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- [00:01]
Robbie Peterson
It's not just something you made. It's the privilege that you get to work with your hands. It's building something that serves a purpose, proof that you have the grit to keep going. At Timberland, we understand you take your craft seriously, and we do too, which is why our products are built to the highest quality. We put in the work so you can perfect yours with purpose, in every detail, and crafted with intention. Timberland built on craft. Visit timberland.com to shop.
- [00:31]
Laura Shin
Hi everyone. Welcome to Unchained, your no hype resource for all things crypto. I'm your host, Laura Shin. Thanks for joining this live stream. Before we get started, a quick reminder. Nothing new here in Unchained is investment advice. This show is for informational and entertainment purposes only, and my guests and I may hold assets discussed on the show. For more disclosures, visit unchained crypto.com introducing Nexo, the premier digital wealth platform. Receive interest on your digital assets. Borrow against them without selling. Trade a variety of cryptocurrencies all in one platform now available in the US get started today at Nexo.com Unchained. Today's topic is the future of agentic commerce. Here to discuss are Noah Levine, partner at A16Z, and Robbie Peterson, junior partner at Dragonfly. Welcome, Noah and Robbie.
- [01:23]
Robbie Peterson
Thanks for having us.
- [01:24]
Noah Levine
Yeah, super excited to be here.
- [01:27]
Laura Shin
The Agenda Commerce space has seen a number of new technical offerings in recent weeks, and both of you wrote pieces this week on what that future looks like. It was pretty interesting actually, because your visions differ a bit. But Noah, why don't we start with you? Describe where you think this is all headed.
- [01:46]
Noah Levine
Yeah, for sure. I think it's helpful to start by saying that we've seen this massive catalyst in new developers by virtue of platforms like Claude code. And as a result of that, I think what we're seeing is that there's this whole new demand for new services that these developers want to use. And so with the advent of new protocols like MPP and X402, what we're seeing is there's this new class of merchants which I kind of titled headless merchants, which effectively the developer has no insider, has no idea who they necessarily are. But when they're going in and instructing their agent to go and purchase something, that agent is going out, discovering them, and then paying on a per transaction basis to effectively get those services. And I think that this is going to create a new wave of sort of B2B commerce where developers are looking for these new tools and rather than them necessarily dictating who they are or going and finding them via website, they're going to be able to see them, a more natural discovery through Claude code itself.
- [02:40]
Laura Shin
And Robbie, what about you? Why don't you describe the vision that you laid out in your little essay on X?
- [02:46]
Robbie Peterson
Sure, yeah. I would say broadly I agree with no one. Maybe on the direction of travel, I would say maybe where we disagree is probably the magnitude of how big agent E commerce is, especially in the near term. I think my vision of how things kind of play out is agents kind of broadly fit into three categories. So one is commercial agents and intuitively these are agents that are deployed kind of within businesses. Two, I would say you have kind of consumer agents. So these would be agents that sort of augment our personal lives or helping us buy kind of more consumer items. And then last one I would say is these kind of bottom up agents. And this is more consistent with kind of the open claw phenomena. And these are agents that are actually autonomous and actually transacting in the real world. And I think 95% plus of kind of most agentic activity is ultimately going to be these commercial agents. And I think intuitively that's consistent with how if you look at the SaaS market today, it's 95% plus of software is probably deployed within businesses and governments. And I think the same thing will be true for agents. And I think maybe the nuance that everyone seems to be missing is that an agent, fundamentally what it does is it automates, but that automation doesn't necessarily mean that it has to actually spend. And I think people have kind of conflated the two and then just, you know, sort of drawn the conclusion that agentic commerce could be massive. So I think that's on the, on the sort of the commercial side. And then I think on the consumer side I'm also very skeptical that agents are actually going to be transacting on behalf of, you know, individuals autonomously. And I think, you know, the common sort of, you know, bull case for agentic commerce that people love to cite is hey, I'm going to tell this agent, you know, go book me, book me a trip to Tokyo, let's say. And it's going to, you know, it's going to find the hotels, it's going to scrape a bunch of sort of data, it's going to say, you know, it's going to read reviews, look at photos, maybe it'll have my calendar and all my preferences as well. And it'll ultimately say, okay, you know, I booked this Thing, you know, you never had to kind of look up from what you were doing and that's it. And I think that's kind of, that rests on a bunch of implicit assumptions. One of them being that, you know, we will be willingly, you know, you know, we will actually want to outsource all of that to an agent. And I think the more realistic path is, hey, hey, I'm going to ask this agent, I'm going to tell it, I want to go book a trip to Tokyo and then it's