 You're watching The Daily Decrypt, where we are all currency competition all of the time. I am your host, Amanda B. Johnson, and today's episode is brought to you by Bank to the Future. Most of us spend some or a lot of time online, whether it's for shopping, researching, entertainment, you name it, watching The Daily Decrypt naturally. And so the question then becomes, what happens to the economics between us, if and when our online experiences become so immersive that we begin to sense them as an entirely different reality? Machik Olpinski is a technology blogger who got his start at Google and who has recently begun exploring the potential relationship between cryptocurrency and virtual reality. Tell us, how did you become interested in cryptocurrency in the first place? Then we'll move on to these other things. Yeah, so it all started with, basically my background is in media platforms. I worked for Google for many years, working with Google's display network, the banner ads we're seeing everywhere on the web, and then YouTube. And I was always interested in these emerging technologies. And that was back in 2012. I've learned about Bitcoin. And as many of us, I kind of thought about it initially as a cryptocurrency and then discovered the entire protocol aspect that this thing could be much bigger. And then really I got into it way more. And most of the topics on my blog, the topics I cover are at the intersection of media and cryptocurrencies because online media, economics of online platforms, this is something I've been working with for many years. So naturally, these intersections are really interesting to me. And virtual reality is, of course, it's an emerging technology. Super interesting and more of an enthusiast than somebody who's actively pursuing projects in that space as of now. But the implications of virtual reality in the blockchain are like hardcore sci-fi stuff. That's actually coming. So that I think hardcore is the perfect word to use in that sense. Because so before cryptocurrency created actual scarcity that could be translated into money, multiplayer games they had in game tokens. Like people were buying and selling things with each other in games before cryptocurrency was even invented. Now those tokens within those games perhaps didn't have real world monetary value because they weren't, I guess, especially scarce or just weren't easy to use. But as you pointed out in your piece, okay, so cryptocurrency is like digital currency that could not only be used in games as payments from player to player, but oh, once you take the headset off, this money can actually buy me things in the real world, too. Yeah, like the future that we're heading towards is the future where the digital and non-digital and the analog are converging. So there's really like with Bitcoin already there's no difference between, you know, you can buy stuff in the real world for Bitcoin. I would even say that the implications of the blockchain for VR go one step further because with a blockchain essentially we can come to a consensus as to what happened, what transactions took place and in what order. Basically the way that the time stamping and the blocks allows us to come to a consensus in terms of this particular version of truth and reality. So the blockchain is the history of what happened and we all agree to that. If you take this, if you forget that a payment is like, you know, using in-game payments in VR, that's just one thing. It's very interesting and, you know, it's going to happen for sure. But essentially, if we assume that the VR is going to take off and I'm assuming it will, the question is, you know, how this virtual world, there's this concept of the Metaverse. Metaverse is basically like the 3D VR web. We have a 2D web, we have websites and it's all connected via the HTTP protocol. So the question is like, how the VR worlds will be connected? So the blockchain can be the foundation and basically provide a foundation for the history of the particular VR world. Like what happened? Who bought a particular piece of land? Who owns what? Because right now, if you have a virtual reality experience, we're basically downloading an application from the server. And it's controlled by Oculus or by Google or by Steam and they basically serve you. The particular version of the world, but once you turn it off, it disappears. There's no continuity in that world. Or if there is, it's controlled by the third party, like World of Warcraft, for instance. With a blockchain, you can imagine that we can come to, instead of coming to a consensus in terms of the transactions like we do with Bitcoin. So we have a consensus of what happened with transactions to place and what's the balance of each particular user. We can have a consensus as to the state of the virtual reality world. So you can have parallel versions of like virtual history. And you can join the reality that you prefer, for instance. And you can create these virtual worlds and agree in a decentralized manner as to the rules in the particular virtual world, as to the economy and so on and so forth. I told you, it's very sci-fi. Yeah, this statement you made of being able to, I think the way you phrased it, was join any reality that you like. Like, I mean, that is what it caused me to want to talk to you about this. Because that is like, wow, that is a huge implication. And let's just talk for a moment for anyone who has not experienced virtual reality. Do you have your goggles there? Yeah, I have the Gear VR goggles here. This is the mobile VR headset. That's manufactured by Samsung. Would you mind, I know they look silly. Would you mind just putting them on for a moment, just for perhaps? Without it, because you know, you slid the phone here, without the phone. It'll make you look googly-eyed maybe. Like this? Yeah. Okay, yes. It looks really goofy, but