Goodbye for now: Web3 Compass Wrap-Up

Speaker A: Hi and welcome to this week's podcast episode of Web3Compass. If you follow this podcast, you probably know my last episode was published some while ago and today, um, will also be my last episode, as you probably read in the title, at least for now. So what can you expect from this episode? Um, first of all, I want to talk about current, uh, current trends such as institutional investors moving into the space and also the impact of this development. Then I want to talk a little bit about personal stuff, why I don't work in the crypto, or let's say DAT industry, and why I'm also not planning, at least in the short and middle term to do so. And then I want to talk a little bit about, um, my predictions for the future, which will also include the Metaverse. So let's start with institutional investors moving into Web3, or let's say adopting distributed ledger technology and also launching Bitcoin ETFs. So Larry Fink, the CEO of BlackRock, said in July this year he expects crypto to transcend traditional currencies, including the US Dollar. And this statement from the CEO of the biggest asset manager in the world means a lot for the whole space. Um, because Fink also said in an interview with CNBC in 2017 that Bitcoin is an index for money laundering. And I would say also, um, I wouldn't judge him too hard, um, I highly reflected on the statement, but it was not completely false. And also, um, looking at recent events, um, you see, um, that the industry is transforming and also cryptocurrencies were used for money laundering. And I think, um, a lot of things are developing in a positive way. But it's of course it always has two sides. It is neither black or white. It has all sorts of, um, gray shades. And he also said, um, we are working with our regulators because as in any new market, if BlackRock's name is going to be on it, we're going to make sure that it's safe and sound and protected. And I think this is very interesting statement. It shows also, as I said, the transformation and BlackRock can be like a huge pull factor and they can pull in other stakeholders, as for example, JP Morgan, who are an authorized and participant in BlackRock's Bitcoin Spot ETF, um, at least according I think to the, um, SEC filings. And, um, it's a little bit ironic because JP Morgan's, um, CEO Jamie M. Dimon, um, called people who own cryptocurrency stupid. So, um, it seems they don't want to miss out on any revenue being made here or not sure what's their internal process but yeah, ah, let's see how, how this um also changes in the next years. And yeah I think um, or not I think I see a big trend that the cryptocurrency industry will be regulated. Um the FTX lawsuit is one example, the current Binance lawsuit is another one. Um they, they settled as far as I know and, and another one with the SQC is outstanding. And um, in this whole process I see us and by this I mean US companies and US authorities as ah leading force in the whole process with which probably also means that they will write the rules. And as of now I can't say if this is a good or bad thing. As I said before um the reality is oftentimes neither black or white for end consumers. This will probably have a positive impact with all the scams going on in the last years. Um, but will it remain decentral and will a lot of the, the the core values of let's say the cryptocurrency space, um, will they remain stable? And I'm not really sure um if this will be the case in the future because if the US and by this I mean US authorities and us um companies also who influence authorities um if they control the exchanges which basically they control the inflow and uh outflow um of um is it then really um autonomous, Is it really decentral? Um I would say not really. It will be then controlled by a central authority and one um example for this is that the US for example wished um Binance to stop serving um due to the Ukraine Russia war. Um they wanted the from Binance to stop serving Russia based users which Binance refused And as far as I know um, there was also such a case with uh Coinbase. Yeah, so um, of course we always have this um Western or not. I, I don't want to say we. I always have this Western perspective in mind where I'm also um pro Ukraine and of course this is um politica and in this case also M pro US um M. However um the question is or the statement here is yes a ah central authority um which is in control and it's not really decentral. And I also want to, to ask a question what would be the impact of crypto transcending traditional currencies including the US dollar And I'm not sure if anybody of us um also not um Nobel Prize winners or economists can predict this because um you, I, I can just suggest you to look at global reserve Currencies throughout the history. And by this I mean which was the most dominant reserve currency at which point of time. And you will see it strongly correlates um with the power of let's say an empire or a country. You see the rise and fall of let's say Spain, the Netherlands, um the uk um, you also see the US um or USA dominating currently. But you also see always the rise and fall of the um reserve currencies and, and also nearly in parallel it reflected also the power of an empire. So and if we assume now Larry Fink is right and the US dollar will be transcended by crypto, what will