actually going to give me options. And then it's going to ask follow up questions and it may say, hey, where in Tokyo do you want to stay? Hey, here are some reviews. And this is what they're saying about this hotel versus that hotel and so on. And I think the other nuance people are missing is preferences aren't a static thing. I think they're ultimately revealed in the process of discovery itself. And I think that's not just true for, you know, whether it's booking a trip. I think that's also true for, you know, whether you're buying groceries. And it's certainly true if you're buying clothes, you know, you actually want to go see what the, what the clothes look like and so on. So I think just most consumer decisions, the agent won't have the full context. And I think, you know, again, I think there's all these qualitative inputs as well that you don't actually discover until you go through that process. And you know, an agent doing all that on your behalf never actually captured that kind of nuance that the consumer ultimately wants. So that would be on the consumer side. And then to Noah's point, I do think there is this emergent sort of category and I would call these like bottom up agents. And again, this was sort of catalyzed by the open claw phenomena to kind of Noah's point. I do think this category will grow. I think that said, it is still extremely nascent and if you just look at the data, there aren't that many people who are actually using these agents to transact A lot of it's been sort of speculative, whether it's X402 or MTP. So I just think it's very early and I think the market's just generally, or at least at a minimum, social sentiment's got, kind of got ahead of itself here.
- [06:24]
Laura Shin
Yeah, I mean, honestly, when I was reading both of your pieces, I was thinking that this will probably roll out in stages. And so even though the visions that you laid out were a little bit different. Like, I didn't think either was kind of right or wrong because I was like, well, they're probably both going to be right at different times. So maybe let's talk about just this moment right now where things are kind of getting, getting built out. Because like, something that was interesting to me was that in both of your pieces or, or just in various other things that you wrote, I saw that you both referenced how stable or, sorry, how credit cards will be fitting in with stablecoins. And you know, I think you both have ideas on like, how much agents will use credit cards versus stablecoins. So. Yeah, can you talk about like, how you think that will be decided or like how, you know, the trajectory of both of those types of payments will go in this early phase and either one of you can go first.
- [07:25]
Noah Levine
Yeah, yeah, I can, I can touch on that. No, I mean, I think, look like if you, you know, and I think it's very similar to the discourse that was happening a few years ago when people were talking about, well, stablecoins are going to replace all of consumer to merchant payments. And it turns out that the networks, beyond a lot of the additional value added services they provide, there is a huge sort of Lindy effect where you have consumers that have been using cards for a very long time. You have merchants who've been accepting them for a very long time. And so I think it was very natural that, for example, stablecoin link cards ultimately became the preferred form for consumer to merchant payments. And I think a similar thing is happening in agenta commerce where, you know, people are coming out and saying, well, look, you know, there's, there's all these benefits of using stablecoins versus cards. But you know, what they don't maybe realize is that for most the average consumer, they're much more, you know, familiar with using a card and they would prefer to use one. And I also think there's been a lot of arguments that have said, you know, agents can't hold cards and this technology doesn't work. But I think if you look under the hood, you can see things like, you know, the same technology that powers Apple pay with tokens is the exact same technology that the networks like Visa and MasterCard are using to power agentic commerce. And so I think from a starting point, you know, it's going to take longer for the networks to, you know, to establish their standards and to make cards conducive with this new form of commerce. But I think there's nothing from a technical standpoint that is going to stop cards from working. What I kind of talked about is, you know, again, I think kind of to Robbie's point, like for consumer, for a traditional consumer to merchant transaction, like if I'm looking to book a flight, you know, people are going to have preferences, they're going to want to use cards to get things like points. There's a, you know, an element of chargebacks and fraud which is helpful. I think that is probably the more boring side of agent E commerce and is likely going to be won largely by the card networks. But that being said, I think again this whole new sort of developer ecosystem that's forming, what we're seeing is that there's all these new merchants that are being established that are maybe a couple of buddies in their basement that are building a merchant in a couple of days via vive coding. For those people, it's going to be somewhat challenging for traditional choirs and processors to underwrite them so they can accept cards. And I think stablecoins are kind of emerging as this new digital cash similar to how you'll have Macy's will accept cards but you'll have street vendors on the corner who are accepting cash. I think that for that group, stablecoins are actually a very useful solution.
