 Live from San Juan, Puerto Rico, it's theCUBE. Covering Blockchain Unbound. Brought to you by Blockchain Industries. Welcome back to our exclusive Puerto Rico coverage. Here is theCUBE for Blockchain Unbound, the future of Blockchain cryptocurrency, the decentralized web, the future society, the world of work, et cetera, play. It's all happening right here and reporting the global internet's coming together by next, this is Fred Kruger, founder and CEO of a new innovative approach called Workcoin, the future of work he's tackling. Fred, great to see you. Thank you very much, Sean. So we saw each other in Palo Alto at the D10E and the Four Seasons caught up where Facebook friends were LinkedIn friends. Just a quick shout out to you. I saw you live streaming Brock Pierce's keynote today, which I thought was phenomenal. Yeah, it was a great, it was a great work. Yeah, and it's Pi Day. It's Pi Day. I'm a mathematician, so it's Pi Day. It's Geek Day, all us nerds are celebrating. So Fred, before we get into Workcoin, I just want to get your thoughts on the Brock Pierce keynote. I took a video of it with my shaky camera, but I thought the content was great. You have it up on Facebook on your feed, I just shared it. What was your takeaway of this message? I thought it was unedited obviously, no New York Times spin here. Right, no, look, it's, well, first of all, it's very authentic. You know, I've known Brock 10 years and I think those of us who have known Brock a long time know that he's changed, you know, and he became very rich and he's giving away and he really means the best. So it's completely from the heart and it's 100% real. You know, being in the media business kind of by accident, and I'm not a media journalist by training, we're all about the data, we open our data as everyone knows we share the free content. I saw the New York Times article about him and I just saw it twisted. Yeah. The social justice warriors out there just aren't getting the kind of social justice that he's actually trying to do. So you've known him for 10 years. I see it as clear as day when it's unfiltered, you say, here's a guy who's eccentric, smart, rich now, paying it forward. Yep. I don't see anything wrong with that. Yeah, no, it's, look, I think that the, what's, what is everyone missing? You know, I think everybody is, everybody, there's a little jealousy. I mean, let's be honest, you know, I think that there's, people resent a little bit and I think part of it's the cryptocurrency world's fault. You know, when your symbol of success is the Lamborghini, you know, that's, you know, it's sort of like this is the most garish kind of success-driven, money-oriented crowd. That reminds me a little bit of the domain name kind of people. And so, you know, but Brock's ironically not at all that, so he's kind of, you know. If you look at the ad tech world and the domain name world, because they're all kind of tied together, I won't say underbelly, but fast and loose would be kind of the way I would describe it. Initially, yes, ad tech, right? So if you look at ad tech back and say, I don't know, 2003, 2004, it was like gunslingers, right? Everybody, you wanted to buy some impressions, you'd go to a guy, the guy'd be like, I got some choice impressions, bro. I'll say a watch, too, on it. Yeah, exactly. That was the ad tech world, right? And that world was basically replaced by Google and Facebook, right? Who now control 80% of the inventory, and it's pretty much, you know, you go to a screen, it's all self-service, and that's it. So, you know, I don't know if that's going to be the case in cryptocurrencies, but right now, you know, initially you sort of have this little Wild West model. Well, anytime you got alpha geeks and major infrastructure application developer shift happening, which is happening, you kind of look at these key inflection points. You need to kind of have a strong community self-policing policy. If you look at the original DNS days, because you remember, I was there, too. John Postal, you know, Rest in Peace, Scott Speed, we all know what he did. Vince Serp with TCPIP, the core dudes and gals back then, they were tight, so any kind of, you know, new entrants that came in had to prove their worth. Right. I won't say that they were the most welcoming because they were nervous of people to infect the early formation. Well, so they're guys, they're nerds. Right, so I think if you look back at domain names, you know, like back in the day, a lot of people don't know this, but John Postal actually kept the list of domain names in the text file, right? So, you know, and that, you basically wanted a domain name, you called John up, and you said, I like my name added to the DNS, and you'd be like, okay, let me add it to the text file. You know, so, again, these things all start in a very sort of anarchic way. Yeah, but they get commercial. They get commercial, they get, network solutions, various, we all know the history, I can, controlled by the Department of Commerce, up until a certain point in time, until about four years ago, really. So, this is moving so fast. You know, you're a student of the industry, you're also doing a startup called Workcoin. What is the form of a success? What is your strategy? What are you guys doing at Workcoin? Take a minute to explain what you guys are doing, your team, your approach. So, let's start with the problem, right? So, if you look at