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- [00:00]
Podcast Host (Crypto101 Host)
Are you curious about the economic forces shaping your daily life? The Planet Money podcast from NPR makes sense of the economy in ways you'll actually understand and enjoy. Guys, you love listening to the rundowns. I get some of that information from this NPR Planet Money podcast. Especially recently with the war going on the straight of Hormuz, you're just kind of getting those updates as they come from these guys. They put out a ton of awesome content. It's a different perspective from crypto101, but still a great listen. So go over there and check out the Planet Money podcast. If stuff like current events and the finance world interest you, each story on Planet Money starts with a question. Recent episodes ask why Pokemon cards are growing faster than your retirement count. Questions about the war. Just like we talked about recently a lot on our program. From the job market to the stock market to prices at the supermarket, Planet Money explains it all. Planet Money is a different kind of world where the complex economy somehow makes sense, where human stories supersede abstract theories so you you can learn, laugh and be entertained. It's econ, but just down to earth. The hosts go to unusual lengths to explain the economy. They've published their own book to track the global supply chain. They've shot a satellite into space to understand the economics of the private space industry. They've gone inside a live book auction to show how ideas get to market. It's the kind of show where you learn something, probably laugh and walk away seeing the world a little differently. And I think if you like crypto 101, you'll enjoy planet Money. So maybe check that out. Follow NPR's Planet Money podcast and understand how money shapes the world. Crypto101fam we're back again to talk about my favorite online shopping and it is quints. Lately I've just been more intentional what I wear every day. I've talked about it before the Florida heat, I got to be very intentional about my wardrobe and I'm leaning into pieces that feel easy, comfortable, but still put together. As the weather heats up in Florida, it just makes quite a getting dressed simpler. Quince has my go to the fabrics feel elevated, the fits are clean and everything just works. And I'm so busy on the podcast I just don't want to overthink it. Quinces all the wardrobe staples for spring. Think 100 European linen shorts and shirts from $34. Lightweight, breathable and comfortable, but still look put together and clean. 100 Pima cotton tees with a softness that has to be felt. Their pants also hit the same. Balanced, relaxed and comfortable, but still polished enough to wear pretty much anywhere. Everything is priced 50 to 80% less because they cut out the middleman from your favorite brands. But don't sacrifice on the quality. Quince works directly with ethical factories to cut out the middleman. So you're getting premium materials without the markup. Guys, you heard me talk about quints for a long time now and it's because their clothes are awesome and the shopping experience is second to none. The online store is so fun. They have so many items and they've been a great sponsor to crypto one on one. So if you're thinking about getting some new clothes, go to quints.com refresher every day with luxury you'll actually use. Head to quince.com crypto101 for free shipping on your order and 365 day returns. Now available in Canada too. That's Q U I n c e.com/Crypto101 for free shipping and 365 day returns. Quince.comCrypto101.
- [03:24]
Podcast Co-host (Crypto101 Co-host)
All right, everyone, welcome back to the Crypto 101 podcast. We hope everyone is having a good morning or evening because no matter where you're coming in from, you're certainly in the right place here today. This is going to be another great episode. I know we always come in, that's the thing is like, oh, it's always a great episode, but today especially it's going to be a familiar face. It's going to be a name that a lot of you are familiar with because they're one of the leaders of the crypto space. And we'll get into all of it in just a second. But I want to give a warm welcome to, to Mr. Johan Ide. He is the chief business officer over at Chainlink. Johan, good to have you, man. Excited to talk today.
- [04:00]
Johan Ide (Chief Business Officer, Chainlink)
Hey, thank you for having me. I'm excited to be here.
- [04:04]
Podcast Co-host (Crypto101 Co-host)
Yeah, absolutely. I mean, Chainlink is again, a familiar name to a lot of people. Chainlink is one of the pillars of the crypto space. The Mainnet launched back in 2019. You guys have facilitated over $29 trillion in transaction value. And Chainlink is the largest oracle provider in crypto with around 70% of market share. So when it comes to like, who is actually communicating and partnering and working with not only crypto based companies and blockchain tech, but also the, the traditional financial side, I think you guys are this perfect middleman that gets to work with and talk and Interact with both sides and you guys are essentially like the bridge that connects the two. As the lead Oracle provider. So there's a lot of cool stuff that we can talk about. You know, some of the problems, some of the big future solutions, the good, the bad, the ugly. And again, to the listeners out there, I think you're really going to like this because you get to see how both sides work and you get to see like what's happening behind the scenes here and really what's going on from a lot of the leaders in the industry. So buckle your seatbelts, get ready those notepads, and you know, before we even dive in, just give us a high level overview of what chainlink does. I know we mentioned this word Oracle and we talked about connecting the two, but for the people who just are not as familiar, just introduce chainlink and what your primary mission is.
