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Chinese EOS Community, Stablecoins, Regulation, Governance, and the Future of DeFi w/ Equilibrium



all right everything e OS fans it is Evan Schindler you're not used to seeing me give the intro on the show but this week I am with Zack Gaul we're in my studio so we're doing his show but my studio we got the guys from equilibrium here with us as well so we're excited a little bit of a changeup Zack how's it going guys how's it going like like the intro there I think we should go around the table here so this show concept whenever we discuss this we kind of planned this last week I met Alex in San Francisco for the es World Expo and now that was I think whenever you guys announced equilibrium publicly for the first time you know first time I heard of it which is crazy because I usually hear about product projects before they come out hmm but then we saw you last week at b1 June and you were telling me about this trip Europe you've been on and we're kind of gonna talk about that in a little bit but um you made your way to Pittsburgh and we needed a place to record and Evan he want to introduce yourself and Leo B and what you did sure well I I've offered up my studio here you guys complimented me on I felt really good about it this is man cave what I want yeah I'd like to you know have a different taste of culture east and west very appropriate yeah and I'm glad that we're gonna dive into that you guys were in China you work with Chinese companies so I you might have seen me on everything else before I don't know I know Alex we met in DC yeah they're from how we just talking about some some yeah some tea some Chinese tea but actually in the EO space work with a company called dab unis that Zack and I Zacks a partner of mine with that and we do a smart contract dev work for a bunch of companies so that's what qualifies me to be in the conversation but I try to just be like the the comic relief when I'm around such powerful minds as from the tree pinch the tree of Rob says yeah we all work together previously I seola so we have that relationship post and that's kind of how we all you were doing podcasting before you got yeah way before that yeah I just started doing this stuff while working at Ice yogurt but you guys are guests you're here in Pittsburgh you went out everywhere you traveled all the way from California but you travel kind of started before that why don't you guys introduce yourself yeah thank you guys for having us here is real pleasure was definitely great to catch up in DC in California before so yeah finally we here in Pittsburgh on the ear athenaeus podcast yes so a few words about myself I'm the CEO of equilibrium and along with being CEO of cuckoo Librium I'm also the co-founder of change OE it's I guess along with shape-shifts one of the biggest exchanger on the markets today's I'm here with chief counsel of equilibrium juice guard buddy yeah so maybe cool yeah yeah thanks good to be here my name is Josh good buddy I'm as Alex mentioned the chief counsel for equilibrium I think between the two of us I'm the boring one being a lawyer he's the technical genius I'm the boring lawyer so my background is in financial markets I've been a derivatives lawyer and have done my time in purgatory at places like BNP paribas JPMorgan reddit Suisse like the pillar side I've been in the dark side but I have come into the light now so I am I'm the chief counsel for equilibrium with one of my hats my second hat that I wear is as the global chief counsel or general counsel for qui be of global who are we who OB you may have with the block producers shake-up lately um I think there's a disconnect in communication people in the like english-speaking Western world you don't really understand what's going on in Asia they just see all these block producers they've never heard of absolute but at the same time maybe on that side they don't know what whatever and here's doing yes so we kind of talked a little bit before we started recording about some of the ongoing developments there and how impressive their work actually is over there yeah it's fascinating in the sense that as you say there's this this kind of communication disconnect between what we're doing here and what they're doing over there and you know bridging that is a challenge sometimes but things like the block producer summit we were at recently we had a large Chinese contingent and seeing that here I think is also because they're taking the time out to come here and say hey this is what we're doing but as a general maybe stepping back into into what China are doing at the moment I spend a lot of time there for Bobby and I get quite involved in the kind of event space and getting involved in incubators and seeing what's happening there and what I can really see is this this kind of thinking that is very much derived around the WeChat model WeChat is everything in one it allows you to pay chat pay your bills or the food so you have this micro app culture within WeChat so there's an entire economy built around building mini apps for WeChat so that is a very small leap into the DAPs world in the ER space and so every time I'm over there and you were there more recently than me but every time I'm over there and I go and see the the range and the scale of DAPs that are being produced on EOS I think wow ok it makes perfect sense because you were doing this for years in the WeChat space or in the alley pay space so that whole mini app culture is something they get really really well and they're trying to bring that over here it's fascinating so basically I'm the least cultured one in this room Alex just came back from China or came to the United States directly from China yeah yeah so you've told me about this before about this week I know what we chat is but about how they're so cashless they're already yep yeah an example of a homeless person with a qrk yeah in many ways they're there ahead of the u.s. especially with payments and like the micro apps that you're talking about there's actually lanes on the sidewalk for people to walk in that are looking at their phones because they're so glued to it that they don't want people bumping into each other and yeah so and I come from a payments background retail payments you know NFC and EMV technology and that was one of the hardest markets to even try to get into because they skipped straight from cash never really adopted cards I mean you've got Union pay and they do a decent amount of volume button the the the QR payments really caught on there and it really you know when I started getting into crypto and into blockchain that was one of the first things I thought of just having been in payments in a previous life I thought man as soon as they figure out how to get blockchain payments on – this QR system you can cut out so many middlemen and and all these networks and all these processors that are just taking a feed to do this you know old-style system of payments so they're way ahead of us with WeChat though is we chat taking as big of fees as like an Apple store that's taking like a 30 or 40 percent cut of all payments no no super low no so affordable to the point where you know you might pick up some freshly cut fruit on the street in a market in Beijing or anywhere and you'll pay for it using your WeChat payment and I think it's verging on frictionless I you would not notice the amount that really is coming out of your account yeah it would be a merchant the merchant would be the one that was yang for it yeah and here's free as far as I know or is like going from like zero to one you're saying from there it's like the users won't even notice a difference because they're already scanning things with their phone and paying that way it's right back end infrastructure that be different completely way out here people are used to swiping cards yup yeah yep like even we have Apple pay and like nobody wants to allow that nobody uses it even though it's available at like most retailers yeah I should I should I should I should mention that I've been to China like four to two weeks in past months I couldn't buy anything in supermarket with the cards they have no no terminals for doing that only we charge only QR codes and you can do that only having Chinese bank account that's there's a charge there's a channel yeah yeah that's a challenge so we'll use cash forget it because some of them go no we don't want cash well if you try and give a cabdriver cash they go WeChat it's not working no I don't have any pay so get around IIIi use I used ATMs man III cashed out and you used to use just you know physical cash that's it did you did you take the trains around or were you flying mostly I know know I was almost mostly flying flying must have been someone with someone that was Chinese at Hope or you by yourself or yourself yes yep I would I mean I've been there a few times