freelancing right now, everybody knows that a lot of people freelance, I don't think people understand how many people freelance. There's 57 million people in America who freelance, so it's close to, it's close to 50% of us don't actually have jobs other than freelancing. And so, you know, this is a slow-moving train, but it's basically moving in the direction of more freelancers, and we're going to cross the 50% mark. And that's only going to get bigger because of virtual work, global workforce, no boundaries. Right, and so it's a global phenomenon, right? Freelancing is just going up and up and up. Now, you would think in this world, there would be something like Google where you could sit there and go type patent attorney, and you could get 20 patent attorneys that would be competing for your business, right? And each one would have their price, and you could just click and hire a patent attorney, right? Is that the case? No, no, okay. I need a patent attorney. Okay, so what if you have to hire a telegram manager for your telegram channel? Can you find those just like Googling telegram manager? No, you know? So basically, you're- The user expectation is different than the infrastructure can deliver it. That's what you're basically saying. No, what I'm saying is it should be that way. It is not that way. And the reason it's not that way is that basically there's no economics to do that with credit cards. So if you're building a marketplace where kind of these people find each other, you need to have, you need the economics to make sense. And when you're being charged 3.5% each way, plus you have to worry about charge backs, buyer fraud and everything else, you can't build a marketplace that's open and transparent. It's just not possible. And I realized six months ago that with crypto, you actually could. And so not that it's going to be necessarily easy, but technically it is possible. There's zero marginal costs. Once I'm taking in crypto, I'm paying out crypto in a sort of open marketplace where I can actually see the person. So I could hire John Furrier, not John F, right? But why don't I just go to LinkedIn? This is what someone might say. Well, if you go to LinkedIn, first of all, the person there might not be in the market. Probably is not in the market for a specific service, right? You can go there, then you need to message them, right? And you just say, hey, your profile looks great. Do you want to be a, I noticed you're a patent attorney. You want to file this patent for me and then you have to negotiate. It's not a transactional mechanism. There's a lot of steps. It's not transactional, right? So it's not clicked by fund engaged, you know? So it just doesn't work that way, right? So this is a very, it's just like such a big elephant in the room problem that everybody has these problems. Nobody can find these good freelancers. So you end up, what do you end up doing? You end up going to Facebook and you go, hey, does anybody know any good patent attorneys? That's what you do. That's a bounty. Kind of, it's kind of a social bounty. Hey, hi, hey friends. Yeah. Does anyone know anything? So it's social proof, right? So, which is another thing that's very important because if John, if you were, Take a minute to explain what social proof is for the folks. All right, so social proof is just the simple concept that it's a recommendation coming from somebody that you know, right? And trust. So for example, I may not be interested in your video services, John, but I know you, right? And I am in the business of a graphic designer. And you're like, Fred, I know this amazing graphic designer. And she's relatively cheap. Okay, well, that's probably good enough for me to at least start looking at her work and going the next step. On the other hand, if I'm just looking at a hundred graphic designers, I do not know. It's customized contextual data around a specific transaction from a trusted source. Yeah, it's just- So you're socially connected to her, right? Sort of think about this. It doesn't even have to be a source that you know. It could be just a source that you know of, right? So to use the Brock example again, you know, Brock's probably not going to be selling his services on my platform, but what if he recommends somebody? And you know, people like giving the gift of recommendation, you know? So Brock knows a lot of people or may not be doing as well as him, right? And he's like, well, this guy could be a fantastic guy to hire as a social media manager. For example, you know, helping out a guy who needs a little bit of work. And endorsement is a major thing. Endorsing, and it is giving something, right? You're giving your own brand by saying I stand behind this person. All right, so talk about where you are with Workcoin. Obviously people might not know your background. If you check them out on LinkedIn, Fred Krueger, mathematician, Stanford PhD, well educated from a centralized organization like Stanford, has a good reputation. Yeah. Your math guy. Is there math involved? Obviously blockchain's math related. You got crypto. Yeah, I mean- How are you guys building this out? Share a little bit of- Right. If you can, show a little leg on the tech. Yeah, so the tech is sort of simple. So basically the way it is, it's right now it's built in Google Cloud, right? But we have an interface where you can fund the thing. And so it's built, first of all, that's the first