← On The Chain - Blockchain and Cryptocurrency News + Opinion
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- [00:02]
Chip
Before we bring in our guests tonight, I want to take you back to December of 2020, because if you were holding XRP back then, there's a pretty good chance that this person joining us today put something directly in your wallet. Most people know the name Flair. A lot of fewer know the story behind the guy that built it. Hugo Fillion wasn't a crypto founder looking for the next meme. Coin wasn't chasing the latest trend. He was managing portfolios at the time. There's a lot of deep ins sense that stuff going on. Heavy background in machine learning. So before walking away and studying that machine learning over at the University College of London, and what was really interesting here is that whether you're Wall street or it's artificial intelligence, there's a lot of things that keep happening over and over. Power is kind of concentrated into fewer and fewer people's hands. Systems will be getting a little bit bigger, gatekeepers becoming a little stronger. And the people using those systems were a little bit less control, not necessarily more.
- [00:55]
Jeff
And that's really where the story starts. Because instead of accepting the reality, Hugo decided to build something completely different. What eventually became Flare wasn't just another blockchain competing for attention. It was designed to solve a problem that's been hanging over crypto really since day one. How do blockchains securely access data from outside their own networks? Big question. How do they communicate with other chains? Big problem. How do they interact with real world assets, financial markets, AI systems, and everything else happening beyond their own ecosystem?
- [01:28]
Chip
Yeah, and for XRP holders, this is where it gets really interesting. Because XRP has always been one of the largest digital assets. We know that for a long time, but it's been years and it's had limited access to decentralized finance. You could hold it, you can move it, you could hodl it. But compared to other ecosystems, really wasn't a lot that you could do with it. Flare looked into that. NASA said, simple question. What if XRP could do more?
- [01:50]
Jeff
I like that question. What if XRP could generate yield? What if it could be used as collateral? What if XRP could participate in lending, borrowing, staking, and an entirely new financial ecosystem without losing what made XRP valuable in the first place? That's really been the vision. And now, years later, we're finally seeing how much of that vision is becoming reality.
- [02:13]
Chip
So in today's show, we're going to talk about where Flare stands today. Flare 2.0, what's working? What's coming next? And some of the biggest questions. The XRP community still has because whether you're an XRP holder or a die hard Flare supporter, you're simply trying to understand where the blockchain infrastructure is heading next. And this is a conversation you do not want to miss.
- [02:35]
Jeff
That's right. Definitely don't want to miss. Let's go.
- [02:40]
Chip
Welcome to on the Chain.
- [02:47]
Jeff
Hugo. Welcome to on the.
- [02:51]
Hugo Fillion
Hey, thank you so much for having me.
- [02:53]
Chip
Well, it's great to finally have you. And I had the pleasure of meeting you in person. It was in New York, it was October, November ish, last year and we, it was really a pleasure to finally meet you in person and had a nice little chat with you. And so I was always nice that you gave me the time to kind of sit down and talk shop and talk about other things that were really random, which was probably even more fun to do that. But welcome to the show. Yeah, it was a lot of fun. Welcome to the show. And you know, as you know on the chain, we've covered, you know, Flare from the very beginning, from the time it was announced. Right. So we have been, we've been watching it and we report on it quite a bit. So again, a nice, very big pleasure to get here. And so I think one of the, probably first things we'll start off kind of chatting about, we can get into your background a little bit too, but kind of wanted to see like for people that are, you know, watching live. But what's bring us up to speed on flare 2.0 and where we are right now.
- [03:47]
Hugo Fillion
So I think of flaring stages. Obviously the first stage was getting the data protocols up and running and working properly because that's the heart of the network. So for those that don't know, Flare is a blockchain that has validators. But unlike other blockchains, those validators bring data to the network and it's a collective system. So you have to have agreement effectively across the validators for data to be valid. So that was phase one, Phase two was effectively taking that data and launching the bridge for xrp and for, you know, over time there'll be other assets added. And phase three, which we paradoxically call flare 2.0 because it has a big enough shift in functionality that we think it is a 2.0 is that it adds off chain secure private compute to Flare. So the critical thing to understand is it's not just a server running in the cloud somewhere, this is a set of servers. So we've, we've effectively designed it such that it, it has reasonable liveness guarantees you'll never get the same liveness guarantees as blockchain. That's the whole point of a blockchain. But you do get the ability to validate that the thing that has happened within the code base within that that off chain component has happened, has happened correctly. And that the code you think has been run has in fact is in fact the correct code. And that's flare 2.0. Now that doesn't sound necessarily to the, to the, to the non technical person as massively interesting the capabilities that brings. But being able to run an entire AI model which you know what that model is, you're able to verify that it is a particular model and not, not just. Not me just giving you the answer and being able to change the model at will. But I know it's this model, I know that it's run correctly, I know that it's run on this data. Being able to keep secrets so private keys, meaning that Clare can extend its interoperability very, very nicely to become, you know, the whole RWA thing is happening right now. We're constantly refining our RWA strategy. One of the things that's needed is privacy. There are different ways that you can achieve that ZK proofs or what we're doing. But this whole Flare 2.0 has I guess a number of components Compute, meaning you can run big models or risk models or you can run private applications. That's the first thing that's compute. So it gives us the ability to hold the keys or like a multi sig key for addresses on many different chains. This and then together with our data protocols, this allows Flare to do really interesting things both in terms of interoperability, but in terms of private interoperability. Imagine being able to execute a transaction on Ondo, on Ethereum or on XRP Ledger from Flare, from Flare's private accounts so that you can be compliant but you can execute privately in RWA protocols. This is the kind of thing that flare 2.0 is going to get to and we'll be launching that on Songbird in the next I think two months. The base technology for that, not, not necessarily applications which will then will then be testing on Songbird.
- [07:48]
Jeff
Yeah, well it really sounds like what you're putting out there is going to be extremely significant for the agentic world. All right. For AI, for the interaction especially financial. From a financial impact. You know what we're seeing on the back end with AI doing a lot of things autonomously. Can you talk a little bit about that and is that something that you're factoring into 2.0.
