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Coinbase CEO Brian Armstrong on Cryptocurrency and the Future of Decentralization

Jun 06, 2021
Gary, what's up bro, good to see you. Come in, thanks for inviting me. Yes friend. This will be a fun conversation today. We're in Los Angeles, California, and we're sitting down with Brian Armstrong, the founder. and CEO of

coinbase

well Brian thanks for hanging out man yeah thanks for having me where to start? I mean obviously we're on the other side of an incredible IPO, congratulations man, thank you, I don't know how to thank you enough. I don't know, just being able to meet you and be a part of what you created, yeah, you know, it's amazing, you know it's mutual.
coinbase ceo brian armstrong on cryptocurrency and the future of decentralization
You helped me a lot in the first days, I don't know if people know it, but you. You were like my first CEO coach, you made a big investment at the time in Coinbase because it was so obvious and it was just me showing you a bunch of numbers on the screen and what do you think about this and this and you gave me advice every week and I was coming back and I remember at one point you saw some numbers from some growth experiment and you said you should show it to investors, I mean, it makes me want to invest, so do them.
coinbase ceo brian armstrong on cryptocurrency and the future of decentralization

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coinbase ceo brian armstrong on cryptocurrency and the future of decentralization...

I want to invest kind of like a light bulb went on in my head it was like Gary would invest you know so yeah anyway you made a big bet on me too and you were always very optimistic about everyone's startups when they were . super young and early, that's my biggest memory of you, actually, of and combinator, it's like you were defending everyone when they had these barely functional beta products and you were like their first customer and you had their t-shirt and a little bit of motivation like An early customer who really believes in the product can do a lot in the early days so thanks too mate I appreciate that I mean that's what gets me up in the morning is believing before people believe and then helping people. they believe in themselves, but then what you do next is you just go and make everyone else believe after that, how crazy is it that it can be some kind of self-fulfilling prophecy, really like just having someone else believe in you can make yourself believe in yourself and um, yeah, there's a lot of things to that, like a lot of good ideas probably just die on the vine because you know people look down on them or make fun of them or assume that they'll never work, so having someone who really believes in your ideas is not -trivial, the interesting and difficult thing is to believe that something that can be true, how did you know so early about cryptocurrencies and bitcoin?
coinbase ceo brian armstrong on cryptocurrency and the future of decentralization
Yeah, about cryptocurrencies, and I mean, it sounds like there were things from places you worked before that. I kind of started reporting that yeah, that's true, I mean, you never know for sure, right, I remember having moments of self-doubt where I thought maybe I'm crazy, you know, because no one else seems to understand this if they know. I explain it. they, I listen to some people, you know, who today create business ideas and they're doing them like, um, almost like a consulting type analysis or a financial analysis and that's the tam and here's the set of competitors, and I think so.
coinbase ceo brian armstrong on cryptocurrency and the future of decentralization
For me, it wasn't like that at all. I basically just read the whitepaper and thought, “That's cool, the Bitcoin whitepaper,” and I couldn't get it out of my head, so it wasn't like I had. a really sophisticated analysis of the market potential because there was no market for it, basically it was just I think this seems like a good idea, it seems interesting to me and maybe it will be interesting to other people and I was trying to think of all the ways I could die. Know? Would its existence be regulated? Would there be some type of cybersecurity flaw?
And the more I talked to people about this, I couldn't find any obvious reason for that to happen. I wasn't sure it would work, but I felt like there was a good chance it would be worth a try and you're right, my previous work experience definitely gave me a little insight. Working on fraud prevention at Airbnb, I had seen how difficult it was to move money around all these countries, both collecting money from customers and then paying it to people who were listing their homes on the site and it was like all in one country. The world had its own little ownership system with a couple of entrenched oligopolistic companies charging opaque fees and it seemed like this thing would never get rid of all the bureaucracy and would actually be Innovated unless there was a new system.
I was thinking about it in terms of the Internet, as if it doesn't make sense for each country to have its own Internet and you pay a fee when you want to load a web page from another. country or something it's like we all run the world with one standard, it seemed so beautiful and elegant to me, so those were some things that gave me a little clue that maybe it would work and I knew enough about computers and economics. Not that I was an expert on any of that, but after reading the paper a few times I thought this might work.
