Pioneering Privacy in DeFi with Alex Shipp

This post is based on a conversation between Alex Shipp and Aryan Bhasin as part of the show web3 for gen z.

Alex is the Chief Strategy Officer at Offshift, which is an ecosystem on Ethereum L1 that bakes privacy into DeFi applications. We talk about the flaws of credit systems, commoditizing data, and how private decentralized finance, or PriFi, works.

Just as a reminder, Alex is not giving financial, legal, investment, or tax advice. Please do your own research.


The merits and demerits of credit systems

I think this conversation is going to be super interesting. It combines a lot of pieces that I've been reading about across the crypto ecosystem: privacy and decentralized finance.

Before we jump in, to add some context, would you mind sharing with our listeners your background and what you're working on?

Yeah! I have a finance background, which means I studied finance bachelor's degree in my undergraduate years. I got into crypto through Bitcoin from a monetary angle. I learned a little bit about the monetary system and central banking and it really didn't resonate with me too much. And so I explored Bitcoin and to me, it felt like Ethereum and on-chain privacy were the logical, next step in that progression.

I found myself at Offshift, where I’ve been for the last couple of years. Offshift is a project that is pioneering PriFi, or private decentralized finance, on Ethereum on layer one. It adds privacy to the most decentralized environment that exists in the crypto space for smart contracts and decentralized applications.

Before we jump into Offshift, could you also set up some context for us on central banking and credit systems and how credit was being managed way before crypto came in?

I'm happy to. I actually gave a big talk about this at EthCC, which is probably the biggest Ethereum event in Europe. That was in July, 2021. The event gave some pretty deep historical context surrounding credit issuance.

There's this idea in the Bitcoin community that we just need sound money, which is money that can't be rehypothecated and can't be inflated, very much unlike the fiat currencies we have today. I think there's a little bit more to it than that. Because if you look at the history of gold, for example, it has a lot of really strong qualities as sound money. But it wasn't exploited as not being scarce enough. It was just replaced by a system of really unsound credit.

Inevitably, any money in the world, anything that serves as money, whether it's paper or gold or any other substance or anything else, has some inherent qualities. And we know about these, and we talk about these, whether it's the visibility or portability or fungibility or scarcity, these are all really important qualities. Some of these qualities inherently take money away from its ability to be transacted in a superlative, cheap manner or a fully efficient, fully convenient manner. And so at some point, that manifests in the form of transaction costs, whether it's shipping gold around or protecting the gold. Or in the case of Bitcoin, it manifests in all this hash power.

The transaction fees that people have to pay here are not as low as they would be if we just used a centralized system like Visa. So, what sort of happens inevitably is that some institutions or businesses or organizations pop up that offer to hold your money for you. In the case of gold, that happened around the 20th century. A lot of these banks popping up offered to hold the gold and they would issue a receipt, a piece of paper that says how much gold you have. The paper is a lot easier to transact. It's so much more efficient. It's so much easier to keep track of. It's so much more divisible because you just write a different number on it.

There are many ways in which credit can be used to make a much more efficient economy through more efficient transactions and reducing friction. Transactions always contribute to economic growth and wealth creation. The challenge is that paper – the credit – isn't scarce the way money is.

It's really a distributed process and it's a beautiful thing, the way money emerges in an economy. Whenever a society, whenever an economy or whenever a group of people selects something to be money and has the ability to just create these units of credit out of thin air, they start to become trusted as people redeem the units for money.

The credit issuer then starts to realize that it can make a little bit more of this credit and it can earn interest on it, which is profitable. So inevitably these things turn into Ponzi schemes, pyramid schemes, or scams. We call them all sorts of things, but it’s basically when there are more units outstanding, more credit than the actual money that exists underneath it.

Eventually, there's a run on the bank, as we say, traditionally, where people take the credit to the bank and they say, “Can I have my money?” And the bank says, “We actually don't have it. We have none.” We see this happening recently in China. We see it happening all over the world for many years; it really is this civilizational challenge that humans have faced for a long time, which is that there always ends up being more credit than money. And it leads to some sort of economic collapse.

Central banking is a government-based solution where all of these sorts of entities, these banking entities and institutions, get shut down and the government erects its own sort of central bank that can issue credit. Even though it does prevent bad acting on the outside, it enables and incentivizes bad acting on the inside. So, inevitably, we run into the same sorts of issues over and over again, which is that we have this civilizational desire for credit instruments, but we don't have a sort of stable and high integrity means of issuing credit.