- [05:30]
Johan Ide (Chief Business Officer, Chainlink)
Sure. If you want to go back to what the idea of chainlink is, let's go back to 2017. You probably remember back in 2017, for the folks who were around, you had tons of white papers. You had tons of ideas, basically. So you had white papers, maybe hundreds of them. Right. Every time you looked at the white paper, you came to the same conclusion. The idea is great. How do you actually build it? And the thing you found every time is that all of these ideas needed a connection to the real world. They needed data, they needed to know what was happening in the real world outside of blockchains. Because a blockchain, at the end of the day, it's a siloed database. You have nothing connected to it. It's like an island. There isn't much you can build on an island. You need to connect it to data. That was our first mission. It was basically, how do I make blockchains go from a dream to something that's actually useful, to go from a white paper to an application. That's really what chainlink is about. It's about creating this connection that allows us to build use cases that are actually useful on chain. So the very first iteration of this was with data feeds. Back in the day, you had no defi. Basically you had an idea of a financial place on chain. And this financial place, every time we discussed it was, let's say you want to create a money market, let's say you want to have a derivative exchange. You need to know the price of assets, you need to know what's the price of eth, what's the price of bitcoin, what's the price of gold, of silver, and you didn't get this price natively. That's what chainlink solved. We are the first ones to basically start putting data on chain for people, for applications to start building on top of it. And through this one simple concept, which we call price fits today, you had defi go from. It was minuscule back in the day, 20 million, $30 million in value to billions overnight. So that's really what we do. If you want to think of us, we are the folks who basically get blockchain to go from an ig a dream to reality. And we do this by connecting our very siloed databases, our very siloed blockchain worlds to data that's actually useful to build complex financial applications on top.
- [07:53]
Podcast Co-host (Crypto101 Co-host)
So you guys connect data on and off chain and allows a lot of all this external data to be able to put on and connect to blockchain technology. I think you're right. If you look at where we've come from, from 2017 to the current day, 2017 was kind of the starting moment where defi really began to blow up. And you had the first true, I would say the first true DeFi run around 2017, 2018. Of course you had a really big one that happened in the classic defi summer just several years after that. But it's continued to go up from there. TVLs have remained quite high. There's new defi protocols and overall the, the span and kind of the creativity of, of projects since then has continued to grow. You see new innovations and new stuff is constantly made possible because we have this kind of infrastructure. So I would say it's again, it's very foundational in nature. And that's one of the points I want to kind of make across here to the listeners, is that this is a core part of crypto. And you guys, because you have about 70% of the market share, you get to work with a lot of different customers and partners, both on chain and off chain. Can you just share with us maybe a few of those notable customers or partners that you all work with and how you help them? You know, maybe specifically. I'm sure it spans a little bit from company to company.
- [09:22]
Johan Ide (Chief Business Officer, Chainlink)
Yeah, absolutely. Look, the way to look at us is we started with data and now we're doing way more. Because at the end of the day, it's about creating a very data rich environment. But that also means cross chain, right? So for instance, when you discuss cross chain with us, we're working with Coinbase today. So every single wrapped asset that they issue is secured by the chaining CCIP protocol. We're working with World LibertyFi on their stablecoin. We're working with Maple Finance. We're working I think with over 200 different token issuers securing tens of billions basically through cross chain. On the data side, which is another connection point here. We're working with basically every defi protocol you can think of from AAVE to Compound to Morpho to camino. We have 70% of the market share overall. But many of the chains people care the most about are fully, fully powered by chaining data. 90% of Ethereum is on chaining data. I believe base is 98%. Arbitrum is 90%. So on the defi side, everyone is using us on tokenized asset issuance. You find names like Amundi, which is the largest asset manager in Europe. They're using chaining data to price the nav for their tokenized fund they're issuing. We're working with ubs, we're working with. Well, we have a big collaboration we're announcing this week. Actually it's not announced yet, so that's when I can't type, but you get the idea, right? So we're working on both and DTCC was actually one of the largest projects we had. So DTCC is the CDS for the us. They basically process every single security transaction happening in the us. When we're talking about volumes that the GCC is making, it's not trillions, it's quadrillions. You can't even fathom the amount here being transacted. So we're working with them on a project we call Smart Nav, which is basically how can we create enough data on chain for every tokenized fund being issued? Right. So you can see we have a very, very large variety of names both in Defi and in tradfi. And I think that kind of leads to what you were discussing earlier about us bridging these two words. Because at the end of the day what chainlink is about is bridging. Right? We started bridging blockchains to data that they need to create data rich applications. Now we bridge two words, Tradfi, defi together.