I guess it's crazy that I remember and I went into my email and dug it up as the first mention. of your name in my inbox and it was actually Jason Tan at Sift Science, yeah, and what really caught my attention was that you were on Airbnb, debugging with Jason at 2am. and yeah, you know, I think that was the moment. where I thought you need to fund Brian, he's like anyone who loves the craft so much that you know at 2 a.m. m. you know you're active like your brain is engaged in something that you know is useful in achieving a goal, I mean that really resonated. with me as a founder because those are the times when I did my best work, you wake up and it's like I wrote all that code or I discovered this crazy thing, yeah, I mean, I've realized that actually a lot of founders have work schedules. strange sleepers, it's not that they are all night owls, some of them are also very early sleepers and that doesn't mean that if you have a normal sleep schedule you aren't a good founder, but I think anyone.
I probably could be a founder, but I've noticed that there are some people that you know are working during the day and there are so many emails and meetings and you're distracted, so they need a period of time, whether it's very early or very early. late, where there's nothing else scheduled, you can just drill down and yeah, Jason Tan, I remember at the time Sift Science was a big startup and c that was doing fraud prevention with machine learning and at Airbnb was trying to prevent some of the fraud. that was happening and so I had looked at a couple of different solutions and what it would take to build our own.
I thought these guys seemed to have a good product and um, okay, let's plug it in, let's debug it. So I was coding everything and I liked talking to them and going through their API documents and it was a convenient time to work, like late at night, because you know there was a lot going on during the day, but yeah. There were definitely times in my life where I got so into coding and just wanted it to work and it was fun. There are other moments where you dive into the code and like nothing works and it's incredibly frustrating and two hours later you're like, oh, it was like a character was different and it's like you already know, it was a labor of love and um , I loved building things like that, so yeah, I definitely got into it a lot, yeah.
I mean, I love that story just because a lot of people who are watching look at what you've created and think that all desire is so mimetic, especially in terms of creating companies and becoming founders, but I feel like that's like the common thread is. being a builder, being very focused on yourself, you know, it's not the technology itself, it's not the problem itself and it's probably not the sleep schedule, but it's kind of like all of that goes into a state of flow and then you have this. As a result, yes, other people have written more eloquently about this than I have, but there is something about this desire or this ability to look at the world and say, okay, this is how things are, but they could be different and not just dismiss the idea. hand because it's so ridiculous, so there's something weird, it's almost like being able to suspend disbelief for a minute and say okay, maybe this could work, that's kind of a feature and then I think the builder feature is also very Importantly, people who know pg wrote a lot about this and all good, remarkably determined and resilient people who are like you, they know setback after setback and are like I'm going to keep going, because startups certainly are like that, so I think the construction piece is It is also interesting that the ability to code helps.
I don't think you necessarily need 100, but the reason it helps is you know when you're on a shoestring budget and you've only raised a small amount of money and maybe you only have one, two, three people, you could theoretically hire a company to build your app correctly, but you almost never get the first version of the product correctly, so if you are overpaying, so to speak, some high-priced company. build the app and then you get the first version wrong, which everyone does, and then you get the second version wrong, which almost everyone does, and you're on the third version, you're like you've run out of money and you're dead.
So I guess it was almost like a way to save money if I coded it myself and I remember, for example, I wasn't very good at design, but I put things together as best I could. using like twitter bootstrap or even there were some people, some friends on yc that like I remember one of the people created my logo for me or whatever as a favor so it was kind of like borrowing and stealing and trying to get something comes out and then if you iterate, iterate, iterate, you get product market fit, then you can start attracting enough people to make better and better things happen, but in the early days there were so few people joining my project that I had to make something happen with anything.
One thing I remember about your version of Coinbase in 2012 was that it was the perfect idiom for uh bootstrap, yeah, I guess so, it's like you know it actually looked like Twitter, so yeah, it wasn't. by any means, the most beautiful site, but it was functional and had something that looked like it wasn't incomplete, it wasn't going to win any awards, but I wasn't a big detractor of the design either. So, but that seemed like a really important thing from the beginning, to make some kind of clean, well-lit place to buy these things and interact with them.
It was interesting to see that a lot of people had the idea of ​​wanting to do something. with bitcoin, but for you to pick something as specific as a set of problems, you know it wasn't and in fact, you built it and I started sending bitcoins with it, yeah, well, I mean, that was my problem, so I, like many people, downloaded the bitcoin. client that was desktop software and had a proper command line interface and I started syncing my node on my macbook like that was the first version I tried and I knew that wasn't going to scale to a large number of people who they would want to do that, you know, for one thing, it took a while to sync with the blockchain, right?