- [08:16]
Hugo Fillion
Yeah. So I think the thing that really matters when you're using AI models to manage money, because what we're mostly talking about blockchains is money. It's two things. One, that you know what model you're using, Two, that you're not. You don't succumb to the probabilistic nature of the model. The problem with generative models is that they're probabilistic, which means that you can get an unexpected answer. Now, the nice thing about Flare 2.0 is, and we've actually got this in spec documents, you know, internally, so you can build filters, so you have the model and then you can build filters to effectively mitigate the probabilistic aspects of the model. And this means that you can get to a much more logical output. And that really matters when you're talking about money, because you really don't want an agent to do something completely like to hallucinate that there's a great opportunity somewhere and put all your money into it. That would be rather problematic. So I think Flare 2.0's confidential compute is a great utility place to put in place guardrails for AI agents.
- [09:45]
Chip
I love the way you language that problemistic because that is actually more on target than hallucination. Hallucination sounds like, well, I got something wrong. But when you're talking about your money, the last thing you want is maybe that wrong bit of information where all of a sudden, you know, you make it doubles down on something you had no intention. So I love this idea of putting filters in there. I think the rush to everything agentic AI and working on your behalf without guardrails, there's a lot that is problematic. And I see other people going into it. I get to go to these trade shows where I ask the companies, everything's AI these days, this blockchain AI. And then when you start digging into it, they never really have the real answers about how the guardrails work or how they. How they protect data or how they mitigate any sort of hallucination. So the fact that you're putting that in there is really strong. And so how do you see the future unfolding with this agentic economy? You know, we talked. There's some. A lot of. We're seeing a lot of people pop out of nowhere, especially in the blockchain world that are talking about how these agents will. Will make payments. And even on the institutional side, where do you see the positive of that and where do you maybe see, like, where there could be Aside from hallucinations, what are some other problemistic things you see going forward in the next six months to a year?
- [11:03]
Hugo Fillion
I guess. You know, the dream is that I can type into my phone, I want to take my family on holiday and an agent can just, and I want to go to, I don't know, Hawaii. And an agent can just, you know, on. The agent says, well, what kind of experience do you want? And you say I want, you know, I don't want to break the bank, but I want it to be better than Travel Lodge or whatever the equivalent is. Motel 6 in the U.S. right. So the agent can go and figure that out. Figure out the level of, I guess, experience you want. Select hotels and go book it. Right. I think that's the dream for like the agentic economy from the, from the individual perspective, from the, I suppose from a more institutional perspective and a little more circumspect as to how that should be applied. You know, automated trading and things like that. I think that's good. Any, you know, any edge in those kind of things gets competed away very quickly. Right. Because all these models are very similar. So you know, you might have an agent that you've fine tuned trained and you've found some kind of edge or you think you've found some kind of edge. But to me that's like not a long term thing. My mind would be agents managing risk probably better than, than to say trying to take prop positions but still I'm very circumspect that the, that the technology is there yet. Like it's still better to use a statistical model to understand risk than it is to use an LLM. I do think there will be things like machine to machine payments. You know, we've got internally our own entire AI thesis as to where the whole of AI goes. It's not something I want to break down here, but it's like a longer conversation. But we think that there's some really nice places where blockchain and AI, not necessarily the agentic economy, but blockchain and AI itself. Like how do you create agents? How do you create these kind of things meet? And a lot of that is about how I think that over time these, these models like Chord and Grok and all this kind of stuff are going to converge to effectively the same similar performance. And then in reality data is going to be key after that. Right.
- [13:52]
Chip
Just one follow up to that. So you know, it's interesting, I know not to get too much on the AI train, but what we saw, what just happened with Anthropic pulled obviously because of, you know, Fable 5, right. Because it was just mythos with supposedly some guardrails. Do you think that more and more institutional will end up going into maybe using their own models, maybe more open source or adapting open source? Because I see that as these models start, start converging, like you say, do you think that eventually it's starting to cost people out? Right? So you know, every time Claude comes up with their new one, then Codex comes up and they're competing in this, they're still losing money, right? Because they're still undercharging. They're not really paying for the tokens you should be pay for. But at some point does it price people out where it's not going to replace employees because it's cheaper to have an employee now than it would be for that. But on the institutional side, do you think more of the bigger players will adapt their own open source or develop their own models that maybe hallucinate less when we're talking about maybe machine to machine?
- [14:49]
Hugo Fillion
I think two things, I personally think two things will happen. One is I think institutions are not going to give their entire business away to large AI labs. And so they are going to be running AI on premise or you know, in their own private cloud. And they're not going to be happy with, you know, Google or whoever it is just siphoning their data off. That's just like it's the fast way to die. You know, that's, there's that second, I, I actually believe that eventually open source models will, there'll come a point where spending another 20 billion on training is pointless. Like you, you're getting such little accuracy or performance out of the additional training that basically open source models and, and, and, and frontier models will be broadly equivalent. Because even if Google goes away and trains the best model ever, or Anthropic or whoever it is, someone ought to steal that and put it online. And so actually I think personally I think the money being put into training will never be recouped. And therefore I think the longer term is open source. And I think that's where blockchain has real value. Because once you get to effectively a set of models that are broadly similar in terms of performance, the only upside, the only additional performance you can get is what data do I have? And that's, that's kind of our thesis
- [16:26]
Jeff
over the long term, then that's a really great point. I like bringing it back to the data. I think that that's critical. It also allows us to talk A little bit more about the impact that flare 2.0, considering where AI is. But also talk a little bit about the direction that we're moving in through tokenization also and the critical necessity of data. So if we think about everyone's excited, hey, we're going to start getting real world asset. We're going to start tokenizing everything. Tokenizing real estate, tokenizing stocks, bonds, commodities. Now what does that mean? There's now so much tokenization how we actually tracking data, who owns it, interest paid, mature the value when you're transferring it. How important is all of that data to make sure that we're impactful.
- [17:24]
Hugo Fillion
Thankfully the blockchain is very good for telling you who owns it because the address system works pretty well. But the rest of the data, which is what is the asset, who's underwriting this asset, what is the provenance of this asset, all the attestations around effectively the value of the asset. Because I need to be certain that the token I'm buying actually represents, let's say, the house that I think it does. And that's an area that's interesting. Very not. It's not that it's, it's not with flare. It's not hard to do at the moment. It's, it's not where the market is in terms of people do want data capabilities but they, what they want is so basic at this moment in time. It's like proof of reserves. Like, you know, it's very minimal.