Is the problem that the issuer of the credit does not have complete incentives to maintain integrity or is it more so along transparency lines and that people cannot really see how much credit is being issued to others?

That's a really good question. I would say emphatically both. I think you'd have to be truly a saint to not act on that opportunity as far as integrity's concerned. But I think on the other end, there is something to be said about a free market for credit instruments and free markets determining the price of the most used asset in the world. For a monetary asset like money, the price of it is “interest”. And when you start to manipulate interest rates, you are losing these free market mechanics and any meddling with the free market always has some sort of negative backlash. So, I think on both ends, there are some issues that concern integrity. But there are also others. It's almost like trying to play God, saying we know what the free market wants, we know what the free market needs, we can stimulate it. It never works out.

How DeFi solves problems with centralized credit

Let's briefly bring in decentralized finance and talk about interest rates and how they relate to central banking versus decentralized finance.

How are interest rate markets settled in decentralized finance? And how are interest rates decided?

One of the things I think is really exciting is the transparency that you alluded to. You can see all of the capital that is deposited in DeFi. For example, in MakerDAO, you can see all of the hard assets of Bitcoin and Ethereum that are deposited.

So I think that again, that allows for proper pricing. I can get into more detail, but I think the point is that (1) there's transparency, and (2) you have this sort of a new model, which is governance by participation. For example, MakerDAO, in particular, issues their governance token, their native token MKR, to allow people to participate in the protocol either by providing capital or by taking out debt and paying interest on it. No matter how you slice it, they're receiving MKR. And they could also buy it in the open market.

With governance tokens and DAOs that are very active now and becoming more prominent in DeFi, it's the users of the protocol – the individuals – that own the network. That is the web3 paradigm in a nutshell. The network is supposed to be owned by its users, not by venture capitalists and a small group of individuals. That way, people can then vote on these interest rates. They can vote on the parameters that govern the protocol, which is so important because, again, people who are in the protocol want the protocol to be successful and don't want it to have liquidity issues at all.

So all of these sorts of credit systems are competing with one another in a very transparent, decentralized way, and they're all governed by their users. You have this sort of alignment of incentives within each protocol. And you have a really solid, competitive meritocratic environment, which promotes high-integrity acting.

I do want to just elaborate on that briefly because a lot of people would say “look at all these scams that come up”. It's true. A lot of scams do come up, but they fall apart. And I think there's something to be said there, which is that when you see all these CeFi platforms going under, yeah, it's really a shame because a lot of innocent people lost money, but you see that the truly decentralized platforms that are governed by their communities and that are fully transparent, they're weathering the storm quite well.

Yeah, I agree with that. So it seems like the problems with credit markets relate to transparency, integrity, how credit and interest rates are decided, and also people issuing more credit than is actually available to issue.

And the way decentralized finance solves these problems is through governance, which helps you decide parameters like the interest rates for a token, and over-collateralizing loans to make sure there's always more in the pool than is being borrowed, and finally this notion of transparency – you being able to see how much money is in the pool and what interest rates are being set. Would you say that's a good summary?

Yeah it is. And I would just say on top of that, it doesn't even have to be over-collateralized necessarily. The whole point is that the community determines those parameters. And so the community could vote in favor of extra over-collateralization, more safety, and lower yields. And then in other environments, the community could vote for other parameters. That sort of self-governance is really what makes this whole space special.

So the problem with credit systems has less to do with credit then, and more so to do with governance of the markets and who gets to decide things together.

Yes, I would say skin in the game is what it's all about. And free markets tend to perform best.

Data as a commodity in web3

Let’s tie in data now. Ever since the internet blew up, we've seen economies being built around data and data being used as a commodity. And we've obviously seen how that plays out with social media using data to monetize their companies.

But could you give some context on how data is used as a commodity in this web3 ecosystem?

Yeah, definitely. Sometime between 2017 and 2018, the Economist mentioned that data is now the world's most valuable economy. It's passed oil, and that was four or five years ago. And as most people know, the crypto space and the virtual space are moving quite fast. So I'm happy to speak to it.

Facebook is basically a meme at this point in that it is evil and that it monetizes your data and sells it for billion-dollar profit margins every year. In the same way, there are Chainalysis and Nansen, the two biggest on-chain data analytics companies. They know how to surveil the Ethereum blockchain, these fully public blockchains, so there's absolutely nothing wrong with what they do. They're operating in a free market capacity, certainly.

