Solana's Crypto Native Next-Gen CEX | Armani Ferrante

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this episode is brought to you by SE say's V2 upgrade introduces the first high performance parallelized evm already live on public devet maet comes later in Q2 you can follow along with the say Journey on X say Network say is spelled s EI go follow say onx say Network scary stat for you the odds of falling victim to online crimes are one in four AA provides digital security protection to keep your personal information passwords online activity and Technology safe from online threats for Empire listeners Aura is offering 14 days free plus up to 55% off an Ora subscription when you visit AA

a.com blockworks terms and conditions apply cite for details you'll hear more about Aura later in the show this episode is brought to you by Avalanche Avalanche is a leading network of blockchains giving some of the world's largest financial institutions new use cases and business models while leveraging ing completely customizable infrastructure check them out it's core. apppp slcover you can explore avalanche's subnet ecosystem at core. slcover I was playing around earlier today really cool this episode is brought to you by mantle mantle LSP is a permissioned and non-custodial eth liquid staking protocol deployed on the eth L1 and governed by mantle mantle staked ether which is me serves the

value accumul ulating receipt token of mantle LSP with multiple rewards and yield opportunities today it is the fourth largest liquid staking protocol with almost 1.5 billion in the protocol mantel your opportunity for yields and rewards completely on chain big thanks to mantle all right everyone welcome back to Empire we've got Armani from Mad Lads and from backpack Armani welcome to the show man hey guys how's it going thanks for having me yeah good man good good to have you here so armonth I want to start off so Santiago is an investor um so maybe he can help take us a lot deeper than I can go but I actually am kind of an outsider to like you I own some mad Lads and stuff but like an outsider to

to really what you guys are building at backpack from an outsider's point of view like thinking about Armani the Builder you launched ankor the framework you launched madlads the community you launched uh backpack the wallet and then you launched the exchange so I'd love to get your like highlevel View of what like what is arm money building here yeah great question so I think um there's multiple Parts I think of the of the stack you know anchor of naturally is a smart contract framework um that's really you know the customers you know it's a developer uh a toolkit uh uh mad ads is an nft profile pick it's an nft Community um a community in a super genuine uh sense of the word uh a

backpack is really the the consumer product that's really the the the force that uh that we're uh putting uh behind or the company behind um um and what it really is is it's an entry point into crypto um you know a lot of people like to talk about super apps uh they like to talk about these on stop shops um uh backpack truly is in in the most like meaningful sense of the word uh uh uh your entry point into crypto um namely through the kind of substrate of like custody it's like you want to own crypto um no matter how you want to own crypto uh it's it's the best place to do it and and the ultimate goal um is to be able to own crypto on any chain whether it's self- custody whether it's a ledger whether it's a 24 seed phrase

or whether it's a centralized exchange and you want to use a you know an account or uh and and that's kind of I think you know at a very high level um uh what we're trying to do with backpack and like the way that's operationalized um you know we can go out a bunch of different rabbit poles uh but today that's kind of where we're at um and you know there's a bunch of stuff that're that we're building uh and terms of like the next kind of a year of backpack but you know that's more or less where we are today nice uh let's talk about the exchange so every cycle there's kind of a new so so exchanges have been the best business model historically in crypto the last decade there's like no better business model than a than an exchange um and every cycle there's kind of a new

exchange that rises to the top you could say um what 2013 2015 you've got you've got coinbase 2017 kind of binance came along unseed coinbase um 202 one I mean you you could say FTX like came into that seat obviously was fraudulent but you know it did kind of become the top exchange um and I think when I talked to people and I think the thesis for a lot of the investors was look backpack is going to be that exchange this cycle how do you think about building a crypto exchange and like go as deep as possible here like how is it going to be different like what is the strategy customer acquisition like would love to just like get all your the brained up of your thoughts on building an exchange

yeah yeah it's a great question so there's a bunch of different ways to tackle this question uh but I think you know at a high level maybe just to give you some moral context on how I think about exchanges you know I think the exchange is one really important piece in into the app uh but it's really like an auxiliary component um in the same way that like a wallet is an auxiliary component to an L1 where you know an exchange and a wallet you know these things aren't very useful unless the underlying L1 um is flourishing and and and has a you know a vibrant uh successful ecosystem and that's kind of like our view of the world uh uh I I think you know we are pretty different in the exchange world in the sense that we are coming from the

onchain world and then going and building out this really important tool to grow um L1 ecosystems and to kind of encourage self- custody and to kind of make Innovative uh uh crypto products uh which is maybe a a bit of a different perspective than starting with the exchange and then going going onchain um but you know if you you know rewind let's say like a year ago which I think is one that we decided decided to go down this path and and you look at the exchange opportunity um uh on the one hand you know if you aren't really kind of super familiar with the exchange business model you might look at the landscape and think to yourself oh wow uh it's quite competitive uh you kind of have to be uh uh crazy to go build uh an

exchange uh but if you if you if you take a bit deeper um there's some quite interesting insights that I think um uh were I think uh I I think I mean the exchange opportunity was pretty pretty obvious but actually how to execute on the exchange opportunity is actually quite subtle um and is this really weird mix of skills uh uh you need to have like you know really good uh engineering obviously uh you need to be able to you know figure out how to actually solve these really important problems you know changes are notorious for being hacked FTX was you know uh we all what happened there I don't need to relitigate that uh uh uh and there's this enormous kind of like trust minimization problem that no exchanger really has has solved in a meaningful way um and but but it's

that's just like one part of the problem right you also I think in the wake of FDX uh need to have that kind of compliance piece uh really figured out in a really mature way and this is really the thing that scared the hell out of me out of building an exchange you know I'm an engineer I'm a product person I you know I love marketing and community and and being loud on crypto Twitter um I I I'm not a lawyer uh I I'm not a compliance expert there is you know AI a rich kind of uh uh history of of of of I think uh people building crypto changes um some successful some not uh that have basically ignored this piece Al together um we obviously all saw what happened with binance and and

and and and and how cat had to step out um and I think you know uh the DAT it's my view that the days of like a Founder who's maybe a good programmer or a good product engineer or whatever um starting uh one of these like you know crypto exchanges without the compliance piece figured out I think those days are mostly over uh uh and it's basically precipitated by uh FTX I think um every kind of uh regulator for good reason um is really kind of on the edge of their seats like really paying attention to the world um and you know on the one hand I think it's that uh you know it's kind of unfortunate in the sense that it's really hard to build one of these startups now uh but on the other hand it's it's obviously quite great in the

sense that like you know the world kind of has to level up and we have to mature as an industry um and so these types of things that were you know once kind of just Shrugged off uh are now kind of uh important um and it's kind of my view that as a results uh the uh kind of crypto world or startups and crypto are going to run into like two different kind of are gonna fall into two different buckets they'll either be totally centralized uh uh like us uh where you're fully regulated your you know uh your your license your money transmitter maybe uh you know whatever it might be um you're you're licensed vast in whatever jurisdiction you're operating or you're going to be fully decentralized you know you're going to be uh you know operated on a super decentralized network with a bunch of