- [18:29]
Chip
Minimal is about the size of it. 8. So another thing too, you know we saw the FIP 16. FIP 16. Specifically what we call the flare income reinvestment pools. People know it as fire. But you know, when do you expect that to go live and, and really start burning flare?
- [18:47]
Hugo Fillion
So there's two burns. So the first is we, we increase the fees for transactions to something a bit more like still unbelievably cheap, but something a bit quite, quite a bit higher. So we think that will burn 300 million flare tokens this year was our estimate. And then you've also got the burns from the data protocols. So that's a burn, but they're like the key burn, the burn that really I think matters long term much more than transaction burns is the buyback of flare that comes from two places. Fees accrued from protocols and MEV harnessing. So we're already accruing within fhir fees accrued from protocols. It's not huge. It will get bigger over time, a lot bigger, depending on how big the protocols are. But the really I think the juicy bit will be the MEV extraction which is where MEV is pretty much available on every network, any network with a leader or essentially a non asynchronous system. That's most networks and at the moment every other blockchain lets you, that's an external party harness that MEV. What FIP 16 did is it gave the foundation the right to effectively run hardware to extract that MEP on behalf of the network. And that roughly comes to. I think it was. I need to double check, but out of the top of my head, 1.3% of TVO is a rough number. So per year. So if you think of harvesting 1.3% of TVL which you know, 400ish million, if you take into account total TVL not the DeFi llama TVL because they have a different way of counting it. But if you think of the total TVL 1.3% of that's fine. It's a nice burn. It's not great. 10x TVL. Then you get to the point where. We also put down inflation under FIP 16. So I guess what I'm getting to is the whole point of fire and the whole point of FIP 16 is to get to a point where we can neutralize almost all of the inflation and in fact maybe go further and actually make the, make the supply of flare diminish. But it will require a larger ecosystem
- [21:42]
Chip
just to follow up to that. When you think in terms of projections related to Lake Fire and network transaction fees, what kind of estimate would you think to increase the deflation to let's say such an extent that it would actually offset flare inflation?
- [22:02]
Hugo Fillion
That is hard to quantify, but you know, so we've decreased inflation from 5%, 3% by increasing the transaction fee, we think we'll get to 2.6%. So we think that the increase of transaction, which is a burning mechanism actually brings inflation. You know, if we take the same as last year's transactions or the same as the last period's transactions, we get 2.6 inflation then in order. Look, it's not easy to quantify. We don't know exactly how much MEV there's going to be on any given day. We don't know how many income generating transactions there are going to be on any given day. But the more the ecosystem grows and the more assets are in the ecosystem. Because the best thing for fhir is not to own flare earning. Flare doesn't do much, just burns flare. Best thing for fire is to own XRP Bitcoin eth, all these things. This is where the MEV comes in or stablecoins. And this is critical. So I don't want to give a projection, but it's really not that hard for us to become inflation neutral in terms of where I think the ecosystem has the capability to grow. If we had a lot of the large chains, if we had a 5, $10 billion ecosystem, TVL ecosystem, I don't think it's hard to become inflation neutral, if not inflation negative.
- [23:45]
Chip
Well, predicting, that's me asking you to predict when are the quantum computers going to be a reality and when do they push that button? So there's a lot to goes into configuring what that might look like.
- [23:55]
Hugo Fillion
Yeah, yeah. Well, it's, it's entirely how also how people behave on the network, what they're, what they want to put their money into, you know, what the transactions look like. But there's some additional areas as well which we can come on to.
- [24:12]
Jeff
Yeah, I love, I love the, the technical info that you're providing. We do have a question that's coming from, from the audience here, and this one's from Matt LaRoche. If you wanted to use a Flare network for tokenized gold defi yield and attached to a MasterCard debit card to spend, would it be more beneficial to mint the tokens on the Ethereum blockchain with EVM or on the xrpl, Considering how Flare already has FXRP assets and they can utilize the native escrow feature of the XRPL for added security, which. What would be a recommendation there?
- [24:55]
Hugo Fillion
I'm struggling to understand the question a little bit. So you've got gold, you've got tokenized gold, something to do with a mask, something to do with the credit card or a mask, a debit card.
- [25:08]
Jeff
So it looks like he's the question here. So tokenized gold defi yield with an attached MasterCard debit card for spending. So I guess the question would be for the tokenized aspect of it, is it better? And maybe you can remove the spend part and let's just focus on the tokenization side of it first as it's getting tokenized. Minting those tokens on the EVM or
- [25:39]
Hugo Fillion
xrpl, I mean, you could do either if you wanted to do it on, you know, if you wanted it to have some interaction with the Flare, you know, the. If you could mint it on player, you could mint it on xrpl. XRPL does not current. We do not currently serve assets other than XRP from the XRPL but on the flare 2.0 with what we call protocol managed wallets, we, we want to extend the assets that we can get from the XRPL onto fles. If you minted it on Ethereum, we could also take that asset in via layer 0 if you minted it as an oft token so there's options or you could mint it directly on Flare.
- [26:30]
Jeff
So here's, here's kind of. I think if we dig a little bit deeper into it and looking at the benefit, the direction that Flare is taking the every up until Flare for the most part everything is operated in a silo. Even though the XRPL has great technology for doing transaction from asset to asset. But in terms of operating within a smart contract environment, the movement and interaction of all this data from chain to chain Flare is from the, from the onset has been the one really talking about that. From that perspective and in operating with the multi chain, do you see is there benefit one chain over the other overall? Is there overall value as you're interconnecting? What. What does that look like?
- [27:21]
Hugo Fillion
Is there value of Flare interconnecting? Absolutely. I mean for starters we've given XRP defi. Is there. I mean there's value in, you know, whatever particular network you want to use given your use case. Right. So you know, if you're, if you're looking for payments, XRP is very good. I think Flare is a great place to mint assets if you want it to have an audience and interoperability and access to computer. That said, our goal is to take in assets from XRP ledger from other blockchains, have them used on Flare and also allow them to be used within Flare confidential compute and applications that are built within Flare confidential compute.
