 Hello, welcome to theCUBE's presentation of Unstoppable Domains Partner Showcase. I'm John Furrier, host of theCUBE here in Palo Alto. We've got some great guests here on this panel. Talk about DeFi, the relevance of it, the importance, and all the major things happening in the changing world of finance and decentralized web, which is web three, great wave here going on. We've got Jamie Roginski, founder of Wall Street Bets and strategic advisor of Wall Street Bets app. Great to have you on. We've got Michael So, partner head of business development cook finance and Mike Morlitz, CEO of DeHive. Gentlemen, thank you for coming. I'm super excited about this panel conversation here in the Unstoppable Domains Partner Showcase. Thanks for coming on. Yeah, thanks for having us on. Thanks for being here. So first of all, it's been a crazy ride. You go, even just go back from, just go back eight years ago now and then go to the big ICO craze. You had now the operationalizing of crypto applications. Blockchain, I'll say the price of Bitcoin has been gone great. Everyone's been making a lot of money but it's really about the fundamental change of users. And DeFi and decentralized finance has been one of the tip of the spears here for the terms of change because money's involved. And that's the shift here. So before we get into it, I want to get you guys to help me define what is DeFi? What if someone says, Hey, what's DeFi? Everyone wants to know what's DeFi? What does it mean? What is DeFi? Well, I think it's still being defined to be quite honest with you, right? Like it stands for decentralized finance, but for the most part it's figuring out a way to use these crypto coins, tokens, assets, DAOs, dApps, this that and the other to try and integrate this worldwide transactional, parallel ecosystem to traditional finance, right? So I'd say for the most part, you're able to transact, send money, buy things, invest it, generate interest rates, et cetera. So is it a new money system? Is it an architecture? How should people think about this? Because to me, it seems like a whole nother stack, if you will. It's not a word stack, tech stack, but it's really more of a different thing. People still scratch their heads. So do I, is it help me? Does it hurt me? What's the, how would you explain it to someone who's like saying, Hey, I got a bank up my app on my phone. What's the difference? Yeah, to me, there are three things that define DeFi. You know, one is the fact that it is non-custodial, meaning there is no counterparties who take hold of your money and decide when they want to release it back to you. You own it, you hold the assets, you know, on your own wallet, you know, there's one clear, you know, defining moment of DeFi. Second is the fact that, you know, where the value of transfer happens in track by traditional finance. You know, you would see how the actual transfer may not even happen actually outside of a particular location, such as, for example, a centralized exchange. However, on DeFi, you can clearly see that how the value of transfer happens on chain, on Ethereum, on Avalanche, you know, on other chain as well. And third and last, you know, to me is how the organizations define what decisions, what setups are to be made within, right? For example, you know, DAO, you know, the centralized autonomous organization, they will actually use the communities to define how things can be decided. So that's one way to see it. Yeah, it's interesting. As all these protocols and the tokens and infrastructure, Mike, this is the complex system going on here. It's the plumbing, right? I mean, it's a money system. You know, how decisions are made, you got communities involved in there, you got actually mechanisms for immutability and security, you got application developers. So you got to kind of think of like an operating system here to make it all work. What's your take on this whole impact of what is DeFi relative to the, what people see on their phones as just an app or just some finance app? There's a lot of stuff going on under the covers. Yeah, I want to totally agree with Michael because it's all about one point of entering to a web free year. I have just my personal key and can use all my wallets, get access to my funds from different point in the world. And I just have entered to all this applications, all this huge amount of services and monies. The second general part for me is that it's all about smart contracts and not intermediates here. Then people want to cooperate on many ways to each other on stable coins, yeah? And this is just smart contract and one person from one other side and another person from other side. That's it. It's all about DeFi ecosystem in the second, in two words. I mean, this idea of disintermediating the middle man is a huge part of this. I mean smart contracts is critical to this. You got to have the infrastructure. You got to have the user behavior. This is why it's important. Can you guys weigh in on some of the things on the importance of DeFi and where we are right now relative to progress? Because even just in the past two years, the cultural shift of DeFi has changed a lot. Where are we right now in DeFi? Can you guys share your perspectives on progress compared to the evolution of where it will go? So I think that DeFi has definitely made a lot of progress in with regards to adoption, not only by retail participants, but also by institutional ones, right? They're warming up to the idea of these, first of all, from Bitcoin or whatever these larger ones that have more proven track record and they're starting to experiment more and more from taking crypto transactions, et cetera. But from the retail standpoint, it's also made a lot of progress. I'd say the biggest benefit to the DeFi world is community, right? It works because it's decentralized, which means one of the requirements is a lot of participants. But one of the hindrances, which is one of the biggest ones has kind of been in the way is the usability, which although it's improved a lot, it's still not ready for the mainstream user that's used to just one click, buy it, whatever. Don't care to understand how things work. But those two worlds are starting to bridge, right? People getting comfortable, institutions getting comfortable, as well as retail participants not being scared away by the process. Yeah, I mean, that was just, I just asked you to follow up on that, James. You know, mine is that that community user piece is huge. A lot of people in