independent nodes you know maybe you're an immutable smart contract you're you know something that really uh uh uh represents like the best of of the space things like you know Unis Swap and uh uh you know you know uh other kind of like really kind of pioneering OG defi protocols like that um and and anybody that's caught in the middle is going to be in this weird spot um in my view uh where you know they're not trust minimized um uh they they they they don't follow any of of the rules um and it's my view that it's only a matter of time between you know they either get uh you know you know squeezed out of existence for one way shape or form either they're fragile uh in sense that they explode or or they don't comply

with the rules and they get regulated out of existence um uh and and so I think that middle Spa is a really bad place to be um and so for me uh you know if we were going to build a centralized exchange uh this piece had to really get get get checked off it's like how do we do it and do it right um and do it kind of uh with the sophistication of like building a you know like like a Wall Street financial institution and it's like really easy to like say that in like a negative light like everybody hates Wall Street or whatever uh what I really mean by that is like you know being able to comply with like the legal framework that you know uh kind of financial institutions uh have to operate in uh in in in you know different parts of the world um and and

the reason for this is is really uh simple uh the this the reason why centralized exchanges are so uh valuable and have such like enormous distribution is because they are like the very first touch point that bridge people from One economy into the cryp economy from from trafi into defi um and they are uniquely positioned unlike any other product really to be able to bring all of that value back and forth between those two economies um and and obviously if you want to be able to kind of interact with that value in the traditional economy if you want to be able to you know have great Fiat rails have client money accounts with banks uh uh be able to you know trade not only kind of crypto

assets but you know also stocks and bonds and and and then you know you know real estate or whatever it might be right um um you need to be able to operate inside of that uh that compliance framework um and to me that's really important it's like you know uh foundationally I view the space you know I as I view I view crypto is like you know eating Wall Street in the same way that like software ate the world right we you know ultimately if crypto is really going to succeed you know every piece of financial Plumbing every piece of financial infrastructure um has to be built on on crypto rails um and so it's kind of this uh you know uh really kind of uh important part of in the product landscape to to not only focus on um

decentralization and not only focus on on this parallel crypto economy but to also bring all that stuff into kind of the traditional economy as well um and so I think found this is kind of like a foundational kind of kind of kind of view with like you know going after the change Bas uh uh and and so I think like that is like maybe the beginning of the conversation of like you know those things become being really important and then obviously um uh you know when FTX collaps a lot of people kind of saw that as you know um a huge void um that was ready to be filled um and actually executing on that um on that is actually very difficult and that's like you know maybe the next part of the conversation

but I this I'll stop there yeah why don't we just go there um sure sure yeah yeah yeah so I mean I think you know firstly you know uh if you want to execute on the on the exchange opportunity obviously you need to have you know the engineering chops and and and I think you know you need need to be able to build you know a a really kind of reliable robust like web2 system that's up kind of up 247 and never goes down uh but has to be really fast right um uh and like you know with the uh uh you know requirements of a modern financial institution um but I think the the thing that's I think unique is like well you also now have to start layering on all this like cryptography and stuff like that and all this stuff's kind of

interesting uh and unique um and then there's a compliance piece that's like interesting and unique most people have like one or or two of those uh uh uh uh but then the third piece which I think is is pretty challenging uh is is like the distribution piece right um and that's really having all three of these things together is really unique most people have two or three uh most people honestly have one very few people have all three of them um and and and and the distribution piece in the go to market I think is something that is unlocked in a couple key ways um so I think there's you know obviously unique product I think that's the most traditional way that that uh uh people kind of uh go to

market I think what's really I think unfortunate but just like the reality is that the barrier to entry to building a centralized exchange is so high that that unfortunately is like a source of edge um is like a very real way to kind of differentiate yourself um uh like a small example of this is just like what we're doing in Japan like you know we moved here very kind of intentionally uh uh because um it's really hard to get license here um it's really really hard um and the the bar is really high um and you know it's not that common for you know an American to come and move to I think Tokyo and and set up office here and and and hire a Japanese team and not only a Japanese team but a team that

actually knows kind of the process and and and how to actually uh uh build out po centralize the change here uh and so I think um uh that's an unfortunate reality and then I think you know um another piece is just like the international nature of crypto exchanges and this is maybe the part that is super um uh just it's like invisible to most people um so like I'll make like an assertion that like I don't mean to like be like you know mean or insulting or anything but like you know I'm an American I I I'm I'm I I love the US I will probably live in the US that's again at some point in my life but if you're building a an international crypto change you have to live where next to your customers you have to if

you're if you're not living next to your customers you're you're you're not doing it right uh you're just leaving value on the table um like little things like tweeting when your customers are awake are really important um let alone being able to speak the language and you know whether it's Japanese or or Chinese or or Cantonese or whatever um and and so I think that's another element that's really unique to our team in the sense that like we have a bunch of people that are super intern that are have part from different parts of the world um and so we're able to like go to these local markets in ways that I think a lot of teams have trouble with armania on that point I want to double click on Japan it's a very unique market and very Crypton native uh I think a lot of the

spot Bitcoin like the penetration of crypto and Japan is high similar to Korea but they're very particular uh bitcoin's very strong some of the other assets are not so much like what was the rationale for going first to Japan being a market that is so hard to crack into and very unique and localized what before you do that AR Ronnie what are the two what there's coin check and bitflyer are those the two exchanges in Japan yeah those are the two the the two uh the two real quite large quite successful so they're still okay and binance I think took forever I don't know if they are actually even licensed at this point but they were working on it two years ago um I believe that's right that's right yeah I mean I think firstly Tokyo is just this where this where I am right now Tokyo is just like

one of the best cities in the world it's incredible um it's people like I have this conversation people are like oh why did you do that or whatever and I'm like well just come here for a weekend and you'll see why it's it's just like it's it's beautiful it's safe it's clean there's so many smart people um it's just it's like it's just amazing um uh as you said it's super crypto native I think it has a very Progressive crypto culture um and so it's really exciting on that front um I think we've very unexpectedly have been able to hire a lot of really really smart people here um which is I think was probably the I thought it would be hard just because you know it's like you know as a as a as a as a foreigner or whatever um and so that's been like super pleasantly uh

surprising um I think what's really unique about Japan is a couple things um other than obviously all the stuff that you mentioned is quite a unique culture as well um listing tokens is very unique here um in the sense that you only get a couple shots on goal it's like heavily throttled um and so they have this like uh uh White list of sorts where if you want to list a token in Japan you have to basically get it approved um and it's not till uh about two or three exchanges have uh the same token approved that the third or fourth one can come along and list it without approval and so the number of tokens that are on exchanges uh here in Japan it's actually way less

uh uh than than in other uh part of the world um I think the other thing uh in Japan is um uh like a really strong um admiration and respect for kind of uh you know its institutions I mean I say this as a foreigner so like you know what do I know but I think what's unique and what's pretty consistent just based on the people I've spoken to is that like the licensing piece is really important here um and so uh like unlicensed offshore exchanges tend to not do really well here uh uh and so if you're going to go to Market in Japan you you have to do it like you you have to like you know button up and and and and and and and and do everything kind of you know uh uh bespoken by the rules here um um and so I think that was kind

of you know we basically thought okay well we're going to do it then we have to this is kind of How We Do It um and I think you know the other thing is just like um it's just a big Market it's like you know one of the largest countries in the world by GDP um and you know that is obviously makes it you know exciting I mean there's the two kind of competitors uh but I think generally um in the exchange uh landscape you know uh there's just not a lot of competition uh I think um in a sense like there's not a lot of people competing at a very high level uh uh there's like a lot of exchanges obviously uh but not a lot that are kind of you know really going toe-to-toe with um you know the the largest kind of exchanges in the space