thing. So we built it on web and mobile. And you can basically fund your buy Workcoins from the platform itself using Ethereum and also we've integrated with Sensei, a different token. So we can integrate with different tokens. So you're using these tokens to fund the coin, to fund your account, right? And then once you have the tokens in your account, you can then buy services with them, right? And then the service provider, the minute that they finish delivery of the service to your expectation, they get the coin in their account and then they can transfer that coin back into Ethereum or Bitcoin or whatever to cash out. Okay, so now that product's built is the coin's been issued. Are you guys doing an ICO? So we're in the middle of an ICO. Private? Private only for now. So we've raised just under $4 million. Great, congratulations. I have no idea if that's good or not. It's better than zero. It's better than zero, right? So it is better than zero, right? So there's interest, obviously. Yeah, so look, we've got a lot of interest in our product. I think part of the interest is it's very simple. So a lot of people can go, I think this thing makes sense, right? Now, does that mean we're going to be completely successful in taking over the world? I don't know. Well, I mean, you've got some tailwinds in your back. One, the infrastructure and e-commerce and the things that you're going after are 20-year-old stacks. Number two, the business model and expectation of the users is shifting radically and expectations are different and there's no actual product that does it. So look, I mean a lot of these ICOs, a lot of these ICOs they're going to have, I think they're going to have technical problems actually building it to the specification. Is this difficult? When you're dealing with the blockchain, first of all you're building on sort of some movable platform, right? I mean some people, I met some people just today who are building on Hashgraph. No, that's great, but Hashgraph is like one day old. So you're building on something that is one day old. And they've just announced their coin five minutes ago. So it's like, again, that's great, but normally as a developer myself, I'm used to building on things that are years old. I mean, even if something that's three years old is new. Really, for the developer. Well, I mean, look, this momentum going on, that someone might want to tout Hashgraph, for instance, it's got momentum. It's got total momentum. They're betting on an ecosystem. But that brings up the other thing I want to give you thoughts on because we've observed this at Polycom. We've been watching the industry landscape now on our 10th year. There's almost an ecosystem staking the ground. The good news is, ecosystem's developing. You got entrepreneurs, you got projects, you got funding coming in, but as it's going to be a fight for the ecosystem because you can't have zillion ecosystems, potentially they have to be, or can you? You know, here's the problem. Everybody's focused on the plumbing right now, right, the infrastructure, but what they should be focusing on is the app, right? And I have a question for you and I've asked this question to my advisors and investors with our DNA fund. And I said, how? Let's see if I get it right. It's a test here on the spot. I love this. Okay, so here's the question. How many in your wallet right now, on your mobile phone? Show me how many blockchain apps do you have right now? Zero, on my phone? Okay, zero. Well, I have a burner phone for my other one. Okay, so. But on any phone, on any phone that you possess, how many blockchain apps do you have on your phone? Wallet or apps? An app that you use- Zero, zero. Okay, an app other than a wallet. Okay. Zero, right? Yep. Every single person I've asked in this conference has the same number, zero. Yeah. Okay, so now think about this. Actually, I have one. Oh, which one? It's called Cubecoin. Okay. Okay, there you go, Cubecoin. But here's the problem. Like, if you don't have, if you went to a normal- Can I get Workcoin right now? Yeah, well, not right now, but I have it on my wallet. Okay, because it's- So for example, it's in test flight, right? Yeah. But like, my point is I have a fully functional thing. I can go buy services, use the coin, everything. In an app. So, I think this is one of the things- So, hypothetically, if I had an application that was fully functional with blockchain, with cryptocurrency, with ERC2 smart contracts, I would be ahead of the game? You would be ahead of the game? I mean, I think- Great news, guys! And I think you absolutely are thinking the right thinking, right? Because everybody's just looking at the plumbing, and look, I love EOS, right? But, you know, it's sort of a new operating system. Same as Hathgraph. But you need apps to run on your- First of all, I love chatting with you. You're super smart. Folks out there, Fred is someone you should check out. Yeah, great advisor potential. I think you're right on this. I want to test something out with you. I've been thinking about this for a while. If you think about the OSI model, the OSI stack, for the old, younger kids, that was a key movement that generated the key standards in the stack for internet networking and physical devices. So, it was started from the bottom up. Yeah. The top of the stack actually never standardized. It became, you know, the presentation session layer. That's really, it was