The Future of Crypto: Navigating the Decade Ahead - TOKEN2049 Singapore 2022

uh first of all a big thank you to the Token 14 2049 organizer um thanks so much for putting together such an amazing collection of speakers and I'm sure the audience are in for a big trade so I have a lot of uh questions prepared for all this our Stella panel but before we jump into those questions I want to give each of the panelists some time to quickly introduce themselves first I'll start with me so MMR I'm the CEO of long hash Ventures we're singapore-based web3 fund we also have an accelerator so if you're building early stage crypto projects uh definitely hit us up um well pass it on to Justin hello so I'm adjusting sound the founder of trump I'm also the Ambassador and the permanent representative of Grenada to WTO so I focused lots of the times on regulations and the collaboration with sovereignty States thank you so much so guys uh saurabh Sharma I'm a head of Investments at John crypto jump crypto is a very active infrastructure builder in the crypto space a very active investor and a Trader and we have a lot of efforts going on a ton of depicting troubles in blockchain infrastructure tooling building that's kind of a North star and then have been investing in the space for a very long time thank you so much hi guys I'm Constance I'm the Chief Operating Officer for FTX I'm primarily responsible for the growth of the business great to have you guys I think I'm sure you guys are no strangers to the audience I think FTX jump and trong have been making a lot of headlines when waves in the in the market and help to push the industry forward um I think given the title of today's panel is about the future of crypto and navigating the decade ahead which I think it's pretty impossible to look into the decade ahead but let's try to do the impossible here maybe let me start with adjusting um and I want to hear from the rest of the panel as well what are some of your bold predictions for the next decade and how should we navigate if there are some of those challenges yes um so for me I think we need to learn lots of from traditional institutions so I think that I get into crypto around 2012 so actually this year is the 10 year anniversary for me to get into crypto so I I think for the for the first year I think definitely our mission is to drive Main Street attention to crypto but for the uh next I think 10 years is become the mainstream right but still I think uh we still have some uh between these two objects uh first of all I think there is lots of scenes uh we need to learn from traditional Finance industry uh because at the end of the day I think crypto is the same with the traditional Finance institution because most of since we are doing here is to control people's money or move people's money or basically response which has a huge financial responsibility so that's why when I first started in crypto I wear like hoodies slippers right but after start from this year uh I I wear suits uh I think maybe give people a little bit confidence on the services we provide to them right that's super interesting so next 10 years is where we cross the chasm I guess Sora yeah I think I mean first of all I'll say that you know we we believe that uh you know next cycle of computing Innovation is going to be driven by crypto um um so there's a lot of exciting r d work going on to it and we are very optimistic um that crypto has the potential to unlock it's completely new sort of model of governance which is going to involve communities who are going to be involved in you know kind of determining what behaviors are permitted how networks grow and most importantly how the economic value is distributed right so that's kind of the fundamental first principles belief of why we are in the space and excited about the space it's a it's a obviously that's a very interesting very large distributed systems problem on a technical side I think that's that drives a lot of uh interesting work at Jump does uh it's a very difficult sort of computer science kind of challenge but it's a very big outcome on the financial and the economic side as well uh but I think I said it's uh you know uh talking about a decade is a pretty hard thing to do so everything I say is with obviously grain of salt but yeah there's some early signals you can take on a few things that you see uh I mean I'd say the first thing probably the killer use case application has been stable coin so we'll see that I think they have seen pretty good Mass adoption and I think we'll continue to see them scaling up um and I I think probably you know in relatively next few years I think we'll I believe we'll surpass the trillion dollar supply on the unstable coins and that could be any form of things combination of obviously the private stable coins um uh the cbdc conversations and and then and then potentially uh other sort of experimentation in at least Niche form as much as I can say uh so that's probably the biggest one uh I would say related to that the built on the stable coins I think the complete payment stack will be revamped um and that's a huge sort of fintech activity that I think we expected to see and that's that's that's probably relevant for everyone and that relevant for banks the merchant networks the card networks uh because once you have to save a coin rails uh again or even the federal uh banking system is kind of looking at the digitally you have to kind of rewrite those applications completely so that's kind of on that side on pure infrastructure side I think we will continue to see uh multiple sort of compute and execution environments and blockchains continues to flourish uh uh or scale up but uh but I would do expect