be the impact? And I don't know, will it be like anachro capitalism? I see a strong trend that a lot of um, very rich individuals and by this I mean um, 30 million um plus um dollars, US dollars um under management or let's say just their net worth under management. Also funny, like everybody's family office but I mean at this point of time you're, you're some. You, you are right. So um, I ask myself how many of them see themselves as citizens of a country? And I asked this question because you also see a lot of influencers who have um, who don't have um this amount of money but um, couple of millions let's say and they are moving to Dubai for example or to other tax havens. You have a lot of um, people who inherit um companies or fortunes setting up share companies. And what I want to say is um, let's, let's take also another example. You always see these statistics. The richest 10% of people having XY% UM of wealth. But also on the other hand, um, also that the 10% of the richest people are paying XY percent of taxes. So both numbers are high. Right? So it's dependent on the country. That's why I don't want it to cite actual numbers. But um, what I, what I mean is that you um need also rich people, high performers, um entrepreneurs, um, in a society you need um, people who have a lot, um, who take care of those who don't have a lot. And if you look at trends also um. Scott Galloway um recently published a book, I m also talked in another podcast about it about S and P S&P 500 companies. How many of them um have their profits now in tax havens. And of course also a question of definition. But if we are being honest, um, you all probably know what I mean. M. The number has um since uh years, um constantly um getting was constantly Getting bigger. And I think now it's over 50% of the S P500 companies will have um, part of their profits at least in tax havens. And um, by this I'm, I'm not sure what this will mean to society. If you also have, let's say a decentralized uh, financial system, um, what will be the impact for the whole society? Um, yeah, I, I just don't know. Um, and what I want to say with these comments is that it can be that um, a lot of very wealthy people are using this system because it's, it's easier um, to also decouple from let's say the countries where they live in and live like a cosmopolitan international life and be like, such as a class of the global elite, um, where wealth accumulates. And um. Yeah, not sure um, how this will also impact global conflicts. And this is of course highly political and hard to predict. And yeah but I said I also want to talk about um, some predictions. Right. So and this is something um, if the, if crypto is transcending the US dollar I'm not sure which um, which the impact of this will be because um, if the, if Bitcoin then has like a certain amount of value, there will also be people who already bought Bitcoin early and, and it will be very hard for any other people to, to get in on this trend. Right. Um, yeah. And the second part which I said is um, which I want to talk about is why I don't work in the crypto or let's say DAT industry and why I'm not planning to do so. So this year um, I changed my job because despite delivering great results I didn't get the opportunity to evolve with the speed I wished I would. Uh, evol. And um. So I said if I couldn't change the situation within the environment, I have to change the environment. And of course I asked myself um, what are possible next steps and do I want to work in crypto? And of course, um, first of all I looked at the exchanges. FTX of course um, was already known as a scam. Binance was always very intransparent and in some ways I would also say shady. Um, just look uh, right now at the lawsuit in the US and um, hearing from people who work or work there. Um, I don't want to be any more specific. Um, it was also a very secretive and uh, centralized also insight. Maybe not for everybody but at least um, for people in regional hubs. Bitpanda for example also an exchange. Um, they over hired and then fired um, many people in their probation period. And I uh, took this as not a good indicator, um, to, to also to build like a career or to, to make a living. And then there was another big US exchange, um, where I had a podcast interview scheduled. So I was in contact for a long time at first with like a public relations agency from them. And then they had some changes internally where they didn't, um, where they changed the agency. And yeah, I had some, some questions prepared and they basically didn't wanted to answer any of the critical questions and instead focus on questions. For example, how more um, women can work in the crypto industry. And I don't like it when um, companies or people make these questions gender specific because over 80%, I think even over 90% of my listener are males. And a lot of them I know from, from conversations also asking themselves and the same question how can they work and in the crypto industry and so why should you only focus on women and as an conclusion exclude every male. And to, to be also clear, I also really want to state it clear here. I think it is very important to empower women and divers, very important in the workplace. I just don't support the way in which often US based company exclude um, men in a generalized way. So for me it's the same rubbish woman faced for