the old guard will dismiss things as meme, meme stocks, if you will. You know, we've seen a lot of the traction, but when you have communities moving at massive forces, that's in a way infrastructure, right? So you have behavior changes where you've got some peer-to-peer community happening, it can't be dismissed. I mean, yeah, this is my arbitrage and a little bit of a, you know, I won't say crypto vandalism or kind of fun. But at the end of the day, that's a behavior that is specific change. That points to it can't be dismissed. What do you guys react to that? What's your reaction to that? Right, we are actually at my firm, Cope Finance, we are actually at the forefronts of seeing that movement. So at Cope, you know, we label ourselves as composable finance. And one thing that we've seen is that our communities consistently will propose very interesting strategies, connecting different DeFi protocols together to basically execute on a portfolio execution that allows them to achieve certain objectives. And we have to say, you know, if you were to define Web 2 as read and write and Web 3 as read, write and create, you know, then this is really, you know, where the difference lies. We are now at this point where we are simply providing an infrastructure, as you said before, but allowing, you know, the creativities from everybody to come together and let them mask the crowd wisdom everywhere, you know, to decide exactly what should take hold from a product perspective. So we're very excited about that. Yeah, and these are new protocols that need to be built. I mean, what does that mean, right? So how does software adapt to that? This comes into the question, I think why it can't be dismissed. Jamie, what's your reaction to that? Because you're in the middle of it, you see all these behaviors in Wall Street, certainly as an environment where there's a lot of activity because there's finance and all this money there, right? And again, a lot of that old money, old systems, now moving to the new, now global, et cetera, what's your take? Well, I mean, first of all, I don't think that one is going to move over to the other one. I believe there's going to be elements where they coexist, right? Traditional finance still has a lot of merits to it and it has a lot of use of practical applications, but they can feed off of each other. There's a lot of things that DeFi can learn from traditional finance and vice versa. So I think that we're just going to start seeing this convergence of these two different worlds. And I think it's extremely powerful, right? Because the way that you think about sequential and transactional systems that are centralized, right? Like it requires all sorts of mechanisms. For example, I know I'm speaking arbitrary, but like you have a market with an exchange in an order book with limit orders. And then you have the guy come in there and push market buy or sell pushes the price, right? That's the mechanism by which you see something flash on your screen. In the world of DeFi, there's additional mechanisms that have previously been impossible like automated market makers, right? They don't have order books and there's no counterparty. I mean, there is, but they're distributed. So the risk profile is really different. So like it's just a matter of rethinking and looking at all the advantages and all the benefits that DeFi has to offer. I love that whole point there because that's basically refactoring existing markets in the new way. And this becomes the next question is, is that okay, if you have like say unstoppable what they got this access through an NFT, which is super cool. It's kind of like an identity. The development environment is really key in all these big ways. Because if you think about what needs to happen next is you need more software developers or developers in general on this new paradigm, right? So with that in mind, how do you guys see the market of more innovation being developed on top of where we are now? Because that's the next key flywheel in this equation which is I need simplicity. I got to make ease of use and make reduce the time it takes to do things. And that's just going to come from development. So what's your guys reaction to where the wave coming in from a development standpoint? You mentioned smart contracts earlier, Mike, what's your, how do you guys think? Yeah, I am at that moment, I am thinking about the web free identity. It's very close to unstoppable demands doing because they are doing that you can connect by your domain to different apps, to different projects and so on. And the next step after that will be web free identity. I think there will be some custodial service when you will put your passport or verification service and you will get NFT identifying your, identifying your own. And then if you, with this NFT, you will go to every service which should be identified. For example, tomorrow will create new law about that all users for Uniswap should be identifying and you will using this identity NFT for using Uniswap. And I think it will be a huge amount of works for all web free applications and all this stuff. Michael, what is unstoppable matter? Why does unstoppable matter to DeFi? What's your take on that? Yeah, yeah. First of all, I have been a big fan of unstoppable since day one from the NFT domain rollout. But one thing that I'm super excited about unstoppable is the fact that it provides a digital identity exactly like what Mike said. And the fact that you can leverage unstoppable and the fact that the digital identity can be used in a different way than where we see the traditional finance they suggest owning all your PII, all the personal identifiable information. The NFT aspect allows only certain informations to be transferred but at the same time allow all the participants in the ecosystem DeFi or even Trefi institutional alike to only pick certain pieces such that they can still live within the existing framework. So I think that really is powerful in a way it bridges where the existing money of value transfer happens to where in the future how people can use a different infrastructure to perform the very same actions. Jamie, what's your take on the unstoppable position here relative to DeFi? Like I think unstoppable is in a really great position, right? The whole spirit of DeFi is to removing bottlenecks, right? Removing kind of choke points, which can either be, you know by some people choose to label that as the government but I choose to think of it as more as a