it's the internal experience. You just have to try it yourself. I've done it myself, and yes, I want to describe for our viewers, anyone who has never used virtual reality. So with the headset that Machik just put on, he would slip his phone into the end, if his phone were running a virtual reality app. And I don't know how it's able to do this, but basically with the combination of the headset and the phone, like all other visuals are cut out. And so you can be standing in your living room, but you have no visual awareness of anything except what is being shown to you on your phone. And as you look left, the phone's program shows you what is left in that software picture. You could look up, down, right. You can look all around. You can turn around, and like I said, I've only tried virtual reality once, but in the program that I tried, I think someone made it like a little horror show or like a haunted house that I was walking through. Anyway, so I don't know. I think the default was that if I stood still and just looked straight forward, I would slowly move forward in like a hallway. And I was looking around in the hallway and there were blood spatters on the floor. And I was probably like, I was looking at these papers, and I was probably only in there for like a minute. And I'm telling you, like when I took the things off, it was like coming. I was like, oh, there's a couch here. Oh, like I'm in a living room. Oh, there's Pete. Like it was so immersive that just when I took them off, I felt like I had been transported through like the pipeline of time travel into another place. Yeah. That's pretty much an experience and this is how you feel. If you're watching this and if you feel like you don't know what we're talking about, you need to find someone who has the Oculus Rift or HTC Vive or any of these headsets. There's many of them coming up. Even Google Cardboard. Isn't Google Cardboard like $15 or something like this stuff cheap? I have Google Cardboard here. It's an old one, but you basically put your phone in there and it works. It shows you the idea. The actual experience is like it's actually amazing what you can get from the piece of cardboard, but in terms of the actual experience, there are with Oculus or with HTC Vive or even with Gear VR, the quality is way better. So I advise you to try the best headset possible and then you will understand. Like if you're watching this, just try it and then you will understand. Otherwise, it's just really impossible. It's like describing someone at the taste of food and trying to use all these objectives and yeah, it sounds cool, but once you try it, then you know it. So this is this type of technology you have to try yourself. Now, okay, so that company Voxelus, I thought I remember hearing that they were starting a cryptocurrency called Voxels and now in terms of how virtual reality games could be hosted, you were saying before that right now virtual reality is hosted on like Google's server or Oculus's server or whatever. So are you suggesting that you think that the games themselves could be hosted in a blockchain like manner, like is that what Voxelus wants to do? I'm not sure what exactly is the Voxels model I heard about them, but basically, because VR it's not only about games. There are projects and there's a project run by Mozilla to create a Firefox browser. So they're focusing on what's called WebVR. So it's basically the 3D web and the way of describing 3D worlds using HTML. So you can go to a website in VR and you can have the 3D experience of the website. So yeah, so that's, it's still very niche. It's the prototype stage, I would say, but it's going to take off. So it's open, it's open like the web, it's not closed. It's not the closed ecosystem like the Oculus ecosystem or the Unity and Unreal, all these 3D engines that were used primarily for games. So we are at the stage right now where everything is closed because all these companies have to get the return on their investments into the technology, but it's going to open up. And in one way or another, we'll be able to create these virtual worlds, which are basically maybe not hosted on the blockchain, but where the consensus as to what happened in the virtual world, or who owns what, or who owns a particular piece of virtual real estate, it will be hosted on the blockchain. There's one of the projects called, I don't know if I remember it right, but built on Ethereum, it's called Ethereum. So that's a proof of concept of a virtual world hosted on an Ethereum blockchain. So we are at the very early stage, but theoretically and conceptually, these problems are really interesting, like sci-fi stuff coming materializing itself. So do you think, okay, so if one can choose their own reality, at least for a time, at least for the period of the day that you don't need to be like actually eating or actually producing something in the meat space world, do you, so do you think that people will choose to spend perhaps more time in virtual reality than reality reality? And if so, it seems like you're predicting that people will start to provide it, not goods perhaps, but I mean, so let's say you and I were interacting in virtual reality and you know how to tap dance and I'm like, hey Machik, I will send you $2 worth of cryptocurrency if you do a tap dance for me like right here and right now, like wearing a pink bunny costume, maybe I'm into that. And you do that and I send you the $2 worth of cryptocurrency. So it's like, we've just had like a real economic transaction of value in virtual reality. Is that kind of what you see happening? Yeah, I'd say it's already happening, like people are spending hours and hours in games like World of Warcraft and you know, they're getting paid for that. So these online economies are already there. And the only reason that the currencies they use are not like directly