- [12:06]
Podcast Co-host (Crypto101 Co-host)
Yeah, I want to talk a little bit more about that because you brought up a good point. When you're talking about like tokenization and different parts of defi with traditional finance coming in, there's a lot of of opportunity that comes with that. We always see these big sayings thrown around of oh, this is a trillion dollar opportunity, this is a multi trillion dollar opportunity. You get all these big phrases out there when it comes to chainlinks, business operations. What are some of your top priorities at the moment? You know, is it tokenization? Is it more multi chain stuff? Is it just, you know, data, which is what you guys are obviously big on. You know, what are some of your top business priorities at the moment?
- [12:46]
Johan Ide (Chief Business Officer, Chainlink)
So we have multiple products, we have CCIP for cross chain, we have data feeds for data. We have proof of reserve to ensure the backing of, of tokenized assets is actually there. Right. So you can't over mint tokenized assets. That's a really critical one. We have cre. You know, I won't go into all the products. I do invite the people listening in to, to go to our docs later on.
- [13:11]
Podcast Host (Crypto101 Host)
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- [17:17]
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- [17:48]
Johan Ide (Chief Business Officer, Chainlink)
Those products converge in one pretty simple business opportunity. How do we make the space as big as possible? The space is currently secured by chainlink in a big part throughout defi, throughout blockchain, throughout tokenized assets. So for us, we do want to ensure this space keeps getting bigger and bigger. The big opportunity we see today is that a lot of the tokenized assets being issued on chain are not actually getting distribution. They're not getting enough buyers on chain. They're not getting enough defi adoption. If you look at why tokenized assets haven't really taken off yet, it's because the distribution just isn't there. You're not finding the critical buyers you need to find on chain. That's one key part we're working on, is how do we make these tokenized assets a more appealing product through things like proof of reserve, through things like cross chain. And how do we make it something that can be listed as collateral on defi protocols, for instance? How do we. Yeah, please, go ahead.
- [18:54]
Podcast Co-host (Crypto101 Co-host)
So when you say the distribution isn't there, is that basically like saying the demand isn't necessarily there yet because people can just go through the traditional means instead of the tokenized means?
- [19:06]
Johan Ide (Chief Business Officer, Chainlink)
Absolutely. Right now, I think for many of these tokenized assets, they're struggling with a big question. How do I make this tokenized asset easier to buy and have more utility on chain than it has off chain? And this question for the most part has not been solved yet. And that's one critical part helping to solve.
- [19:26]
Podcast Co-host (Crypto101 Co-host)
It's a good point. And I think when it comes to tokenization, there's going to be different forms of it for different people. Right. I think one really good argument for it is giving people access to buy something that they might not be able to natively buy because of their country's rules and regulations. Right. And when you look at like one of the great examples was just like publicly traded companies in the U.S. not everyone outside the U.S. can get easy instant access to those. So a way that you can do that is through tokenization for, I would say, the. Probably the average US Customer. It gets a little bit more tricky because it's in the U.S. you kind of are, you know, dare I say, we're a little bit spoiled, right? We can get access to almost anything over here in one way or another, but there's a lot of different market share out there. That's. That's beyond us, right? There's a lot of people who probably want to get access to things and they can't. And that's a really big opportunity. And then there's also this argument of fractionalization, right? Increasing liquidity by being able to fractionalize things that are lower liquid, you know, higher price. And that's a whole another kind of target audience or target demographic. And that's another really interesting one. So, I mean, there's a lot of ways to look at it, which I think, again, kind of goes to the addressable market here. It's not just like. It's not just like you're looking down a narrow doorway and you're like, all right, this is the only use case. It does get pretty broad.