- [09:42]
Laura Shin
And actually just a quick question. Who would be the equivalent of that in this world? That would be the equivalent of the street vendor accepting cash?
- [09:50]
Noah Levine
Yeah. So I mean a great example is a couple of the report I did or the article I did before. I was looking at x 402 volume and you know, there's this, this really great data provider Allium who has an X402 server. I didn't have an account at Allium so I just wanted to get a couple of data points. I was able to, you know, spend, I think it was 30 or 40 cents to build the entire report. No card was very easy. You know, I think for something like that that's, you know, data is a great use case for that.
- [10:18]
Laura Shin
And Robbie.
- [10:20]
Robbie Peterson
Yeah, the only thing I would add is I think. Yeah, and I think Noah makes a bunch of great points there and I thought his piece was actually the best piece that anyone's sort of written on. You know, how this, how, how things evolve at least with respect to card networks versus blockchains. I think the reality is like today, both are insufficient and they're insufficient in their own ways. So if you look at, you know, card networks, what they've solved, which is actually very, very difficult to solve and I don't think a Lot of people fully understand this is, is risk scoring and auth. So they're actually like authenticating each of these transactions. And it's not as simple as just saying hey, this transaction's fine, let's let it through. It's hey, we've like all these sophisticated data points that we're looking at and then we're assigning some competence interval to like okay, could this be fraudulent and could it not be? So they've solved that. Where there may be a little more insufficient is on the settlement piece. Right? Because settlement is not instant and there's a bunch of structural reasons for that which we can unpack, but that is where they are insufficient. Now conversely, if you look at blockchains, you know, they have this instant settlement, you know, intuitively this is a global, you know, asset ledger that syncs in real time, you know, which is very conducive for agentic transactions. What they have not solved conversely is you know, the actual risk scoring that the card networks have solved. So I think they're insufficient in their own ways and I think they both have a lot of work to do and I think each of them respectively will kind of continue to converge and build upon the same vision. I think the reason at least with respect to these kind of bottom up agents as I would call them and as no alluded to, you know, this could be, you know, a bunch of, you know, people just hacky devs kind of spinning up, you know, different, different agents kind of, you know, in their garage or whatever. I think with respect to those use cases, I think blockchains win for a different reason and a non technical reason which is they're open and they are permissionless and they're unencumbered by sort of any regulation. Right. And maybe said differently, there's just way less friction building on, on blockchains versus building on traditional, you know, Rails and you know, Visa and you know, MasterCard. These are public companies that have, you know, that have shareholders, that have institutional counterparties and they will inherently not be able to take the same amount of risk that a blockchain could because blockchain doesn't have shareholders, they don't have this risk. So I think for that reason most of this experimentation probably actually does happen on chain but maybe that's not for the reason that most people are thinking intuitively.
- [12:30]
Laura Shin
Okay, so one thing that I did want to ask about was for the way, so the way that this goes with, you know, what you call the bottom up agents and then I, I don't remember what you call the other ones. But I was just curious, like, you know, for the bottom up agents, they would still need to have some back and forth with like they're human. Right. Or like how is it that they are more autonomous?
- [13:00]
Robbie Peterson
Yeah, so the way, the way I would frame this is, you know, if you're looking at kind of these, the other side is commercial agents and then kind of consumer agents. And the reason I would say these are more top down is because I think they will ultimately be distributed and they're going to be distributed via some software vendor, probably at least on the commercial side. And then on the consumer side, maybe it's OpenAI distributing this via ChatGPT or Anthropic through Claude, but there will be some human in the loop in both of those contexts. Whereas I think with respect to these bottom up agents, they actually are agentic. I think semantically you can actually use, you know, the word word agentic in that context. Right. And they will be fully autonomous and they will be procuring kind of their own resources and you know, calling these APIs and so on, and there won't be a human necessarily in the loop.
- [13:46]
Laura Shin
Like what I'm confused about is who will create them? Well, like how do they create them? It almost sounds like you're saying they create themselves, but I don't understand that.