many of them to become hyper optimized for application specific stuff uh over time um and I think on the on the Purity on the economic side I would say you know business models for creators is going to completely evolve with a lot more uh ability for them to uh uh you know Drive uh how the payment models and modalities is going to work uh the how they're gonna be participating in the e-commerce with their the creators uh uh either creators or even users from a data perspective as such and I'd say there's a you know subtext to that I think the kind of scaling up of kind of this new form uh which is nfts right which we've seen mostly pfps we're going to evolve from pfps and I think almost every consumer brand every entertainment every gaming company is gonna involve these nfts into sort of their uh you know this user engagement or customer acquisition models so I think those are the prediction challenges I think there are many on on the technical side I think we're so early in solving the kind of the scalability security side of it uh and there's a lot of work going on there regulation is going to be the significant challenge because uh you know connecting the threat of Nations uh and then more importantly Global coordination on this is going to be super tricky and uh it's important but it's going to be very tricky um and then an economic models are still kind of being iterated upon the tokenomics model and the token incentives are still super early so there are a ton of challenges uh far ahead as well yeah yeah yeah so there's a lot of I think uh High potentials right like like you were saying robust infrastructure that's going to be hyper optimized for future application then stablecoin definitely as one of the first killer use case I think of crypto is going to continue to grow and of course I think the next generation of web 3 applications like you mentioned right Creator focused applications and everything is going to flourish but of course challenges ahead as I think this whole Space grows Regulators are going to come in um so so I think um yeah let's um would love to hear from Constance how you're thinking about this um I think the what I really like to see for crypto in the next decades is really uh around Mass adoption it is no point for crypto to be there if people don't use it or if blockchain technology is not being adopted massively and that's a lot of the efforts that I believe everyone in this room is trying to push forward every day and um it just it is just a collective effort that we need to keep building things and we need to keep educating people around us educate educating track fights Regulators what crypto and what blockchain really is and how crypto and blockchain can help them to move on to the next stage because if we really look at the society nowadays we don't really have major advancement in the past decades and but for society to be there the the society as a whole has to move forward and I think that's a lot of what we are trying to do here we are trying to think about what how we can help the the other industry players to collectively together move the crypto space Not only crypto space But as a whole technology space and traditional Financial space to the next stage and I think it will be really really exciting to see that uh every uh you know crypto and blockchain because becomes part of our life and all the current major platforms typically becomes matching engine for P2P activities so P2P no longer is just uh on transactions but it could be on social activities it could be on gaming activities it could be just part of our life I think that would be really exciting to see for the decades but of course it takes a lot of efforts to build to educate and also to work together to you know build a crypto buy bigger yeah definitely well said I think it's unanimous among you guys that next 10 next decade is probably where mainstream adoption will happen but to get there lots of challenges so I would like to maybe take a step back and talk about techno technical challenges right and I think all of you guys either have a part of organizations that have either launched Altair layer once or you have invested heavily into alternative layer ones as a key infrastructure to power the entire web3 economy so love to hear from you guys how do you think this space is going to evolve um maybe I can start with Sora yeah I I think the the general sort of the trade-off design space um of you know um solving for this kind of blockchain sort of trilemma around security decentralization security I think it's it's pretty high dimensional and pretty broad for uh any single blockchain to cover right and I and I have my own version of you know maybe a fourth dimension which are called generalizability in addition to that it's very hard to be and then if you have further than applications built on top of that which are also very specific so it's very hard for a single blockchain to be able to sort of serve that and and get optimized yeah so so that's why we fundamentally believe uh in multi-chain uh future and then hence uh sort of enabling cross chain uh uh infrastructure uh to make it a seamless user experience uh and hence we'll continue to see uh strong and smart teams uh coming up with their own uh kind of design uh models of solving this uh in a different way and um and then hence we'll see more more L ones so to say we'll see more Roll-Ups to solve the scalability aspect to that uh and so forth and end of the day as I mentioned I think it could take multiple forms I think we've seen this in the past too I mean if you go back there are multiple protocols that obviously you know gopher and DCP and and bunch of other and didn't all start with