But they're able to look through all of these through block explorers with some really sophisticated algorithms and understand a lot of what's going on in terms of the capital flows within crypto. And they can aggregate that data and sell it. So they're literally monetizing your money. And again, there's nothing wrong with it. But there need to be privacy-centric alternatives that allow people to protect themselves while they're operating in this sort of decentralized space, whether it's with NFTs, whether it's with DeFi, whether it's anything else on Ethereum. There just isn't really any privacy-centric alternative.

Just a quick follow-up there. If you had to generally think about how people measure the value of data, how would you add more concreteness to creating an actual value based economy of data?

When you look at the Cambridge Analytica stuff, you look at it and it's not hard to understand how an authority would find the data useful. But in a more free market, like in a private enterprise context, marketing agencies obviously have an interest in what you are interested in because that makes their services more valuable to potential advertisers.

But I think, as far as this whole data economy is concerned, what's really important to consider is that the data economy forms with privacy. Right now, there really isn't going to be a market for data because your data is just instantly extracted the instant it’s generated because it can be copied without cost. The concept where individuals are selling their search histories, selling their browsing histories and selling a record of their on-chain transactions or anything else, there’s certainly massive interest in all of that. It's very much precedented and it's fully established, whether it's from Google or Facebook or anyone else, or any of their high-profile clients that are interested in knowing everything about us. Whether you want them to know or not is beyond the scope of that question.

The point is that for an economy to form, the Googles and Facebooks and, in the context of web3, the Chainanalysis need to hit a brick wall there where they can't tap your data. That's where it starts. They're not going to be giving out consolation vouchers like “oh, sorry, we took your data, here have a few $DOGE.” For that market to form, there has to be this wall that gets put up where users have privacy-centric alternatives that are user-friendly, that aren't too expensive, and that aren't difficult to get to use.

That's where these companies start to ask themselves, “We have a really good business model here, but we're going to need to start approaching these customers individually or providing some market for their data.” And they're going to have to determine what it is that would be worth for them to pay. And I think that's where a market starts to form. There's a famous saying that a negotiation starts at the word, “No”. And I think a data economy starts at the first true privacy-centric alternative that goes viral.

That's a great way of putting it. You can only start to be able to measure the value of data once there's a market forming around it. And the market would only form when people have the option to say “no'“ to selling the data.

Specifically for on chain data, what we're saying is that once you have privacy alternatives, then companies like Chainanalysis would have to start asking users how much they value their data, and that's when you get demand and supply forming between the users and the company.

Yeah, I mean those are the bids and asks right there. I think that the economy starts small, and some people start to make some critical decisions and then it picks up steam. And it may or may not be for everyone, but it's certainly there.

There's a term that you mentioned earlier called rehypothecation. Could you explain how that relates to data and what exactly the term means?

Rehypothecation is a big word that describes a very simple process. You'll find a lot of those in banking nomenclature. Basically, it is creating more receipts than you have actual assets. So think back to credit and money: it's putting a gold bar in the vault and having a receipt for it, and when you make that second receipt for the one gold bar, you are rehypothecating it. You are creating a new credit instrument for which there is no hard money underneath it. And again, when you have redemption, when you have people coming back and asking for their gold, that's when you start to run into issues.

The thing is that in the digital space, inherently it's governed by very different laws than those of physics that you have in the physical domain of gold and paper. So when you generate data, which is inherently yours, it can taken by simply a copy-paste. And there's no cost to that. So most people are used to operating in this environment where everything they generate, everything that's theirs, can be, copy-pasted away. They're used to just being basically used on a daily basis, for billions of dollars a year.

Rehypothecation really speaks to what I would say is an aphorism at this point, which is that privacy is scarcity in the virtual domain. That is to say that there is no scarcity and you can't prevent rehypothecation and your data and the wealth in it from being stolen unless it's private. So you have this kind of just like a free-for-all where people are just taking your money in the form of data, until you have privacy there to prevent that rehypothecation.

Explaining Offshift and PriFi

That makes sense. Let's tie credit and privacy together and give a set-up for private decentralized finance, or PriFi. How would you explain what Offshift is to people who haven't heard of PriFi before?

Offshift is an ecosystem that has the potential to support a wide array of platforms that live in the crypto space.

