lead to interoperability I think as far as we're concerned I'm not sure many people on a day-to-day basis have loyalty to a tech like I don't know anyone who sat here right and said hey you get your Samsung out and let's argue the toss between iOS and Android right there will be a handful of people that will love doing that but they are a handful and everyone else is just interested in wicked cool application that does the stuff that you want it to do and so yep absolutely there are reasons to build on cardano but over time i think that underlying tech stack will have to just learn to be truly interoperable and and i'm going to make a distinction here between interoperability and evm compatibility so a lot of chains out there are evm compatible and that's cool but you're just being building on one tech stack and so should there be a chink in that armor there's a risk that the whole thing falls down coming back to your point on cardano though so you know we've got got things like deterministic fees right so you can plan forward for the next whatever you know x hundred x thousand transactions that you will pay the same fee that wasn't the case with ethereum right for a very long time still isn't right actually on the on the layer one itself right so you can't execute whatever your business is if you have the uncertainty of the volatility that comes with trying to execute something. There hasn't been a security breach on Cardano since it went live. So people will point fingers and laugh at the academic research, the peer-to-peer review, all of these things that people love to point a finger at Cardano for, but the upside of having taken that steady approach is that it's robust. Right. And now whether you're in whether you're in the financial services space or using a layer one for some of the purpose, security surely is paramount. Then there are other features which I think are not necessarily well recognized outside the Cardano space. And so this is something that we do want to highlight. So the fact that I mean, restaking obviously a big thing over the last year or so, actually with Cardano, you've always been able to stake your ADA and then basically walk away with it so there isn't necessarily that concept of restaking in within cardano because you don't necessarily need it and another feature is the concept of ispos right so you can be a stake pool operator people can delegate their aid to you you now have a way to fund your project and that investor now gets rewards or your other tokens as a reward for that right that's somewhat akin to an airdrop right which again lots of noise and excitement over the concepts of airdrops over the last year or so, right? That's always been there by design on Cardano. So there are those sorts of features which I think put Cardano out there. I think the really critical one is this idea of decentralization. We've recently also established a members-based organization. It's called Intersect. And the idea is that Cardano will very shortly move to being truly self-governed. Cardano's last stage of its roadmap is called Voltaire, and that's where it becomes essentially self-governing. So the co-founding entities will increasingly just step away into the background, if you like, and the community itself will own the decisions of how the blockchain develops and how the ecosystem is run. There'll be changes to allow for that governance to happen on-chain, and the members-based organization called Intersect is there to facilitate that. For a period of time, clearly, there will also be some off-chain governance required as well. It's a not-for-profit So it is purely there to administer the decisions of ADA holders who can vote on any decision they want. That's important because, again, as an exercise in demonstrating how do you get to a truly... decentralized format? How do you put a framework in place that is highly complex in its legal format? Culturally, how do people engage with each other? What are the rules of the road if you want to play in this space? It's the first time that there's something like this is happening of this scale. And the decentralization part, of course, is important because that's the crux of public blockchain, really. Now, again, coming back to the financial institution space, do all of them care about public blockchains? Not right now. And that's why you'll see a certain proclivity to using things like hyperledger. And again, I don't think it's right or wrong. It's a question of what is fit for purpose for your particular objective or your agenda.

SPEAKER_02: 21:42

Cardano founder Charles Hoskington recently lashed out pretty harshly against Joe Biden and what he called Operation Chokepoint 2.0 as a coordinated effort to kill crypto. Not to get too political or anything, but I was wondering for you, or at least for Amargo, how far reaching is US politics and US regulation? How much does that affect what you do and how things operate for you? Sure.

