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- [00:00]
Monster.com Representative
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- [00:35]
Indeed Representative
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- [01:43]
Interviewer
Hong Kong based venture studio and blockchain game developer Animoca Brands has grown to be one of the most powerful names in Web3 culture. The market cap of tokens issued by Animoca's portfolio companies totals more than $45 billion according to CoinGecko Data. Joining us now to discuss the state of play is Yatsu. He's a co founder of Animoca. Welcome Yat.
- [02:06]
Yat Siu
Thank you for having me. It's a great pleasure to be here.
- [02:08]
Interviewer
Always a pleasure to see you. So I want to say you're one of Coin Ask's most influential 2024.
- [02:14]
Yat Siu
Thank you so much.
- [02:16]
Interviewer
And you told us that 2025 is the year crypto will go mainstream. So what are you going to do to make that happen in terms of getting more mainstream adoption in this space?
- [02:27]
Yat Siu
Well, I mean there's a whole bunch of things that we're doing. You know. Animoca Brands today is much more than a gaming company. We actually started with gaming because it was a way of creating mass adoption. We have over 540 portfolio companies, not just in gaming, but in deepin, in AI, of course, deepin, other areas of financial services, L1 L2s. But really the main area that we think adoption will happen by the end of the year will be around gaming. And we can talk about that a little bit later, we think. But the other one is digital identity. So reputation systems, like with Mocaverse, we think that's going to build more trust. And trust is definitely what we need a lot more of in web 3. And then of course, with education, with Open Campus, from some of the sort of companies that we incubated within the education Edu portfolio of Open Campus. There are some companies, for instance, solving student loans, for instance, in education, with using DeFi. And that's pretty fascinating because think about all the hundreds of millions of students around the world who need that kind of financing. And what crypto is really good at is connecting the need for finance, better finance to solve certain problems. And I think, you know, financial aid and student finance is a good way to do that. So, yeah, Open Campus, mochaverse, Gaming, our entire portfolio, digital identity. These are major themes that we hope will bring mass adoption this year.
- [03:37]
Interviewer
That's great. So as a student, you could. How would that work? You would put out, you know, what you need. What kind of.
- [03:44]
Yat Siu
Yeah, so you need a reputation score, right. In order for you to basically get a kind of credit score. And then you would be able to basically get financed through crypto. But how do you do that? Well, you need to have a wallet, of course. Right. And then of course, you have to pay back your loan How? Through crypto. So in a way, it's actually not that different from when you think about how PayPal and Venmo scale their businesses. They started through students, and that hasn't happened really for crypto yet. And again, what the team at Open Campus is doing and the companies are incubating, that is a perfect solution. Student loans in America alone is a $2.2 trillion space. Can you imagine just to think about how many people still have student debt and the kind of interest that they're paying. But, you know, with all the yield optimization and the returns that you can have in crypto, you can reduce the cost of the yield for the student, as in lower interest rate, and you can actually make equal or better returns for the one who's providing the loan. So there's a lot of good. Interesting.
- [04:32]
Interviewer
What's the timeline for this?
- [04:34]
Yat Siu
Well, they've already started doing that and, you know, sort of a million students were already financed, really more in Southeast Asia. But really, I think the big area of potential would be, you know, the U.S. i think, which of course, it hasn't done. And Mocker has been very cautious about entering the US in the past. You know, surprise, surprise. However, you know, we spend time in New York and we think the US Is the next place for us to focus on as well. And so we're, we're going to do some more efforts there.
- [05:00]
Interviewer
That's fascinating. Yes. President Trump has called the U.S. the crypto capital of the world.
- [05:06]
Yat Siu
So.
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Interviewer
So what kind of.
- [05:07]
Yat Siu
Certainly trying.
- [05:08]
Interviewer
Yeah, certainly trying to happen. What pathways are you hoping to make in the United States now? I guess you feel more comfortable now, of course.
- [05:17]
Yat Siu
And it's not just us, it's all our portfolio companies as well. The other thing that if you consider what's happening in the US is that there's a lot of capital that starts to unlock. All the venture capitalists that were sort of retreating from crypto are sort of. We should be looking at this space as well. Most of it is flowing into bitcoin at starting. But then you're going to look at the rest of the ecosystem. There's really, if you think about it, US is the capital, basically the venture capitalist center of the world. But they haven't really invested in that area and now they really want to catch up. So. So we think that's a potential. Of course, it's first or second largest economy. Depends on who you're talking to, I guess, which statistic you're looking on. It would be sort of ridiculous not to look at that market. Also very technically savvy. And at the end of the day, look at the adoption, what you see in places like Kraken and Coinbase, you know, our portfolio companies like Yugolabs and Igloo, the people behind Pudgy Penguins, they're based in the US as well. So it just makes sense to just double down on that market.
- [06:07]
Interviewer
You are a man, a global traveler, a polyglot and whatnot. So you know what's going on in various different regions.
- [06:15]
Yat Siu
We hope so anyway.