It also reminded me of email servers or git servers because you know you can run your own email server, but no one wants to. they want, they want to run Gmail or something in the cloud, it works on your phone and if you lose your phone your email doesn't go away or whatever, and the same thing with git, git is hard to use, but github did it easier, so those were kind of my analogies and I thought someone was going to make the cloud-hosted wallet a thing for cryptocurrencies. I was actually trying to talk myself out of it because I thought that's a really big responsibility that it's going to be a big company that does that, you're going to store people's money, you're going to have to have regulation, so my first prototypes were actually, with a friend, I made this bitcoin wallet that ran on an Android phone and I tried to just make it easier to use and we put out a version, but I realized that the day we launched it I realized I realized it was poorly built because it required me to be trying to run the full bitcoin node on the phone and so even if we were on wifi it still took me hours to sync and I thought, "Okay, someone's going to make the version on the cloud of this." I could not avoid it.
I started experimenting and stuff and published it, so it's an interesting idea. It sounds like someone is going to do x and I prefer to say yes, I think there is a lot of truth in that, you just notice that there is a big problem in the world or something that you know you had to do. It happens, I think people say it well, sometimes you say, uh man, that was a big pain, someone is going to have to do this and then weeks go by and you say maybe I should do it, I just figured it out myself, maybe others need it.
Same thing resolved. I wanted to ask you about cryptocurrencies, and Bitcoin in particular, that attracted you. You had to be part of a band to accept it so early, but even within that band there were ideas that weren't useful or turned out to be useful. be wrong, you know one of which I think was being totally anonymous or pseudonymous at all times and you hadthan making a different decision for yourself very early I'm curious because that's like creating a stripe within a stripe that became

coinbase

um yeah I mean there were a lot of cypherpunks at those early bitcoin meetups I attended and of course , satoshi was anonymous and So I think some people were of the opinion that we're all going to do 100 anonymous here and I have no problem with that.
I think actually the

future

is probably pseudo-anonymity or something like on Reddit, you have a username. Declare bankruptcy and start a new one, your reputation goes away too, but I think that's probably going to be the

future

, but starting a company is a little different than what an individual might want, and I knew that if this company was going to ask people. to enter your credit card or your bank account or store your cryptocurrencies, then it wouldn't be right for me to be anonymous, right? I also did a thought exercise that okay, if this thing is small, it can probably fly. under the radar no one will care, but if I don't want to build something small, I want to build something that helps everyone use cryptocurrencies so that we can create more economic freedom and all this, if this reaches millions. of people, there's no way I can be anonymous like I, you know, I knew enough from reading about the history of PayPal and working at Airbnb doing these money movement things that there's regulation involved and like I'm not willing to be on running and never coming back to the United States or something.
I thought I have friends here. I have a family here. I want to be. I need to do this like above from day one if I'm going to do it. I felt like I wanted to create all these credibility indicators about the company, even when it was very small, design is a small thing, you know how support works. I even remember having on the About page, like pressing on and like sales on and like random email addresses and I was like the only person's company, so I was trying to create and yeah, news articles and put my real name, who's who created it and put it on my linkedin so they can read about me and my background.
I'm not trying to hide here. I'm not trying to be anonymous and get into the combinator. Getting certain investors like these were all little credibility indicators that started to add up to help us. I think we got over some of the noise you used somehow. I thought if we get there, we're going to need to have this right, so you had to assume that you could reach millions of users and then work backwards from there, which I think is actually relatively rare for many. of people like they don't focus on the result and believe that they can get to the result, they focus on seeing themselves as a startup and that's like just the initial part, it's like you know that's putting the cart before the horse in many ways , yeah, well, there's probably a way to take that too far, like you're so worried about having this beautiful product and everything is perfect and you never launch it in the first place properly, which is why startups do it.
You have to fake it till you make it, you can't be too precious about it, but yeah, if there's an opportunity to create some kind of legitimacy along the way, certainly take it, I think I mean even go before, you know the technology and the software. . Computers have treated us both incredibly well, what was your first computer and first interaction with technology like? Well, I feel very lucky on that front because I grew up in a house where my mother worked at IBM and she would take me there. I worked at times and got to see computers and we had some of the early IBM 386 and 40s 486 computers in the home.