SPEAKER_01: 22:09

So I'll stay away from whatever Charles said about anyone. I think with the US being as big as it is, the biggest market for all sorts of things, you can't ignore it really. There has been a benefit, I think, for this part of the world with the US regulators taking the approach that they have taken thus far, which is one, a certain migration of talent to this side of the world, but also an opportunity for, I'm just going to loosely refer to Asia as if it's one thing, it isn't, but for Asian jurisdictions to have a competitive advantage here. I think the regulators over this side of the world have been much more front-footed in in at least saying, okay, we don't quite get it, but happy to work with you, as opposed to shutting the door and having a predetermined conclusion on what the outcome will be. So in Mergo, I mentioned before what the types of things that we do on behalf of the Cardano ecosystem. We then ourselves are building a finance stack. Right. And so we're working on various stable coin ideas. We have we run a light wallet on Cardano called Yoroi and we've built what we refer to as a headless architecture. So essentially for an institution wants to white label our tech and then have their own custodial wallet, they can do that. And in addition, we've. also built a tokenization platform. Now, it can tokenize whatever you want to tokenize, be that fiat, debt, equity, commodities, IP, real estate, whatever. We will be the tech provider to partners, be they, again, from the traditional space or from a more crypto native space, looking to tokenize whatever it is. And we don't profess to be the experts in understanding a particular asset class or the behavioral traits of a particular asset class. So that's who we would look to partner up with and provide the underlying technology to facilitate that. Of course, once you're in that space, you're coming up against regulatory considerations. Now, our tokenization platform was built with a view to satisfying either existing US regulation or incoming regulation, particularly as it pertains to stable coins. And so we have a view that it's It's been designed to meet the most severest of requirements, if you like, as they are today. And so it's a very compliant, it's a platform that allows the activity to be compliant in the best way. Obviously, it depends what the asset class is and so forth. Jurisdictionally, we are operating in a digital realm. So it raises questions on what jurisdiction is relevant, right? But I think the good thing here is that we're in a geography where the likes of Singapore, Hong Kong, Thailand, Japan which is where our roots are in Japan, right? All very, very front footed. when it comes to the regulation of crypto. And that's a good thing. And actually, it's not that they've all been front-footed from day one. Japan was front-footed, and it kind of did a bit of U-turn. And now it's coming back again. It's setting out a framework of how DAOs might exist. And if you were to implement DAO for whatever purpose, what are the rules of the road that allow you to carry on with that activity? That's very cool. That's the first, I think, in the world that's pushing that kind of agenda. So I think The way the US regulators or the approach the US regulators have taken thus far is a shame for the crypto industry overall, because I think there's a richness of talent and an opportunity just because of the size of its market over there. Personally, I do think that it's now become a political challenge. volleyball, right? And you can see that with the way that the ETFs were suddenly pushed through and you're hearing a lot of positive noise from both sides, right? Both Republicans and Democrats in terms of how they might think about crypto going forward. So there may well be a U-turn, which I think is good globally for the crypto industry. I think while that doesn't stay in place, it creates an unlevel playing field and that is an advantage for those of us on this side of the world.

SPEAKER_03: 26:33

Back to commercialization of Cardano blockchain. Cardano has been around for a really long time, at least in terms of crypto. And it was, I guess, seen as part of the leading group, let's say, of blockchains back in the day. But now there's so much more competition. It's so much quicker and easier just to develop one and launch a blockchain. And I guess there's a blockchain for everything, for every use case under the sun now. I guess the question is, what are the challenges of bringing commercialization to Cardano that when you guys have been around for so long had a long head start compared to all these other newer fancier maybe hype

SPEAKER_01: 27:09

upstarts yeah being around for a long time is sometimes posed as a slight negative like you know where are you you've been around for what seven nine years actually right but actually let's look at it this way ADA is still top 10 market cap and people are always saying hey Cardano like what are you guys up to you know, what's going on. So in spite of a lot of apparent unawareness of what's going on, it has retained a top 10 market cap, which I think speaks, needs to be unpacked to understand exactly why is that, right? There's clearly some strength there. I think the other point I'd reference is that the smart contract functionality came out at the back end of 21. That was basically the end of the last cycle. And so not many people have been in a position to see what Cardano can do with that smart contract functionality, really kicking in. Now, if you look at Masari reports and whatnot, you'll see that, say, DeFi TVL increased eightfold. last year right on cardano and i think we'll continue to see that trend because there's a heck of a lot of developer activity a lot of stuff that's being built a lot of people who have left cardano and have come back on the developer side because you know from a technical point of view it allows them to do what they want to do and so that I think is, again, some of the facets of Cardano and the price movement that isn't necessarily well recognized out there. Now, when you're comparing to other chains, sure, it's always, you've got other layer ones that tag themselves on, oh, we're the blockchain for X, right? We're the blockchain for gaming, we're the blockchain for DeFi, we're the blockchain for whatever. Sure, but... A short while back, I said, let's make a distinction between Bitcoin and Ethereum onwards, right? And so that idea of programmable money, I think, Sometimes it's confusing for people, but I think of it just as a technology stack. And my super oversimplified analogy is that we are sitting at this table made out of wood. So you could have a piece of wood and we happen to be using it as a table, but we could, you know, nail it up against the window and stop the wind from getting in. We could put it up against the pavement and use it as a ramp to get, you know, how do you want to use it? So I think the idea of, oh, we're the blockchain for X. Sure, you can say that, but it's more of a marketing campaign. And then people tend to focus on the price movement. How quickly has that price escalated? And not to say that that's all fluff, but I think looking at how that price moves over time and how many people are still there at the end of a bull cycle, I think will give a better sense of, is that blockchain fit for purpose for the particular utility you need or not? And again, I'm not suggesting that none of them are. I think that that has yet to be weeded out. And the last point I'd make is you refer to it as competition, and I don't think it's competition. I think it is, again, just a case of interoperability. So most organizations, most individuals, care about the application, right? And not the underlying technology, as long as the technology can do what you need it to do. I think all roads lead to interoperability. I think that most chains will, okay, you have bridges, but I think over time we will get to something that's more robust, right? That allows a number of chains to be truly interoperable. And I think that's needed to give people the utility, but also the safety and the security that's needed.