exchangeable on on like, you know, global currency markets is because of the legal obstacles. You know, you cannot put, you know, shares of, you know, some virtual game, I mean with shares, but the currency of a virtual game on Forex, for instance, you cannot trade it against the dollar because of the rules regulations, you know, cryptocurrencies change that, you know. So now we have platforms like Ethereum, for instance, where you can everybody can create their own currency with a few lines of code. And you know, what virtual reality is doing is just adding this extra third dimension to the entire game. So instead of playing and transacting in a game, but on your screen, you feel like you're there and suddenly, you know, how much time do you spend in virtual reality? No, I'm just like, you know, I'm a more often enthusiast than I'm seeing in this as a next step in the evolution of media. So the internet, like the way it was evolving has been evolving was like, you know, we evolved from text and then we had images. And now is the time where video online video went mainstream, like we're having this conversation on video using Google Hangout five years ago, it would be impossible. Like this wasn't something people were recording on a daily basis. And now like video podcasts are something very common. And you know, in five years time, you know, we'll have this conversation in virtual reality and, you know, we'll be sharing the space. So, yeah, and the social VR applications are already there. You can get your Samsung phone, download a social VR app, and you can watch movies with people from all over the world. Like, you know, you see their avatars. So, you know, it's happening, but it's very niche. But it's going to evolve. It's going to evolve fast. And yeah, people will be working and maybe partially living in these worlds, whether that's good or bad. I'm not the one to judge, but you know, it's it's inevitable is going to happen. You know, I've already begun to feel a little bit behind the YouTube curve in that there are already virtual reality videos like on YouTube. And so if you even if you don't have a headset, these YouTube videos have a little clicker up in the corner of the video screen. And you can click where you want to look. And as long as they were using like a 360 degree camera to make their video, even without goggles, I can look all 360 degrees all the way around where that YouTuber was filming. And so I mean like that makes the daily the daily decrypt like even a little bit old school that you can't like look all around like our hideous studio without me like actually showing you. Yeah, 360 is like the first step towards virtual reality for a lot of people. Because you can watch these 360 videos on your phone and you can tilt your phone. And you know, you can you can have a full 360 view. It's not the full it's not the full DR. Yeah, it's not but you know, it's a glimpse. It's the first step for many people. Yeah, so so it's going to happen. It's going to happen. But the question is like to me because you know, I'm interested in how media works in terms of you know, economics, how these platforms make money. I worked for a platform who makes a lot of money by facilitating these exchanges. I mean Google like they're the backbone of the internet in many ways. So the question is like, you know, how we are going to like if you're going to have a popular virtual world, like you have a popular website, you can make money off this website because you can display ads or you can sell products. In virtual world, like you know, maybe that's too you know, maybe for sure we will have ads. The advertising will be there. But the question is like, you know, how it's going to be monetized. Like you don't have like the 2d web, 2d interfaces, the screens and your touch screens and desktop screens are all based on the concept of clicks and everything runs on clicks. So people are clicking and click is the is the primary currency of the attention on the web. Like how many clicks you got and everything revolves around clicks. In VR, you don't have clicks. You have an experience. Of course, you can imagine you have in VR and you can have page views and clicks in there. But in general, you are in a space. So what's going to be the the currency? Like how are we going to what's going to be the attention currency of VR? This is something that I'm really interested in. And then I'm thinking about a lot because that's going to come sooner or later. But I have some ideas, but no definite answers yet. Care to share the ideas? That could be a good closer question. Yeah, it's generally, if we think about the blockchain, like you know, VR is just one aspect of it. But generally, the concept of click has evolved from the client server model of the web. Like we have servers and we have our clients and if you want to see a website, to go to the website, what's happening behind the scenes is that your computer sends a request to the server and it loads, you know, requests to the website. And the server is basically counting these requests, same quest you have. We're assuming that more people have seen the website. So because of the, because of the client server model, we got the concept of impressions and the clicks and click through rates because, you know, the number of times the number of times the page was displayed and the number of times somebody clicked. So here we have a click through rates and everything, the whole like online economy is built on top of that. But with the blockchains, you cannot come to a, there are no clicks in the blockchain world. Like, because there are no clients and servers, everything is based on blocks, on state changes from one block to another. We had one state and then the next block comes and we, the state of the blockchain has changed. Certain transactions were included into the block. So