- [20:49]
Johan Ide (Chief Business Officer, Chainlink)
Yeah, absolutely. I mean, look, there are two examples here I'm going to discuss. One is X stocks. So Xtox has gotten tons of adoption, and a lot of this adoption, for instance, is in Asia because a lot of Asian investors want to get exposure to US Stocks. And Xtox is one of our key partners. And the concrete ways we've been able to help them, for instance, is they're using ccip, so they're able to get their token on every single chain using our cross chain, increasing the amount of buyers for their tokenized stock. Right? Because if I'm on more chains, then by definition I get more buyers. I have more exposure for people to buy my assets. The second way is thanks to chaining data feeds. Xdox was able to go on many, many defi protocols, from camino to morpho, etc. So now if I'm buying XStock, I can buy it on any chain and I can use it as collateral to borrow stablecoin to be able to buy more X stocks or be able to buy ETH or do whatever I want, right? So just by these two things, we took an asset that you could only hold on, I don't know, Solana, to an asset you can hold on any single chain and you can use as collateral to be able to do more with this asset. And I think that's a killer use case. A second Thing to go to your points, one of the biggest adoption we saw back in the day for stable coins was Argentina and Turkey. That's we're talking 20, 19, 2020. So if you go way back, the first adopters of dai, it was called dai, now it's called usds. Those were all in Argentina. Why? Because there was hyperinflation in their country and they needed exposure to US Dollars. So. Absolutely. The tokenized asset adoption is always going to be conditioned based on different geographies. Right. I think that's been a trend in our space and I think that's also the beauty of our space. The space will succeed in any case because we have the ability to take any asset on a global scale and there is no other infra in the world which can take an asset and make it global and accessible to every single person and democrat, democratize it in the way blockchain can today.
- [23:09]
Podcast Co-host (Crypto101 Co-host)
So you're basically saying kind of to, to bring this point together, there needs to be some demand issues solved for incentivizing tokenization before there is this further adoption. And there's different ways we can go about it. But that seems to be what you're really focused on right now is saying, how can we incentivize tokenization to be used more forward frequently? How can we make it a better source of. Of. Of like an asset to purchase as opposed to its traditional counterpart? Is there a way? I mean, does this link the liquidity between. So say you have a tokenized version of like the S P500 and then you have the actual S and P500. Like does that unify and increase liquidity or does that fractionalize it because you know you're causing people to buy either the, the tradfi part or the tokenized part. Does that like, act as like a net positive?
- [24:01]
Johan Ide (Chief Business Officer, Chainlink)
There will be a transition period. At the end of the day, nothing will happen if there is no net positive for these institutions, for the buyers, et cetera. Right? Yeah. The way I view it is that all of these folks are exploring tokenization. NASDAQ had an announcement I think a few weeks ago. So all of them are exploring it because there is a positive. Right. This positive, I think comes down to two things. One is efficiency. You have huge efficiency gains. The second one is bigger liquidity. The markets right now in the U.S. for instance, were built for U.S. buyers. They were not built for a global audience. A good example is the market shutting down on US hours or on the weekend. You can see the benefit of crypto by just Looking at something like hyper liquidity, where when you had the war in the Middle east, where did everyone go to try and hedge their old position? It wasn't the tradfi markets, it was blockchain, it was derivative exchanges on chain, like hyper liquid. Right. So yeah, please go ahead. Please go ahead.
- [25:06]
Podcast Co-host (Crypto101 Co-host)
It's crazy because you're right during that period, I mean we talked about it on the podcast and on some of our internal sources. It was crazy. I mean, you're right when the markets were closed or it was after hours or really during the weekends, you saw them obviously having a lot of crypto trading. But then they kind of opened the doors and said, well, people want to trade metals, so we'll allow you to trade metals. People want to trade oil, so we'll allow you to trade oil. People want to trade, you know, the indices. So that's their kind of latest endeavor saying let's let people trade 24. 7 of like the S&P 500 or different indices. And so that's what they've done is said let's allow people to get 24. 7 access from anywhere to trade these assets as they want. And they removed the barriers. And it was ridiculous, the numbers that they were pulling in. I mean you're talking about billions and billions of dollars shattering their own records and exploding to be one of the most used crypto platforms, which is so fascinating because they're on their own chain. Normally speaking, it's hard to drive traffic to your own chain if you're somewhat separated. Right. If you're built on Ethereum, everyone knows how to use you, everyone has your wallet, they know the on and off ramps. It's easy. Same thing with like Solana and etc. But they were able to do this with their own product and platform on their own chain. And they still were so successful because of how compelling the use case was, which is exactly what you're kind of feeding into. And I think that if we can kind of take that principle and apply it to different areas, again making it more convenient for people to use something like that, then the, the market share or the activity naturally follows.
- [26:49]
Johan Ide (Chief Business Officer, Chainlink)
Yeah, absolutely. I mean I think what it represented was there is a lot of demand for tokenization, there is a ton of demand for being able to hold trade real world assets on chain. And the reason for that is a few key things. One is it's global, you increase your buyer base by hundredfold. 2 is it's 24, 7. 3 is every asset is composable, every asset plays by the same rules. It's way easier to create applications that can take in any assets and be able to compose them together, just like we had in Defi. Right. So it creates huge amounts of efficiency. Efficiency. So basically going back to our point is all of that stuff we're discussing, the people who are looking to tokenize stuff know it and they're going towards this world of tokenizing everything on chain. Right. Our job is to make it as easy and as straightforward as possible. And I think this is the most worthwhile endeavor you can have right now. Because if you can actually succeed, you take this space from being a few billion dollars to being tens of trillions, hundreds of trillions dollars. Like we're talking about something that if it succeeds, the whole world gets on chain and it's not a dream, it's something we could do in the next few years.