maybe this is good a good a good of a pause to just get your thought process into the r decision building an exchange centralized exchange at a moment where yes that we all felt that there was a gap cuz FTX was a good product yeah yeah I mean people used it it was a good product um putting aside all the other stuff um one component is I mean it has a all this level of efforts really high for centralized exchange right you're talking about licenses you have to building distributions really hard it's not clear in many places the other alternative is kind of go do build competitor to Unis Swap and then build some onramps you know by integrating with a bunch of Partners and maybe kind of

stitching it together like that the point that you made around owning the customer relationship I mean coinbase is synonymous with crypto in the US it has built such a powerful brand and people still use it even though you know fees are higher than other places um why go like did that compute when you were thinking about was that even an option building a decentralized exchange do you think a decentral exchange with some on and off offramp could ever approximate what a centralized exchange has from a custom relationship standpoint so I think it really depends on on on what you are what role you're trying to play I think decentralized exchanges are super important I think um I I I I think there's certainly kind of

you know the future in many ways um I think we you know obviously our our our product you know the wallet in particular um it's a self custodia wallet it's in the same app as the centralized exchange um you know you can interact with Defi and indexes in that way um I think the main I think there's a couple things um that that are really important so I think firstly um there's a lot of decentralized exchanges now U I think there's tons of competition um I think that part of the world is really being taken care of uh really effectively by teams like you know us swap on ethereum Jupiter and others on on salana um yeah just generally a lot of really impressive people that are doing really

great work um I think in the centralized exchange landscape I think there's also um a lot of really impressive people doing a lot of great work um I think there's less in terms of number of products uh uh in ter uh that are that are I think solving all the problems that in my view need to be solved um uh and I think for a lot of us um you know the centralized exchange is the first touch Point into the industry I don't know about you guys but I bought my first eth my first Bitcoin it was on coinbase um I I never I didn't on board with a self codio wallet and I didn't know what a ledger was I didn't know what a pneumonic was um it wasn't until I got on a coinbase and used the app and

you know uh you know got my first crypto that I eventually you know started learning about kind of all self- custody um and that was that Progressive kind of arm onboarding journey and I think that is one of the most important things that a lot of Exchange are trying to do but they're not doing it as integrated as they could be um and like they're just best positioned to teach the world about self- custody um there's no place better like coinbase made a really interesting decision like tons of respect for them I Brian Armstrong's incredible like no no like no no shade at them they're like the Pioneers in the space but like the fact that they have their app separated is something that I I I strong I I think is a really good example of like one of

the differences between us and them it's like for us like we want self- custody to be inside of the same app and like yeah you you can use the centralized exchange you could use your exchange account that's going to be like a backbone of this of the product uh but self- custody is is just as important and it needs to be kind of right there front and set alongside the exchange um and so I think that's one uh big component I think the the second big component um other than you know coming to The Exchange space with this onchain ethos uh is wanting to actually go toe-to-toe with like the largest financial institutions in the world like okay we're not there yet we're certainly not there yet we have a long freaking way to

go uh but it's my view that particularly kind of uh in in certain parts of the world um you don't go and look at you know just literally go look at a financial app go look at your your banking app uh go go to you know your favorite you know a banker or or trading product and and you'll and and compare that to like Instagram or compare it to like Tik Tok or whatever it's like night and day in terms of like the engineering quality and the design and the product experience um and the reason for that is really simple it's just that there's just an enormous barrier to entry to to building these things it's quite literally impossible you need millions of dollars you need Decades of experience you need relationships with

all the right people to get into the right rooms to have the right meetings to get the right trust uh to get the respect and and and and time from from from the right people that will allow you to do these things that uh it's so hard to build these companies and there's been a couple of them that have come in uh over the past like you know decade or whatever you know there's like Robin Hood and whatever uh but they are kind of like the exception you know I think from from my point of view this is the other piece that nobody is really tackling other than coinbase um coinbase is the only one um that's really trying to go for that market and really trying to like eat the traditional Financial World um they're the only ones that have been able to go public that's like that

should be like indicative of any of anything right um like there's so many people that like you know tried and could have but they just for whatever reason couldn't get to that like they couldn't like you know get their you know Financial depart you know uh uh Department to like you know have the right auditing stuff in place um and so I think to get to that next level uh is is really important for the industry to like you know for crypto to really take over um and I think that's one of the big place is where everybody is just falling falling short um and it's not necessarily that they're falling short for like you know any like bad reason or whatever just I think a lot of people just haven't tried it or don't realize how important it is um and so we've kind

of set up the exchange from day one with this goal in mind um and so we're doing like a lot of really hard things that require a lot of you know experience like hiring like you know really established and experienced Auditors from like you know big accounting firms and financial institutions and not only uh exchanges in crypto but also you know uh people that have kind of you know done this stuff before and so uh yeah I think that's like the other big missing piece that I think is really important for the industry to get to the Exile hole when I first uh used it and then heard the pitch from chrisan um I felt and agreed with a lot of your point of view there has been a lot of innovation in the exchange space uh if you have the license you can get away with a kind of

crappy product and that's the nature of the world but it felt to me that you guys having started with mad Lads and like really UND it it was a sort of a very interesting these guys really understand crypto you're building it at a time where we have just more visibility in what the user really likes meaning nfts felt like you have a deeper appreciation for that um but of course as you say you know the you have to do the you have in crypto building in crypto in the centralized World regulated world you have to sort of build for perfe ction it's not like you know um and the in the capital requirements and the level of effort is higher than maybe like spinning up a

competitor to Robin Hood right um you know when we were in the early days of parfi Ben and I were of the mind that we had to build and use every single service provider like not the second tier or the third tier we had to use the best auditor the best accountant because because otherwise people discount you right and I can and so the question for you is um when you think about like expanding and really servicing the next 100 million users um how much of that is we just need to raise a ton of money and replicate what we've done in Japan and go elsewhere and convince Regulators that we are legit and we have the best team to execute and feel make

him feel safe yeah I think so so maybe for for some context um exchanges can use money unlike any other business and it's not just like buying stadiums and hiring celebrities right and like you know we've seen plenty of that obviously um and I guess there's like a time and place for that type of thing although we're certainly not at that place or time uh uh what you need the the money for is for you know things like uh parking money um uh uh in and and uh in like Banks so that you can get like licenses and like hiring teams all around the world offices uh local um uh uh compliance people uh local customer

support people that speak the language uh uh people that are not just like random people off of the street but people that have like done this type of thing before can actually build a real team that's like familiar with the local country and the local laws and the local like you know uh compliance regime or whatever uh uh and so every time you expand into a place um you have to like set up all of this infrastructure um and it's like okay it's like couple million here a couple million there it's it's just absurd uh it's it's like it's like it's so absurd that it just Nobody Does it right um and and the way that it was done in the past with like you know coinbase and binance and and FTX and all these others right is that they were

just so early that they were lucky they were they were just lucky that they they like they got a jump on it right uh but the world is has in my view has changed now um and so you can't kind of run that same Playbook again um it's like you know building a bank in the you know 1920s or whatever uh was was a lot easier than uh in the in the 1930s and obviously look up up until today right um uh and it's like the same story in crypto um and so yeah I think this the barrier to entry is enormous the ability to just spend capital is is absurd um and and so raising a lot of money is is obviously really important especially if you want to get to that next level um because you need to do things that not

only build the product but you also need to have all of these like kind of uh uh you know you know all these people with financial expertise and and auditing expertise and security expertise and you know you like n SRE a security team and accounting team a financial team a compliance team not just a one country but in in Japan and the UAE and the US uh and literally uh you know every country you can imagine um and so it's this like enormous Beast uh that is unlike like really building a normal Silicon Valley startup or normal kind of dii startup uh which is just like um super I think unappreciated until you've actually gone through it this episode is brought to you by SE