the same standard right and then they kind of converge to uh to some agreeable form and so this doesn't have to be uh that way at least this early on we're still pretty early in that Facebook kind of I call it sort of maybe at the 1995 of internet in terms of building infrastructure and so it's it's uh it's unfair to assume that uh any one single platform you can take uh bets on is going to solve and uh solve multiple sort of applications so that's kind of maybe the fundamental thing that we will see a multi-chain uh cross chain narrative uh and then we will see over time uh these these platforms start optimizing and picking other lanes and you know there's no real good comparison but lack of better words you can think of as a multi-cloud multi-compute environment and you're kind of optimizing across all of these uh we see those infrastructure doctor in web 2 quite common and this is obviously you can consider every blockchain or other one has a large big computer uh or large big cloud and and you're building applications across many of them yeah yeah yeah and I know um you were telling me just of the stage that jump took a very technical approach to support the projects and ecosystem as well you guys have like what 150 Engineers like building wormholes and all sorts of solutions right to support the ecosystem yeah I mean I think for us jump crypto has all I think the you know technical r d infrastructure building is a North star I think we've taken a kind of a view in a position that we are going to be very much involved in building the core web3 infrastructure and very deeply technical Primitives that uh that at least we view are the big bottlenecks in uh on unlocking the scale and the potential of this ecosystem and obviously we're not the only ones that are amazing folks and community members across I mean ethereum Community is phenomenal and the merge is obviously a great Testament of how that kind of panned out but we you know we have a strong team and we continue to grow that team uh across the stack ranging from networking stack to obviously work at the zero knowledge cryptography level and and that is a pretty important North Star for us as a fundamental sort of uh work that we do that's fantastic and uh I want to uh ask the question to Constance because I think FTX has been pretty heavy into a few odd layer ones and recently you guys also bet big together was jumping to a tour three right so how are you guys thinking about this space What are the methodologies right you guys are so our our investment logic is really to look at what are the teams and uh possible technologies that would move the mass adoption forward and because we deeply believe that each chain um there's gonna have their own ecosystem So currently um apparently the due to a lot of concerns on the cross chain there's still a multi-chain world and uh our logic is to help all the infrastructure to be really great so that people can build on top of it so that's why we are really heavily helping the layer ones to build out the foundation stations for Builders to build but of course I believe uh the the multi-ching world is is kind of like the IOS and Android and or Apple and Windows world so it could exist separately and individually but it will be great that if they can cross function so I actually I really agree with um uh Sarah on what uh he was saying so um that's a quick summary of that fantastic and now on to adjusting I think uh you're the only one here that have launched a a layer of your own uh Tron so just want to hear from you how you guys do you think the future is going to be more teaching and how are you guys positioning yourself for a future yeah yes um so first of all I think um basically even we have different choice of the blockchain actually I think the blockchain kind of these days merge with exchange business so you can see um you have like defy application so you can making trade like Landing uh and the uh spot and the future uh exchange um blockchain as well so um so basically I think at the end of the day is financial services right um basically it's just depends on different uh infrastructure I think this is the uh the key for blockchain development for Trump I think our Focus always first in like stablecoin we collaborate with all the major uh stablecoin issuers issue stable Quantum and we have our own decentralized stablecoin usdd and also the same time we have D5 um I think our TV out right now is the second largest protocol and also of course course like and have tea and the older new scenes you know in the space we are doing it and also we have our own exchange platform uh planets um and also collaborate with lots of C5 exchange to uh provide all kind of the services for uh users um but I I think for for me uh I'm more targeted uh basically our competitor like traditional Finance institution uh like Banks insurance companies like uh and and and investment platform uh rather than uh our competitor right other blockchain because I believe our space is uh still very small space I think around one trillion dollars but traditional Finance industry uh is um probably like 10 solve hundreds trillion dollars so that's why I think this is more like a future right so we move forward to be become a mainstream uh financial institution yeah yeah I think in crypto everybody is very collaborative right because like you said uh even though everybody have grown super um multiple times but we're still small compared to traditional finance and there's a lot of scope to to to grow together from there and uh a nice segue because you were talking about the key Primitives in layer ones right you talk about exchange you talk about stable coin so I want to kind of the next