tens of years and instead of learning from this, it's just now the other way around. So um, I also said I would want to, I want to frame the question more inclusive. And then they basically said um, they don't want to take the interview at the current point of time. And I'm not sure if this is because of the job cuts or whatever. But um, it also showed me that also in the communication with the company, um, I didn't get the best impression. And of course this was um, the, the German hub. Right. So it was not. I don't know how they, they work in the US And I also don't want to put everybody of this company in a box. But yeah, uh, so long story short, the exchanges were not really interesting to me. And Banks or Tradfi or traditional finance who now also participated in the space, um, was not interesting for me because they are from my experience highly hierarchic. They are politic, so political insight, um, they are highly regulated. They are um, oftentimes not um, very fast moving in terms of technology adoption and especially in countries like Germany. But I would say in a lot of countries in Europe, um, you have a lot of people in the company who don't want to change and then you have to face a lot of change management and yeah, it's just not the environment I, I want to be in. So instead I decided to work for an AI company in Heidelberg, Germany which I am. Um, Paretos is the name of the company which I think um, has a very, very interesting um technology. Um and the company focuses on forecasting and optimization which for me also I'm um looking um right now at success stories we have with our customers. Really also has a high impact and uh. You might now ask the question, are all crypto bros AI bros since the crypto hype uh cycle uh reach this peak in let's say 2021, 2022. And here I want to cite Gary Vee. Um, you might know him, him I would say he's a famous marketer. But this word probably doesn't uh, can, can describe him in his whole complexity. He said in, in one talk I heard from him the corporate word is obsessed with yesterday. And people who are uh technologists or who love technology are believing in tomorrow too soon. And I really find myself in this statement because I also thought a lot will change in a very fast way. But the uh whole process, it just takes longer technology adoption rate, um, it takes time. Ecosystems have to evolve. And yeah also this, the shiny um object syndrome. I'm also affected by this because I um would say I'm very optimistic, um in a lot of ways and also enthusiastic. And you can, you uh, can catch me with new technology. So I learned a lot from this also um, to differentiate or uh, to take sometimes a few step backs and reflect on the technology. But if we now talk about my predictions I would say still a lot of what I talked about and will become um, realistic in the future. And here I look for example at old science fiction movies and now um, I'm looking what technology we have nowadays and I don't know where I read it but somebody said basically today's we are also some, some way of cyborg because with carrying our um, smartphone everywhere where we go we have basically access to like a mini computer which um has like the super intelligence and you can basically Google um a lot of stuff and have, have access to um. Yeah, not, not unlimited knowledge but let's say um, more knowledge. Um everybody um in the past could ever um, have gathered in a lifetime or in. Yeah, you know what I mean? So um, I think also in uh looking at web3 a lot of the things will um, become reality. And the first thing is for example The Metaverse, I think it will be a thing. So um, also looking at the Apple Vision Pro where you have like a hardware producer uh, who has really good hardware. So I'm also Apple fanboy. I also have to say until I think 2021 I only used Windows and Android but then I made the Switch and um, I really love Apple products. I also of course for, for gaming for example. I also love Windows but you have like a hardware producer who really has very, very excellent hardware moving into the space. And if you have seen this videos, these are amazing. And also talking about holograms, I don't know if you know Alex Friedman, he's a famous podcaster from the US and he had an interview with Mark Berg where I would call them holograms, where they were basically as holograms. And it was amazing what um, was technologically feasible. And so what I can imagine very well is that especially in the entertainment industry there will be changes. So like gaming, they already are at the forefront of innovation. Um, currently playing Baldur's Gate 3 and I think it's so amazing. So you can um, have your own character, you can um, take a lot of details and then you have the cinematic sequences um, in the storyline and your customized character is there and every detail is portrayed in an extremely good way. So after not playing many video games for a long time I thought why this made so much progress in the last 10 years where I played a lot of um, MMORPG. Um, so I was really fascinated and I think this is just, just the beginning. And um, I, I can think about interactive movies or interactive um role play games or also for traveling, for um, meditating. I also talked about like um, business use cases such as trading like let's say firefighters or uh, for chemical experiments for everything which