This was like growing up in the Bay Area of ​​California and that was before the Internet, but you know, I learned how to use Like Dos and how to play little games on the computer and things like that at a pretty young age and I think it wasn't until Internet emerged. I remember first we got dial-up internet and then DSL and everything I really started. to get excited about this and started trying to learn how to make HTML and web pages. I remember reading this book about how to learn Java in 21 days and I was probably in 8th grade or something and I didn't completely understand it. none of that and I like it completely failed, you know, to understand it, but then I got html and I thought, okay, html is simpler.
I can learn that first it happened exactly, I mean that book, yes, and then html in that order, actually, yes, totally. that's so fun and barnes and noble like it's going to maybe we stumbled upon that where was this in california? this was in san jose california look right down the street in fremont yeah, I mean, something very special was happening right there in the world at that time and I remember, um, yeah, actually, the first job I had in the high school, there in the library, it was like someone put a piece of paper on the wall saying they wanted an intern to help develop their website and then it was this guy. garage in san jose kind of a cliché startup and that was my first job in high school.
You know, he was making a little bit of money trying to build his website and it was a notable moment in time historically, looking back, we were in that primordial soup and you know, now I know people who grew up and had never seen a computer, They saw maybe I saw a picture of one in a magazine or something and then they knew they wanted to be in computers and they applied to college, got in and started, got a degree in computer science without ever having seen a computer in the world. real life, which was kind of surprising, but I guess yeah, I feel very lucky to have had early access to it, it's the bike. for the mind, as they say, yes, yes, and there was something about it like, frankly, I was a very shy and awkward child, I wasn't good with people, so I just liked being alone in front of a computer and reading books , and I felt kind.
It was exciting to use and I remember the first time in high school I had a little glimpse that I didn't really know what I wanted to do with my life. You know, I was learning all kinds of things. It was like taking some music lessons and I was studying doing all the things in high school and I remember making this website in high school. It was actually a friend of mine, he and I were trying to resell computer hardware or something we had like a PayPal account and we made a simple website and I remember I went to sleep one night, I woke up in the morning and the little guy hit counter was like 500 people had visited the website while we were sleeping and I thought that was the best thing I had ever done. because it was almost like a superpower like I was asleep, but something that I created was helping serve the world in 500 people, even which I could never do one on one and that gave me a kind of rush and I remember going to college and thinking I wanted to do something like business and computers or something like that.
The crazy thing now is that even thinking about this video is going to be interesting because there may be hundreds of thousands. of people watching it and then, would you like to visualize yourself right now being in a stadium with like 200,000 people or something like that? Yeah, you know, it's a little crazy, it's like the printing press of our days to provide distribution, you know. The Internet changed all of our lives in terms of just connecting people and having a huge impact on everything you do and create and now I want to say that the Internet is actually eating up money and you have created one of the you know one of the cornerstones. of that, so I don't know where we go from there, how crazy is it that we live in this time where money went from this thing, you know, locked in a row somewhere in a database to something which is actually distributed and Yeah, you know, everywhere and it's not owned by a single entity.
Yeah, I mean, I think people don't appreciate how powerful it could be to take what the Internet did for information, democratize it, anyone could publish it and do it for money. because you know before the Internet it was like there were all these gatekeepers, publishing information was expensive, it's like you needed to convince some studio executive to appear on your TV show or get a gig on a radio station that broadcast to thousand miles or in a newspaper. You knew these incredibly powerful institutions and suddenly anyone could do that? So people think that money works today somehow.
I can swipe my credit card or whatever and buy a coffee, but in other ways we're stuck. the era of the radio, television and newspaper area and if we make it so seamless that anyone around the world can participate in this global economy and the payments are instant, global, cheap and fast, as I believe many will be unlocked things from that and you can see little glimpses like in China, for example, they are entitled to WeChat and WeChat payments are really seamless. You can make micropayments, they're instant, they're practically free and we see everything. These small business models are just flourishing on WeChat and that's just a country, it's a big country, but it's a country, so what if we could connect everyone in the world to a payment system like that?