- [13:54]
Robbie Peterson
No, I think like they'll still be created, you know, by a human and they'll still, you know, fundamentally be serving, you know, on behalf of a human. But maybe at some point you have agents spinning up other agents and so on. Right. So yes, there will be human in the loop insofar as they will be serving a human, but the guardrails will be much wider. And I think that's kind of the nuances is, you know, on these commercial and consumer agents the guardrails are very narrow and if anything they aren't even transacting. It's more, hey, I'm a research assistant that's going to help you figure out what hotel to book. But I'm not actually going to book the hotel. Like at the end of the day it's going to be you that actually authorizes that transaction. And maybe you already have your card details plugged in. So it's just like an Apple Pay transaction. Right. And again, on the commercial side I don't, it's, hey, it's a salesforce agent, right, which is going out and doing automated sales outreach that does not necessitate the agent actually transacting.
- [14:42]
Noah Levine
Right.
- [14:42]
Robbie Peterson
And then similarly, maybe it's a finance agent that's automating finance functions. So none of that necessitates an agent actually transacting. Whereas conversely, I think with the bottom up agents, they actually are autonomous and they're actually going out and doing things. And maybe they're interfacing not just with, you know, with you know, these APIs and procuring resources from humans, but they're probably also going to be interfacing with other agents. And I think that's a qualitatively different category.
- [15:08]
Laura Shin
Yeah, I forget which one of you said this, but I guess that example of the data that you're procuring for like a really small amount of money would probably be a good example of that. So one other thing that I think both of it might have been both of your pieces or even in this conversation that you both referenced was a lot of times payments actually cannot be instantaneous because of the possibility of fraud. So how do you think that gets factored into agentic commerce and how this is all built out?
- [15:36]
Robbie Peterson
Yeah, no. Do you want to take this?
- [15:38]
Noah Levine
Yeah, for sure. Well, I mean, I think, you know, again, if you take back to an example like booking a flight, you know, I think again, if you go through traditional car networks and you go through the traditional Rails, I think you get the same benefit, you know, fraud and chargeback benefits that you get, you know, with traditional E commerce. I think the again, going back to kind of my thinking of there will be a whole new class of merchants that are going to get paid on a, you know, per transaction basis. If I'm buying a service for fractions of a cent or a few cents. This notion of fraud I think is a lot less relevant because frankly, you know, if I use a service and maybe it's a scam or it doesn't work, it's frustrating for a little bit of time. But ultimately I can be okay with, you know, wasting a few cents and can say, look, don't use the service. Again, I think where this gets problematic is when I'm going and purchasing high value or high ticket item purchases. And at that point I think that's where, for example, the card networks are going to continue to have an advantage. But I think if you believe that a lot of these, it's not going to be these enterprise agreements and major SaaS agreements. And again, it's just I have a specific project that I'm building and maybe I want to use this tool once. I don't think fraud is as big of an issue because at the end of the day. It's not a big enough amount of money that I'm spending where it materially impacts me.
- [16:53]
Laura Shin
All right, so in a moment, we're going to talk a little bit more about the different types of agents that will exist and how this will play out. But first, a quick word from the sponsors who make this show possible. Step into a new era of wealth. Discover Nexo, the premier digital wealth platform. Manage your crypto portfolio with confidence and control. Receive interest on your digital assets. Borrow against them without selling. Trade a wide range of cryptocurrencies all in one platform, now available in the US with 30 days of exclusive privileges for new clients. Experience wealth club premier access, enhanced interest rates, reduced borrowing costs, and crypto cashback on swaps. Get started today@nexo.com Unchained. Back to my conversation with Noah and Robbie. So, Noah, I actually wanted to ask you what you thought about Robbie's like, taxonomy of the different types of agents and how you think, you know, that part might play out in terms of, like, you know, ones that transact more than others.