- [28:11]
Chip
Nice. Well, it's just another little segue to. I wanted to talk a little bit about Zodao Zao. I work on the marketing team with both Santiago and Fabio and just a quick question, I don't know if you are aware that you know, Zoda uses Flare for the primary price Oracle for XRP membership fees rates from USD.
- [28:33]
Hugo Fillion
I was.
- [28:34]
Chip
Yeah, that's. It's pretty exciting right? To be able to be able to put that into play and make sure that, that, that's there. I just wanted to ask you so your thoughts about that. That choice and you know, also maybe a little bit about Zaldao itself.
- [28:49]
Hugo Fillion
Yeah, I mean I think thoughts on the choice of using Flare as the Oracle. Best possible Oracle in my opinion. Funny that I give you some thoughts between Flare and Chainlink with regards to price oracles, I think you spoke to me. Last time I spoke to you, you mentioned a comment I had said, which was I thought that it was ridiculous that people were using fairly centralized oracles given that they had no guarantee and there was no comeback. My point, and everyone's talking about RWAS and tokenization and effectively the entire financial industry coming to the blockchain and pointing to people using fairly centralized protocols as like, oh, well, you know, they're doing well. Why do you need a decentralized data source? And one of the things that really sort of, from my perspective, you've got to be fish or foul in this game. If I was going to use a centralized Oracle, I want to guarantee behind it, I want insurance behind it. I want to know that I can roll back that transaction if the three nodes that are serving me that price screw up five nodes. Some of the worst oracles on Chainlink have five nodes serving them at that price and the best have 20. We have 90. But if you're institutional and you're using a very weak oracle and something goes wrong, it's hugely problematic and we will see this happen. I guarantee you there will be chaos in our industry, much like there's chaos with bad designs for protocols and things like that. My take has always been that if you can't give a guarantee and pretty much no one can give a guarantee, it's really hard to deliver a price. It's just not enough money in delivering prices and having to stand behind it in terms of guarantees. So if you can't economically give a guarantee, then you've got to go for the maximal decentralization because that's your lowest risk position. So that's the answer. To talk about why Zao uses our Oracle then what do I think about SA generally? I mean, I think it's very good that there's a DAO that is related to XRP ledger. I don't know enough about the day to day operations of Zhao at the moment. I think there's kind of a competition for funding for people who put up good ideas for the XRP ledger or the related networks. And I think that's great. And I pretty much will always support Santiago in anything he does anyway.
- [32:00]
Chip
That's great. Yeah, I mean it's a, it's a, it's a really, you know, deep initiative and you know, exciting as well for the community. And I kind of smell maybe there'll be something, another Zodouts focused interview to kind of talk deeper about that. We'll dig Deeper into that. But I. We can. We can chat about that another time. I thought it maybe that we would just kind of segue for a little bit. One thing we love to do here is we kind of like to have a little bit of fun. Right. Kind of know the man behind. Right. I mean, it's like not personal questions like, hey, we're not going to dig too deep, we're not going to be. Go crazy, but we'd like to kind of dive in a little bit and kind of see a little bit. So I thought maybe we'd play some rapid fire questions if you're a game kind of. And it's real simple stuff, so it's like a this or that. So we'll start off with this one and this is the one that Jeff and I talk the most about, because this is the only place we disagree. We try hard to find places, Hugo, but it's tough. IPhone or Android, Mac or PC?
- [32:53]
Hugo Fillion
IPhone and Mac. Sorry.
- [32:55]
Chip
Thank you very much. Don't be sorry. Because we are the same camp. Jeff's in a different camp.
- [33:01]
Hugo Fillion
So,
- [33:03]
Chip
curiosity, what's. What's behind that ecosystem that you chose?
- [33:08]
Hugo Fillion
First of all, I prefer that it, you know, I just. It works. And it's academic to me, basically. It's, you know, uninterested in that. But it generally, it works. It works with my devices.
- [33:22]
Chip
Yeah. I told Jeff the biggest thing I love is the handoff where I copy something from my mobile and I paste it on my piece, you know, my MacBook.
- [33:30]
Hugo Fillion
I also think. I also think that Apple takes privacy quite a bit more seriously than Android, to be honest with you. And they can. And they. They can do. Because they're also in control of the hardware.
- [33:45]
Jeff
They control your ecosystem.
- [33:47]
Hugo Fillion
They do, they do. Which has. Has positives and negatives. But unless you want to go buy the Solana phone, you know, pretend decentralized phone, I'm sticking with. I'm sticking with iPhone.
- [33:58]
Chip
The pretend decentralized.
- [34:00]
Jeff
I like that.
- [34:01]
Chip
Yeah, yeah, that sounds like another thing to deep dig deeper into, but yeah, 100%, yeah.
- [34:08]
Jeff
Oh, here, Here you go. All right, the fun, fun stuff here. Netflix and Chill or Movie at a theater.
- [34:16]
Hugo Fillion
Movie at a theater, if you can find something to watch.
- [34:19]
Jeff
Right. That's the challenge.
- [34:20]
Hugo Fillion
Right? Yeah.
- [34:22]
Chip
Now, this one here, Jeff and I have predicted which one you would go with, and you'll know when I ask the question. Let's see. Actually, so which one would you. Do you prefer? Is it tea or coffee?
- [34:35]
Hugo Fillion
Ah, that's tricky for coffee, but I drink tea.
- [34:41]
Chip
Interesting.
- [34:42]
Hugo Fillion
So I, I, I, I, I went nuts and I bought myself really, really mental cappuccino machine, the espresso machine, you know, where you weigh the beans and you do the thing and you have a, you special flat grinders. And I was like, because I love coffee, I love taste. And then someone was like, I was like, I'm not sleeping, I don't sleep ever. I can't get to bed. And I like quit drinking coffee in the morning. And I quit drinking coffee. And I was like, oh, Quit drinking coffee. I get to bed, I get to sleep in like 20 minutes.
- [35:22]
Chip
No kidding.
- [35:23]
Hugo Fillion
So what's, what's your favorite of a coffee at 7am? Takes me to an hour, hour and a half to go to sleep.
- [35:31]
Jeff
Really? Wow, that's interesting.
- [35:33]
Hugo Fillion
I know, it's a metabolism thing.