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Interviewer
Who's leading?
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Yat Siu
So right now I would say Asia Pacific is leading narratively and a lot of the attention is also really in the Middle east, in places like Dubai. But the US Never wants to play second fiddle to anyone, so they're going to go ahead and do their very best to be number one again.
- [06:30]
Interviewer
So I see that you were appointed to the Hong Kong Task force to promote Web3 in 2023. What kind of developments, initiatives have come out of that right now? And where do you see it headed?
- [06:41]
Yat Siu
I mean, there's a lot, but I would Say, the most recent one that we just announced a couple days ago is our stablecoin initiative with Standard Chartered. And when you think about that stablecoin initiative, it's very different because it's an actually sort of hkma. Basically you think of it as a central bank, licensed stablecoin as a stablecoin, not as a CBDC together in partnership with a major bank. Again, that's not really been done before. Right. Hong Kong is really leading the charge in that area. You know, I think the number of more exchanges have been licensed. Again, it's evolving, it's creating. Remember, Hong Kong didn't have the benefit of the many years that places like Dubai has had. They really sort of had to catch up. But also interesting is they made that commitment right when FTX happened and actually they doubled down. They never retreated from the position and continued to grow, grow that space. And so we're very, very bullish on where Hong Kong is going to be in Web3.
- [07:25]
Interviewer
It's interesting because just north of the border in China, they have a ban on crypto mining, crypto transactions. Do you see that softening up?
- [07:35]
Yat Siu
Hong Kong has always been the financial intermediary for China. So you have to consider it from that perspective. But you can actually trade, you know, stocks and American stocks in China freely. You can't have free sort of capital flows. That's always been. So the China perspective, however, Hong Kong has been the gateway for that and Hong Kong will be the gateway for that, for basically digital assets. And just to clarify a few things, you know, the reason why the primary reason for sort of banning the mining of things like bitcoin in China has really more to do with energy than to do with crypto in and of itself. Right. And you can own crypto, you just can't trade it. There's a bit of a difference.
- [08:07]
Interviewer
All right, I want to talk about meme tokens. We had US President Trump issue meme coin. The president of Argentina is getting into real big trouble for sharing a tweet about a meme coin called Libra.
- [08:21]
Yat Siu
He actually wrote about it, but yes.
- [08:23]
Interviewer
Yes, and we had some breaking news on CoinDesk about it. Some tweets from one of the co founders of Libra or someone, a market maker of Libra, who basically said he gave money to the president's sister. And you know, there, I mean, that interview was wild.
- [08:42]
Yat Siu
It was pretty crazy. So, yeah, I mean, look, I mean, I think to me it's starting to signal the top of meme coins when you think of actually what happened with Trump. I think of Trump as a vampire attack on the meme coin community, because it really sucked, all that liquidity. And then, of course, Melania just happened literally, you know, like within 24 hours, which was basically sort of kind of like a sort of, you know, it's like a double, double hit. And then now what we have with Library, you have essentially sort of, I guess, a sort of quasi final death knell. And I think we're hitting this kind of sort of close to the end of. Not to say that memes go away, they'll always be there. They're always going to be these cultural artifacts. But how we talk about sort of this meme super cycle, I think we're going to hit that end, which to me is a positive thing, because it means that people are going to start looking at the dangers of this and they're going to understand it's fun. But if you want to sort of actually put real money behind it, then you have real risk. Where do you want to put your money in? Where do you want to actually sort of invest in things, do it in things that you have conviction, who's behind it? Last year I spoke about the institutional era of crypto was starting, right? I was commenting about how institutions were really going to be the signals of where you want to put your money in, because they actually do due diligence. They're willing to lock their tokens for many, many years. They're willing to disclose, they're willing to tell you what they're going to do with it, as opposed to all these other guys who are basically just going to dump on you. I mean, there was just literally another case where an influencer went out, launched a token, and then rugged his community, basically within less than a day, and thinking it's okay, for instance, right? So that mess has to be cleaned up and people are going to be fed up of it, if they're not already. And we're moving now to the stage where it's about utility, it's about purpose. And what's really, to me, powerful is that you remember we saw the similar face with ICOs in 2017.
- [10:23]
Interviewer
Yes, absolutely. It feels very similar.
- [10:27]
Yat Siu
But remember what happened, right? People were exiting crypto, broadly. But here people aren't exiting crypto, they're exiting into Bitcoin, or they're exiting into other areas, but they're staying inside the crypto community. You know, maybe they're exiting into stables. Stables are gradually increasing the volume and the size of stables keeps going up. So to me, that's a bullish signal, so. Meaning that we're not losing people. We're not gaining people in meme coins. That's the other thing. They're not getting new users, but we have much more confidence broadly in the space, so it's much more mature than it was five years ago.
- [10:59]
Interviewer
I love it. Okay, we'll end it there. Yeah. Thank you so much for joining us.
- [11:03]
Yat Siu
Thank you for having me.