technological, right? Like you have this distributed naming system and this idea of identifying yourself has uncalculable benefits, right? I don't think we're at the point here where we can just imagine it. Right now we start off by associating it with I'm gonna sign into a website with my username and password and this is the new version of that. That doesn't have any huge feel to it, right? But what's under the hood is what actually allows people to do a lot more things such as like being able to port these things across and interconnectivity on different websites and being able to have control over your data, right? Like to actually be able to open up markets for even being able to monetize your own data, right? So that when you sign into a thing you can just decide what things to share and what not, like there's so many ways that we can't quite yet imagine the use for this that I think that unstoppable is in an incredible position to take advantage of that. That's awesome insight. That's a great way to talk about it. I mean, you look at it, distributed naming system first of all, it really hasn't not been done at large scale. I mean, the traditional naming systems have been centralized. So if you look at that as an enabling platform, I mean, it's limitless possibilities. Again, you start initially with some problems, but there's real technical enablement here. So the last few minutes I'd love to pivot on that point and go what's possible with this D5 going forward? Because if you take that premise that you have this enabling system that people are going to kind of align with de facto and then ultimately maybe standard, what does that enable? Because you're now in a growth mode for the sector. Okay, which is innovation coders. And when you start seeing protocol start to become de facto, that's a good thing. So let's talk about in the last few minutes what's next for DeFi. Jamie, we'll start with you. What's your take on what's next? Cause you kind of teed it up. Take us through the, take a walk down that path. I think we hypothetical of course, but you know, let's take it, take a road. So, you know, I think that for starters, DeFi gets more powerful the more that people use them, right? So we're going to just start by saying there's going to be more adoption. So this thing is going to be more robust and more things can actually live on this decentralized plan. One of the biggest benefits of decentralization is it's robustness. So you think about like the worldwide web, it's really not a web. It's more like just like a pipe of data that's owned by a handful of companies and the internet and the servers that host and all these different things. We're already starting to see decentralized storage we're already starting to see decentralized networks, right? So that you're actually able to slowly start reducing those choke points. You're going to have this entire system where the world is interconnected where people can communicate without these choke points without being able to worry about censorship. You'll be able to have the world that's able to transact, interact and where you live is no longer going to be as much of a factor as it is today. Awesome. Michael, what's your take? What's possible? Where's it going? Yeah, I'll take what Jamie said earlier. I mean, using the AMM example, the automated market-making example. From our end, I think one of the defining moments was when Uniswap first roll out in the big way, it allowed many individuals to become market makers for the first time in their lives. And I think that's very powerful. It changes the dynamic as to where the, I guess, the forces and the power of finance lies. In addition to that, like I said before, I think many people would start to come with their own ideas as to how things can be executed from a finance perspective to achieve many different risk-reward profiles. So from that sense, I think it is only the beginning that now we are seeing how digital identities can be linked to an individual. And at the same time, also the value creation side of this story. All right, Mike, your take. What's that? I believe in two things. First, this is cross-chain and multi-chain liquidity. Because right now it's not simple way for transferring, for example, USDC or stable coin from Polygon to Cosmos Network. But I believe in common liquidity for cross-chain. And the second one is more user-friendly interfaces like hybrid interfaces and connecting DeFi and traditional financial startups like your ecosystem building now. Then you have layer one blockchain solution and then we have two applications who are connected to one application. More user-friendly and more common useless applications. Great stuff, guys. Amazing content, great panel. You guys are awesome. Great on the front range of this whole wave. We had one minute left, so quick lightning question. So in one quick statement, what one thing should people pay attention to in DeFi as we look at the next year or two as we go forward? What are the key innovations? What should people look at? It could be an area that's obvious. It could be an area that's not obvious that people should look at, pay attention that's super important, that is the most important area. Mike, we'll start with you and we'll go across. Sure, I would say one thing is composability. I really am excited about the fact that everyone is starting to generate ideas on their own and simply leveraging the existing DeFi infrastructure to allow that to happen. So that's one thing I would say. Jamie? Sorry, I think NFTs, right? NFTs, I'm not talking about the JPEGs or the pictures. I'm talking about the use of these technologies in much the same way that we were talking about being able to identify yourself online or buying actual real estate or whatever it might be. I think that we're unable to imagine what's gonna be some of the biggest uses and I'm very, very excited about seeing what's gonna happen. Okay, Mike, one thing should people pay attention to. To my mind, we don't know what market will be next year and I will recommend to pay attention for stable strategies, for stable coin projects, for stable rates and all this stable coin farming sphere for DeFi Marks. Guys, thanks so much for sharing your insight on this topic, really appreciate your time. We're coming into theCUBE here in Palo Alto for the Unstoppable Domains Partner Showcase. Really thankful, thanks for sharing. Thank you very much. Okay, the CUBE conversation here, I'm John Furrier, thanks for watching.