- [18:01]
Noah Levine
Yeah, for sure. I mean, look, I think at the end of the day, like today, it kind of feels like there's a lot of conversation about having all these different agents doing these different things. But, you know, frankly, at least from my perspective, it feels like they're all sort of part of the exact same ecosystem. Like, you know, for example, you can spin up different sub agents within that can focus on different tasks, but at the end of the day, it kind of feels like it rolls up to the. To the same product or to the same agent. And so I think what we're going to see is that. And we're starting to see this develop already with sort of this new skills ecosystem that, you know, there are certain sort of almost like character builds that you can have where a certain agent has infinite amount of intelligence, but when you give it very specific guardrails or very specific kind of constraints, it will be more useful for that task. I think how that impacts commerce, though, is kind of immaterial because to Robbie's point, if the human or the developer is ultimately the one that's making the payment, it really only matters if you have one balance. And so I think one of the areas where a lot of the commentary in my opinion, has gotten a little bit sideways is there's this notion that I'm going to have 10,000 different sub agents and each one's going to need their own wallet and each one's going to have to have their own Controls and all these things. And I think frankly a lot of that is a little bit over complicated. And I probably tend to gear more towards Robbie's opinion there. Where at the end of the day, like, you know, if a given task is a certain mandate of how much you're willing to spend, you know, which one, how much each agent or participant spends is kind of irrelevant. And so I think from that respect, you know, we're likely to see more subdivision between different sub agents of what they do. But I think from a commerce perspective, it won't be as complicated.
- [19:33]
Laura Shin
All right, so to go back to the fraud issue, I wondered what other roadblocks you see that, you know, need to be solved in order for the agentic commerce space to be built out and grow.
- [19:49]
Robbie Peterson
Yeah, I think a lot of people have talked about, you know, the rails being kind of the ultimate bottleneck. And you know, the thought experiment is like, hey, if we can solve the rails and have instant payments and micropayments, then and the agent of commerce, it'll completely take off. I think my perspective is it is not the rails that's the bottleneck and it's actually human social structures. And I think, I don't know that people are willingly going to just outsource everything to an agent. I think that implicitly takes a lot of trust and that's not consistent with how decisions have historically been made for consumers. So that would be one example. I think more consequential examples are, you know, bureaucratic inertia. Right. Like I think, you know, if you're, if you believe that a lot of these agents are going to be these commercial agents that are ultimately going to be deployed sort of top down within organizations. You know, there are multiple layers you have to ultimately get through to actually be able to sell that, you know, within an organization. And I do think it'll be a competitive necessity down the road and it'll be almost like a liability if you don't integrate these agents. But I think that actually takes a lot, a lot longer than people intuitively think. The other thing is government spending is a massive part of the economy. And I think you'd be crazy to think that governments are going to be adopting agents within the next few years. I think that's also going to take a very long time. There's plenty of precedents throughout history that would also be consistent with that. The other thing is legal and regulatory bottlenecks as well. And I think that's another thing. There isn't enough people discussing that where it's not just the rails that weren't engineered for machines. It's also our entire regulatory system, our entire legal structure. And I don't think it's going to be something in the same way that a protocol upgrade is sufficient to fix the rails. There's no protocol upgrade that can be applied to legal structures. There's a lot more, again, just inertia there. So I think that's what everyone's underestimating is there are so many bottlenecks to adoption. I think the technology will be there, and you could almost argue it's already there, but that doesn't necessarily mean everything's going to be adopted overnight.
- [21:49]
Laura Shin
Noah, do you have anything to add?
- [21:52]
Noah Levine
Yeah, I mean, I personally am more bullish on how much comfortability humans will get with agents taking off. I mean, I think if you go back to early Internet days, there was similar fears, I think, of is my data going to get taken, how secure, how safe is this? And over time, I think people got more comfortable with it and the technology and the guardrails improved. And I think people are going to optimize for what is, you know, the lowest barrier to entry and how do they create the most efficiency in their lives, even if it means taking a little bit of a risk. I mean, even if you look at, like, the OpenClaw ecosystem, like, there's a lot of setups of OpenClaw that, you know, I think are less than ideal or not very safe, but people still do it because they like experimenting. And I think over time, as the guardrails get there, that's how you start to cross the chasm and you get more mainstream adoption. I think for me, like, if I was to say, like, what is the biggest barrier, at least, especially in this sort of new headless merchant agentic economy that I kind of talked about, I think it's honestly less about the rails. I agree with Robbie there, and I think it's more on the discoverability layer. You know, if you have thousands and thousands of new potential endpoints that you could be hitting and they all kind of look like perfect complements to one another, how do you differentiate between them? And so, you know, I think it's an open question of, like, is this something that gets developed from a private company or versus is this a, you know, sort of an open ecosystem? I think we see that that debate happen a lot in crypto itself as well, you know, with this topic and outside of it. But I think, you know, in order for this to be useful, you know, there needs to be more signal in terms of like, actually how, you know, how safe is this? Like, you know, how reliable is this? And I think that will grow the network significantly.