and I speak enough to not get lost but even I I don't think no no I mean I mean you easily can get lost in China because you know Google Maps doesn't work actually you you can even locations they're mostly I'll on all incorrect that all everything in Chinese everything engineer so if you if you type in some you know address in in English it can't be wrong so so you arrival is wrong destination yeah but but you easily can use some translation app to translates to people what do you actually mean so oh yeah so yeah as I mentioned I spent there two weeks I was I was really impressed with the amount of people who are involved with us-based particularly so we were literally floating between offices in Shenzhen from one meeting to another we actually I think I think we we had like six up to 10 10 meetings a day with dill did with different guys in inch insane so for instance like we were floating between meeting with token pockets it's the largest I guess wallets in China with respected specifically for for us pays us Park us us space us Shin Jane although all these guys they they hope we had a meetings in person so and we've done a lot of connections there by the way so I actually I actually visited Shenzhen and Beijing within this trip so yes tell us about these blog creatures out there because for a lot of our audience the they're foreign to them I mean literally and figuratively so like what what did you learn from being there like what are they working on like how do they kind of envision the es IO ecosystem compared to conversations you have with Europeans so they're doing a lot of work there in China with with the community they're hosting a lot of a lot of meetups they're getting together also the they all they all are into into development of the apps so every every every block produces doing something some applications some wallets or anything so they're very deep in in textile technical technical side of things yeah so weeks in China yeah I spent then straight to DC you came to our everything yes event on Friday and then you did the b1 June on Saturday and then you pray left Sunday or Monday yeah yeah well we'll have left like on Monday said so to San Francisco a lot of people made that trip there so a lot of years people went straight from DC to San Francisco I would say I would say that a lot of people did exactly the same trip as I did since a lot of a lot of them came from that Oakland from Beijing people that I wouldn't have expected to meet at the everything year's event more so they were at the b1 June event I was just kind of in a different place but everything is I talk to a lot more people I'd say yeah yeah we had the meeting by the way with with the US studio here there in Beijing they also did the same plane as I did to to DC's health we took the same voice studio I think that's where are the the best projects that's really going to push the developer ecosystem forward right we have our EOC of developer courses by Peter Kay who's also a partner big shout out shout out the feet and we like none of the block one documentation includes yo studio because they are hesitant to promote any third party because mmm they have that liability of that third party but as soon as Dan like tweeted something about his duty being a cool tool we're like yes because we wanted to include it anyway but we didn't want to include something in these tutorials we're gonna spend so much time on then have something else come out or be one was working on some things that's like do studio a team is I guess my plug here yeah yeah they're hosting a lot of meetups by the way I think all over China including Hong Kong by the way and yeah since since we are going we're actually thinking of more expansion to China to have more exposure to local community we are going to participate in in these meetups and maybe with us studio as well so there is one one of the high priority for us so Josh you being you know international man of counsel what does what's what are your thoughts on kind of how the regulatory comes into play in China because I know the media gives you mixed messages and you can't trust the media there or here so what's you know what how does it on the inside what's it look like well I mean we hear a lot of hyperbole here about China and regulation and I think really I boil it down to to two things one is the regulators and the authorities in China are listening they're listening and they're learning and secondly engagement they're engaging and what I mean by that is they're sitting at tables with the right stakeholders going what do you do how are you doing it how can we understand it and how can we support you so they're supporting us already but of course they're yet to come up with this framework which kind of gives people carte blanche to do what they're already doing in an open and overt way so the regulators are very engaged in in China at the moment because they see this arms race that's taking place all over the world to attract all these various you know whether it's defy businesses or just blockchain technology or crypto exchanges whatever it is there's an arms race to capture that business within your jurisdiction it's very sexy it's very new you know people people love these stories right so all of these jurisdictions are trying to capture those businesses we got London competing the u.s. is already one of the hubs all of Europe is trying to grab that business by the horns so trying to see that and they know they have to do something about it so it's a positive message in that they are actively engaging with the right people but I think it's going to be a little bit more time before we get to a place where there's actual clarity and that that's to be expected really it's a big country with a lot of complicated and domestic setups whether it's their payment system whether it's their capital controls or their banking it requires a well drawn out well-thought-out methodical plan before it really takes it to the next level I think it's pretty optimistic sentiment there it is it is and I think we hear it we hear too much noise all right so much fun yeah and it's very easy to concentrate on the fat but the unsung success stories don't get out often in as we're doing here that's what we're doing examining so why I know there's probably a lot of reasons you're in China so I guess this would be a good point to just introduce what equilibrium is like I think beginning I made an assumption that people knew and I'm sure there's people who don't why don't you explain what equilibrium is and what you guys do and then I'll get into some of the things that I think we're valuable with your China trip hmm yeah so as I said I actually was doing Chand joy and have a lot of experience with exchanging crypto assets and we also feel lacking of you know some reliable stable coin which is highly transact bull and transparent by its nature for sure we sell some particular particular projects rolled out to other chains like to ether for instance which has which is actually a decentralized stable coin and it is proven model but it feel it still has certain drawbacks for instance the cost of ether transaction is so high right and the the capacity of network is not it's not too aggressive as you asked for instance so we actually saw the gap in a for for for us community and for markets overall and we decided to fill this gap with with reliable reliable solution are in terms of decentralized stable coins and that's why we're building up equilibrium the equilibrium framework so most of the time when people hear about stable coins a lot a lot of people that haven't dug deep and – enough the only one they really hear of is like the Ted like the actual pegged to the like what's what's the definition for like a tether like the look like a fiat collateralized peg yeah so it's basically a stable coin collateralized by something else that doesn't exist like USD T it's yet money and most people here if tether on you know some people have heard of carbon yeah um but what you guys do is different you guys are more similar and I know there's a lot of differences we'll get into them too like a maker Dow you are a collateral backed stable coin right so could you explain to the people who don't really understand collateralize anything and explain how a collateral collateral backed stable coin is generated in the first place right right so so basically there are several approaches in building stable coins the most general one is to simply have some physical assets like physical dollar sitting on some accounts and you you simply issue tokens one to one backed by USD right so there's the approach of tether of choice D of use DC by coin base a lot of projects on the market doing that and it's a kind of mainstream for now but there are a lot of obvious drawbacks for this model the most obvious one is that this this this model actually relies on some