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the eth L1 and governed by mantle here's what you got to do step one Bridge me to the L2 step two put into top daps for extra rewards lendle they've got 8% me Loop apy that's at app. lendle doxyz slm markets you've got circuit which is a base plus boost apy is 6.8% that's built on lendle there's three steps to get started you got to get the m e on L1 you go to m.m manle doxyz stake step two you bridge the me to an L2 that's bridge.

mantle. XYZ we can put the links in the show notes and step three you can explore a bunch of different dap opportunities for extra yield if you want to get that so big thanks to mantle and congrats to mantel on becoming the fourth largest liquid staking protocol already it has felt that um most recently regulation is maybe at an inflection point but buing the US with this election cycle uh as you think about expanding one has it gotten easier to talk to Regulators to get approved um do you have you changed your mind maybe on when you're you know your strategy for the US in general yeah so I would say it's um like

I I wouldn't say we've really changed our mind I think our approach to the US is basically you know it's a huge Market uh it's you know uh where it grew up um we want to go into the US uh it just takes an enormous amount of time and an enormous amount of money um and you can't really shortcircuit it um and furthermore I think the US product is like you know quite strong I think coinbase is is quite good um and I don't see any good reason for us to to IM you know uh immediately go toe-to-toe with them um the market you know internationally is is is just as big or bigger and and so that's where where we're starting where we can kind of get a head start and start building a real

business get users get a real product off of the ground uh start growing and start snowballing uh both you know uh you know both you know letting our product grow letting your user base grow letting your resources capital and team grow so that when we're ready we're ready to go into the us we're kind of ready to go guns blazing and and ready to really compete at a high level um and I think this snowball uh uh uh like mechanism for lack of a better word is actually really important when thinking about building an exchange um like yeah like you really need to figure out how to prioritize because it's an enormous amount of resources and and you can't like go after the biggest market like on day one right you have to figure out like what's the path for you to get from

zero to like climb climb climb until you can eventually get to like a really high level um and so that's kind of you know the game that we've been playing yeah I want to get un understanding of why you think you've won to date and how do you think about winning in this game uh you talk about you mentioned earlier you're you're solving unique problems coinbase has expanded their product offering quite interestingly most recently with like base for instance they've been very opinionated on becoming that place where you you you first interaction with crypto and then we want to guide you in an app store kind of equivalent of entering web 3 you guys have taken a different approach um but I want to hear for for the

benefit of our listeners how you think about like the steps you've taken and how your product's different while you're winning yeah great question so firstly I wouldn't say we're we've won by any means I mean we've we we've won a couple we're we are we are uh yeah we're trending in the right direction I mean certainly doesn't feel like we've won we have a very long way to go um I the way I think about it I mean it's I guess like pretty TR if right um uh what we are doing and continue to do is to just focus on where we can be unique um and there's a bunch of different kind of elements of this um so the first element is just like starting with like our core right it's like madet community and and

salana right this is where I think we have very unique distribution unique background unique storytelling uh just you know you know moral friends and family that are in the ecosystem right and and so this is like a great place to start building a company and start building a product where you have you know a 10,000 pick profile a profile pick collection of people all around the world that madlads is unique and that it's really like genuine it's like it's not like uh it's it's it's like it's it's like an actual Community it sounds like kind of silly and dumb but uh but but it really is um and so that's been like a really great starting point just like okay just build a product for for these people uh you know there's two products that every nft holder has right they have a wallet and they have an

exchange and so that's been really just uh I think it really to be relationship and and and think that think that was a unique starting point uh and then you start there and then you know you keep expanding right we did it with the Sal system and kind of rode that wave I think salana obviously went was like at 8 or whatever when you know post FDX collapsed and now it's at like 170 or whatever it peaked at like 209 or whatever it was this year um and so a bunch of tokens got launched that was a bunch of listings that was a bunch of launch pools for us uh that was a bunch of awesome product uh engagement where you know we had uh you know the Mad Lads helping the product then the product helping the Mad Lads in backpack um and and that you know allowed us to you know

start growing in in other kind of unique parts of the world um and I think that's kind of been our approach to community it's like the exchange in the wallet is really unique and that our goal is ultimately just to promote and to help uh grow other projects and and we can do that in a really positive s way um and so we're kind of like this cheerleader for you know the pro the the projects that that we work with uh because you know it's a very symbiotic relationship um so yeah Armani will you um tell me about the future of the exchange and how you think about like adding more products to it so you start with salana assets then I saw you guys listed Shuffle I think it was um which is which is an eth token so maybe you're now

pushing onto eth then do you start to like will you ever add nfts will you ever think about adding you know traditional equities like tell me about the vision for for the product side of the exchange yeah so I the way I think about it is um I there's like a couple different user segments that are pretty interesting to go after I mean firstly we obviously went after where we had unique distribution which is just okay let's get every salana uh backpack wallet user basically to to use the exchange um a and you know as we're doing that you know on the B and marketing side and getting listings um uh we start working on the next phase and and really kind of that next phase expanding to the broader uh I would say

like Pro suer uh more typical kind of centralized exchange user which is you know people that care a bunch about trading people that care a bunch about having a diverse set of token products people that care about you know Futures and and and and bar lending and spot Argin and all these things um and and really recreating in in my view like what made the FTX SP uh product really special um and you know you see like this of binance and okx where and bybit where they all kind of had their own uh it you know go at recreating that product um but I think uh I think that continues to be a a pretty important uh uh uh I guess just a a product that

hasn't been properly reproduced um and and so I think that's kind of like you know a small way to expand uh the the the customer segment where it's you know no longer just about you know so on Maxis or whatever but now starting to to think about the larger kind of you know people that care about uh trading crypto more broadly um and when you start thinking about trading product uh it's all about one thing right it's all about Capital efficiency it's all about cost of capital it's all about where's the optimal place for me to have my funds um and the optimal place for you to have your funds is the place where it's you know a most secure and B uh can be used for the maximum amount of things possible right um and and so if those your two design constraints um then you

know that starts guiding a lot of the decisions and a lot of the the way you start building right so um I mean on the on the on the second Point um you know the the the table Stakes is just you know the the large out ones right salana eth Bitcoin you got to have those three chains you got to have all the awesome projects that are part of it um I think for us you know um the wallet is like a really integral part of the product like on the mobile apps literally one app on the web we have it like natively integrated with the extension and the website um and and so we kind of go after expanding the product offering with those kind of two products in tandem uh but you you know the more tokens that you have right the better