- [28:05]
Podcast Co-host (Crypto101 Co-host)
Well, yeah, I think the whole tokenization argument and idea is. It's a really good one and we talk about it a lot over here. I want to start steering us more towards talks about security because I've seen you talk about this as well. A lot of us know, you know, a lot of our listeners were asking us and they've probably seen the news in regards to what happened with Kelp Dao just, you know, a few weeks back, right. It was $292 million. I think it was an exploit that went. You essentially threw kelp down and then they channeled this through aave, took a bunch of of money and it was this big ordeal. Can you talk to us about like what actually happened there? Because I think it triggered something like $13 billion in DeFi value pulling out over a 48 hour window. And I think people are just confused about like what happened and how this happened and why it happened and what it means moving forward.
- [29:04]
Johan Ide (Chief Business Officer, Chainlink)
Yeah, absolutely. So this risk taking assets. So it's basically the Kelp team, they were using a cross chain protocol called Layer 0. The protocol had an exploit which created the whole situation where someone was able to steal money, put it into AAVE and take out a huge loan against it. So it created all the issues you're seeing today on socials, etc. Now what strikes me in this issue is defi composability is a great weapon. It can also get back to you very quickly. That's what happened here where an exploit in an asset caused a big issue for the defi space that we know today, every single part of our space is connected. If you have an issue with one, you have an issue with all the others. Basically, so for any asset, if the asset has a problem, all the defi protocols that integrate this asset are at risk. That's number one. So because of this, you really can't compromise on security in this space because every single vector of attack will be used not to destroy the asset, but also to destroy the whole space that's built on top of the asset. That's really, really scary. A second thing that our space has is that once you have an issue like this one, you cannot go back in time. Blockchains are immutable, as we all know, right? So anything that happens, you can't go back. There is no arbitration thing that allows you to take back the money from the hacker and, you know, solve the whole thing. That's unlike TradFi in blockchain, any mistake will cost you very dearly. Now, because of these two reasons, Chainlink has always looked at security first. What does this mean on our side? It basically means we don't do anything if it's not secure. It's very simple. And I think this principle, you really can't compromise on it. If you're an infrastructure provider like us, you can't move fast and break things. As an infrared provider, your motto needs to be it's either safe or you don't release it. You don't do anything with it. Okay, so from, from our end, for instance, on the cross chain side, we have 16 node operators which are running the cross chain. So if you wanted to actually attack the network, you would need to hack each single one of these node operators. Here you just had to hack one single party in order to steal all the money. Like it happened in the hack. Now. Yeah, please go, go ahead. And then I continue.
- [31:49]
Podcast Co-host (Crypto101 Co-host)
You know, that kind of reminds me of like other similar issues slightly different from this, but other similar ones where in the early days, projects, a lot of altcoins would only have a few validators and so it wouldn't require like you said, 16, or sometimes it's 100 or whatever. It may be that different validators out there, they'll have like a few validators. So, so people need to like take over like a few of them, like two, three. And all of a sudden they get access to all this capital. And that's kind of like what this reminds me of. And it doesn't make it as, as much sense. Like the, the, the big one that comes to my mind is Ronin or Ronin back in the day, right? I think they had like, what was it like? I think it was like less than 10 validators I could be wrong. It was either like 7 or 13 or something like that. And so these, this group came in and it's like, oh, okay, all we need to do is take over a few of these and we get access to the blockchain. And the, the Ronin hack was like one of the most infamous ones out there. And that's kind of what this reminds me of as you're talking about it.
- [32:50]
Johan Ide (Chief Business Officer, Chainlink)
Is it your.
- [32:51]
Podcast Co-host (Crypto101 Co-host)
Is there like a comparison? And do you find it frustrating that similar. Ask again, different but somewhat similar mistakes can still be made all these years later?