- [35:35]
Jeff
You're naturally caffeinated. How about tea? What is your favorite tea? What do you normally drink then?
- [35:41]
Hugo Fillion
So English, English breakfast tea with milk. It's a good, no sugar milk.
- [35:48]
Chip
Interesting.
- [35:48]
Jeff
What I've found with English, With English teas there's, there's a process and a method to making it. It's almost like an art form we make. It doesn't come out the same. When I go to my next door neighbor who's Scottish and Shan, she makes it, it's on a different level. Like it came out of the pot. I water go with the bag. I saw everything, but it tastes different
- [36:08]
Hugo Fillion
and you've got to warm the pot first. But if you really want people to take tea to the next level, try the Japanese.
- [36:14]
Jeff
Oh yeah, there you go.
- [36:17]
Chip
So kind of already know this. Early bird or night owl?
- [36:21]
Hugo Fillion
Night owl.
- [36:24]
Chip
Text or call.
- [36:27]
Hugo Fillion
So text, because that's what everyone wants. Like no, I would rather call. Absolutely no one wants to get a call.
- [36:39]
Jeff
Yeah, I much prefer to be on the phone. Texting gets, gets old sometimes.
- [36:44]
Chip
Well, like pick up the DM phone and start chatting. Right.
- [36:49]
Jeff
People get shot.
- [36:51]
Hugo Fillion
I, I, I get to the point where like I have three text messages deep trying to get through, trying to understand something or talk to someone about something. I was just like, yeah, speak, just talk. There's so much more bandwidth.
- [37:03]
Jeff
Yeah, exactly. All right, here's one. Cooking at home or takeaway?
- [37:11]
Hugo Fillion
Cooking your head.
- [37:13]
Chip
Yeah. So I, you probably like somewhat of an aficionado when it comes to cooking. I have this feeling. Do you, Is there like the favorite dish you make?
- [37:21]
Hugo Fillion
I'm all right, I'm all right. I, I bought a Traeger not that long ago and I, I make quite a good brisket, which is not a British thing. But, you know, I quite like barbecue. And now what else do I really like to make? Mostly revolves around beef.
- [37:42]
Chip
That's nice.
- [37:43]
Hugo Fillion
I'm good at risotto.
- [37:44]
Chip
Oh, sounds. That sounds like a nice meal. Some brisket and risotto. They're beautiful. So one of the great things about the US hosting the, you know, the World cup have been these videos of Europeans. A lot of Brits coming over here and being just amazed by the food and because they were told that there's no American culture, there's no this and that. But what they missed was they used to go to the big cities, but when they go to the Deep South. You mentioned brisket. Are you a big fan of like, let's say like the Texas type style brisket? Have you. If you spent some time in the States where you've had to have some really good barbecue.
- [38:15]
Hugo Fillion
So I, I mean, I have, I've been to Texas, Austin, if that counts, and been to the Salt Lake and all those kind of places. I wouldn't say I'm an aficionado. I know that there's like a varying degrees of barbecue and there's Kansas, does it a different way from Texas and I don't know, Oklahoma or something. But I'm like basically meat, some kind of rub, put it on the thing, smoke it for a long, long time. Pretty much comes out pretty well.
- [38:48]
Chip
Gotta love that, I guess the next one here, let's say. What do you prefer? Let's say books or podcasts.
- [38:58]
Hugo Fillion
Cuff books for getting lost in a world. Podcast for information.
- [39:07]
Chip
Yeah. And when there's quite a few books behind, we can't read them all, but I imagine they're varying from probably fiction to nonfiction to maybe educational in nature.
- [39:16]
Hugo Fillion
Rereading a good George Orwell book at the moment.
- [39:20]
Chip
Which one?
- [39:21]
Hugo Fillion
It's called Coming up for Air.
- [39:23]
Chip
Coming up for Air. Okay. I don't think I've read that one.
- [39:25]
Hugo Fillion
That's worth. Worth reading.
- [39:27]
Chip
Yeah. Where was. I was talking about him last night with the buddy saying when I read that in school, when I was asked about it from the teacher, I said it's so preposterous and crazy. I didn't know it was going to be foreshadowing. I actually thought it was like so out there that could this. It was so out there that it was not to venture into that world.
- [39:44]
Hugo Fillion
But be nice to. It would be nice if it hadn't been a manual, wouldn't it?
- [39:49]
Chip
Right. That's exactly right. I mean, but I look back on those days and think, wow, that really, it really was foreshadowing. And I love digesting some, some great Orwell interviews out there where they dig a little bit deeper into. Because I even think that must have been crazy written at the time. People are like, okay, this is just dystopian way off the edge of the deep world and, and such an oddity as well. And then another big question. Beach or mountains?
- [40:16]
Hugo Fillion
Mountains. There's nothing I could do on the beach, I like to say, but there's. I could spend about three to four minutes on the beach before I really
- [40:28]
Chip
at the beach, pretty much.
- [40:30]
Jeff
I like, I like both. I like beach and I prefer to walk in the mountains, hike in the mountains. But I like.
- [40:35]
Hugo Fillion
What do you do on the beach? Hang out, like lie down and I
- [40:40]
Jeff
sit at the tiki bar and drink.
- [40:41]
Chip
Usually drinking is what the usual choice is.
- [40:44]
Hugo Fillion
I like watching what you're really asking me is do I like going to a bar on the beach? Who doesn't?
- [40:51]
Chip
But like, I think we are asking
- [40:55]
Hugo Fillion
sitting on a. Or a bar in the bed bar in the mountains. Just some nice ones in Slovenia, actually.
- [41:02]
Jeff
Yeah.
- [41:06]
Chip
And then I guess like the final one here just got to. We jump back into it. Just want to have a little departure and fun. But what does it come down to? Spotify or vinyl?
- [41:18]
Hugo Fillion
I feel like the vinyl thing was overplayed. I. My dad actually is completely bonkers about vinyl and has like, I don't know, five hundred or thousand dollar needle, you know, made from, I don't know, Ruby or some nonsense like that. And he's always trying to get me to listen to records and they sound fantastic, but I just don't have the patience for that kind of thing.
- [41:47]
Chip
You probably can discern with the hearing. Like he can. You know, there is a beautiful warmth to vinyl.