is dangerous for policemen, for soldiers. Um, yeah I think there's a huge potential and also the technological ah, um, speed is there. And I also think that the adult entertainment industry will be as with the Internet, also at the forefront of um, at least information technology innovation. Um, yeah, let's talk about NFTs. Um, I also uh, reflecting back on my own invest investments. Some are of course trash. Others are for me arts. Uh, so I talked in the past about Petraki and his collection. Um, for me, um, I'm happy that I have this nft. Um, and I think it's like a way of digital ownership and with also like big auction houses uh, from the art industry like Sassaby's and Chrissy's involved. I think that these blue chips, NFTs, the ones who had um, cultural impact. Um, I think, and I have to state it here very clearly, this is no financial advice. Always do your own research. I'm um, no financial expert but I think those will be um, worth a lot in the future because um, I think there are a lot of people, especially young people like myself who believe in the strength and who believe in the concept of digital ownership. And if there's people who think this is true, there will also be a market and also um, just, just look at the prices right now. So I, I think sometimes if you can go through such a winter and prices remain at let's say even high levels. Um, yeah, it's, it's a little bit with cryptocurrencies. Right. Then my um, assumption would be that these um, are now quite stable and will be probably also in the future. But let's see. So and next point is with AI and deep fakes on the rise, I think um, let's say um, to verify the realness of your data is very important and I can imagine um, that the blockchain or DAT technology will be um, a great tech um for let's say M technology architecture or information technology architecture to verify um, that your data is real with for example text which are stored then on the blockchain. And then I think um, that as stated before, the financial system will be hugely run on DAT technology and this will enable um, certain things such as the tokenization of assets or the tokenization of let's say real estate but also intellectual properties such as music rights, um and all the stuff. There are currently companies who are doing this. I think it will be even bigger in the future. Um, but as also said it before, um, technologies believe in tomorrow too soon. And I also think retime transactions will be the standard. I just um, did a transaction like five minutes before I started the podcast and um, there was no retype transaction possible. Sometimes I think that this is even real in, in 2023. It's um, very strange especially when you're doing a lot with PayPal where you can just transfer money in real time. So yeah. And then I, I think um, also last um, prediction distributed ledger technology is no general purpose technology. So it's not the technology which includes all areas of life and stuff. I don't think this is true. I think it will have some functions as like the Gartner hype cycle where you um, now see it more realistic where you have use cases. Um, I learned it at MIT course I took that it is a general purpose technology? I personally don't think so, but I think it will have a lot of impact in different ways. I'm also interested how Soberhorn tokens um, will um, evolve in the future. I think they can be. There's a good chance they can be picked up in the next hype cycle but then on the other hand for real life users use cases. I'm not sure if um, if especially uh, countries like let's say um Western countries or wealthy M countries um also across the globe um have a need of, of this because normally um, a German passport or US passport or whatever passport you have um, should be enough. Um, so not, not sure how they will um, evolve but I think there's a great potential that they are picked up in the next, in the next crypto summer and there's a lot of projects who get pumped but also here no financial advice of course. And yeah, um, I don't will continue this podcast because um, I don't work in the industry. Um, it's very hard to keep up with the news. I work a lot in my current job job. Um, I try to catch up with AI technology, try to um, know more about um data, data structures, all the stuff um, about all these areas and I just feel like it's um. With all my other goals in life, also with my girlfriend, my family, my friends, my health, um, I can keep up the podcast but I will um, from the sidelines I, I will look at this topic. Um, will um, stay also in the space. Um, I also have my cryptocurrencies. I have not um sold anything. I have um, my NFTs. So um, yeah, let's see how this all turns out. And I also want to thank everybody who supported me in this journey. I just looked in my iPad where I prepared podcast episodes, interviews. I also have something on paper but there I have like over 300 pages. I had incredibly interesting conversations and yeah, if you want to chat sometimes, uh, sometime you can also message me on LinkedIn. Um, sometimes I will not be able to respond directly because I have a lot going on in my life. And if you don't, if you aren't on LinkedIn or you don't want to dox yourself, you can also write me in mail at sebastianb3compassio so I wish everybody um, all the best for next year and yeah, thank you very much for supporting me. Cheers.