So you have this ecosystem where there's decentralized money in Bitcoin and Monero. You also have other forms of decentralized credit, as we discussed with the MakerDAO’s and all sorts of other DeFi applications. And then you still have this issue where even though your money and credit aren't being rehypothecated, your data still is.

Offshift closes the loop and creates this rehypothecation-proof credit where your data is also not being rehypothecated. It's where you are truly in a state of self-ownership online because you are protecting your privacy in fully decentralized environments.

So you're combining rehypothecation with decentralized finance. Could you just give a walk-through of what would happen if a user lent, let’s say 10 USDC, to Offshift the protocol. What happens to prevent the rehypothecation of that transaction?

The rehypothecation there, just as a simple concept, is someone seeing who owns those assets. That's really where the rehypothecation comes in. It's seeing your financial transactions, it's knowing it's you and knowing what you do. That's valuable to marketers. It's valuable to everyone, to know things about you.

What you would do is, let's just talk about our forthcoming platform Offshift Anon, which is where you inject capital. So say you take $10 and you put it into the protocol. It will go through our native token, which is called XFT, and the XFT instantly gets burned. So when you put $10 worth into the protocol, it's going to generate a secret deposit. And the secret deposit is secured with zero-knowledge proofs. We can talk about those later, but the idea is that on the other side of that deposit transaction, you're going to mint synthetic assets, our Anon assets.

These are synthetic assets that you can mint that protect your anonymity. And the reason is because when you want to mint them, you can mint them to another address. So you're burning, or you're putting capital in, from one address and it's coming out in another address.

There's a series of high level mathematics involved, which allow you to make this deposit and then make this withdrawal, without the deposit and the withdrawal being associated with one another. I think going into more depth in that would be extremely complicated, but I'm happy to do it if necessary.

Yeah, let's not go into too much depth, but I am curious: even if I make a deposit, even if I'm using an anonymous wallet, people can still track my deposit and withdrawal because it's associated with a dollar amount and you can track that specific transaction to an address, right?

That's a really good question. I have to give you some props there. So what you're really referring to is that, and I just wanna make sure I'm highlighting it properly, is that it doesn't matter what happens if you're putting in, say $10 and 50 cents, you just look for an address that suddenly mints $10 and 50 cents worth of synthetics. And you're saying you can make that connection very easily. Is that correct?

Yes

Well, I wanna just highlight one concept, which is called an anonymity set which is that if you have a large enough number of deposits, then it's more difficult to associate any deposit with a particular withdrawal. As you allude to though, if they're different quantities, then each individual deposit and each individual withdrawal will be actually very easy to identify.

So the key is that everyone must put in their deposits in specific denominations. So say everyone has to put in 1 ETH worth of a deposit. Then at that point, you have a very large anonymity set of identical deposits and identical withdrawals. And so at that stage, it actually is not easy or really possible at all to associate one deposit with a particular withdrawal.

That makes sense. To follow up, how are synthetic assets playing a role here?

I think synthetic assets are one of the most exciting things that's come out of DeFi in the last couple years. A synthetic asset is really the most basic form of a derivative. So anyone who's listening in who's a finance guy, if you talk about options and puts and all of these sorts of complex sophisticated financial instrumentation, a synthetic asset is a very simple form: its price is pegged to the actual asset. There's no betting on it. There's no insurance stuff. It's very simple.

What makes Ethereum exciting is that you have all this programmable money. So you can make assets using Oracles. You can create new assets which have specific prices, like in Ethereum for our case it’s AnonETH. It’s the same price as an actual ETH, but the AnonETH can be programmed with very specific attributes that make it inherently private or allow its user to be anonymous in transacting.

You have a lot of these in different spaces that sort of have different qualities or that are minted in different ways. And there's a lot of demand for different synthetic assets because it really begins to beg the question of what even makes an asset real in the first place.

The reality is that assets are given value by systems, not the converse. Someone would say that the New York stock exchange is valuable because it has all of these really valuable stocks on it. But in the crypto space, it's worth considering that what makes assets valuable are these systems of exchange, where they live.

Image back during the GameStop fiasco, if people were able to trade synthetic shares of GameStop in some kind of cryptocurrency environment, that would've created a really interesting situation. A lot of demand for GameStop that wasn't allowed to be exercised or expressed in Robinhood and other centralized exchanges would then have shifted to these synthetic assets.

So synthetic assets are the beginning of a migration of capital to crypto because it allows you to invest in something whose value is the same as its real-world counterpart, but which has many more freedoms, around-the-clock transactions, less censorship, and in our case privacy.