centralized infrastructure which can which actually you know it can be treated by local authorities right so the I'm not I would not be so sure of real prime transfer in stencil highly regulated etc yeah right yeah right I think the naming names we can we can say that there are some stable coins out there and people don't know this that are Fiat backed one to one tethered and pegged to the dollar that if they choose for whatever reason they can go on the blockchain and go ah that's that's Alex's ex asset we're freezing it and then we're deleting it thanks very much good bye and you get that you know that whole the theme of concentrated counterparty risk is not just the fact that it's financial ie sits within one entity that may or may not exist tomorrow it's a counterparty risk to the way that they treat your assets as well so it's much more nuanced than just hey they have your cash you've got to look at them and think whether you're comfortable trusting them having your cash it's more than that do you trust them to safeguard your assets so I I'm not exactly sure which ones you're referring to but so with something like tether there's always the the audit ability and transparency that is lacking is because I can't see their bank accounts fraud and write the audits are all even even if the audits were on schedule you're still trusting the audit and so but then there's other stable coins that are regulated in the u.s. I'm not sure like the Gemini coin the coin based coin and those ones they're there on a blockchain and but they're not completely decentralized the night I think those might be similar to what you're referring to is where even though you think you own these coins like there is a central entity that could shut them down and freeze them correct yeah it's probably all of them if they are all approved in the US show up because it's kinda like a backdoor hmm so with something like collateral backs stable coins everything's on the blockchain it's locked new a smart contract with multi SIG's that we'll get into in a little bit yeah and you could see how much collateral is in the account and you could see how many tethered dollars or have been printed yeah Ryan what yeah it's always available for everyone to see I think that's the biggest difference it's completely outside of the banking system so one like with the Queen based dollars gemini dollars and then the tether USD t you still have a centralized entity in there there's still a bank who dollars the day like they're holding the dollars and if they don't want to give them to whoever the blockchain companies and they could do that yeah right right moreover I will I give you an example everyone remembers that a couple of months ago or maybe three months ago so I'd say that stated on the website that's not till it's just yeah so since this moment not only by doors back to our stable coin but but but out with with also with with the securities what are these securities how they evaluate it I don't know I think that's the coolest part and the biggest differentiate differentiator between what equilibriums doing compared to the project that's most often compared to and that's maker down mm-hmm so with Yves tokens they have a utility and that utility is resources and governance right so with something like maker down you you lock your aetherium into a contract and you print dai you print your your tether span your dollar peg or not dollar PEC but your your collateral back to stable coins you generate them from your ether your ethers locked up and it's not doing any work for it it's nothing work for anyone because all it's good for is gas and transactions whereas on EOS you do the same thing you lock your EOS into a smart contract yes DTS are generated which are basically they're picked $1 so you could use them to spend right I use them to trade but while those ia's tokens are locked in this contract this is the most interesting part to me is that the in vote for block producers which you have no voting rights on aetherium it's all hash power hmm and then you could also generate income from those tokens that are locked up and they're almost like rika latter lysing themselves over time through fees through something like the recs which over a long period of time the APR on the recs like coins because more people are using the drive around the bandwidth yeah so and here I also can give you example that's currently we're also mmm developing the market making solution for for the framework which roll actually supports this the the secondary markets and so we actually needs a lot of resources for wouldn't within us network for doing that and we're actually utilizing recs for now and we deploy we have deposited to wrecks like 0.25 us get resources for 1,000 us us against this this deposit so it's tremendous multiplicator right yeah yeah and you know the the feedback we got from the community when we announced that we were using recs within the framework was overwhelmingly positive so I think that that call by Alex in the dev team was a really positive development for us because it almost further enhanced all of the various really interesting and powerful tools that the framework can give its users so I keep comparing to maker Dow make it as the maker token and then the da ice table coin you guys also have two coins within your system the USD T is the equivalent of a dollar on chain but then you also have the nut token sorry kind of people have have nots oh i guess explain do you tell you both the dollars easy yeah what's the utility of the nut token I know you guys are I guess rolling out some of the human stuff here soon – she kind of want to talk about that yeah so to to to before before driving to details I would say that we have done a lot of work but before providing more utility to native utility token called nuts and actually for now it's used both as internal currency for the framework and the governance token so if it comes to the internal currency nuts can be submitted by users for covering some fees accrues by the framework for the generated USD stable coins and actually we enable arbitrators who are involved in liquidated liquidation process on the framework to submit nuts in order to get an access to liquidated collateral at a discount all right so it's it's a huge difference by the way to make her since mmm care talking is not used for doing that yeah so I mean you've been in the blockchain space for long enough respect like with Shin jelly you were working with all all different block chains what kind of led you to use like out of all of them um it's a good question whose question I think when you see and I'm just speaking from my my personal experience when you have exposure to all of the various protocols and blockchains you think you know they all have their pros and cons and some are suitable for certain things and others aren't and I from a an exchange perspective have always looked at what it means to have a stable coin what's the utility how does it work best you know whether it's the regulation whether it's the operational side and the one thing that stood out to me about EOS was just the the ease of transaction how quick it is mmm cheap it is you can do things on EOS that you simply cannot do on on aetherium and one great example which we were talking about earlier is it's the price Oracle maybe you want to earn that in a bit more detail yeah definitely we got a right price feed on smart contracts and we have literally a real time price phase we can't do that on either it would cost a lot gasps yeah yeah because it because of course of transactions I give you another example we we actually mmm have the decentralized application for generating USD obviously and these application has no back-end at all so it's just the front-end sides and the smart contracts and we I was really impressed when we launched that and when you do the transaction you broadcast transactions from the front ends signed your private keys with it with a private key and you see the results of transaction immediately within the half a second this really impresses yeah you mentioned price rules I guess I would be remiss if I didn't bring this up what's your approach to the Oracles hmm and what services are you using to get your price feeds into your smart contracts yeah so the the approach force bride-price Oracle's is pretty straightforward we are utilizing the Oracle Oracle service provider they're our general partners or acquires now they call provable so they they provide the the trust line which with the smart contracts and the external source of market data so that we can actually fetch the prices from whatever we want currently we are utilizing creep to compare for doing that so we get the aggregated price of us to use the pair but in further we are going to build up some median Iser on chain mini another so that we can get prices directly from exchanges like ten or