I mean, you're talking orders of magnitude. I think of a kind of unlocked potential, I mean, it feels like we're in, in my mind, there are three different revolutions that happen if we travel back in time to 2012, when we first worked together and we sat down and you said to me, " hey, bitcoin is.” it'll be worth it, you know, 50 60,000, I mean, who knows where it will be when people are watching this, you know, by then it could be millions, who knows, right, I guess I just wouldn't believe you, yeah, but that seems like it the first revolution. and then the second one is you know you could argue challenge and then the third one, I mean, you've talked about this, probably just decentralize all the organizations, social media and maybe the government, and yeah, there's kind of three things. that happen simultaneously, yes.
I think people still haven't fully appreciated, yeah, the different phases of cryptocurrencies, they're still thinking about them. Most people, if they've heard of cryptocurrencies, they still think of Bitcoin as something like gold, digital gold, okay, so it's something like that. an investment that you can make and something scarce and, um, that's really like phase one was like cryptocurrencies as this new category of investment and now we're defiantly looking at the second phase of cryptocurrencies as a new financial system and all of these pieces are reinvented there. with loans and insurance and things like that, the exchanges are recreated in a decentralized way and then the third phase will probably be crypto, as this new Internet application platform, um, which could be creating new identity systems, new ones like social networks , he could reinvent himself there like you were. to say that governance, whether it's recreating new companies with their cap tables or even governments in some votes can be reinvented in many ways, so I mean research like with the research center, yeah, I mean which is a good example where it's a startup that's creating a token to try to bring a community together and it's like you know the first people to put their houses on Airbnb could have gotten a percentage ownership of the company or the first drivers at uber right um I think nowadays there are a lot of companies like The standard model that most Silicon Valley companies do is they issue a bunch of options like 10 or something like that and they give them to the employees and then they reissue the option pool as more employees come in, there will probably be companies in the future where they issue an option pool to the employees and then an option pool to the customer base because they're both helping to build this new thing and they're both basically they'll like to know that the board will top them both up every time they run out, but you'll end up with these startups that are owned by customers, employees, and investors, so they'll allow new things like that.
Yes, I mean the research center, for example, is fascinating. I mean, I think you wrote one of the blog posts that laid out what a research center could be. Yeah, I've just been helping that project get off the ground in my free time, which is fun, it's helping me better understand what a crypto startup of the future is. It's really going to be like: I think about that and I think about what research organizations do and you know, and these are some of the most important and prestigious institutions that exist and then here's basically a decentralized autonomous organization that's a website which also has a currency, but what's more important than just the currency is how people interact, you know how things are financed and what is financed and how that really drives human knowledge, kind of like the financial services that we we talked about were stuck in this bureaucracy and like legacy systems and I think scientific research is verysimilar in that sense and it's very archaic the way you know an article is submitted to a journal and like a journal it takes a year to review it and you have three random people that I don't even know who reviews it and maybe be accepted in this journal and by the way you have to pay the journal to submit your article and they charge the people who read it and it's basically just a pdf and you know why it's not.
You know, scientific research is more like open source software at that speed. We saw a glimpse of what happened during Covid, when people started out of urgency to publish their research on social media and get peer reviews the next day on Twitter or in a media outlet or whatever, so I think that It's the future, this whole idea of ​​getting a stream, the currency of academia is kind of dating and I think it should actually be driven by something like a research currency. I mean, if you're creating breakthrough innovations or you're just helping select or answer questions or lots of ways you can contribute to research, you should build up some ownership in something for that, like the people who are making these breakthroughs. innovations like crispr or whatever, they should be billionaires like startup founders are, so there is a huge gap between academic research and then every once in a while an innovative idea jumps out to be commercialized and many, many The Wealth generation happens in startups when things are commercialized like, frankly, Coinbase is an example of that.
I read a research article written by Stosh Nakamoto. I thought it's a great idea. You could probably help market this and a lot of the pots were generated here but the people who write the research papers don't create wealth so their fake currency is these quotes and there is no reason for that to be the case like why Not much research is published with some type of license. It's like, hey. If you want to commercialize this, give us one percent of the revenue for the first 10 years or you know, and basically there should be just a button that says license, yeah, you know, whereas today you have to go to these transfer offices. technology in universities. and there are a ton of lawyers and custom processes and it's like letting anyone start doing the research and letting anyone who wants to market it have a license, like there has to be a well-oiled path between those two worlds, I think, I guess .