That completely answers my question. Just a small side question though: if people wanted to understand more about the protocol, what would be the best resource you'd recommend?

I would definitely go to offshift.io. We have a really good website and you could go right to our documentation from there on our Offshift GitLab, which is just a decentralized version of GitHub. And you could read the white paper for our ecosystem.

You could also come find us on Telegram and on Twitter. We do have quite a strong community. I have to say I like our community a lot. There are a lot of different people you could ask questions to and share perspectives with. And so that’s also a really good avenue.

That's super helpful. Thanks for sharing the resources. Before I pivot off of our conversation on off shift, could you just give a quick summary of the protocol again?

We talked about synthetic assets, denominations, deposits, withdrawals. We talked about privacy and decentralization. Could you just give the pitch again, but this time, hopefully with listeners having more context?

Yes. Offshift is an ecosystem that lives on Ethereum layer one, which means that it's an ecosystem of applications that allow people to engage with decentralized finance, in the most decentralized environment in crypto, without foregoing their right to privacy.

On our forthcoming platform, Offshift Anon, users can shift in their capital and they can mint a series of synthetics assets. These assets can be pegged to Bitcoin or dollars or ETH, and in the process of burning their capital and minting the synthetics, they become disassociated from that capital, meaning that they become anonymous owners of the Anon synthetics that they mint. That protects their privacy while operating on Ethereum.

What the Chief Strategy Officer role looks like in web3

That's perfect, thanks so much. Let's talk about your role at Offshift as the CSO. So agnostic of the protocol and how that works, how would you describe what you're doing on a day to day basis?

I would say that quite simply I'm the only public figure on our team; everyone else is anonymous, which probably doesn't surprise you, but it is important also to have someone that puts their face and name on what we're doing.

I would say I manage all the public-facing engagements. I do also contribute internally to the platform, tokenomics, and important documentation. I'm out talking at conferences, doing networking and business development. And of course these interviews as well. I write a lot of op-eds that have been featured in CoinDesk or Coin Telegraph or NASDAQ or anywhere else in the space.

I would say though, to really communicate it simply, is that when you have a normal tech company, they are going to raise money and they're not really going to interact with their users or their community until after they launch the product.

In the beginning, they're only responding to the small network, your small group of VCs and, high net-worth individuals, the board, so to speak, that's funded them. Crypto is different because it's open to the full public and it's funded by stakeholders that could include your users.

So you have this really unique and intimate relationship with your user base and with your community, in that you are responding to them as investors as well, and you're responsible to them. You want to communicate with them and you want to provide transparency and you want to understand their needs before and during the time that you're developing the product, not just once it goes live.

You have this very sort of delicate process of development where you are very much responsible to the community, in a lot of different ways, that normal web2 tech companies would not have to deal with. So it's important to have someone that can do that appropriately and that understands the space and a lot of the people that are involved in it.

When you're explaining the progress that you made on the protocol, as you're developing it, do you feel that you have to make big promises on the roadmap about what's coming up to the users because there is this internal pressure that you have to get a product out?

That's a really good question because it's extremely relevant to some of the challenges that we've faced. At this stage we are just committed to providing privacy-centric platforms. We do value individual privacy for most of the people on our team. But insofar as we're developing something that will be open to the full public, we want to provide maximum transparency into the development process.

We do have a roadmap to testnet, which we're slated to launch in October. We also provide biweekly developer updates and we also do monthly AMAs where I come on the video live and answer questions that the community has submitted.

It's definitely great to make promises, but you have to make sure that everything you're promising is 100% true. There's no harm in saying, “We can't make an announcement yet because we don't fully know what we're going to announce”. There's definitely a time and place to reserve some space for yourself as a project and to say, “We want to make an announcement, but what's more important is being fully accurate in that announcement. And so we're gonna take a little bit of time here to collect ourselves”. But that aside, I do think having a roadmap and concrete dates show the community that we do have a lot of structure with our vision. That's really important piece to gaining and maintaining trust.

Is there a day when the team plans to become public or is the team always gonna be anonymized?

Good question. I have to say there are a lot of really sharp and brilliant people involved and it's an honor to be able to speak on their behalf. I don't think that they will want to dox themselves. However, things change really fast in the space so you just never know. So that door is not fully closed, but I would suspect that won't happen.