- [41:54]
Hugo Fillion
Absolutely. But you know, audio files are much like coffee nerds like me, you know, they can take it very much too far. I don't need another one of those.
- [42:02]
Chip
Well, speaking of coffee nerds, here's two of them. We're going to have to get you a. A bag of our badassery coffee. We'll. We'll follow up at the end here, but we'll see where we can ship it to. But we'll send you one beans for your espresso. We'll send you some stuff. And what's different.
- [42:18]
Hugo Fillion
That would be lovely.
- [42:19]
Chip
What's different about our brand is it is made to order. So order comes in, gets freshly roasted. And most people never had freshly roasted beans. We take them right out of the container and just chew on them because it still has the oils on it and the talk about nerds. That's us. We're the nerds. So it's. It really is phenomenal.
- [42:37]
Jeff
Hey, so. So this is an opportunity to go through. We have some questions from. From the audience here. I'm going to go back kind of through some of the first ones just so we try to. To reach everyone. There's a couple here that I. I picked out and so the first one Joe Bud was asking. You don't have to get into detail if you don't have. If you can't. But how many flare does. Does flare Org have? How are they released and do they have an escrow mechanism like ripple and their XRP?
- [43:08]
Hugo Fillion
Yes, we have 26% and there's no escrow at the moment. Don't need one. Most of them like a large percentage of the mistaked and yeah, that's it.
- [43:25]
Jeff
And the final on that was institutional adoption.
- [43:30]
Hugo Fillion
Now that XRP has. XRP doesn't have smart contracts.
- [43:33]
Chip
Yeah, I was gonna say I think they meant flare there flare
- [43:39]
Hugo Fillion
institutional adoption. So I think depends which institutional adoption you're talking about. We are not yet you know we very interested in RWAs. We want to get into that game. We are slowly getting into that game. It's one type of institution crypto institutions. I think you've already seen that. You know some of them have started partnering with us like uphold. I think there'll be more of that and I think you know for me that's our growth route for the. Our major growth route for the next year is how do we get lots and lots of XRP on flare through crypto institutions like upholding custodians.
- [44:23]
Jeff
I like that.
- [44:24]
Hugo Fillion
Exchanges and custodians.
- [44:26]
Chip
Here's Robert. Robert says Hugo and team are building the future of defi. It's happening. Love to see that. Steve Bullet says does flare work better at higher price?
- [44:38]
Hugo Fillion
Does flare work better at a higher price? I mean everyone would be happier. I think it's dependent on. So flare can't work at a very low price because ultimately the security of the network is bounded up with the token. So stake the token. Therefore, if you're looking for the dollar security of the network ultimately there is, you know, you don't want it to go below a certain point.
- [45:09]
Jeff
Right. And this kind of goes back to the beginning where we're talking about AI but maybe you can expand on this a little bit also which was coming from Jim D said our large AI complex is still viable with new Quantum computer breakthroughs. And we can expand on that a little. Does the quantum computer breakthrough have any impact on blockchain?
- [45:30]
Hugo Fillion
So quantum computing breakthroughs, which are not there yet, but there's obviously a path to it, definitely have an impact on quantum blockchain. Huge. We, however, my co founder, you know, her PhD was in quantum computing. So we've been aware of this issue for a long time. Pretty much everyone is not overly concerned about it because I think, you know, we. There'll be. We already know which encryption schemes we can use that are post quantum resistant. Well, we have actually, we actually put a paper out on it. Not that long. Well, a couple of years ago. And they'll be adopted. Then the networks will be updated. Where it will really, I think it can have. A real issue is with bitcoin, which is tough.
- [46:27]
Chip
There's Jenna saying apple camp, let's go. Got some Apple fans, not Android fans in there per se. Randy, does flare use anyone else for bridging or messaging as a third party?
- [46:39]
Hugo Fillion
Yeah, we use layer 0 as for bridging, flare, flare and fxrp out of flare to other networks. So have our bridge for XRP and later, you know, later Bitcoin 2 flare and then layer 0 out. We've been very careful with our DVN selection. We have a wide variety of TVNs. There may be some news there over the longer term. Nice.
- [47:09]
Chip
This is the obvious one, but he's asking soccer or football.
- [47:14]
Hugo Fillion
So I actually funnily enough, football meaning which do I prefer? I was never much into soccer, but I did quite like watching American football, especially if it came with hot wings.
- [47:30]
Chip
Beautiful. Yeah. So yeah, I'm a nut about American football. It's really the one sport. But I think what they were meaning, they're like which terminology, soccer or football? I think in the traditional sense, football,
- [47:40]
Hugo Fillion
the US I mean like, like if so soccer should be called football.
- [47:47]
Chip
I agree with that. But I blame you guys, the British, because you're the one that coined the phrase back in the 20s. If you go back to the history, you guys coined it and somehow we adopted it, but we could not adopt it. So now we look really foolish by calling American football football. When the kicker touches the ball 1% in an entire game. Why do we call it football? It's the dumbest thing ever, I will admit.
- [48:08]
Hugo Fillion
What would you call it? I don't know what you call
- [48:13]
Chip
ball. I don't know. I don't know. Run ball. I don't know anything but football. Because you don't even. You. You really don't use your foot. But, you know. Yeah, unfortunately. But it's been phenomenal. Of course. Yesterday I watched three World cup games. My wife's like, okay, we got to call this we can't watch.
- [48:28]
Jeff
It's the more important question.
- [48:29]
Chip
Can't watch anymore. But because I'm, I'm also a big football fan, you know, when it comes to, you know, the, the big sport in the world. And it's good to see England had a good showing too. How far do you think England will go?
- [48:42]
Hugo Fillion
I mean, England mostly just goes to the quarterfinals and then everyone thinks they might go further and then they don't, and then everyone cries. So, you know, that's, that's, that's been my entire knowledge of football, really.
- [48:56]
Chip
Yeah, they had a good showing. So, yeah, everyone's excited about the US but they haven't really been, they haven't really played a. We're a big worthy opponent yet, but we'll see what happens.