question is gonna be around stablecoin because I think people in the market have also whether you're investors right whether you're users or Builders uh we've gone through quite a bit of change over the last 18 months I think there's been a lot of pursuit of decentralized stablecoin and uh there's various designs of it people are excited and disappointed and so just kind of want to hear you know as a layer one operator and you were talking about how important stablecoins where do you think stable coins gonna go from here you know is it going to be centralized stablecoin continue to grow from here are we is there still hope to come up with new designs for decentralized stablecoin yes uh sure um I think first of all um actually uh stable um definitely is one of our priority and focus right now uh as you know we have around more than 40 billion dollars worth of stable coin on troll Network this has been our Focus since day one but I want to mention a very uh uh a good example A lot of people didn't even notice uh is basically I think stablecoin is the best of the store of value for people in Asia so a lot of people um based in United States probably don't understand that because like in your United States like everyone can get a US dollar bank account right this is become basically like infrastructure uh uh for everyone right just like the electricity the gas you are using like every day you don't even pay attention to them but for most of the country in Asia you know um don't even need to mention the name you know people have no access to US dollar at all so uh I I will say like um 95 of the population can only hold their own currency um so they can't exchange to US dollars or if they they have you US dollars is force liquidate to their own currencies for most of the country so there's no way for them to hold US dollars at all but actually you know like a layer one solution can provide basically blockchain can provide a very good way for you to have your own bank account right so before that I think owning bank account has a huge amount of the cost not only um uh Financial cost but also monetary costs uh sorry regulatory cost is very high but right now um just doing blockchain you can just get access to any open source blockchain Valley and create your own wallet in five seconds and with basically zero cost right and then you can store your value in your wallet as long as you don't tell your secret phrase to others right it's uh 100 safe so I think this is a very actually revolutionary uh compared to the Azure like traditional Financial infrastructure we have today um so that's why you have seen for example we have seen like recently the daily increase users and also the active of the chain of Fortune increase dramatically in this year six years even I mean for most of the blockchain is bear market right so um probably the activity of the blockchain drop a lot but we see a consistent growth of trump blockchain I think it's mainly because these days like Asia lots of people in Asia started to get used to use the stable coin on trial Network and they feel comfortable with it 100 I think stablecoin is probably what's going to take us to mainstream but uh I also want to hear from uh Sora yeah I mean as I said I think civil coin is will be one of the kind of killer use cases uh at least up to this point we've seen so uh that that is um going to continue to gain Mass adoption I think in my view I think we'll probably see um all three sort of modalities continue to evolve uh you know the the pegged fiat-based stable coins which I've already already are pretty sizable and uh sort of a great purpose have showcased the the true sort of benefit of that and through defy and kind of usability of that and then obviously uh connecting the rails globally uh and usdc usdt uh other forms that are coming up and I'm sure many other institutions are probably thinking about it or so forth and I think that will continue to scale uh just because from a retail perspective um I think they're they they was they imbibe all the uh kind of elements that users want to see sort of permission list kind of open transparent uh kind of Ledger that uh that give access to store value and obviously emerging countries in many cases or then simple cost efficient modality of transfer and payments uh I think the second will be cbdc is we're gonna see more and more chatter about cbdc's and you can't ignore it uh and you know there I think we'll see so many variations there given that are going to be driven by national agendas and you will see you know you can see the point of view of uh uh either fear or or just see the amount of variation is going to have uh of how people uh might make it more composable uh with the rest of the kind of new web3 ecosystem or more controlled uh but that is uh you know I think most likely or at least my my view is at least in uh in Western economies they might serve the purpose of kind of wholesale and then might leave uh the private server coins for the retail purposes but uh my I think I'm still guessing and I I do think that there is going to be continue to be experimentation uh and research on the on the algorithmic side uh and you know I think projects like maker who uh been continue to kind of test the use cases because if you believe the world is going to get more and more tokenized or more assets are going to get tokenized then they do serve a purpose of uh incorporating productive assets uh to any use case um uh if designed and a maker has been testing with Huntington bank and kind of connecting the physical assets to that so that algorithm Next Level coin component will see experimentation and then uh you know might serve obviously misuse cases so I think