- [23:24]
Laura Shin
Yeah. So on that score, I actually did want to ask about some of the different standards that are out there because so Noah mentioned this marketplace in his piece and that is powered by mpp. The I'm just like, it's Merchant payments protocol by Skype and Tempo. And you know, another big name that people are talking about is Coinbase's X402. Or they developed it, it's like an open standard. You know, I think the short version of the difference between these two is MPP have something called Sessions, which is sort of like opening a tab at a bar with the budget, frankly. Also to me it sounded just super similar to Lightning channels or State channels and you know, then. But the one other detail about MPP is basically at this moment it's more centralized, it's only settling on Tempo. It requires Stripe, but it does connect to traditional payment rails like Visa. And they say that they will eventually be chain agnostic. And at the moment they also have lightspark on it, which is a Lightning payments company with Bitcoin. X402 is just more permissionless. It supports any ERC20 token. At the moment, it's gasless for users, but it doesn't have the Sessions aspect. So you're transacting with every request. I just wondered if you had thoughts on different type of architectures and which ones you think will be adopted more quickly and why you thought that you can name any others. Because there's a whole bunch of others, like Visa's CLI tool, the Google agent payments protocol, AP2. There's a bunch. So you can talk about any ones?
- [25:27]
Noah Levine
Yeah, I think it's a good question. I mean, look, I think I'm pretty optimistic on both x402 and on MPP. I think obviously the benefit that MPP has is that they obviously have the Stripe ecosystem behind them. So I think there's definitely a head start there where if you have existing stripe merchants who want to participate in this new agentic economy, it'll potentially be a lot easier for them to just click a button and have that enabled, versus maybe with x402 you gotta go and set up a facilitator and potentially will require more bespoke integrations. And it's worth noting that stripe also integrated X402 prior to the announcement of MPP. So I think it's still. It's unclear how this will develop. I think Obviously the crypto ecosystem tends to prefer more of the open permissionless standards. But I also think that there are some benefits you have when you can control the product more and more. You know, I think to your example of things like Sessions and also the ability to use traditional payment methods is a huge step in the right direction. I do think it's worth, you know, Visa CLI is a new product that Visa is developing where it's not a protocol but rather it's sort of a new CLI based wallet. And so, you know, you similar to, you know, I think some of the other wallets that we're seeing, you can download it into openclaw or Claude code, you can go and transact at a bunch of different endpoints. It comes with a whole directory of endpoints I think that they've developed as well as connection to existing ones. And unlike, I think some of the other NPC based wallets, it comes default with card. And so again, I think at this point, as I mentioned in my paper, I feel like the Rails are largely there and who wins is probably less relevant because it's ultimately going to come down to what merchants want to integrate with. I think the bigger question is who are the new merchants that are going to come out and what services are they going to create that is useful to developers to the point that they want to adopt this? I think that to me is the bigger question and the bigger opportunity for innovation.
- [27:18]
Laura Shin
But do you want to elaborate on that? Like what type of merchants you think will come out for, you know.
- [27:24]
Noah Levine
Yeah, well, I mean, I think there's a, you know, one area that is less talked about is there's a lot of interesting stuff on the creative side. So, you know, the ability to vibe code, music, the ability to, you know, have image generation, I think we've seen a lot of creative things there. And so, you know, the ability to generate a song with, you know, explaining the vibe and the mood is interesting, but I think it's going to expand much more into more general developer services. I think if you've used any of these coding platforms, you notice that there's a lot of commerce moments that happen when you're using it. Whether you need to get a domain name, whether you need to set up a server, whether you need to get access to proprietary data. I think there's all these commerce moments where you have to leave the terminal, go and get an API key, maybe get a subscription, then come back into cloud code or opencloud and paste it in and it's a big Friction point. And so I think the more that people develop on the kind of the buyer side, it will lead to more inspiration and influence on the seller side.