kind of, they differentiated and eventually became front end. Right. If you look at what's happening now, the top of the stack is really the ones that's standardizing, or standardizing with business logic. The bottom of the stack has many different versions of, say, blockchain. So the question is, is that it might be the world that will never have a TCP IP moment. It might be that the business app logic will dictate to some sort of abstraction layer down to programmable plumbing. We see this with cloud with DevOps. So the question is, do you see it that way? I mean, I'm thinking out loud here, but what I'm seeing the trend here is, is that people who make the business logic decisions first and nail those, that they're far more successful swapping out and hedging on the plumbing. Look, I think you're, you mentioned the word alpha geek, and I think you've just defined yourself as an alpha geek. You know, basically, let's just, you know, go like in Denzel Washington said in the movie, Philadelphia, talk to me like I'm a five-year-old, okay? What is the problem you're solving, you know? So, you know, so my point is like, everybody is walking around with apps. If the thing doesn't fit on an app, it's not solving any problem. Like, that's the bottom line. I don't care whether you're... So this is your, your validate in the concept that all that matters is the app. The plumbing will sort itself out. Is that a dependency or is it an interdependency? Look, what do you need in a plumbing? Here's what I think you should think. Do I need 4,000 transactions per second? I would say rarely, okay, rarely. It's not, most people are not sitting there going, I need to do 4,000 transactions per second. If you need that, you've already crossed the finish line. You probably have a proprietary solution. Just to like put things in perspective, Bitcoin does 300,000 transactions per day. Well, why does Ripple work? Ripple works because they nailed the business model. I'll tell you what I think Ripple, why Ripple works, okay? I think all, and I'm not the first person to say this, but I think that the thing that works right now, the core application of all this stuff is money, right? That's the core thing. Now, if you're talking about documents on the blockchain, is that going to be useful? Perhaps. In a real estate on the blockchain, perhaps. Poetry on the blockchain, maybe. Love on the blockchain. Yeah, by Bennett. Hey, there's crypto kiddies on the blockchain. Love is coming next. Love is coming next, but the core killer app, the killer app, right, is money. It's paying people. That is the killer app of the blockchain right now, okay? So every single one of the things that's really successful is about paying people. So what is Bitcoin? Bitcoin is super great for taking money and moving it out of China and into the United States or out of Nigeria and into Switzerland, right? You want to take $100,000 out of Nigeria and move it to Switzerland? Bitcoin is your answer. Now, you want to move money from bank A to bank B. Ripple is your answer, right? If you want to move money from Medellin, Colombia that you use in Narcos, Monero is probably your crypto of choice, you know? This is truly anonymous, you know? And I think it's really about payment, right? And so I look at, WorkCoin is, what is the killer thing you're doing here? You're paying people, you're paying people for work. So it's designed for that. So that's, I think that's a simple. The killer app is money. Miko Metzomorow would say open source money. That's his narrative, love that vision. Okay, if money is the killer app, the rest is all kind of window dressing around, trying to raise to- I think it's the killer, it's the initial killer app, right? I think we need to get to the point where we all, not all of us, but where enough of us start transacting with money, with digital money. And then after digital money, there will be other killer apps, right? It's sort of like, if you look at the internet, and again, I'm repeating somebody else's argument, but the internet- It's Fred Krueger's hierarchy of needs. Money starts, right? And the initial thing, what was the first thing of internet? I was on the internet, before it was the internet, it was called the ARPANET and Stanford, right? I don't know if you remember these days. I do remember, yeah, I was in college. But the ARPANET, it was email, right? We had the first versions of email. And it was back in 1986. Email was the killer app for 15, 20 years. It was the killer app, right? And I think- For 15 or 20 years. Absolutely, well before websites, you know? So I think we got to solve money first, you know? And I bless everybody who has got some other model, and maybe they're right, you know? Maybe notarization of documents on the internet is- There's going to be use cases for blockchain and some obvious low-hanging fruit, but that's not revolutionary. That's not game-changing. What is game-changing is the promise of a new decentralized infrastructure? Here's the great thing that's absolutely killer about what this whole world is. And this is why I'm very bullish. If you look at the internet of transmitting value from one node to another node, credit cards do not do a very good job of that, right? So you can't put a credit card inside a machine very well at all, right? It doesn't work. And very simple reason, why? Because you get those Amex fraud alerts, right? Now, the machine, if he's