- [33:03]
Johan Ide (Chief Business Officer, Chainlink)
Yes, that's, that's completely accurate. Look, I'll tell you one thing. I've been on the front lines of the, you know, whole security stuff for years now. When I started in 2018, basically pushing, you know, working on price feeds, etcetera, all the protocols I would speak to were extremely, extremely worried about security. They would ask me questions, how many nodes, how many node operators, how are they running the protocol? Had a very, very good skepticism. And they're all extremely focused about security. In the recent years, I've seen less and less of that, meaning our space as a whole has embraced values that are much more around latency, how fast are you, how cheap are you, et cetera, rather than security. And you can look at that by just looking at the number of L1 chains who never, who've been raising money in the last few years. They never talk about decentralization, they never talk about security, they always talk about how fast am I and how cheap am I? Now I do think we need to have a big wake up call as a space, and I hope this hack will serve as this purpose, to start asking questions around security again. We asked this question in 2019, so just to go back to your point, back in 2019, we had a lot of Oracle hacks in the space. People weren't using things like chainlink, they were running their own centralized Oracle and they kept getting hacked. And because of that, the whole space was extremely focused on security. I think this hack we just saw is going to probably play this role of refocusing more people on security, which I think is a very, very healthy thing given the things I've seen in the last few years where, you know, most of the talks we're having with users now, many of them are all about how cheap are you, how fast are you?
- [35:05]
Podcast Co-host (Crypto101 Co-host)
We've been, at least I can speak for myself, I've been a critic of that mindset. Meaning that it's frustrating because for years you're Right. New projects would come out and be like, okay, well what do you offer? And they'd say, well, we're faster and we're cheaper. All right? A couple days later, the next layer one, the next layer two comes out. Were faster, we're cheaper. And that was just the regurgitated thing of everyone was a little bit faster and a little bit cheaper. And it got to a point where all of a sudden there was like hundreds of these different layer ones and layer twos. And that was like the main point. And, you know, we get pitched a lot of them over here and then they come to us and say, hey, we should come on the podcast because we're a little bit faster and we're a little bit cheaper than Etherium or Solana or fill in the blank. And my thought process is as, at what point does that truly matter as much anymore, right? We get so fast, we get so cheap. There is minimal reward for going any further than that. Why not look at different areas and solve issues over there? And I think one of those areas obviously is security. So you do make a good point. And I think it also raises the not like concern, but the thought, right? Immediately my brain is going, okay, well we were talking about this with the crypto companies, but you guys at Chainlink have plugs to a lot of these big different financial institutions, right? Banks out, asset managers, the big names in tradfi or traditional finance as it's better known as. Like, what does it actually take for those institutions to take crim to take crypto infrastructure seriously and feel secure? And has that been like a barrier in conversations that you've had? Because they seem really bullish on it. But if there are these issues, you have to think that maybe there's a little bit of holding back because of stuff like this is like, is that, is there any truth to that?
- [36:52]
Johan Ide (Chief Business Officer, Chainlink)
Look, the good thing is actually understand our space. And they're hyper focused on security. So one of the key reasons why you're seeing Chainlink work with all of these traditional finance names, from J.P. morgan to DTCC to Swift, is because they're focused on security. And you notice there is no other Oracle working with them. There is no other cross chain provider working with them. We're the only ones. And really one of the key reasons is the security aspect. We do have very large convos around security. They don't exist stuff lightly. As you can imagine, we're ISO stock TO compliant right now, which was a key requirement for many of them. So with traditional finance, it's not A blocker. It's a key key point which plays very well for us because we didn't wait for traditional finance to tell us, you need to be secure for us to use you. We've been aiming to be secure since 2019 because we actually care about this space and we don't want hacks to be happening. So yeah, that's the way I would view it. Look, at the end of the day, just to finish, it's cheap, fast topic. Because that's been also a key point. That's been. How do I say it politely pissing me off for the last few years. At the end of the day, AWS is probably cheaper and faster than anyone else, right? If you're in this space, you're not in it because you're cheaper and you're faster. That's a nice feature. It's not the whole thing. The whole thing is you can host billions of dollars, trillions of dollars on your infra security without it being lost. That's what matters.