the trading product and that's kind of like you know a basic uh informative uh Direction but then you start you know venturing into you know other products right you know potential Futures cross collateral system margin systems bar lending Spar margin Etc um but then once you've kind of gotten to that point I think then the question is what's next um and I think you know in in my view you know one of the most important uh Innovations in this space has just been stable coins I mean this isn't like you know particularly insightful I think a lot of people agree with this uh when you look at companies like Circle um what are they really um circle is basically a centralized exchange that has one product they don't

have a training product they just tokenize dollars and put it on different blockchains and create uh through their you know centralized exchange they don't call it a centralized exchange but it's a centralized exchange it does everything a centralized exchange does um uh and that by itself has probably been one of the most important Innovations for crypto at large right you know whether it's usdc or usdt or or um any of these other kind of stable coins uh that are tokenizing kind of these you know real world assets or whatever you want to call it uh and I think this is really the unique thing that regulated centralized exchanges can do in a way that no other products can do basically um and so I think given our kind of

setup um given our kind of I think skill set on the team and orientation and just way like the problems we've chosen to solve we're kind of heading in that direction where I think we will be able to or we'll at least give it a go uh to you know try to tokenize a lot of really important assets and bring them on chain to create uh you know uh you know people like to call talk about Exchange liquidity hubs but I think uh you know creating these um you know very Capital efficient environments where it's just way more uh just practical and and and and also uh just productive and safe and uh just just more convenient to have your money on and and backpack right whether it's through the wallet or

through the centralized exchange like that's ultimately the goal right um like and um I think once you've done that right I think for a lot of you know uh you know maybe Millennials or gen Z's or whatever um or gen Alphas or whatever the the the letter is these days um you know the the centralized of change starts becoming a financial Hub in the same way that like you know our parents thought about you know their you know Banks or whatever um and I think that's ultimately kind of you know the direction that a lot of you know I think that that we're going um and there's going to be like a lot of work involved a lot of challenges that we face but I think ultimately nothing beats crypto in terms of like the place to have your you know all of your finances um and so

that's definitely the direction we want to go the way you describe the frustration with the financial system which is like it's not up to par with best-in-class u internet services um and my thesis for exchanges particular yours coinbase is that they will become the premier financial institutions especially for younger Generations which are harder to capture um like but once you have them like there's enor enormous amount of LTV there um how do you think about like the users that are you initially acquired a lot of them were mad Lads holders deeply passionate community in crypto I think you have this phenomenon where like the early adopters are easier to acquire and retain but as you go and try to expand

into other circles it just becomes harder and harder uh maybe you're bumping into a user that is using huobi or binance or okx and you don't have pers and they do and but you have Launchpad and really unique distribution in salana how do you think about like um expanding and I'm curious any insights you can share into what you're observing at the customer level uh the interactions what they're doing the behavior if there any particular like insights there that you found interesting over the last like year I think there's maybe a couple ways to to to look at this um in terms of like us your acquisition and and and

kind of getting to that next level I think firstly uh building crypto products is really uh it's not like like a it's not like necessarily uh like hard it's not rocket science you know if you're a good web 2 engineer or good web 2 product person you know you can you can work in crypto and build stuff uh but I think a lot of the you know um the skills and expertise and and just um uh you know foot guns and and like how to build secure you know reliable crypto systems that scill is like pretty uh there's not a lot of people in the world that can do that um um and so if you think about you know maybe the first part of your question that where you

were getting at um you know I think as the industry grows which I think we all continue to think it will be will grow um you know as you know the products in the underlying ecosystems whether it's salana or ethereum or Basse or whatever become more and more important um you know the the the you know it's like Rising Tides raises all votes right um and so the institutions that are there um to kind of facilitate uh uh uh that economy uh grow alongside it um and and there's very much I think Network effects there um in terms of like not only capital and people and brand distribution but also just in terms of

like actually just becoming part of the fabric of that economy uh and whether it's you know running you know uh validators and actually operating the networks to you know um contributing the protocols um to you know you a small example of this is like you know uh our uh it's just like anchor right just like every you know a lot of you know I would say I would say that the majority of of of smart contracts on salana literally have you know you know our company name in it or whatever and and that's um like a really small example that's like maybe not super meaningful uh but it you know it's illustrative of of the point of that I think um you know as the industry kind of grows and and takes over and really starts to in my view you know it'll eventually dominate kind of traditional

Financial Services um the the institutions that you know were part of that will will capture market share um in the same way that internet companies did uh with all the incumbents um and so I think that's like definitely uh a big part of it in terms of like going after like the main entrenched um uh you know uh I don't know archaic uh Financial Services businesses yeah is having a stable coin necessary to really get mainstream users um I would say I wouldn't say creating a stable coin is necessary I would say having good stable going products absolutely is um would you ever think yeah would you ever think of

creating your own um I think they'd have to be a really compelling reason to um I think getting Distribution on them is really hard it's like close to Impossible you think exchanges are the best places to get distribution like if you're the first BD problem that you're probably going to solve when you're creating a stable coin is like go find an exchange partner um just like Circle the reason Athena Athena's gotten traction is because they're a great customer to exchanges so they're going to get listed they're going to have the distribution right so if there's anyone out there that's going to create a competitor usdc maybe different denomination Yen or you know otherwise euro is probably going to be an exchange like you guys yeah you know that's that's totally right I mean

I think uh I totally agree it's not on the road map but yeah hardly agree with the sentiment yeah um can you just make a comment or just talk about the Launchpad there's been really interesting projects um that have like launched and backpack how important has that been to really entrench your position in the salana ecosystem and how do you see that going forward to get an edge over other exchanges perhaps yeah I I think it's super important I think ultimately exchanges are in this really unique position where they you know own that customer relationship they have that distribution to you know a just huge broad audience in a way that very

few projects do and you know I think it's really important to you know take that responsibility and and to use it in a really productive positive some way um and so I think you know we we have just you know tried our best to create as much value and to uh extract this minimal amount of value from from projects uh in the sense that like you know our success is their success or their success is our success I should say um and so that's kind of the view um that that we take to launchpads and and I think uh people have been really appreciative of that and and it's been like really successful um and we kind of were able to capture lightning in a bottle with it in the sense that we got a bunch of people really excited about

about them um you know people you know in the larger kind of Apec region in particular but all over the world honestly um and so I think it's a really important moment not unlike nft mints where it's just one of the best opportunities for a project to tell their story um and tell you know educate the world what they're building why it's important and to have this like huge microphone to uh in in an audience uh in a way that's that's really important and really special and and so yeah I think it's a really important moment for projects and and really important for a business as a result yeah I mean I think binance executed this phenomenally well in the last cycle their launch pad I mean projects have launched there had

ton of distribution and attention out of the gate um it has felt like that as like iOS have been like not as you know popular I guess or or for a variety of reasons um I'm curious um when you think about there's it felt historically that there's been some tension between the strategy of listing tokens some exchanges are really just kind of fast and prioritize that they us just want it uh others have you know like coinbase have taken their time but then they've also listed random tokens that it just felt like the strategy's been confusing at least from my standpoint how do you think about your strategy and is that