SPEAKER_03: 30:53

Right. So in your opinion, what are the most promising applications of Web3 technologies today? And how are you working to bring that into the

SPEAKER_01: 31:03

Cardano fold? I would think of this on a timeline. What's that saying? A journey of a thousand miles starts with one step or worse. I think the possibilities for Web3 are huge and we haven't necessarily fully realized understood what that potential might be. But coming back to sort of day one, I think where we can see the obvious use cases are within the finance space. So this is coming back to the headless architecture that I mentioned a second ago, the tokenization platform, you know, things like stable coins and ETF approvals for me are great in that they symbolically show a certain acceptance of a movement to that world. A stablecoin, or at least a fiat-backed stablecoin, allows that bridge from old world to new world, and that will facilitate adoption. So that's, if you like, the first step on this journey. Key narrative of this cycle is clearly real-world asset tokenization. Again, that's what our platform is here to do. We're working with fiat issuers. We're working with gold issuers. We've got real estate projects that we're talking to. The tricky bit for me is not the technology necessarily. It's more around the working out, is there truly a demand? How do you sort out access? How does distribution work? Those things are separate to the technology. And that's why we want to work with partners who know that stuff. And we can do the technology in the background. So the use case of finance, I think, is quite telling and I think we will see continued adoption either of aspects of blockchain or aspects of crypto to improve the way things are done or outright movement to things that are truly DeFi or truly crypto native if I can use that as a generic term. I think going past that from a day one to a call it perhaps a day two I think is where we'll start to see other industries adopting and so here you you know, the idea of NFTs, particularly for the loyalty use case. So you can already see the Adidas's and the Prada's and so forth, right? Adopting here. I think it's going to get much more sophisticated than that. You know, going across to say music, I mean, Iggy with her meme coin. It's an interesting one, I think, which goes to adoption and awareness more than anything else. But the day two, I think, will be around that creator economy. And people would go, oh yeah, sure, okay, but that's not really scalable right now. Like if you're a journalist and you kind of, you know, you write an article and you're going to get a couple of whatever, X of X crypto, so what, who cares? But I think that will play out over time where the scalability of it manifests through effectively like a microeconomy that aggregates into a larger set of microeconomies, right? And that's where the scaling will come from. And I think the other part of this is, Tapping the untapped market. So finance, everyone always talks about banking the unbanked, right? But I was at a meeting with a bunch of Web2 players some weeks back. And one of the organizations there was from a makeup company, right? And they were talking about when you want your customer loyalty, you're required to put in your name, your date of birth, your address. You give away all of this personal information. And they obviously lose a lot of customers at that point who can't be bothered because it's time consuming or don't want to give away things like their address and their date of birth. And here, zero knowledge kicks in massively. And that's not obvious to them yet. But they will start to understand how, well, if I can get the information I need without someone having to divulge all this private information, without being so time-consuming, that's a win-win, right? They've got the customer, they've got the loyalty, and the customer's getting the thing back that they want, which is the discount or whatever it might be. So I think there's industries outside the immediate finance space that will start to see how... blockchain has relevance for them. And then I think day three, and this is a very distant day three, I personally am very intrigued by the idea of digital nation states. My parents are Indian. They moved to the UK in 1960. English is my second language. I moved from the UK to Singapore. 11 years ago, my wife is Chinese. She and my kids are Singaporean. What is my identity? In the UK, you'll know this, when someone says, where are you from? What they mean is, where's your accent from? When someone asks over here, where are you from? What they're talking about is, you look like an Indian, but you sound like something else. So what's going on? And actually trying to explain to someone you know, all of that, you know, it's quite hard work. But my point here is that I don't have any particular allegiance to any geographical boundary, right? I didn't choose where I was born. I chose to come and live here, sure, and that's great. But I think that the idea of, and I certainly have no ideas of jingoism, right? Like, oh, I've got a British passport and so therefore, you know, the British are the best. None of that exists in my head because there's so many different ways that I culturally recognize myself that it's all meaningless anyway. So the sense of community and who do you belong to, I think becomes really interesting. And the idea of a digital nation state, I think just philosophically, Even before you get to the economics of how might that work and what do you mean? So you have a digital passport and a physical passport? I don't know. All of that stuff will work itself out in the weeds. But the idea of belonging to something which is truly in the digital realm and may well exist in parallel to your physical boundaries, but may well over time just exist, right? The way we draw up countries today isn't the way we drew up countries even 100 years ago, let alone 1,000 years ago. So it's all... artificial right and so imagine if there's a way where you basically almost nomadically migrated to wherever you wanted to in fact we're always already seeing this with places like phuket bali barcelona allowing for digital nomad visas right off the back of covid and what that meant for their individual economies so these are little tiny steps towards that end state which may or may not play out but i think it's intellectually very interesting to think about