It strikes me how different the decentralized autonomous organization run by software designed by a deistic creator is, you know, like someone who thinks about the needs of all the stakeholders and people involved and then writes code that he can then put as the right situation. in the place where magic can happen, like in the case of the research center, what we hope is that the research center will help create a whole wave of innovation and drive human knowledge and I think it will achieve that, you know, I think that We'll have like a generation of Einsteins, you know, maybe in 10, maybe 20, you know, but probably at some point during our lifetimes, you know that can happen and will happen, maybe less and less under the auspices of a university and maybe more and more. more on something totally decentralized like this, totally yeah, I mean, I think about YouTube, right, it's like if YouTube started and people would put up cat videos or copyrighted material or whatever, it wasn't taken seriously, but now youtube is so big.
It's honest, it's better to have like you know 100,000 subscribers on YouTube than to have your own TV show on NBC or something like that. I don't watch NBC, but I watch YouTube all the time, so I think similarly. when you create these new systems like they could be a dao or a research center or whatever you know, a lot of the early participants are a little bit quirky, they're a little weird, they're on the fringes, right, they're probably not going to be in In the case of the research center, as a full professor in his 30s, it could be a graduate student who is new to his career and decides that he wants to bet on it and, by the way, many of the most active users in the research center Research is sort of like graduate students and PhDs who are early in their career, so we're getting things that sometimes aren't talked about in mainstream academia.
I don't know, I mean, the dows are an interesting thing, so the governance component. It makes sense for a dow and you can make money and proposals go into the dow and people can say okay, I vote yes on this one, money should go here and there, but that's how it was when I was creating, you know? helping to create a research center, I was thinking about how is the actual product going to be built properly because the dao is kind of a more esoteric, high-level concept and that's why we have a research center, a corporation that's actually called a research center. research. technologies is the corporation and is a technology provider to the dow so the dow can have a vote and decide to allocate money to this provider which is a c corporation that actually builds the website and the app and the like data They pay AWS bills. and stuff, but it's a technology provider for the real enterprise, so to speak, it's the dao, so I don't claim to have all this completely figured out, but I'm experimenting more in this area because I think the daos are going to be really important in the future and many of you who know, all of this case law had to be resolved as a Delaware corporation and that jurisdiction, the new jurisdiction is online, right? and i think daos is kind of like the cloud de c corp, which is where a lot of the future is being built, so in my mind dao is almost like a real thing and it turns out a c-corp de is as a technology provider that services you, yeah, reminds me of the time Yuri Milner came to speak at YC and of course people asked him why he invested in Facebook and he said the whole world is becoming a brain global.
Yeah, that's what the Internet is yeah, and then when you think about a dao, it's actually, I mean, I guess it's a synapse or an axe, I mean, it's kind of a protocol for different cells in this brain global work together, that's not like a centralized command. and control, yeah, I mean people talk like you know that in science fiction there are hive minds and things like that, and I mean, I think the Internet is turning the human race into some kind of hive mind because I just think that I like it. Look at the number of WhatsApp or Signal groups I'm in and the number of links that are sent every day and compared to three years ago, but three years ago or even a year ago, and it's like it's increasing, for What the exchange of information between all these people in small groups or in large groups is going more and more and it's almost like we're creating a hybrid brain of some kind that reads like some biologists and things that talk about what human beings are like. . 90 you know, chimpanzee and 10 percent ant or bee type colony, interesting mind, we have a kind of hive mind aspect to us, like if you ever see a group of people at a party all dancing in unison or us We like yoga, where everyone moves in unison and it is even very natural, as if in our bodies we could viscerally feel that experience, it is as if even in companies they do rituals like that, sometimes in which everyone acts as a meeting. standing up and We're a bit like a colony of ants or a nest of bees or whatever, but we're all so different.
I mean, what do you think of this when I think about

decentralization

? You know, it opposes tyranny in a In many ways, when you think of tyranny, you think of command and control and then you just know that the worst things in human history maybe come from arrogance or a taste for too much control. and then you know one of the most notable artifacts of a decentralized autonomous organization is that you can fork it, yes, and if the creator of the dao no longer meets the wishes of the stakeholders, it is actually much easier, since there are far fewer ways and that could actually be really good for humanity, yeah, totally, I mean Boston biology has a big talk about this like, um, I think it's called the biggest exit from Silicon Valley, but it's about the concept of voice versus output, but yes, if you can fork a code or you can fork a dao.