fifteen and build build the medium for that and another important thing that we are going to to diversify our Oracle Oracle Oracle services on offer for our smart contracts and now we're in the process of integration of these piece within that network right yes sir so that that's one of the goals for us to date yeah I mean we're in like a group chat together you guys are devs are working with your devs all right you mentioned some of the DSPs have been very helpful as well earlier before we started recording is there any DSPs you want to kind of call out that have been extremely helpful with getting you integrated into network services yeah firstly I should admit that we're really impressed with the work of the community with with the unity of the community around us and what's happening in the space in terms of these B's and different other services and dabs so we were in talks with a lot of projects from the space in terms of integrations and partnerships and also I can highlight here defuse for example we're working with them on integration their solution for history plugins and some some some other stuff for our backends it's by the way very very very useful very helpful in terms of rolling out something from on backend side because you don't need to build up something on backends you can just utilize their services yeah so whenever you're not working on your own project like and you're just kind of seen it like what everyone else is doing there any other projects like completely not even viewers or anything that you just kind of impressed with what they're doing kind of I talked about you a studio earlier like they really impressed me is there anything else out there that we really really like what liquid apps are doing yeah yes I mean I mean it makes a lot of sense yeah yeah so what else icon I can't doing a great job yeah making the blockchain accessible and I think that's really one of the key themes that we see when we go out into the the non blockchain world you call it we talk about what we do and they say but how would that apply in the real world and I don't want to think about private keys I don't want to think about what protocol to use or whether it's interoperable with other you know protocols making it easy and those guys has done a really great job in that making it easy to use easy to setup is you know it's a very very important tool to broaden the application of blockchain technology in other areas so yeah they've they've been a very impressive who must have we met on our travels sense yeah sounds sensible sense sense make a lot of sense so we talk to you a little bit about like the regulatory environment in China hmm but you guys had a note before the show about how you're seeking some legal opinion in the US now that's gonna be published absolutely and I think the theme of regulation is is not the most important but one of the most important themes within building a successful stable coin framework because you know stable chrome frameworks simply cannot get off the ground let alone be utilized if there is any real concern about the regulatory status so stepping back a little bit over the last year or so I've I've spent a lot of time analyzing from a legal perspective the regulatory status on various jurisdictions for Fiat back staple coins whether that can be Gemini dollar or whether that's tether or whatever it may be the universal conclusion it is a minefield of regulatory issues in that if you feedback something suddenly it becomes some kind of instrument whether that is electronic money whether that is a Fiat collateralized instrument it can be anything in various jurisdictions so suddenly you're hitting this minefield of cross jurisdictional regulatory arbitrage that you can't win so that is a theme I I I'm very well-versed in I thought wow there's got to be a better way to do this and we've seen obviously make it out come out and do a pretty decent job at kind of a swaging these concerns and I think it's all it's all in the kind of the delivery it's all in the documentation and building things in the right way so as part of this process when we were building the equilibria framework we wanted to build it with regulatory certainty the importance of that is at all levels it's a use cases so if we say to a payment provider incorporate AOS DT as part of your payment service they've got to be comfortable that that's not a financial instrument of any kind or it's not a security as an example getting them on an exchange and traded exchanges they want to onboard securities to be traded they simply can't so you've got to be able to convince them that it is a vanilla simple crypto asset even your average person just holding it in their wallet there's a lot of media fart about is this a set of security so your mom and pop are like thinking gee do I want to hold a security in in my wallet no they don't so for us it was so important building this framework in the right way and you know we took a lot of time going through the the kind of framework itself from there all the technical aspects it's a space all of the documentation how it all inter links and feeds what our story is we conveyed that to Council we work quite closely with them to kind of get to a place where they actually can understand this quite complex technical framework and we were very pleased to get a good result so we're not going to go into any more detail as to the actual opinion itself we're yet to release that but it is extremely positive it hits all the right tones of course it's not a security in any way shape or form for for us is the key because that broadens our ability to take these assets to the right places so we've worked long and hard on that and I think we're quite pleased at that um you know that that has borne fruit in the right way and we see a lot of projects doing it the wrong way around they build their product then they go there lawyers actually you've got to be working with your lawyers while it's late so Facebook has a terrible reputation now but whenever they're growing their motto is move fast and break things and that is the absolute opposite way to go about things in today's regulatory climate yeah so you guys are like in the weeds with the centralized to finance it defy is like what everyone talks about like what is the future of defy from you guys perspectives where does equilibrium fit into that mmm and what let's just go with that how about that not too heavy it's such a big yeah it's such a broad topic to even talk about so there's so many things we can cover at a base level maybe putting my you know my hopeful hat on equilibrium we believe will be a framework that will not just be pegged to the dollar it may be pegged to other assets at some point in the future so really we're offering something that isn't just suited to people that want an asset that's denominated in dollars it can be in their local currency and that as a base fundamental can be a layer that can build on so many different applications whether it's in the payment space which is booming right now whether it's in the micro app space the DAP space where it can be an internal currency that can be used for game developers all of these areas I think we see the equilibrium framework really being a launchpad into all these different verticals and there are so many conversations we've had over the last few days where you know people have said wow we want to integrate you into our wallet we want to integrate you into our payment network and that for us is just the beginning and that is that is very much within the defy narrative and we think it's even gonna get bigger and bigger yeah and I would say there's a lot of more concepts arriving arriving at the space from lending perspective from from from different perspective of defy and I should to make a little a little statement here so we were actually in terms of equilibrium we're launching the equilibrium lab to to make things happen so it would be our R&D division to pick some interesting concepts and to make some development and research and development on that III think that was interesting we kind of briefly talked about that but the name of it so did you come up with that name before yo SiO Labs came out with their name for their or indeed division it was easy choice so I guess we could spill the beans you guys first told me about an hour ago of what the first research you guys are pouring money into to research and model 11 practice around someone else's theory on the best way to do a stable coin right right right so currently we are definitely working on something something interesting and something very relevant to us community and this is the concept of Bank or backed stable coin proposed by Daniel Armour so we're doing research on that because we we think that actually block 1 is not going to do something themselves on the top of this of this concept while they're actually