something that you guys feel like you have a a better understanding because you're closer to these teams at least in salana and you you know you're really entrenching the community yeah no I think that's more or less how we feel I mean I think we're very much like in the trenches on the front lines like uh I think we were really lucky in the sense that a lot of the teams that came into the salani ecosystem like we just like met them on day one like when they first came in um like I think um uh you know whether you know a lot of the Wormhole team you know a lot of the pit team you know a lot of the drift team um The Zeta team and all these projects on salana that are

listing tokens and building really cool stuff um uh uh you know they they you know I would like you know they would like help me like build the the anchor framework or whatever you know just like like things that just didn't happen so we we were really lucky in the sense that um we just knew a lot of folks um uh and so that really I think informed our our our listing process in the sense that oh we knew the really high quality builders uh that were building really like substantive uh products and not just like you know um just you know randomly you know trying to exit or whatever um and I think that's that's super important um just not to say obvious um uh I think you know on the one hand you want to be really fast for

sure that's like you an unique product you have to have your finger on the poll you have to know what people want you have to know what your customers want ultimately right and the tokens that are exciting for them and that's ultimately the thing that guides your decision um but yeah I mean I think like I said earlier it's just we just want to be like productive you know team players and you know the various ecosystems and you know be a a reliable exchange partner um I know you obviously are not just tied to salana you mentioned other ecosystem like e they're very important Bitcoin others um I want to your your take on salana like why Builder why Focus there uh especially at a moment where you know it was as you pointed out like kind of abandoned and post FDX

what did you see there that what do you see there today that you find most interesting yeah I think I mean the the the the thesis for salana is very simple um and if you're a a programmer um it's it's it's very easy to come to this conclusion if you're not a programmer salana is like maybe pretty um hard to understand uh uh but it's it's very simple it's like you know to put it in just normal you know layman's terms like do you want to use one tab on your Chrome browser or do you want to use multiple tabs on your Chrome browser uh do you want to use like one app at a time just Chrome or do you want to use like Chrome and Spotify and your calendar app and your uh Settings app and your you know clock app and whatever

at the same time right um it's like parallelism is like the most blatantly obvious thing um to build um and it's really the only L1 that has done it I think at the scale that that it is has been able to do it there's been a lot of really um uh you know really admirable attempts at it uh uh I think but but but I think they're they're really the first one to to really go to market in prod um with lots of users uh and so I think you know if if you you know during when FTX crashed you know you'd see all this just crazy stuff right like you know it was like SPF chain or whatever and it's like it's like no SPF couldn't like program a

blockchain it life dependent on it right he a Trader not not an engineer uh and so I think the the thought process was really simple it's you know if you believe that crypto is going to survive um okay uh do you believe that smart contract platforms are important and then do you believe that parallel processing uh is important for such a smart contract platform um and if you believe any of those things then uh really the only game in town uh uh is is is salana um Argo you should uh you know keep building on salana um and and I think that was kind of uh there's some other stuff that I think is super important like you know the community distribution and uh you know that whole

problem is is pretty challenging because there are other especially today parallel kind of execution environments like you know s and aptose Etc um and and super excited about that as well uh but you know at the time salana was really the only one that had a a functioning cryp C to economy um and so it was like pretty I think on the one hand it was non-consensus but it was like it was just so obvious in my view that it just like does like keepon yeah on that point for me at least we I was investing in salana projects before the FTX collaps like you know um soland jet like there's a few projects that I looked at was playing with Orca like I look at radium

like I was playing with them uh and then post FTX I felt like the quality of projects Dam there was a point in time where I felt like this is a very different project the defi ecosystem really took a different meaning uh for the better like the quality of apps improved dramatically to the point where like I was sending most people that were interested in crypto to salana based apps like we OB Phantom existed for a while their products gone incrementally better but you had like I was sending people to try out of the three apps out four apps that out would send people it would be backpack Jupiter um you know tensor um and maybe drip if they wanted to get something

free on their hands and I was like Wow for me that was a big aha moment and I don't know I'm I'm still trying to pinpoint like was it Bonk was it like what was it that happened behind the scenes because I again if you're not a developer in these ecosystems I think you miss a lot of what happens under the hood and you might say well this was happening for last three years you just saw the tip of the iceberg but I I I did feel that like you know when when especially like post FDX there were some projects that really started to Break um and it they weren't perfect maybe my observation is wrong but I'm curious to get your perspective like did you feel that there was a big inflection point

the quality of Builders coming into salana that the foundation do something was it Bon like what was it I think yeah I don't I don't really think that um okay maybe I think there's a couple things that are simultaneously true so I think foundationally salana is unique in the sense that it's it's a very product first like ecosystem it's like it's like probably the closest thing to Silicon Valley in terms of of of of blockchains like has the in my view like the most amount of people that just are super pragmatic can just care about their users they're like

a lot less idealistic I think than than than other chains um and I think on the one hand that's a really good thing in the sense that you know they care about the people that use their product and that's who you should care about uh and then it maybe a bad thing in the sense that you know they maybe I don't I don't know why that would be a bad thing actually now that I think about it but some people think it's a bad thing um but but but I think I think it's super um uh uh just I just practical is like the wrong word because it's almost like demeaning uh but but it's very product focused and I think that's kind of foundationally like at its core um it's like you know if you want to build a good product you have to have a fast

blockchain well and if and if you want a fast blockchain it's like us salana and so it just attracted all the people that wanted fast blockchains uh if that makes sense um and then the people that you know cared about running validator on their phone or whatever there's like you know they they don't like salana and that's like totally fine right um uh but but but um so I think that's foundationally one one ingredient um I think um the second ingredient was that well it had you know a couple years uh I think I came to Sal in 2020 um had a couple years of just like of baking of cooking right right like um these projects that that I mentioned like pith Wormhole um um drift Zeta um Jupiter all of these teams were cooking for years

like these were not teams that just like ran rly like saw oh you know I'm going to rip a token like randomly on a weekend like these are folks that have been doing startups uh for a very long time and doing these particular startups for at least you know since like you know the 2020 2021 or whatever however long it's like on the order of like years um uh and like I remember in I was at nft NYC like a year or two before the FTX collaps and I was talking with some of the guys from Jupiter and they're like yeah we're going to do this we're going to do a Jupiter token or whatever and and they just launched it like a couple months ago or whatever and they they put so much time and energy thought into everything it's like really incredible um and so I think you know a

lot of uh there was a lot of that as well that's like a second ingredient just like people are just cooking in the kitchen for so long um and we're really buil like building real I think you substantive kind of products and companies and in protocols um and then I think the third ingredient was just like you know um maybe signal and noise you know FTX goes down all the the people that you know don't really have the chops or they're just here for you know the bull run or whatever you know they're just here for you know I don't know why people come to crypto then I guess just you know come for The Bu run or whatever um but if you're not like here to like build cool stuff you're you're GNA you're going to balance immediately when something like that

happens and so I think there you know you look around and it's like oh who's left it's like okay the people that are left are the real ones um uh and and I think that was a really important ingredient and you know everybody says it it's like so TR but it's also just so true it's like you just like focus and build like no other in a bare market and and I think that was certainly true for us uh uh but yeah I think you know that's my my take if you will on on what happened I don't yeah maybe I like to a builder into space and for folks that are listening and maybe building or thinking about building like one if you had to do it again would you do it in the same manner would you be doing it would you be doing