generally uh uh this is this is a pretty exciting phase um but end of the day I think this is gonna be the the driver of uh complete rewrite of the of the payment money movement stack but did you feel sorry to throw a curveball there but did you feel there might be certain centralized risk though given the influence of usdt usdc right um I think there's going to be somewhat centralized what centralized risk sitting with the issuers of State yeah I think so so again so now we're going into sort of uh pitfalls and and trade-offs on each one of them uh yes so there is you know these are private uh companies who are kind of managing and then this is where how you shape regulation where either you go and shut them down or you create the guard rails of how to manage that uh that risk uh and and set up the requirements to be able to observe that risk uh with the with the understanding that this is uh helping Innovation yeah and this is getting adoption and but we now need to make sure that the risk is nicely captured so what guardrails we're putting on those companies who are in the issuing game uh but carefully not not killing the Innovation so as long as that happens I think these can survive and this happens I mean banks are private but they are nicely sort of captured and this is a probably a better form of banking coming up with the nice guard rails yeah yeah so more oversight more transparency um and that that's a nice segue into regulation I think uh um given Sam is obviously in front of the Capitol Hill right and it seems like everybody is paying attention to how he ties his shoelace but uh we're very but it seems like FTX is doing a lot of heavy lifting in having active dialogue with Regulators um and I think over the last six months right when the market kind of crashes they also kind of triggered for a lot of um uh a lot of the I guess less properly managed platforms right race were surfacing so a lot of people in the industry were saying Regulators are going to come down hard into the industry given how many uh retail people are impacted this time around so just kind of came to hear from Constance right how how's FTX are you personally thinking about regulation how it's going to evolve how you guys are are influencing that direction yeah yeah so um from our perspective even though I mean the the industry might seems like the the regulator is coming after crypto hard but from our perspective I I always feel like our working relationship with Regulators should be in an open and friendly dialogue is is a two-way communication instead of one way of them asking us what's happening I think the crypto companies should all be proactively talking to regulators and tell them what's happening and how things works so that collectively we are educating them together so um in the past year or so my personal experience of dealing with regulator is a lot of time I spend on just teaching them basic basic knowledges about crypto about Bitcoin about ethereums and of course they will ask us a lot of questions and one thing that I really embarrassed uh Sam for what he's doing is he repeats himself constantly to the people on the hill to the people uh in the from the major Banks uh major governments in the world it's always the same question and and it gets old sometimes I'm I'm not I'm not a particularly very patient person but it really gets old so I think it's not just about regulator coming down to crypto companies it's also about us telling them what's happening and what this industry has evolved in the past five years and where it's gonna go and with our vision and Mission it's have already moved Way Beyond the Ico you know coin and you know scammy stage that everyone is actually building so I got asked a lot about how do you feel about the the recent market downtrend and what's your uh what What's your you know what do you think about the crypto Market moving forward even though the market is trending down but I think more people are building it's it's a great environment for Builders to build and we see ethereum emerge we see fundamental being improved and it's overall very very positive but does Regulators know that no they don't and no one's telling them that and we can't rely on a few players to tell them that everyone has to proactively talking to them about this so that's how I think about the relationship with regulators and that's how how we think about working with Regulators so um FTX might have the reputation of getting license everywhere but what we really want to do when it boils down to the root is to educate the regulator help them think about how they should think about crypto and shift the regular regulation landscape to help everyone to grow because at the end of the day like we're Justin just said just now crypto pool is Tiny and it is nowhere compared to any traditional tri-fi pools that we are facing now and is nowhere compared to the technology space that the world is saying now and if you really want crypto to be a thing to be a real thing in our life we have to get bigger and it's a collective effort it's never one or two or like 10 people's effort everyone has to push it forward so we of course FTS we as a primarily as an exchange we can only do um you know education is and pushing on on trading primarily and by doing that we hope every regulator would understand crypto better so that they stop chasing the things that they shouldn't be chasing and they allow crypto for actual building and actual space to grow and being adopted so that's our how we think about it so education is key and I mean to be fair I think uh the crypto evolves super fast right everybody's playing catch up so I think it's a reasonable Regulators are also playing catch