expecting the community to take a little nuts and to develop something something on the top of of the concept proposed by Daniel what he's referring to is Dan Larimer I'm looking to date April 27th released a blog post that he's been teasing for really long time Toyota Hilux price peg token algorithm mmm it had some differences from how you guys were approaching the situation ignoring someone who kind of respect kind of well known in the ear space yeah it's interest it's interesting that Daniel Daniel has joined our telegram group by the way telegram of of equilibrium and he asked a lot of questions regarding the projects and eventually he shared this article and it was exactly that dates with when he was initially released so he shared the link to that suit our group maybe he's trying to lead you towards something yeah apparently apparently that makes a lot of sense because it's like he's just kind of like given some ideas ideas are free if he knows his hands are tied he's pretty very busy karora if he wanted to do it like he might not have I mean it seems like they have unlimited resources but you could still only move so fast sure so when you first saw that what features in it where you like that's actually a really good idea we want to look into it further and then from that point until you decided to launch equilibrium labs um like what impressed you the most and what is your main focus with the labs I guess like what's the process going to be like how do you start to research who helping the team and what exactly are they doing as part of this or India hmm so the team currently as I would say around twelve twelve developers so we have very experienced guys on the team doing research and obviously the developments in terms of equal apps the concept of Daniel is I would say very different to the approach of USD T but what would be the green common between these projects there would be nuts so we actually we're actually now figuring out how to apply natsu to this concept as well so it would be the connects its infrastructure and yes so currently we're working on the series of articles which will be revealed in the upcoming weeks and so the we can actually presents the results of our our research and development as well so the all the development of this concept would be open source and if someone someone from the community wants to approach us with their ideas or feedbacks they are very welcome you mentioned something earlier so you said other currencies no I guess if you could create a peg a collateralized backed pegged token to the dollar that there wouldn't really be what's slowing you down from switching to like a euro for example is it regulatory or is it just trying to do something really good first and then yeah that's I had doing something really good first getting the product out there getting it proven to the community that it works you know feedback collection has been one of the most important bits of this process so part of what we've been doing and you know the white paper is not out yet and there's a reason for that because what we've been saying over the last couple of months is we want you based on the information we've given you so far to come back to us with feedback so we've been collecting all the feedback incorporating that into our roadmap so part of that is of course what does phase 2 phase 3 look like and if we can do it with dollars it's a logical you know jump hop to think that we can probably do it with other currencies and that's where the utility of the equilibrium framework really broadens once we've proven ourselves with our first base project I think you know we want to be quite ambitious in terms of what other utility we can bring to other currencies I think there's a lot of utility for having more than one currency right I think evany could actually speak about that because we're working on so yeah so happiness it's really relative to this yeah it's funny because you you mentioned earlier you were like all these people are coming up to us and want to work with us um one integrate with us and then you were talking about payments and then you're talking about multi currency and I'm like mmm I got a lot to talk to them about after the show we work with a client right now who were trying to do basically borderless payments mmm essentially batching payments from one person and then distributing it to a group of people that might be in in several different countries and right now doing it through sort of the the bank method trying to get away from that and it's it's a it actually makes me curious and I wanted to ask you a question do you guys ever see sort of like having some sort of off-ramp back into Fiat from these these multinational currencies and that's because that's always the hard water the glucose sugar in that out so what's what do you guys see that that roadmap looking like no it's a great question and you know part of what we're building has to have an honor an off-ramp and we recognize that and every time we have a discussion with someone in the payment space as to a potential practical solution that we can bring them we have to have an off-ramp for them so at the moment what we're going to be probably doing is creating very strong relationships with OTC desks and those OTC desks will be able to be a pretty seamless off-ramp for us DT holders is one example they will give you dollars into your bank account if you give them your USD to avoid the banks at any cost that long it's all about making it easy for the user right and these guys do a great job at making you know the the flip between different assets seamless in cheating so we're working with and we'll get into that probably later in the month we'll reveal who we're working with but we're working with some really great o TC desk to kind of build out a seamless solution for an off-ramp really so going from your your your fiat pegged assets to cash and on the other way as well it's really important that they can get into the system as well right further down the line we might have some some more mature solutions that might do that as well really depends on the use case there might be something specific to to certain industries that might be useful you know collaborating with a payment provider and they're very simple on and off-ramps already built there we're speaking to people that are payment producers that have their own debit cards so they're all these kind of different variations on utility that we're exploring maybe people just want to be able to spend their dollar value on their debit card and if they want to say begin why don't there's several I mean not in the United States of course but we saw coinbase launched in the UK yeah and there have been other companies that have tried this before and I think they're all working on it yeah but with that the ideal situation we talk about like the future of defy and the future of defy is you never have to have an on-ramp because you just transact if I sent you if I buy your phone off of you from 500 euros DT I give you 500 euros DT you give me your phone yeah and then you just spend those USD t4 if it's online transactions let's say you want to buy an e-book he sells ebooks yeah you give him ten years DT and he just holds it because it's like $1 laughing what's it matter where it's a store value it's just a unit of account of how much value you have right it's not volatile it's that's pegged your dollar yeah yeah yeah and being able to spend this asset at some point we think is really important so what that looks like we don't know yet but ensk is skyrocketing speed off transactions make them make it off cents yeah that's like the granddaddy of it but like until we get there you have to have that debit cards nice go-between because then you could spend that at the grocery store where they don't take crypto yet right but then eventually like why I go into fear like there will be a time hmm and like what do you guys thoughts on like a timeframe on like certainly we're gonna have the debit cards pursuant it's already available in a lot of countries from I know Gemini at consensus they're launching that sped in wallet and it trans ax gemini coin or whatever they're stable coins called as part of that you could have that so basically geminis becoming a bank and so is coin base with their debit card they're basically just using their stable coin as their fiat reserve essentially and avoiding banks completely on that and the swap happens at the time the transaction because i have to pay the grocery store the other store whoever there are transacting with but on what is the timeline whenever the the grocery store just will take any stable Quinn because it's like this is this is fine this is exactly what I need it's one dollar and it doesn't matter whose it is as long as they're all like might have a basket of ones we really trust yes we just hold it it's a great quest