something else and what have been like the key learnings for you what would you do differ that's a great question I'm almost like afraid to give an answer to this question um you haven't been afraid of any them so we have to get you on one yeah I feel like I don't know how I feel about this I would strongly consider being anonymous I think yeah I think I feel like not I feel like there's this really like counterintuitive thing it's like the more like I I I tweeted this the other day and it's like not always true right but it's like the more you share with people the more like the

opport the more opportunities they have that like they have to like you know uh call you out or something like let me give you a small example like we um uh uh uh decided to like to to we have like our code base right for the wallet and we're like oh there's no open source wallet on Sal it' be cool to do an open source wallet um and so we you know decide to you know um checkpoint our codebase which has a bunch of private stuff in it um you know it's like it's like Ops and and and and and as like you know the exchange on the mobile app and all this stuff so we just like rip out a bunch all the stuff that we wanted to open source like a fully functioning Chrome extension put it on on a public repo and um make it a GPL uh license um

and you're like cool awesome this is we have like a real kind of consumer great kind of Open Source wallet on salana now this is awesome uh uh and it's like here world like you know like please go go you know check out the code like audit it like you know test it out you know stop complaining about no open source wall you have one now uh and then what happens right it's just like people just start just like just like [ __ ] on you for like for doing that and it's like it's like oh you're not doing it the right way it's like you know you're not actually open source or like you actually suck you're like you're you're actually a bad person because you're trying to like uh uh I don't know um like uh like free ride off of like the

Goodwill that like open source people give you or whatever and I'm just like uh okay like I probably done like more open source work on salana than like anybody uh other than like the Sonic cevs uh but okay like you can I'm a bad person um and so just like stuff like that it's just like it it just I I think in crypto just so heightened that I think um you know I think you know that the FTX thing obviously was just like an enormous just like when you guys announc when you guys announc the round it keeps coming out every Bloomberg uh piece was like you know former FTX employees launch another exchange and it was like I'm sure it was attention grabbing they're calling me an executive they like alab Executives I'm like what like to be fair the the bean bag the guys you

guys that picture that has been now used in pretty much I mean you guys should get royalties at point it was like yeah so Ematic but yeah yeah anyway to I digress but uh I feel like there's not a ton of upside of of of being uh of having your identity uh revealed uh in crypto um so I I I would I would strongly I I used to like hate being anonymous too I was just like I'm not being anonymous I have nothing to hide and like I still have nothing to hide and it's like I'm like an honest like good person I'm just going to naively believe that everybody's like you know equally as as as but to be fair other other than Satoshi you've never like the most successful teams in crypto it feels

like a necessary evil and burden that a Founder has to just Embrace as you said it's not easy to build I sympathize with Founders and crypto you when the token goes up and the Project's doing well it's like yeah obviously that's your responsibility as soon as there's some deviation of that you're the scapegoat like you're on the Cs yeah the the analogy I I I talk with the team about this a lot because they'll like pay atten they'll see something on Twitter and then I'll be like oh you need to like not pay attention to Twitter um and and what I like to say is like you know to to like you know imagine you're like walking down the street and you and somebody like screams at you I don't know it's like you know maybe they're on drugs maybe it's a criminal uh maybe

it's somebody who just had a bad day uh I don't know but like you know these things happen right you live in San Francisco it's like this thing is like part of life I don't either minutes Stu recently um I love San Francisco but but it is really insane that some some of the things happen over there but you never stop and think to yourself oh oh you know that person just screamed at me when I was walking to work or whatever I'm GNA stop and spend the rest of my day thinking why did that person scream at me uh uh when it's was just like I don't know some some crazy person or whatever if you're walking in SF or whatever uh and I don't mean to be like Consulting people SF but that that has happened to me just so many times it's

just really great analogy um but that's basically crypto Twitter uh it's like you know all these people that would just like call you like the worst possible things you can imagine uh uh and and it's these just like it's almost like it's really hard to not get distracted by it um and and I think it slows I think it really turns off a lot of really good Builders um I think it's actually one of the biggest problems probably it's just like a lot of really good people just don't want to go into crypto for for like this reason it's like it's you just get thrown into the mix of all these like you know whether it's like criminals like you know or like in the case of FTX or whatever um or or or or just you know uh just people that are Anonymous calling you a

criminal it's like it's tough so uh anyway not super interesting but maybe that's the one thing I would reconsider I think the best thing about uh the best thing about the industry is also sometimes the worst thing and you can't you can't have it one way and not have the other right so you can't have the like I mean the the the like speed at which you guys were able to do do customer acquisition could never happen if you didn't have the madness of crypto Twitter yeah to totally you're you're just you're right you're totally right yeah um Armani are there any good thing like post FTX everyone always talks about like ah like Lessons Learned compliance whatever um don't be a fraud etc etc like are there any good lessons that you learned from

FTX like yeah I mean they were fraud like so the context for this question is I was with um uh an investor who's one of the biggest investors on FTX and he's like look like say what you will about FTX and the fraud and Sam and all that kind of stuff like it was an amazing platform yeah with with a pretty small team so like are there any product lessons that you took away like trying to ignore all of the fraudulent stuff any product lessons you took away yeah no it's a great question I mean it's probably like a deeply uncomfortable question for most people because like that the narrative is so like one-sided as usual I mean the truth is somewhere in the middle right there is certainly a ton of negative stuff uh but it's also easy to forget it was like literally the biggest startup

of the last cycle it attracted the best people the most amount of talent um uh and and that whoever you're referencing I mean I I would directionally agree um there it it was a great product um uh with you know the small team um yeah what what are like the positive lessons I mean I think um I I think the main thing is probably just like growth in crypto I mean you saw it not it wasn't just FDX it was also binance is the same thing right um like you can grow 10 times faster than you think um and 10 and 10 times bigger than you

think um right the growth at binance and the growth at FTX those were like those are I mean they're two examples of to kind of crypto change this into different cycles and and it's easy to maybe look back on FTX and and write it all off uh uh but I mean I think we've seen a lot of it ourselves where you know a lot of that growth was was real these are like real like amazing businesses um and and and so I think I think that's certainly uh a big one um I think I I would say this is a negative lesson that is positive from FTX but I think like um another one other is like just to focus on the things that matter

um I I think like in my view like FTX started doing all this like weird stuff at the end like sponsoring like athletes and celebrities all this kind of crazy stuff and instead of just like focusing on I guess the trading product or whatever um and I think that's like maybe a another kind of important lesson it's just like really focus on the things that your customers care about um you saw you saw coinbase make the same mistake in that in the cycle too like launching the nft platform when they like and and I think in the bareket they acquired it and then they brought a product iy paid him a ton of money and it amounted to nothing yeah that's that's great though how's the organization set up like you guys

have you have like anchor that I don't know how much time you guys spend time on but like you've got the xnf protocol you've got like backpack the wallet the exchange you've got madlads the community like do you have different pods essentially or is everyone working on everything or how yeah and like how big is the organization can you how do you manage all this yeah yeah great question so like the group has broken up into like you know different teams obviously different functions um that are kind of working on different things so like you know like the wallet is like you know a very clear team uh the like you know exchange compliance team is a very clear team um so like on the wallet team will there be like a marketer and a product person and Engineers on the wallet team or do you have like okay