- [28:23]
Laura Shin
And Robby, what about you? What thoughts do you have about which types of platforms will do well in this world?
- [28:32]
Robbie Peterson
Yeah, I think part of the irony at this point at least is a lot of them are backwards compatible with cards. And I think Noah's made this point. I think this is probably an area we actually do agree on is there is this inertia, again, where people are used to making kind of payments with cards. And again, I think one of the really important things is these card networks do have all these tokenized credentials, right? So they have solved for this kind of fraud and risk wearing issue that blockchains just haven't solved for. And I think it'll take a really long time. I think one nuance that I've been thinking about more is do these tokenized credentials and these kind of fraud graphs that the card networks have made and have refined over years and years, do they actually map well to agentic commerce? So if an agent is making a transaction, obviously that's fundamentally different to a human and the behavioral sort of patterns will also look quite different. So I'm also curious that if we end up seeing almost like new fraud graphs and new, new risk scoring have to evolve for agents. And I actually think Noah sort of alluded to this in one of his pieces where maybe that is the opportunity for blockchains, right? It kind of creates this gap where because no one has solved for it, then maybe that's something blockchains could actually solve for. And that's kind of the wedge that they need to ultimately compete with card networks on the agentic side.
- [29:48]
Laura Shin
Oh my gosh, that is so interesting. That makes a lot of sense to me because, I mean, yeah, I just, as you know, there's so much crime in crypto. So I feel like through crypto I've learned a lot about kind of the behavior of criminals. And I remember, you know, when Katie Han was a prosecutor and she figured out that there were two separate federal agents that were stealing the bitcoin that were, you know, what's the word? Seized from Silk Road. The, the way she figured it out was that somebody tipped her off. They thought an agent was doing this. And then she, she thought, no, they wouldn't be, and she wanted to prove this person wrong. But then when she looked at the behaviors, she was like, oh, it's not just that somebody's doing it, but there's Two people because their behaviors are so different. It was so obvious that they were two different people. So yeah, like with an agent you wouldn't have that kind of, I mean you, you might, but, but it's, it would just be harder to figure out like what are the idiosyncratic kind of behaviors that, you know, mark a person. I did also want to ask about a thought that I had which was, I think something that is a little bit more permissioned. You know, like the MPP protocol will maybe succeed first, especially because they already do have so many merchants, but that like maybe over time x402 or just anything that's more permissionless might do better. And I know that MPP is heading in that direction. So, so it may, it may not be that they fall behind at that point, but it just sort of feels like there could be an analog to the early Internet where you know, AOL was how everybody got online first and then of course, you know, like nobody uses AOL anymore. So you know, it, it feels like there, there is something like that. Like you have this sort of hand hold, the kind of setup to begin with and then that it moves beyond. So. Okay, so I did also want to ask, like, I imagine that the rise of AI agents and you know, as, as you're looking at the future of agentic commerce, that is changing a lot about how you think about just VC generally. Like, I know for me, even just as an entrepreneur, it's changing how I think about like, you know, what types of businesses would, would be viable in this new world. So I was just wondering, you know, how is all of this affecting either how venture capital, you know, like what types of projects you're looking to, to fund or what types of projects you're even being pitched.