and I think the day will come when one one brave company comes up with a a-almost asset agnostic system which allows you to whether it's with a card whether it's your phone or a QR code even you are able to pay in whatever asset and they receive a dollar value for it mm-hmm that I think will be super super powerful and in China they do have similar variances on that kind of moment that will be game-changing yeah well and it's not like there's not incentives for merchants right now get away from that old system yeah we touched on it a little bit earlier but the the whole taking a credit card right now you're gonna take a three to four percent haircut offer everything exactly and there there's a little bit of interest infrastructure being built like with what does Jack Dorsey's square squares let's say squares gone full crypto yeah okay friendly so if you think well what does Square do why they going crypto friendly what would that mean it could mean just that the square are giving their merchants the ability to accept in crypto but get the dollar value from it well if that's the case because they're very very guarded with their information they've given that's the case it's a game changer yeah huge and and you can charge I mean pretty much anything under three percent and you're you're saving them money you're making money imagine I actually wrote an article and I made this prediction I said by 2026 we'll see it I don't know it's kind of just an arbitrary number I threw out there but uh and and I was just looking at the volume of like a Kroger or a large chain grocery store in the US even if you just took 1% it would save them billions of dollars right and so there's incentive there for it yeah it's just you got to get over these old systems the networks the processors they don't they don't want to die and if anyone's gonna do it I think square a pretty well place to do it the hardware infrastructure is there though the fact that you can go to most cash registers and use Apple pay that's the hardware component right it's a software upgrade away yeah and the way that the sped in app works with Gemini is it creates a barcode that the cash register just sees as a gift card so transact as if it's a gift okay and if you think about with gift cards and like airline miles or those are like points or like they would like the original kryptos they're just like centralized on someone's door in a database hmm but III think it's gonna be really cool when from you just get rid of the bank's I honestly 50/50 your time line if you have a kid that's born fifty years from now they will not know what a physical bank is like there's if there is a physical bank it'll have a very small like use case compared to what it is if you could do everything without that then it's just kind of a ticking middleman yeah yeah but if it comes to crypto like from from my standpoint the physical off chain infrastructure steal complex right and it's cool by the way that's block one announced you be you be key in on their announcement on on June first so he is the kind of for for us space it's the first step to more convenience of chain infrastructure for users what you guys think about the Facebook doing a stable coin can't deny the value though of that mass yeah come right off the bat yeah I mean they are if anyone is well-placed to do it they are just by virtue of how many messenger users they have and speaking as someone who deleted they're actually delete is the wrong word you can't frozen and suspended their Facebook app or profile even I don't know I think if anyone can do it they can but they're probably going to release the most vanilla use case possible in a very narrow restricted set of countries because unless they're going to build something magical that is crypto back that avoids a lot of regulation which I don't think they will because I don't think they'll be allowed to I think it will be a basket of Fiat collateral is probably where they'll end up being that in itself has regulatory implications in each jurisdiction that Facebook will want to operate they're going to have the set up a licensed institution in your on similar one in the US Latin America is a whole other kettle of fish so it's going to be a long drawn-out process for them to do it if they get it right there on to an absolutely another day all they have is a stable coin and you guys there's dozens of stable coins you guys being one of them you guys don't have to go country by country necessarily if you're doing on and off ramps you will but for as it stands today where it's just transacted digitally you don't have to do that and tie this back in the ear with voice hmm people are gonna be earning voice tokens and transacting and voice tokens but people still think dollars in their head mmm so one of the things you said is step ones probably other currencies euro maybe but then you have the everything's collateral backed with us right now mmm so with the right amount of liquidity anything could be used as collateral and we always hear tokenize everything you can tokenize your house your car eventually there will be a time where everything's tokenized like that and with I'm sure there has a lot to do with liquidity you have to be able to sell it but if you had a tokenized asset you could clap you could technically collateralize it but within your system you have to probably stick to the biggest ones if voice grows into what people hope it is people want to use those voice tokens for dollars right now we don't know a lot about the utility of a voice token it gives attention but there might be other incentives that make you want to hold it I assume that there will be other otherwise it would make as much sense so if there if the voice token let's say on a long time let's say like five years from now mmm it gets some sort of adoption there's millions of users and but there's a reason I don't know what the incentive is to hold it and instead of just getting rid of it unless you're holding it for the price to go up but I think there will be more reasons to move it maybe a staking incentive they want to keep some sort of incentive involved of holding it but they also need to transact in dollars there's an opportunity there to within your system over time so start accepting other collaterals right it's not gonna be a voice token at first I'm thinking something bigger like a Bitcoin or other assets umm how far is that in your roadmap is it something on your radar at all and how much are you able to go into detail about them your question yeah great question great question and definitely something will coming up in terms of mmm cross-chain to build interoperability and in terms of developments of reliable framework on on probably other chains so yeah definitely we have something a lot leprechaun that so to see the bigger picture yeah and like we can't say it's like coming out on X date it might not be started yet but it's just like kind of on everyone's mind because it's on our minds and we're not even in your space necessarily there will be a time when any token no matter what it's backed by or if it's backed by anything with enough liquidity in the right set of circumstances it'll be able to be collateralized into spendable money while still owning that assets similar to how you take a mortgage on your house that's the very best way if I want to spend ten thousand dollars to redo Evans bathroom here I have the value of this house so it's basically just like generating stable coins off of your tokenized house and then spending those stable coins at Home Depot to buy some supplies to remodel my bathroom my right way and it could be done it that is that kind of the future here probably yes but but yeah yeah those who would also highlight here that's so look another thoughts and that's that's you know you you always will have ceiling for generating your stable coins against the some particular cultural right because the cultural has some certain value you you can't generate stable coins more than the value of your of your house right so the house of us is huge but there is still some ceiling and the the ceiling for USD supply current ly is seventy million dollars right so I I guess the reason that other frameworks for destroy stable coins are also going to embrace how the assets from from the markets is not only for for user users convenience but also for increasing this ceiling for or the total supply right and the good approach for from my perspective for that – that is – to get more assets more liquid assets from from other chains as well right so that we can we can actually have have higher ceiling for for the total supply of stable coins so it's kind of like diversifying your portfolio let's say you've gold back dollars we're back in 1970 and earlier so you got the dollar backed gold and all you hold in your portfolio is gold but then the price of gold crashes you have no hedge