okay I mean I'm I'm kind of unique in the sense that like I'm like really the only pm and so I like think about all of these things like I think about marketing I think about like you know engineering I think about product and so I kind of like glue everything together um in a sense uh but yeah it's you know mostly kind of I like kind of thinking in terms of like products and uh like many startups in a company how how do you think that you build company like the companies differently than than other Founders build um I mean I wouldn't say I was like I'm like particularly unique um I would imagine that our company is kind of would be similar to other companies that are started by people with similar backgrounds um I'm I'm a programmer so I

like to think about like building like good engineering teams and giving them like as much like responsibility um and as possible so like just a bunch of really kind of like um uh just like senior kind of like Engineers that basically have a bunch of trust and responsibility to make a bunch of really good decisions um and so they're kind of empowered to like do like large parts of the product like like we don't have like a lot of um uh we don't have any PMS I'm literally the PM we probably won't have any PM anytime soon um uh you know similarly with design um uh although product design is super important we have one really uh awesome one um uh uh so I think that's

like at its core um and then obviously there's all the functions around it that are you know equally as important um that are kind of just there to kind of like amplify the the core engine if you will right um but um I don't know I kind of view myself as just like a uh like I I'm just like a substitute I guess like I just I I find like whatever is like not working and then just go and like work on that right whether it's engineering or marketing or or whatever yeah I want to end with one question uh inspired by something I've read recently but before we do that I'm curious if there's anything that you can offer in terms of what's next on the platform any particular product uh and you know upgrades or launches that you might be

willing to share or or just anything in general you want to talk about that we haven't covered during this segment I generally don't like to um like anticipate future releases for whatever reason um mainly because I think it loses like the impact like um that's a a horrible your question but I would say there's like nothing in particular um we we are there will be a big kind of summer for us um we we have product that we're rolling out um uh but yeah well yeah we we we'll see when it comes out but we have a couple kind of enormous uh announcements uh

let's put it that way probably uh one of our announcements in my view will be like equally as large as the exchange itself um oh w okay L I'm look forward to um I was reading over the weekend this um like this the idea of hard work and there are like five different they kind of broke it down into five different types of hard work and I'm curious as you think about the success that you've had and what has in your mind been most like your style uh one of them is outthinking which is you have a better strategy there's a shortcut the other one is pure effort you're just working longer your the intensity of it is high the third one is being like

opportunistic you know you position yourself to take advantage of of a change of an opportunity maybe a void in the market the fourth is consistency you're just doing average things for longer than most and the fifth is focus and a lot of that is just saying no to a lot of distractions they're all different types of hard work I am curious when you think about the success that you've had yeah which ones do you gravitate to where you think have been most important in your journey yeah for me it's very definitively two four and five um it's like no no questions I think they're all kind of the same to me um uh basically I think just working really hard undistracted for a long period of time

it's just my formula it's kind of as simple as that and if you keep doing that long enough like hopefully you get lucky an opport an opportunity comes along um uh so yeah that's pure for for listeners pure effort consistency and focus I I would argue that most Founders are going to tell you like to me it's so two four two four and five in in a heartbeat like I I would argue most Founders will say two four and five and most investors will say one and three I'd say yes although investors that end up blowing up would say one because I never want to assume that I'm smarter than the market oh interesting but you hear three arrow guys be like I'm really smart or you know long-term

Capital Management blew up spectacularly these are noble orates it just felt that they had an algo and I think you never I never want to assume I think one is the most dangerous because you never want to assume you're smarter than anyone else but I do think a lot in crypto has been opportunistic and if I hear the conversation that we just recorded I do sense that there's been a lot of insight that you've had because you've been in the industry you were at FTX that collapsed and you you saw the opportunity like at a moment where everyone probably said this is the last thing you want to be building like an exchange again and I think that's that's positioning yourself to take advantage of we know exchanges are highly profitable we know that value

can be you know created there and you went for it and sure you've been at it for a while you were very strategic and going to Japan and all this stuff but to me it feels like it was it was actually surprising hearing your answer that you didn't me mention opportunistic because I think a lot in crypto is that not in the bad sense of the word yeah no I to I totally agree I mean I think it's like um what's what's the saying it's like you create your own luck or whatever um and I think I think two for five gives you gives you three it gives you opportunity um so I think that's it's like have your cake needed too I guess um and it also gets you other smart people that want to be around you and so kind of like if you do 2.5 you

kind of get the rest um uh but I I I I just want to like maybe say one thing on this topic that was just so insightful to me that um a friend of mine he's another uh uh he's a def5 Founder in the space he it really blew my mind when he said this I just wanted to share it it was it was just so so incredibly insightful um uh so I I'm sitting there there at a lunch with him here in Tokyo and and Isa Gman um uh you know who do you think my uh who you think like my role model is um as like as a as a founder and and he tells me he's like my my role model is uh it's a redwood and I'm like what do you mean it's a redwood

tree yeah it's like a redwood tree and I'm like what what are you talking about what do you mean it's a redwood tree like that makes no sense and he's like no no no no no think about a redwood tree um you know fires come and go um people come and and and and and and you destroy kind of everything around uh the land um but doesn't matter what happens uh uh the Redwoods stay uh the Redwoods don't go anywhere they they're always there standing um and kind of the history of of the region and the area can be kind of encapsulated in these redwood trees um and and he and he looks at me and he says he says Armani I'm a

redwood um on a redwood tree and he says I don't want to win uh in a cycle he says you know I I I I want I want to win in in three Cycles or five Cycles um and you know if you look at all these guys you know whether it's you know terara and Luna or FTX or three arrows capital or whatever you know these are all folks that had to win in a single cycle that just and just there was a there was a Tipping Point where they just lost it and then they threw it all all way because of of whatever reason right whether they took two speculative bet bets or so customer assets or or or whatever it was um and and and he's like well if you just

change your mindset from winning in one cycle the winning and you know three Cycles or whatever it changes all your decisions um and that was a really uh uh that was just like such an awesome thing to hear from somebody in the space um that type of like long-term thinking so anyway it was just you know shout out to guy and it was awesome yeah it's amazing I I I I've started to use that analogy um in the sense that if you invert and you say how many more years ahead of you do you have in investing you've discovered crypto today do you want to perfectly time the cycle or do you want to position yourself to invest for the next 40 years in compound and if you do that then I think you start making decisions that never

compromise your ability to play the game you never use leverage you you so so you protect capital and you you know you want to be in a position where you want to fund projects where no one wants to fund them and we're not in that environment right now but it's still very exciting so inverting is sort of what has been helpful for me to just play the long game I guess as a redwood that's awesome Armani I uh it's been a fascinating discussion really uh loved having you on I know we've been trying to make this happen for a while but uh you know you're a busy man so really appreciate you coming on the Pod and perhaps we we'd love to have you on again uh when you do this major announcement and uh maybe we can U do a recap of of what you're doing then and

there sounds great thanks so much R young guys appreciate it man really appreciate it all right you heard about say a couple times just want to give them one last shout out big thanks to say for sponsoring this episode of Empire there are a ton of reasons to build on say if you want to get in touch with them you can reach out to me I'll put you in touch directly with the team you can also get in touch with them on Twitter at say Network you can follow the journey at say Network they are currently live they've got SE V2 on public devet today mainnet goes live later in Q2 really excited to have SE sponsoring and partnering with us on this episode of Empire [Music]