up um I guess on the positive side there seems to be encouraging signs Regulators are having more open dialogue with Market participants right I think that's a much better alternative compared to if they just come down with something some regulation and nobody quite understand but at the same time I can see how it could be a challenge to harmonize right you know the the rules and regulations in the crypto space so I think Regulators are definitely getting more open-minded yeah and um and that's that's great that's great for everyone great for the space great for for us great for them as well so I think it's really uh everyone's effort to try to open the dialogue and shift their perspective about how to think about regulations because nowadays when we talk about regulations there's still a lot of negativity going on and talking about oh regular didn't allow us to do that didn't allow us to do this so I think um we instead of you know waiting for them to shift their mindset we should shape our mindset first and proactively talking to them absolutely totally agree and Justin so I think you are also dealing with multiple um having conversations with multiple jurisdictions and all that how are you thinking about this yes last year uh the end of last year I become the ambassador of Grenada to WTO so I talked to um ambassador from different countries um comes to time recently I participated in Mysterio conference 12. so all the minister of trade comes to the um the conference and I discuss most lots of it wisdom about how blockchain and the stablecoin transaction can empower the trade and also really I think for e-commerce like all different kind of the industry because crypto really enable a very good way for payments especially Global Payments uh I think as I just gave you like one of the example so basically anyone can get our crypto addresses instantly by free right so Empower them to receive like transaction from all different kind of the merchants worldwide so that's why uh that's the message I always want to send to you uh Regulators um blockchain it's just like internet right so it's a very good technology with transparency so if you use the blockchain transaction in a good way actually can benefit everyone in the world um so even sometimes they might hesitate because of several reasons because they don't understand how blockchain works and they don't understand like the New Concept comes out like every day right so um but I I always tell them just think uh blockchain like uh database like internet so basically basically provide you a good way to track all the data right so even for Bad actors right even today we see uh some of the hack happen in blockchain Industry um but you can see actually even when the hack happens there's lots of the way you can get money back from like centralized exchange they have all the anti-money laundry Channel analysis mechanism and also for a stablecoin right they can basically freeze the back actor addresses so there's a lot of way for you can actually mitigate the risk but also provide this kind of financial services to mass adoption actually benefits everyone at the same time minimize the risk of um basically all the concerns they have so that's why I I think this is also very important because we need to make sure the regulatory is comfortable so they can open all the uh like opportunity of method option um to to everyone awesome and uh um so syrup you guys are based in the U.S coming from traditional Finance into crypto and uh I guess uh you know being compliant regulation is probably front and center of the consideration as well how are you guys thinking about it yeah I mean regulation is very important uh we very much supported uh I think there has been good very good uh history of uh you know uh thinking through these things I mean even when early internet protocols sort of came up you know that was a collaborative effort of it was a deep technological stuff but think tanks and policy makers kind of work together and obviously crypto moves much faster so you know I think there's going to be some Arbitrage I think the only concern uh and maybe worry is is to not put us a plain blanket on everything and crypto uh Regulators uh within crypto there are so many different things and the policy framework has to serve policies around every use case differently uh you know stable coins is a kind of a different use case gaming and social economic models a different use case thinking about digital property rights is a different use case thinking about digital Sovereign identities different use case uh so these are different policy Frameworks and different thinking and right now it sometimes feel that there's a blanket regulation on all crypto which doesn't really mean much these are all independent kind of elements and that will require a sort of regular sukana so we obviously we you know we we do a lot of work on kind of thinking about it and obviously uh kind of sharing our feedback again coming from a technology perspective these are you know complicated technical things and I think understand that it takes time to kind of bypass bypass that but I think I think I'm hopeful that the next uh wave is going to be seen as not stifling innovation in creating policy Frameworks to adopting each of these use cases specifically in what it requires to enable digital assets which is now you know you can't you know you just can't ignore uh them in terms of property rights and and financial exclusion Financial applications as such yes so more granular regulatory framework yeah lots of challenges ahead but also lots of hope so ladies and Gentlemen let's give a round of applause to our amazing panel thank you so much today [Applause]