- [38:32]
Podcast Co-host (Crypto101 Co-host)
It is important. Right? There is important, there's different. It's hard, right, because you have to juggle all these different points. You are trying to juggle speed and efficiency and you're trying to juggle reliability, also security. So I understand where people come from, but I think that security is arguably one of the most important ones. You know, luckily, maybe not luckily, I would say, you know, intentionally Chainlink has avoided a lot of this, right? Different projects out there, they've had downtime or they've had major hacks or exploits or dramas or whatever. And what's been amazing to me, and I don't want this to sound too much like a glaze, but you know, I've followed you all for a long time, I'm sure many of the long term listeners have, is that Chain Link has been able to avoid just about all of the drama, any major exploits or hacks or any of this stuff. And I think that that's been a contributing factor to how Chainlink's been able to hold so much Oracle market share. When you look at different projects out there, even different genres, right? I would say the Oracle space is a genre within crypto. It is tough for any project in any genre to hold above 70% market share for an extended period of time, right? You look at Depin, you look at Defi, you look at overall activity. It used to be dominated with Bitcoin, then Ethereum. Now you look at Solana and you look at overall activity. You look at Dex's, those Juggle, you look at different layer twos, those have gone back and forth. The list goes on. Right. Even within tokenization, you know, there's balances with different sub projects that are, that are doing all these different things and privacy and yada yada. But I think that that's been a testimony to say if you have good security, if you avoid the drama, if you do what you say that you're going to do and you do a good job with it while avoiding those other negative catalysts, you will gain market share and you will hold it and you will grow. And, you know, that's been kind of the story of chainlink, because you guys have been around now for, you know, I mean, it's pushing, I think, almost a decade since the ico. I could be wrong about that. But that's correct. In the main net was 2019 and here you are. So, again, yeah, security needs to be a focus. It seems as if that is definitely a growing concern and people are paying more attention to it. I think also the help, or not the help, the talk of quantum is making people really look at security and say, okay, maybe we do need to pay more attention to this. Right? You're seeing different quantum communities come in and say, let's make crypto more quantum resistance. And that's a different kind of security, Right, because you're looking at quantum security versus some of these other threats that are out there. But again, I think the more talk that we have about security and the more that we have on improving it, the more serious it's going to be taken. And we bring this stuff up not because we want to critique or we're salty or any of this. It's because we want to see the space succeed in the best way possible. Right? That's why we bring this up. And, you know, it's a critique that I get from people, right? They see these things happen and it pushes them away. They say, you know, maybe I'll avoid this. I don't like that this keeps happening. And again, yeah. Anyway, I don't want to sound like a broken record, but the more that we get rid of that, I think the better it is for the overall growth of, of crypto as a whole.
- [41:52]
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- [42:53]
Johan Ide (Chief Business Officer, Chainlink)
Yeah, no, I absolutely agree. Look, I do think we're doing work of, you know, it's not an easy work to be pitching and talking about security all the time, right? Like you will get folks telling you, oh, that's not nice to be critiquing other people's security, etc. There has been this trend in the last few years where, you know, as soon as you raise an issue with a project security, you're breaking a taboo. You're like, not Kumbaya anymore. That's not good, right? But at the end of the day, I do think it's a very, very healthy thing to do because if we're bringing securities because we care about this space and we don't want people to be losing their money in the hacks that constantly happen because of security issues, right? So look from, from our side, I think one of the key drivers why we've been so successful is because our security and the reason why we've been so focused on security is because we do genuinely care about this space. Right. We do really believe in the vision crypto brings of empowering people all over the world to have financial access in the same way, you know, someone like my, my ideal scenario for crypto is that in a few years someone living in Southeast Asia, Africa, wherever they live, they get the same financial opportunities as someone living in the west today. And I think we've done a lot of that already with DeFi, with stablecoins, etc. Right. So I think it's a fight that's really worth fighting for, frankly. And whenever I see people compromising on this fight by offering infrastructures that's not secure, for instance, etc. I do think it's a very, very unhealthy thing. I think it's taking us back further away from succeeding in the mission that crypto has set and it's a very worthwhile mission.
- [44:44]
Podcast Co-host (Crypto101 Co-host)
Well, I want to talk about the Future, Right. We talked about, you know, what has happened, what is going on. And I'll tell you what, I mean, it gets me excited. Right. We talked about some of the good, some of the bad, some of the ugly. We got to talk about everything that's happening. I want to look forward, right. Because there's a lot of things to be excited about. I think the future is extremely bright and I think the best is still ahead of us when it comes to the roadmap and what you all have in the pipeline. Just talk to us about that. I've seen some big articles. We mentioned some of these things earlier, so maybe we circle back to them a little bit. But I saw that you all partnered to bring the US stock market on chain, working with 24,5 equities. You guys have had the Chainlink endgame coming up. You guys have had some partnerships with like Swift and Euro Clear and different banking partners. Just walk us through like any and all of those and what Chainlink has on the future roadmap.
- [45:41]
Johan Ide (Chief Business Officer, Chainlink)
Yeah, absolutely. So look, we have a lot going on on the data side, as you said. So we're bringing us equities, we're working to bring APAC also equities. We've been working on Gold on silver. That's live already with gmx. So we have a lot going on on this front. On Cross Chain we've been launching, well, we have, let's say, new releases coming up which are going to improve drastically how tokenized assets and how the defi world can both interact together using CCIP Cross chain. So one of the things we're trying to solve is how can we get these two words to communicate through Cross Chain specifically and the new release we'll have here, we have a lot of exciting features. We're working on privacy features. That's a key thing that the space still doesn't do very well. How do I have private transactions? How can I put data that's proprietary data on chain? So we're solving some of these issues. We have some projects regarding AI on how AI could use Oracles to prove the authenticity of some of the things being posted by AI. So for instance, how do I ensure that, you know, some of the posts on social media are not AI slope. So we have a lot of features coming up in the next few months and I would say all of these features are going towards this one vision I highlighted before. How do we ensure we basically cross these two words of tokenized asset and defi?