Um, that's very powerful and you know, I also think about this for Coinbase because we're sort of building this very centralized top-down command and control in a decentralized world and so, you know, I think there are some checks and balances against that. which is nice for example you know we're using open cryptographic protocols so if people decide they're not happy with coinbase one day they can take all their crypto out of coinbase and put it somewhere else there's kind of a freedom for them to people leave, which creates a great sense of responsibility, we are also making it easier for people to store their own cryptocurrencies.
In fact, I think self-custody of cryptocurrencies will be a big problem in the future, as it already is today. but it will be even bigger in the future and we start with custody of people and cryptocurrencies on Coinbase. There are still a majority of people who come to us and institutional clients who do not want to store their own cryptocurrencies. It's too scary, but with things. Like the Coinbase wallet, we're making it easier and easier. There's over a million people using it now that are like storing your own crypto and that's even more decentralized, which I really like, so we're going to continue to invest in that and you know.
I'm thinking about that too, is how do you create a company that stands the test of time and I don't plan on going anywhere except one day if I pass away or whatever, how do you make sure that company has good values ​​and makes good decisions? decisions and these are all really difficult problems that I don't feel like I have all the answers to, but yeah, I think you have a new initiative called coinbase 10 10 yeah, yeah, so coinbase 10 that's taking 10 of your time and resources. , yeah, yeah, and then resources and actually working on totally new things, maybe like self-custody, which right now seem far away, but now it's really core to what the product is going to be and yeah, that's great, glad to hear it.
You mentioned that, so yeah, actually the Coinbase wallet, our self-custody wallet and Chromebase trading and other things that we've created came from that group of 10 and when we were smaller as a company, a lot of them actually came from me. It's like I got excited about something and said, "Let's team up to do it," but I realized that as we get bigger, it can actually be dangerous if I'm like the gatekeeper or the bottleneck to creating these new ones. types of applications, so there have even been cases where people within Coinbase, as entrepreneurial people, have a lot of entrepreneurial employees who came and pitched me and said, hey, I think we should build this or I think we should build that and I .
I've said I don't think it's a good idea or we don't have time right now, whatever they have left and they've become big companies so I think we're the size we are now. I modeled it a little bit after the combinator and and things like that where you know I don't want to have a committee where you have to have 10 people that say yes, that's basically the opposite of innovation, there's a lot, a lot of innovative things are a little bit contrary. , so you need 10 believers, there should be 10 people who just walk in and that's how it will be, yeah, yeah, so anyway that's what we're doing with the 10 things, like we're organizing our own little internal thing where If you're like one or two or three employees or whatever and you think this is something interesting that you want to spend your time on, you can present it to us, you know, if there are a couple of options, right? open to any options, for example, if you want to stay on Coinbase, have your Coinbase salary in equity, then you can keep it and we will own it, it's a coin-based product, if you want to leave and work on it, um, you.
I know coinbase ventures will invest other seed investors can invest any money I would love um yeah and maybe even there will be hybrid versions of that too who knows I'm open to various ideas so I'm trying to make sure we are a company that innovates all the time and isn't held back by the fact that we're too big or too bureaucratic or that I like that I have to think something is a good idea because at this point I'm pretty sure I'm going to miss it like the following. The important thing is that there are so many interesting things happening in cryptocurrencies.
I mean, that's amazing. You know, I think a lot of people who would be in your shoes and are in your shoes are like I made it and then instead what I'm hearing is. like this is actually a place to create the next thing that goes through my head is like, you know, I thinkthere's a big chance that the things that a billion people use in the future will all be, you know, crypto native, they could be daos and then coinbase seems like one of the best to me, if you don't have an idea yet and you're a big builder , you know that coinbase is actually the place to go because it will guide you into the networks of people, the networks of capital. and then give you the similar culture and knowledge to build the future we both want, yes I hope that's the case.
I wanted to be an entrepreneur and I had a tutoring business that I had started but it didn't really work and so I basically closed it and sold it, well I sold it, I didn't close it but then I joined Airbnb and Airbnb was like it was doing Well, I was growing up and I learned a lot and met interesting people. people and that really helped me when I had the next right idea, I made Coinbase and that really helped me, so I tried to create Coinbase in a similar way, and I think that anyone who wants to create a company at some point or just wants to be a part of building something great within Coinbase, as we want to welcome all those people and would like you to know.