- [49:05]
Jeff
Well, you know, I saw an interview yesterday, the day before, and they were commenting, all the Europeans coming over here just so amazed at the US like we're talking about before, but they were talking about, you know, how amazed they are also at our stadiums here. And we have high school stadiums and college stadiums and professional stadiums. And the commentary was, if the US Would put as much attention on soccer as we do football, we'd probably never lose a World cup for decades. We'd be the kingpins of the World cup probably forever. Just based on how the focus here in the US And I just thought it was an interesting rivalry moment because our attention here isn't soccer. Like most people still don't play soccer. They're not.
- [49:47]
Hugo Fillion
All right. I, look, I think you've got your own thing. Like if you should play football, why don't you also play cricket instead of effectively rounders?
- [50:01]
Chip
Yeah, that's a good question. Cricket's a game that really escapes me. I don't, I do not get. I've tried watching.
- [50:06]
Hugo Fillion
So boring too.
- [50:09]
Chip
But that's baseball for me. I mean, baseball, I go to one game. It's, it's nauseating. I mean, the two games we invented were football and baseball and baseball's not, not fun to watch.
- [50:18]
Hugo Fillion
I went to a baseball game in San Francisco and I just remember it being like very long.
- [50:23]
Jeff
Extremely long.
- [50:25]
Chip
They are.
- [50:25]
Hugo Fillion
It's like watching cricket. Yes.
- [50:28]
Chip
Most God awful thing ever. Especially you're in the hot sun in Florida. When you're out there, you're just baking in the sun. It's just a lot. It's It's a, it's, it's a rough go, but there's some other questions in here. Jeff. I don't know if you want to get to any more of these. I didn't know if I saw a couple here and there.
- [50:43]
Jeff
Yeah, we can. Let's see, here's one that just popped in here from Nash Holdings. He was impossible. That flair could build trust for countries with an electoral voting chain for 100 trusted elections. I like that there's real world use of, of data trust.
- [51:01]
Hugo Fillion
I mean, yeah, like it's possible. Is it going to happen? Probably not. One, how much? Where's the value in it for the network? It's tough. Plus governments really don't want. Let's give you an example. The UK government recently announced that they want to ban under 16s from using social media. The thesis is really that they don't care about under 16s using social media. They care about monitoring how people are using the Internet. But in order to ban under 16s from using the social media, everyone has to register their identity. So it's kind of a backdoor way to register people's identities and therefore know what people are doing on the Internet. But of course there would be a way to do it using zero knowledge proofs without having to register and give the government your name, your credentials, your Social Security number and all this kind of nonsense. But they're not interested in this. If they really cared about under 16s and they really wanted to ban on 16s from using social media, whatever viewpoint you have on that, but they didn't want to sacrifice the privacy of everyone else in society. They could use zero knowledge proofs. That's pretty much the point. I can prove that I'm over 16 without giving you any further information. You don't even know who I am. You don't know whether I'm male or female. You don't know anything. I could just prove I am over 16. But they don't want to do that. They want you to go to the tech company that their brother in law owns, you know, because it's always their bloody brother in law and they want, they always. And they want to be able to monitor what you're doing and especially whether you, you know, have said anything that you know, they might take the wrong way. So you know, governments using flare as an electoral system, you'd have to have a government that actually cared about the electoral system being honest.
- [53:16]
Chip
And I haven't come across many decentralization is freedom. And most of the thing we found on our podcast we have a big Australian audience And yeah, the US was victorious over Australia was a 2 nil game yesterday. But it's one of our, it's our second largest audience is Australia. We love our Aussies and, and everybody who joins around the world. A lot of Europeans will watch us at 2 in the morning. Hugo which I'm sorry, there's not much I like that I will watch it too in the morning. So always gratified by that. But I think too when you know the U.S. was an experiment. Right. We're coming up on 250 years was an experiment in self government. But it's the only. I'm surprised in 250 years no other country said you know what? And you're, you're. You just proved that. I think it'd be great if the people wrote the constitution and put limits on the government and told the government what they can't do versus what they can do. Right. But nobody, nobody like 250 years, all these countries, no one thought like that. And not that it's the best solution but certainly has been an interesting one but we've seen it sort of.
- [54:13]
Hugo Fillion
Yeah, I think, I think, I think broadly, you know, off the Democrat like inadvertent commons democratic solutions. The US is the best. That doesn't, it doesn't mean there isn't a deficit of democracy in lots of areas. They're all flawed because no. No set of humans can think of a perfect system
- [54:32]
Chip
public so it is not necessarily a pure democracy because of.
- [54:35]
Hugo Fillion
Exactly.
- [54:36]
Jeff
Yeah.
- [54:37]
Chip
So there is. There it is people although there's a certain party here that loves the start screaming about democracy is like you'd love to have a democracy. It's funny how democracies always sort of drift into dictatorships. Right. And we kind of see the parliamentary system's an interesting one as well because it's widely adopted obviously we see Canada, we see a lot of other, you know, countries Australia and a lot of folks have adopted that and sometimes when I, I do love to watch and obviously the channel is the English politics. I do love the banter. I do love getting into it and I have a fascination. What I'm really impressed by is that our viewership there's more knowledge outside of people who actually live here that know more about the US government and how it works and some of the players. That's always exciting to see that there's such a sort of a, an allure in that respect. So even though I don't know a lot about what goes on I, you know, I love, I love the, love the uk, love the people, traveled there many, many times, got friends over there and I love, I, I love it there, you know, so I, I, I root for the UK and I root for, to, to win. Right. Always. And so we'll highlight, you know, things that are always going around because Jeff and I think that everything is connected some way shape to the geopolitics because it also, it's very integrated into blockchain and you know, blockchain. I saw Tom Lee recently said, I don't know what you think about this comment, but he said that AI blockchain is the perfect thing for AI. It needs something concrete, it needs something as that fallback. And you kind of alluded to that a little bit earlier. I thought that was a really wise comment by, you know, Tom Lee coming out and saying that. But there, I haven't heard a lot other than what you, the way you were languaging AI. I've heard a lot of concepts and it's going to do this and that, but you kind of brought it down to sort of like what you really believe the future is going to, how it's going to unfold.