- [47:20]
Podcast Co-host (Crypto101 Co-host)
Feels like there has to be a lot of market share in the AI stuff like, I just don't see that going anywhere. I see it being used more often, the more AI detection that you all can run. I feel like there's got to be a decent amount of demand coming towards stuff like that.
- [47:38]
Johan Ide (Chief Business Officer, Chainlink)
So we're working on a lot of stuff with that. We're securing prediction markets today with things like polymarket today. Polymarket is another big of our partners I didn't mention earlier, so they're using us for crypto data, for instance. But we're working with many more prediction markets. And one thing we've been looking at is how can AI be used for prediction markets to be able to answer any question? So let's say you have some random question like is Zelensky going to wear a suit at the NATO summit that saw us a year and a half ago? You could use AI oracles to resolve that. Another thing we're releasing that could touch on AI is we're working with lamarisk on risk oracles for aave. Risk oracles could be using AI to be able to adjust LTVs and collateral caps, et cetera. And the third big one I mentioned is I think our space has a lot of value it can bring to AI, because today AI has a big consensus issue. What I mean by that is that a lot of AIs actually spit out wrong facts. They hallucinate. And one of the big issues you have with AI is they never say no or I don't know. AI for all intents and purposes today, is basically a yes man. You ask it the question, it will always give you an answer. One of the big issues with that is if you start using AI for key stuff, you're going to get a lot of wrong answers. Right? So what we're thinking of is how can we actually aggregate multiple AIs through our oracles with one single prompt? So you basically add a prompt to multiple AIs. We get one answer, you aggregate their answers, and based on that you can start getting the right. Like you can know when you actually know something or when you don't. This could help you solve things like AI hallucinations, for instance. So there is a lot of different, you know, vectors as you can tell on AI.
- [49:40]
Podcast Co-host (Crypto101 Co-host)
Yeah, you know, I totally agree, man. There's so many things going on, but we really appreciate the conversation. Is there anything that we missed when it comes to the future of Chainlink or anything else that you've been working on?
- [49:52]
Johan Ide (Chief Business Officer, Chainlink)
I think we, we covered a lot. Look, the, the main thing I would like your Viewers to take from this interview is there have been a lot of talks lately around crypto, AI, what's the most exciting space, etc. I think crypto has extremely important properties for the future of the world. If we don't mess up, it's a guarantee crypto will win and every single asset will live on chain. For this to happen you need key things like security, which is a non negotiable. That's why Chainlink throughout all the years has been investing in security. So I do recommend anyone who's looking to build something into this space, or even who's interested in looking at the space to always keep in mind what's the security of your system, how is your infra working, how is it decentralized, how are node operators getting paid? That's the first thing you should pay attention to when you're getting into crypto. All the rest comes down later.
- [50:59]
Podcast Co-host (Crypto101 Co-host)
It does well. If there's one thing I think the listeners should take as well, it's that guys, the future is exciting, it looks bright. We talked about all sorts of things and if there's one takeaway is that there's a lot of market share to be had out there, there is a lot of market share to be had, there's a lot of things to look forward to. The boat, the builders are still building, the institutions want to be a part of it, they want to grow and there's a lot of stuff to look forward to. So the future looks bright, it's exciting. Johan, it's been a pleasure to have you on here. We appreciate your time. For people out there who want to get more involved, maybe they want to work with Chainlink, maybe they just want to follow you all. Where can they follow both yourself and Chainlink?
- [51:43]
Johan Ide (Chief Business Officer, Chainlink)
Sure. We have our Twitter account Nlink so I think you'll find a lot of resources there support useful and it's good to see all the kind of announcements and work we're doing on a weekly basis. And I'm also on Twitter, it's idioan to find me. So yeah, that would be the best places, I would say.
- [52:03]
Podcast Co-host (Crypto101 Co-host)
Awesome. Well, once again, thank you for joining us. This has been another great episode of the Crypto 101 podcast everyone. And until next time, we'll see all of you at the same time, same place next week. Take care of.
- [52:26]
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- [53:29]
Johan Ide (Chief Business Officer, Chainlink)
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