paying another machine, the second machine doesn't know how to interpret the first machine's Amex fraud fraud alerts. So the machine has to pay the machine something that's immutable. I'd pay you a little bit of token. You know, and the classic example is the self-driving car that pays the gas pump, because it's a gas self-driving car, it pays it to fill it up. And the gas pump may have to pay its landlord in rent, and all of that is done with tokens, right? And with credit cards, that does not work. So it has to be tokens. Well, what credit cards did for other transactions, a little bit simplifies the things. There's a whole nother wave coming that just makes it easier and reduces the steps. It reduces the friction, and that's why I think, actually the killer app's going to be marketplaces, because if you look at a marketplace, whether it's a marketplace like ours for freelancers, or your marketplace for virtual goods, like wax or whatever it is, right? I think marketplaces where there's no friction, right? Once you've paid, it's in. There's no like, I want my money back, you know? That is a killer app. It's an absolute killer app, and I think we're going to see real massive consumer adoption with that, and that's ultimately, I think, that's what we need, because if it's all just business models and people touting their 4,000 transactions a second, that's not going to fly. Well, Fred, you have a great social graph that's socially proved. You've got great credentials, mathematics, PhD, and from Stanford, you reinvent, how many exits? Nine exits. Nine exits. You're reinventing freelancing on the blockchain. You're an alpha geek, but you can also explain things to a five-year-old. Great to have you on. Thank you very much, John. Talk about the work coin, final work, get the last, get the plug-in for work coin. Can people lose it now? When is it going to be available? It's going to be available, look, you can go check out our platform, and as Miko said, Miko's an advisor, and Miko said, Fred, think of it as a museum, right? You can come visit the museum. We're not, you're not going to see a zillion, but you can do searches there, you can find people. The museum is not fully operational, right? You can come and check it out, you can take a look at the trains in the museum. The trains will finally operate once we're finished with our ICO, we can really turn the thing on and everything will work. And yeah, and what I'd like you to do, actually, you can follow our ICO if you're not American, you can invest in our ICO. Work coin dot net. Work coin dot net. Work coin dot net, and you know, and then really at the end, if you have some skill that you can sell on the internet, right, you're a knowledge worker, you can do anything, list your skill for sale, right? And then that's the first thing that we want to get, if you're a student at home, you might want to do, maybe you could do research reports. I used to be a starving student at Stanford, you know, and I was mainly spending my time in the statistics department. If somebody said, Fred, instead of grading undergrad papers, we'll pay you money to do a statistical work for a company. I'd be like, that would be amazing. Of course, nobody said that. Yeah, and if you can also have the ability to collaborate with someone quickly and do a smart contract, you can do some commerce, smith paid. And get paid for it. Hey, hey! How about that, you know? So I just see so many- Move from the TA's grading papers payroll, which is like peanuts. But maybe make a little bit more doing something that's more relevant to my PhD, you know? So all I know is there's so many times where I've said, you know, my math skills are getting rusty. And I was like, I'd really wish I could talk to somebody who knew something about this distribution and could help me- You could have instantly, magically have them- And I can't even find them. Like, I have no idea. I have no idea how I would go to, like how I would go and find people at Stanford in statistics. I have no idea, right? So if I could type Stanford statistics and find 20 people there, or USC statistics, I mean, imagine that, right? That could change the world. That lowers the barriers, friction barriers- Everybody can be hiring graduates too. Well, it's not just hiring, collaborating too. Collaborating, yeah. Everything. Any question that you have, you know? Doctor doing cancer research might want to find someone in China or abroad. And it's a worldwide thing, right? So we have to get this platform. So it's open. And so everybody kind of goes there and it's like your identity on there. And then there's no real boundary to how we can get. Once we get started, I'm sure this will snowball. Fred, I really appreciate you spending the time and I love your mission. And we support you, whatever you need. WorkCoin, we got to find people out there to collaborate with. Otherwise, you're going to get pushed fake news and fake data. Best way to find it is through someone's profile on WorkCoin. Thanks. Looking forward to seeing the product. I'm John Furrier here in Puerto Rico for Blockchain Unbound Restart Week. A lot of great things happening. Brock Pierce on the keynote this morning, really talking about his new venture fund Restart, which is going to be committed 100% to Puerto Rico. This is where the action will be. We will be following this exclusive story, continuing with back with more. Thanks for watching.