SPEAKER_03: 37:45

I was going to ask if you've heard of what Draper Nation is

SPEAKER_02: 37:47

doing. Yeah, Draper House is created Draper Nation. We had them on the broadcast a few weeks ago. Okay. They're doing exactly that. Oh, right. They're

SPEAKER_03: 37:58

just two doors down.

SPEAKER_02: 37:59

I saw them, actually. Yeah, yeah,

SPEAKER_03: 38:00

yeah. Okay.

SPEAKER_02: 38:01

Yeah, it's a very, I mean, it sounds very abstract outside of the Web3 space, but like you said, I think it's got a lot of potential.

SPEAKER_01: 38:09

Yeah. Well, I think, you know, so when people are talking about blockchain, they're talking about decentralization and they're talking about community. And I think the way community is used can sometimes lend itself to being, again, creating a bit of a binary situation. Are you in our community or not in our community? And do you, you know, do you really need to pick? You know, I think I think the creator economy is going to be really big. empowered by virtue of what blockchain and crypto allows it to do i do think there will be ways to monetize in a scalable way which isn't necessarily obvious to us yet and that creative economy will really lend credence to the idea of people having patchwork quilts for careers. It won't be, okay, you start in a bank when you're 21 and you pop out the other side when you're 65 with a watch and a Montblanc pen or whatever, right? It will now become increasingly acceptable for you to have a bit of this, a bit of that, a bit of something else as your skillset, and you go where your interests lie or where the need is for your skillset. And that all plays back into this idea of do you then need to be in a given country? Or flip it the other way, how does a country create competitive advantage for itself, right? When the idea of physical trade will still exist, people still need to eat and grow things and send it somewhere else. But the proportionality of an economy coming from physical versus digital is going to move. And I think that will have some really strong geopolitical impacts in the midterm.

SPEAKER_02: 39:49

So would you give up your British passport for a

SPEAKER_01: 39:52

digital passport? Yeah, I would. Like again, because I don't, I'm not crapping on my background or anything, right? But I'm just saying that because of the way I've grown up and where I've moved, like home is here because my wife and kids are here, right? I don't refer to London or Manchester as home. Even though I spent 30, whatever, 35 years there. It's clearly partly in your head and partly emotional as well. But a British passport allows me to get into many countries hassle-free. It would be the same question as would I go from a British passport to a Singaporean passport? Sure, because a Singaporean passport is slightly better than a British passport. So I think it would be a question of functionality. What would that digital passport allow me to do, either in the absence of a digital passport or relative to my existing passport?

SPEAKER_02: 40:36

Well, that's very insightful and I'll hold you to it if the day comes. But thanks very much for coming on the broadcast. I'm sure our listeners have learned a lot about Cardano and the Margo technology. and we'll keep everyone updated with everything that's going on. What's the best way to keep updated apart from Blockcast with

SPEAKER_01: 40:58

Emurgo? There's our website, emurgo.io. We're on X as well, and you can follow us there. We've got some really good announcements coming out over the second half of this year, very much entrenched in the idea of bringing bigger names to Cardano, but also some specific partnerships between Emurgo and others, very much entrenched in that financial space. which I think will be very interesting for both traditional finance players as well as those in the more crypto native side.

SPEAKER_02: 41:27

Cool, awesome. Well, that's it for this week. Catch you in the next one. Thanks very much. Thank you very much.