- [32:41]
Robbie Peterson
Yeah, I'm happy to go first and let Noah comment as well, but I do think a lot of it sells down to sort of value capture and where you ultimately think value crews sort of within the stack. And I think something that a lot of people have been saying is, you know, what these agents do fundamentally is they abstract away the entire front end interface. And instead of whether it's crypto and you're trading or you're depositing some funds into these yield protocols. Well, what you're actually going to do is you're going to tell this agent, go do all this for me, me. And then you don't need the chart, you don't need any of the kind of interface on the front end. I actually fundamentally disagree with that take and I actually Think especially on the trading side. And I wrote a piece a while ago, maybe two years ago, called the Fat Wallet Thesis. And the sort of core thesis there is that whoever owns the end user ultimately captures the most value. And I think that's been consistent across literally every emerging vertical probably, probably throughout history. And I think it's especially true sort of in the Internet era. And I think a lot of people are saying that agentic, all these agent interfaces are going to undermine kind of this fat Wallet thesis and so on. I think the reason it won't is because people actually like interfaces. And I think again, this is another nuance that the entire sort of agentic thesis misses, which is if I'm trading, for example, in crypto, the chart itself governs my decision of whether I want to go long or short or, or buy or sell or whatever. And I think that is not something that users will want abstracted away ever. And I think that's actually something they're going to always want to keep. And maybe it's, hey, I will have the agent find me the best yield source, right? I think that's one example where maybe it is sort of interesting, right? I have some USDC sitting in my wallet and I say, hey, just go find me the best risk adjusted yields. And it goes. And on the back end kind of deposits that. But I think especially on the trading side, and obviously that's sort of been the principle consumer use case for crypto is people just want to trade crypto. So I think that agents don't really disrupt that. And then the other thing I would add is in terms of, okay, how does value accrue then? So maybe some of this accrues to the front end and whoever owns the end user, I think you also want to own kind of the settlement layer as well. And I think it's kind of this barbell of where value accrues. And on the settlement layer, intuitively there's more of a network effect there where the more volume that settles, the more volume that settles. And volume and liquidity begets volume and liquidity and so on. And I think that's where. And I don't know who's going to win. And I think at this point, I think Tempo is probably maybe the front runner for at least all the agency stuff, given they kind of have the right partners who are in the mix and they have kind of the merchant distribution of stripe and so on. But I think ultimately with respect to VC and how I think about value capture, I think it's, you want to be on one side of kind of that barbell.
- [35:25]
Laura Shin
And actually just one question. When you said like, I forget how you phrased it, did you say, oh, you want to like own the platform, like where people or agents are congregating? But so right now we are seeing like websites pop up, but I don't imagine the agents will like congregate at websites or so it might.
- [35:45]
Robbie Peterson
Yeah, I was more referring in the crypto context of, you know, sort of wallets and trading and sort of the use cases that people are, you know, using within crypto. And I think that's where you want to own whoever owns kind of the end user. I think if you're then to extrapolate that out and say you look at all agentic use cases, I think that probably looks more like the chatbot interface. So whether that's ChatGPT or Claude, I think that's the other layer that you want to own because again, they own the end user. And I think downstream of that there's a lot of different ways to monetize.
- [36:18]
Laura Shin
Noah?
- [36:19]
Noah Levine
Yeah, no, well, first of all, the Fat wallet. That was a great piece, highly recommend anyone to read. It was great. But the one area that I will kind of push back is I tend to fully agree with you that whoever is owning the end customer will ultimately accrue a lot of the value. But I think what's so interesting about AI and there's actually this really, I think, interesting crossover where what we're seeing is that the front end and the back end are becoming increasingly separated, increasingly separate. And the parallel is, I think I had this, you know, one of the big eye opening moments for me in crypto, I think was when I first used a self custodial wallet and I actually exported my keys and then imported the keys into another wallet and you see that the interface changes, but the back end is the same. And so I think there's a very interesting thing happening in AI where the front, the back end is static, but the front end is becoming increasingly more modular. And so, for example, like, while I agree with you that people do have preferences over what the front end is and how they engage with it, what I think we're seeing with these tools is, is that it's actually much easier to create your own front end. And so, for example, if you really like a certain trading app, right, but maybe you don't like one or two features, what you could do is as long as you have the back end in and the back end's in place, then you can very easily customize what that front end looks like. And so I think from that regard, whatever the hardest thing to do is or whatever, the biggest sticking point is in the back end, in the infrastructure where there's some sort of mo in some sort of capability that they uniquely have, I think that ends up being very valuable because ultimately what AI is largely going to do is it's going to make it such that you can build any front end that you want and you can customize it to a much greater degree.
- [37:54]
Laura Shin
All right, well, this has been super fun chatting with you both. Thank you so much for sharing your thoughts and coming on Unchained.
- [38:01]
Robbie Peterson
Awesome. Thanks for having us, Laura.
- [38:03]
Noah Levine
Thank you.
- [38:04]
Laura Shin
We will catch you later.
- [38:36]
Noah Levine
Ryan Reynolds here from Mint Mobile. I don't know if you knew this, but anyone can get the same Premium
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Robbie Peterson
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Noah Levine
So do like I did and have one of your assistant's assistants switch you to Mint Mobile today. I'm told it's super easy to do@mintmobile.com
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Laura Shin
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