against that so I mean moat we know most crypto currencies follow Bitcoin but that's probably step one before you can get to the like other tokenize assets that are actually backed by something that isn't correlated a non-correlated assets to the crypto market and I think that that's just good for risk in general is having other things but is the first step going to be other crypto currencies you said other Yat forms it's a natural segue I think because we understand the you know the risk mechanics within it and there's an immediate use case there I II as Alex said raising the ceiling so depending on the modelling depending on the liquidity of the asset and you know how how comfortable our dev team are taking that asset on is the next one there is certainly a place to broaden out the collateral types that are compatible with in the framework yeah that's probably one at a time slowly roll muscle you can get really good at again exactly um I guess we did skip something that I meant to say it earlier but it was kind of off topic all this travel you guys aren't a block bruiser yourselves but there's this governance incentive so the nut token holders hmm so let's backtrack there's a bunch of youth locked up in a smart contract right doing nothing right now but we know we could vote with them and we know we can bring them out at fracks voting is on everyone's mind because everyone sees like the block producer is moving and we always just want more tokens to vote in general hmm so I think that's really cool that you have that perspective of east and west of you've met probably all of the major block producers and you and you know even though you're not the main holder of the nut token it's distributed you kind of could if someone's really bad and I'm sure you'd kind of speak out like yeah be even if it's just in your telegram channel you can kind of point I guess the voting direction but the nut token holders at the end of the day are who decide the voting and it's not you guys distributed so how when is that going to start what percentage roughly ballpark of the collateralized yose are you able to stake and vote with and then you know start without the governance within that mmm yes so from development perspective the integration with racks and voting for block producers is something on our roadmap and actually it's our would say summer plans so the the closest achievements in terms of that is rex integration which is coming up within a couple of weeks so we will be able actually to stake I guess all the us collateral to Rex and here I will also mention that the current amounts of collateral is two point over 2.6 million us already and it will be growing so it's rather with the profits or infection or the APR is not anything crazy but mmm especially if the value is token went up I mean it's single-digit percent right Leroy less than two I'm sure all right I know one block one bought it a little bit but with the recs profits even if they are one or two percent APR on the EOS right right how is that distributors it's is that the incentive for the nut token holders is any of it if I have yo sticks into the contract I don't really benefit from that but I'm confident because I have these liquid tethered dollars basically mmm combined approach so we basically are going to redistribute this the the portion of this income are across our community among the initial issuers of USD stable coins and another part another portion of these incomes would be used to to have nuts from from from the markets which will then get burns on our smart conscience I think I think this enjoys dissing choice to ownership of smart conscious very important think we're talking governance you already asked yourself the question so euros New York put out a blog article a couple months ago about decentralizing smart contracts so that mmm whoever developed a smart contract and deployed it if you want to truly decentralize it you give people that aren't affiliated with your company and have no incentive of anything so told the keys and the way years New York proposed it was a beyond system layer like base based contract on the site of contract and it would require fifteen out of the 21 active block producers to make a change to a specific contract that opted into this mmm-hmm that came out and you said Colin talk scripted put out a video and kind of brought it to your attention like hey guys why are you guys doing this right our partner Peter K when talking the differences between not the difference is necessarily but just talking about collateral backed stable coins he said I don't like eath for a lot of things but one thing is that you know the contract can't be changed because mmm you can't change a contract once it's deployed there whereas on yes you can mmm but you could decentralize it and your eyes have plans to do that in the near term it sounds like yeah yeah absolutely yeah so the obviously decentralization is a top priority for us and we are going to step this way towards decentralization so we have we have the roadmap for for for doing that and the the first step would be establishing the multi-sig for ownership of our smart contracts so that we have we have will have some certain block producers on this multi-sig to make decision on smart contracts updates and now with where it talks of on that with several of them including block producers from top 21 and also we would like to discuss the collaboration on that and maybe having on multi seek : as well yeah so people often really it's either decentralized or not decentralized but it's like a wide spectrum of it of how decentralize you are if you have one key controlling a contract that's absolutely centralized at all but the more accounts you add to that multi-sig the more parties involved the more decentralized it gets how many parties it what is your goal for how many parties on the multi-sig that's going to control any change on these contracts wire this many people to agree on it so we want to start off with consensus maybe four of seven but event eventually we are assuming that the number of block producers who will join our multisig would be would be increasing so that we have maybe I don't know 10 15 whatever so there's a plan yeah there's no cap on it really you know where we see the utility of it you know following the ethos of it getting increasingly decentralized and having the input is hugely valuable for us so why not so what does it mean it forces you get not not do you were planning to be honest in the first place but it forces you because there's no choice if you ever change the contract completely you got to reach out to all 14 10 20 days blog producers or public entities like Colin tuck script or another big proxies and run some reputable concept parties yeah explain why you need to make this change what the change is and if they're block producers they probably have a lot of technical people that could just look at the differences you're trying to make in write a contract right if it almost like an audit it's like they're not doing anything corrupt so four four four four hour for ice for ice right check yeah and we've built this framework that we'll be working with them with under which is really simple it's like a cooperation and they will get a bite-sized chunk summary as to what what the proposal is they'll get the detailed analysis and even the code if they want they go through the whole thing when they can vote as they see fit so it's really handing the reins of power over to the multi-sig participants that's really cool it's probably all done in a private telegram January now isn't it we don't have a place yeah yeah additionally I should say that we also intending after after this old Nazi mod signature stuff we are going to build up the technical solution for for updating the contracts through governance contracts oh so it would be they've in the next step of the multi signature we get I guess it it will actually take that they take take time from development perspective but eventually the set code permissions would be we expect to be set to be set to the governance contracts of the community would vote with nuts for the updates of the contracts yeah what's your website yeah so we're actually in production since since April at USD t-dot-com so we can guys have hands-on experience there and all the feedback will be appreciated from from the community from all of you alright so and then you give you note your how can people find evidence in there you don't I'll get in touch with you go to that Venice thought IO or Evan at happiness dot IO that's where you find us you need smart contract dev you're moving from east to geo so we had a couple projects DC that are doing that we'll be following up with them this week so we're excited man all right now just closed out you're praising me again in a couple days with Rob Finch so this is it I'm zecko everything else boom