in the blockchain world, we operate on the concept of time. So my insight, my observation, maybe I'm wrong. So I'm just basically thinking out loud right now is that the future economy, like the future media, if we have like decentralized Facebooks on the blockchain or YouTube or Reddit, like the equivalents, of course, because they will look totally different or have like some kind of a decentralized virtual world on the blockchains. So the economy, we will come back to the concept of time. Like in the age of TV, you had airtime. You were selling airtime. You were selling specific, your content was occupying time. So you could buy as an advertiser, you could buy 30 seconds or one minute of airtime. And if you bought this, nobody else could buy it because like, you know, it goes and it's over, like the time flies, you kind of go back. So there was the scarcity of time, not scarcity of clicks. And I think that with the blockchains, if we will build the next Facebook or Google or Reddit or the virtual world on the blockchain, because we have the concept like the time is represented by blocks, everyone will be able to sell basically time in their feed. Like, you know, if I own my feed into decentralized Facebook, I will accept money for selling time in this feed, because I cannot sell clicks, like, you know, Facebook is selling clicks, but the Facebook is the middleman who's counting the clicks on the blockchain. We cannot count them. I don't know if it makes sense, but because it's like, you know, I'm very deep into that. So some things are obvious and you have to understand like how the, like if you're not in online advertising, so some people don't recognize that clicks are actually valuable and, you know, everybody wants to get clicks and people make money on these clicks. And if you record this on YouTube, you make money on impressions like that. Not in versus views, like, you know, if somebody wants to watch a podcast, they generate a view on the YouTube side and YouTube can serve an advertising before you show. So it's all about, but it's again, it's the ad request that's happening. So it's all based on the client server model. So in the blockchain, I think we'll come back to the concept. The time will be again, the currency of attention. Does it make any sense? Like, you know, is it, does it click? Does it click? Well, I mean, that's already how the daily decrypt is monetized. We sell sponsorship slots on our show because that those 15 seconds on every show are scarce. But yes, I mean, we don't have, we don't have the confidence of our content living in a peer to peer network. Our content currently only exists by the good graces of Google, and they are definitely a single point of failure for us. So yeah, I can definitely see the transition from what it is that I already do to me being incentivized to having to paying to have my content hosted in a peer to peer way. Yeah, so that's exactly it. You're selling, you're selling 50 second slots on your show, but this 50 second slots are not objective in a way that, you know, there's no consensus as to these 15 seconds, like when did it really happen? With a, with a blockchain, we have the, we have the objective time. We come to a consensus when something happened. And this consensus is based on the block numbers. So we all see that this block happens now and the entire world can agree to that. So imagine that you have a feed that's timestamped on the blockchain and it's tied to your decentralized identity. And the daily decrypt could then occupy a certain moment in time, which is objective, which is on the blockchain. And you could see that, you know, you have this, you can use the metaphor of a TV channel that only goes forward. And, and you can sell it and you could buy advertising for daily decrypt on somebody else's channel, because if there are a lot of people watching a particular channel, you will get discovered because they will discover it. Just exactly like the TV, TV worked in the past. However, with TV, there was huge barriers to entry, like only, you know, you had to have the broadcasting equipment, licensing, millions of dollars. Right now, I think with the block just everybody will have to, you know, we'll be able to own their channel. And it will be to be based on the objective time based on the blockchain style. But, you know, it's very early. But this, these issues are super interesting to me. How this future economy is going to work. And clicks will be gone because clicks are, clicks belong to the client and server model. The internet doesn't know it now. Well, I hope you keep blocking about it at machikopinski.com. If anybody wants to know what that looks like, that'll definitely be in the show notes as it always is. The show links are always in the description section. And yeah, other than that, thank you for your time. Thank you. Thank you so much. Today's episode is brought to you by bank to the future.com, the online investment platform that invests in the future of finance. One of their investments was in payments company Uphold. And below you can find the video link that explains the impact they've had by taking the volatility out of Bitcoin. More information is available at bank to the future.com. Thanks for watching the Daily Decrypt today. I hope you come back tomorrow. See you then. What market share is there to be had by catering a crypto network to a specific demographic of people like gamers? Jeremiah Nickel is the marketing manager for a cryptocurrency called Hyper. The other thing that's kind of neat is not just tied to the hyper crypto servers, but there's actually a hyper tip bot that's available for Twitch streamers. You would invite the hyper bot to be in your chat so then people can donate hyper to your Twitch stream or they can they can bet like micro betting, which I think is going to be a really neat thing for us.