- [56:25]
Hugo Fillion
Yeah, I agree. I mean, I think at the moment it's really hard to see how blockchain and AI, with the exception of agents, it's really hard to see how, you know, AI benefits from blockchain rather than how blockchain benefits from AI. But I personally think that it's the biggest opportunity out there. Don't want to give too much away because I think the way we see things is valuable. I also have no idea whether the way we see things will, you know, materialize into something of value. But I genuinely think that there's a huge opportunity there
- [57:07]
Jeff
and that's good. It's all progress, growth, trying to adopt technology. I think we're at a point now with AI where it's the craze, like the.com craze, anything with a dot com and it, you know, all the focus is there now my feed is inundated with, with AI where it used to be inundated with crypto. But that's probably because that's where my focus is, you know, right now. But I find it really interesting because there's just like within crypto what you guys have put together, you know, from taking the silos and understanding that, you know, we have to go, there has to be interoperability, there has to be cross chain dynamics in order to succeed with block, with the blockchain technologies. We can't operate only in Ethereum. We can't operate only in xrpl. There has to be a way to bring the world together from a financial perspective. It's not like, hey, everybody's on the US Dollar. Forget about every other currency it has. We have to operate. And it's the same thing within AI, you know, but it's just. It's this craze right now in every direction you look, people are trying to develop the next greatest thing, and you look and I'm like, I don't know. It just. I see a lot of replication until
- [58:17]
Hugo Fillion
I think that's the entrepreneurial and that's the process by which we advance. Right. But there's a lot of wastage.
- [58:26]
Chip
100%. We're getting to the end of this because we. We. We had you for an hour, so we'll respect your time here. Moonchaser says when FBTC.
- [58:35]
Hugo Fillion
So FBTC is dependent on FCC. So flare confidential compute, which is part of flare 2.0. As mentioned, we are releasing FCC on Songbird. You know, very soon we'll be testing FCC and then effectively, FPTC is an application that's built on Flare and fcc. So we'll be releasing that, you know, on Songbird and then on Flare. I just don't want to give a date because when. Whenever I've given dates and, you know.
- [59:16]
Chip
Yeah, it's been probably the next five years. Would we venture there?
- [59:21]
Hugo Fillion
I'd say I. I'd say I would be really pissed off if we haven't launched it by this time next year. Now I think we'll launch it much sooner. But, you know, my hard stop is like, this time next year,
- [59:37]
Chip
you know, Someone's writing down June 20, 2027, right as we speak. They've got it.
- [59:42]
Hugo Fillion
That's right. That's a. Okay. Now that's a hell of a safety margin.
- [59:45]
Jeff
I think it's been put out on X already.
- [59:49]
Hugo Fillion
If we don't get it out by June 20th next year, I. I think I may actually have to buy some kind of horsewhip. Yeah, yeah. But no, no, that. I. I think that. I think that's a sufficient safety margin for when I. When we think we're going to launch it.
- [60:07]
Chip
Beautiful. Well, first of all, I wanted to say thank you very much for coming in, having a conversation. You absolutely, really enjoyed it, having this conversation. And again, thank you so much.
- [60:17]
Hugo Fillion
Happy to come on. Happy to come on whenever.
- [60:20]
Chip
Well, we love that too, because we might have to do a deeper dive in Some of this other stuff we'll get a little more focused on drilling in because I know we kind of. We kind of, like went on a bunch of different places, but we kind of want people to see you, who you are, a little bit about you, because we had the chance to meet and I wanted to showcase a little bit of that, a little more of the personal side without going too crazy. But we appreciate your opinion on everything, so. And I'll throw it to Jeff and then I'll go ahead and throw it back to you, Hugo, for, like, the final comment.
- [60:44]
Jeff
Yeah, Hugo, appreciate you being on with us. This is, you know, really important topic that Chip and I have talked about for so long is the interoperability and getting outside the silos. I'm glad we're able to touch a little bit on geopolitics, you know, because that's a critical element. Understanding who you are, the back, you know, your background and really getting the personal side of any company and the founders of the company is really important to see the direction that we're going in. Glad you're here and looking forward to the next time you come back on the. On the show where we can dig in a little bit deeper into some of the subtopics that we. That we brought up.
- [61:20]
Hugo Fillion
Yeah, yeah, I'd love to. We can dig into a lot. I think over the next couple of months, you'll see, like, a lot more opportunities in XRP fionflare, a lot more capabilities to deploy more. You know, we're at the, you know, if you haven't tried XRP FI on Flare, you've got two major vaults. It's the easiest way in. Monarch and Clearstar. Clearstar is on chain only. Monarch is on chain and off chain. The moment you can pretty much only get to Monarch through Descent, because that was a deal we did. But we'll be opening that up to every other wallet through Flare Smart accounts quite soon. McLear star you can get to through Zaman. Once Flare Smart accounts fully launch, which will be very soon be able to get to both of those vaults from the XRP ledger using your. Whatever XRP wallet you hold. That's the best yield opportunity on Flare. It's the most, you know, there's some incentivization, but it's also the most neutral, natural yield. So, you know, if you haven't used it, you'll see that the capacity for that. The moment we're pretty much at capacity, you'll see the capacity for that opens up. And that's because you know, there's some very interesting things that we're doing.
- [62:44]
Chip
Beautiful. Well said. Nice way to end that. Go ahead and stay on past roll in the outro because we have just want to do like sort of a wrap real quick and then we'll let you go on your way. But thanks again for coming in on your Saturday. Thank you everybody who.
- [62:54]
Hugo Fillion
Thank you.
- [62:55]
Chip
And then of course, you know, if you have any follow ups or you want to, you know, you had any kind of questions too. I mean, you know, one of the things I really appreciate about you, Hugo, is you're very accessible and when someone writes out, you're like, no, don't. Ouch. I like that. That was amazing comment. Right? Don't. You'll call people out when they say the wrong thing. And I love that as a founder, to have somebody accessible but also somebody that's out there that is really key and important. I think you've done a phenomenal job, you know, from our perspective. So everybody, guys, have a great rest of your day and weekend. We'll be back tomorrow night at 8:00pm Eastern Time. Hugo, stick around for a little bit. We'll see you guys on the next one. Chip, Jeff and Hugo out.
- [63:30]
Hugo Fillion
Thank you.
- [63:32]
Chip
Are you down with otc?
- [63:34]
Hugo Fillion
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