15 Comments

  1. Josime Desbiens
    Josime Desbiens June 12, 2019

    it's a travesty that you don't get more views your constant is up to date & so very relevant!

  2. Nat
    Nat June 12, 2019

    Great episode!

  3. max tann
    max tann June 12, 2019

    i want to know more about https://voice.com/..

  4. Michael Blu - mBluCrypto
    Michael Blu - mBluCrypto June 12, 2019

    I never listen to anything twice, today was a first rewatch. 👍🏼

  5. MichaelBFT
    MichaelBFT June 12, 2019

    I live in Shenzhen China. If I pay with cash, I get dirty looks. And some (maybe most) don’t have change, and therefore turn me away, including roadside venders and farmers.

    WeChat’s fees are nonexistent, and you often get discounts or paid interests to use it. It’s supported by the subsidised by the government.

    People in the US don’t get it. WeChat accounts for like 90% of all transactions. This is a social media chat app

  6. Red Armanino
    Red Armanino June 12, 2019

    Good! Also check out Vigor vig.ai/vigor.pdf one of the best DeFi projects in EOS.

  7. Justin Giudici
    Justin Giudici June 12, 2019

    Great to see EOSDT continue to thrive since the big launch party at EOS World Expo!

  8. Ezcoin Shopper
    Ezcoin Shopper June 12, 2019

    Genius show a great investment of my time.

  9. Elim Herr
    Elim Herr June 12, 2019

    Great show guys, every enlightening!

  10. Andrew Bryan
    Andrew Bryan June 12, 2019

    nothing like stablecoins and defi, all the way baby. join our stablecoin DAC at vig.ai

  11. David Ivey
    David Ivey June 12, 2019

    One of the major "benefits" of the banks is that their loans actually create money. This is because when they make a loan they are basically using reserves as collateral and are not loaning out the actual cash reserves. It is simply a balance added to a loan holders account. It is as if money is created out of thin air. The loan holder spends the money he got from his loan, and the recipient of this newly created money puts it in a bank, which now makes this "new money" available to loan. The process keeps repeating and pretty soon we bank accounts that are full of digital "new money" and the reserves upon which this money rests is less than 10% and is regulated by the reserves the central banks require. (Government sell Treasuries which increases central bank reserves, allowing more loans, and thus creating more money. It is the mechanism behind Quantitative Easing.)

    The key point here is that loans are not provided by transferring existing physical money to the recipient. It is just an accounting credit and nothing more. Without banks, we would have to borrow a "real" Bitcoin or EOS or token that changes possession as is not just created out of thin air (actually faith in the bank backed by a government). As messed up as this all sounds, it has actually been beneficial. Without this traditional banking system, credit would become extremely tight. Few people would be able to buy homes and many businesses would not be started or expanded. However, I never see this issue addressed within the crypto sphere. It is just assumed by the crypto sphere that this tight credit market won't matter. It should also be noted that this is how money and banking has worked for hundreds of years — even when we were on the gold standard. Even back then, banks lent out far more money than they actually had in gold reserves.

  12. T&T OPERATOR
    T&T OPERATOR June 12, 2019

    VOICE = A Big Nothing Burger!

  13. Ernest Of Gaia
    Ernest Of Gaia June 12, 2019

    Great show !!

  14. mrg 369
    mrg 369 June 12, 2019

    Go Everything EOS!

  15. timwheelermusic
    timwheelermusic June 12, 2019

    When Alex is listening to questions, he sounds like he's enjoying some tasty hot chocolate.. 😉

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