Check out coinbase.com careers, it's a great place to build not only a career in crypto, but also to learn the business skill set and you can get internal funding or go out and do it and we're totally happy either way, there's this. video that I'll probably overlay here and I'm very obsessed with that's my visual for what you just said so it starts with someone opening a pepper, taking a seed and putting it in the ground. and then you see this time lapse like a new plant just grows out of the ground and, as you know, it flowers and then it produces more peppers, yeah, and then, and then the cycle repeats, yeah, and I think this is something So. of the things that you know you've done and would like to continue doing, actually totally, I mean, yeah, when I look back, what I'm most grateful for in my life, it's probably a couple of people that you know.
Like you were one of them that when I was I didn't have any credit to my name or whatever, but I just had this goal or dream and it was like someone made a bet on me and that really allowed me to do what I wanted, They saw the potential before I saw it myself, so I think that's what we wanted to try to recreate, it's like, how can we do that for a bunch of other people and especially once you know a lot like a lot of Coinbase employees? They've recently gotten some liquidity and, you know, how do you put the capital to good use?
It's like my belief about the world is that prosperity comes from innovation and like innovation basically comes from there being more freedom in the world, uh, going to try new things with science and technology, so If we've had some success here, for example, how do we reciprocate that? How do we show people like this? It's something anyone can do well if they are determined enough or want to do it. Wow, you know, make some variation, it doesn't have to be anything. It's exactly how I did it, everyone will have their own way, but try it, the first one probably won't work.
I mean, I tried to create probably 10 different startups. Coinbase was by far the best in my life, but eight of the other nine failed and one of them was rounded up to basically zero, but it didn't fail completely, so it's like try something, try anything. It almost certainly won't work, but you will learn something. Try something else. It almost certainly won't work. Try again. whatever you need to do and if people keep doing that and really believe it's possible and have some role models, then I think a lot more new companies will be created. The crazy thing when I sit down and think about it is like when I first wrote. you know, one of the first checks for your seed round.
I really didn't know. It was probably one of the first five or six seed checks I wrote. Is incredible. Actually, I didn't know I thought you were like. some like super experienced angel no, definitely not, I mean, I had paid off my credit card, uh, maybe like the year before, yeah, I had to sell something secondary to Ashton Kutcher's just to have money to pay for my wedding, yeah, and then I got hired at and combinator and I literally had never done it before and then obviously nine years later, this experience makes me very emboldened because not only, as you know, any big builder can build something that affects a billion people. , but I mean you. we can keep doing it, actually, like we can keep making more and more things happen and it's the biggest growth mindset that exists on the planet, actually totally.
I mean, that's like the really crazy thing, in a way, it's okay, I just had this really cool result with the direct listing and everything, but it's not the end, it's actually like we're about one percent of the way there. towards this because now that you know, I think a lot of people misunderstand this, there's actually like there's a There's a lot of negativity out there sometimes about like, oh billionaires and like I'm greedy and what's once you like having a place to live on food and things like there's not that many things you can spend money on and so how are you going to allocate that?
Well, I hope that the capital is allocated to help build more things that will create more jobs and more economic growth, and like most people I know, they have obtained some amount of liquidity, whether it be from Coinbase or other things in life . It's actually like they're not buying Lamborghinis or anything, they're actually like trying to think about how they can pay it forward, whether it's philanthropy or starting new businesses like both of those are really good ways to help the world. know where else we can and I mean this is like yeah, I hope this is the first of many times, honestly, I mean, every time we get together, I learned a lot and then, honestly, I just watch how you continue to grow, you know, coinbase. it's like one percent it's like the progress bar and this is the one percent if this is the one percent like oh my gosh you know what's going to happen in the next 10 years I mean yeah fantastic well, I hope it's all fun, it's just fun to build things.
So I'm sure that not everything I try will turn out well and I hope that if I have a certain amount of money saved, I won't have to worry, like if my kids are going to college or whatever. I can take big risks with the rest and we'll see what happens. I think it's fun, we'll try a lot of things and hopefully we can all be on Hume's team and help things get better, yeah, I like it. Brian, thanks buddy, thanks for hanging out, thanks Gary, wow.

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