How to explain technical concepts without losing accuracy

That makes sense. A quick question that I have on content and branding. How do you explain terms like synthetic assets and zk-proofs to people who are not familiar with the technical side of what you're doing at Offshift? Do you feel like you have to simplify the understanding?

It's a very fine line to walk there and you bring up a good point. When you say the technical points, we’re really talking about FinTech, and FinTech is just finance at this point. For anyone to really understand finance, it is extremely difficult. The technical side is also extremely difficult.

And I think what makes it even more difficult on top of that is that, in web3 or crypto, you have this inherently digitally native space, which makes it even more difficult because there's nothing people can put their hands on. There's nothing tangible. So unless you have very sophisticated, intellectually oriented people sharing a conversation, it's very difficult to pick up on these concepts.

We have, for example, Offshift academy on YouTube, which is these five minute videos that distill everything into bite-size content, and we employ visuals and stuff in the video so that people can grasp it. High-quality content is definitely a part of it, but more importantly you have to employ metaphors constantly.

One of the best examples is with zk-proofs. I recently did a fireside chat in June with Edward Snowden. It was just 60 minutes. I recommend it to anyone, look it up “Offshift Snowden” on YouTube. You'll find it's quite a deep dive into the space. And he describes zk proofs very eloquently.

A zk proof is essentially solidifying or proving that some information is true without exposing the contents of the information. It's nice because zero knowledge, the name, lends itself to what the technology actually does. You won't find a lot of that in this space. You have all sorts of crazy names that don't really reflect what the platform is.

Zero-knowledge proofs are very intuitive in that sense. You need to say that something is true without saying what it is and so it obviously lends itself to privacy-centric solutions, and zk proofs really are the secret sauce.

Edward Snowden explained zk proofs like this: If you are colorblind and you have two balls and you can't tell if they're the same color or different colors, you can ask a bunch of people and get some sort of consensus amongst people. You show one ball and then you show the second and you say, “Did I show you the same ball? Or did I show you two different balls?”

Over time, you get a pretty strong sense of the answer and have some data to work with, even though you yourself can look at the balls all day but still not be able to tell if they're the same or not. In other words, you can't do the proof yourself, but by exposing them to other people in various ways, you can get a good consensus from people that aren't color blind about what their perspectives on the data are.

Therefore you can have this sort of proof: you have zero knowledge, but you can use other people's knowledge to get an idea of what the truth actually is.

On the topic of explaining terms with metaphors, do you ever feel the urge to deviate from metaphors to be as technically accurate as possible for your community?

The first thing I'll say is this is that in this space, one-size-fits-all is a terrible approach to content. Even if you are an influencer or you are a media producer, such as yourself, if you're just producing one set of content, you need to find your niche. And I think web3 for gen z is very niche.

But I think, if you're a cryptocurrency project, one-size-fits-all is not the right approach at all. So that's why we have Offshift academy, which is the basic bite size pieces of information, which may employ visual media and some metaphors and is a bit more simplistic. And then of course we do have our technical documentation on GitLab. You’re not going to see all the pictures. You’re going to see all the technical components. You're gonna see a lot more sophisticated language. And, as you say, you're not going to get anything lost in translation by making a lot of generalizations.

To me the best solution is to have these different sorts of avenues for content creation: you have your onsite blog, interviews, conference presentations, and you also have a good mix of content, whether it's YouTube content, technical docs, announcements, and this sort of thing.

You are right there that you are compromising accuracy when you employ metaphors. There's no such thing as a perfect analogy, but I think because of the nascent stage that we're at in crypto, you have a lot of people that are thinking about coming into the space for the first time and you need to get the fish hook out there. If you put something unpalatable on the fish hook, you're not gonna get many people into the space.

You have to give people a little bit of a runway to enter the space. If you overwhelm them you lose them. So, you’re right, it is definitely challenging to walk the line between making an inaccurate analogy and delivering too much for people to handle.

Advice and resources for newcomers

One final question: What would be your advice to anyone interested in privacy and web3 or wants to learn more and break into this space?

As someone who broke into this space, I definitely have some advice that I would like to give. I think it's good to get into web3 or crypto before web3 or crypto gets into your life. I see it as an infrastructural technology and the next iteration of the internet.

If you go rewind 20 years and you say, “Oh, I'm gonna continue doing my work, but I'm not gonna get involved in the internet stuff”, you're going to find that the Internet's going to get caught up in your work and you're not going to be up to speed.

web3 is this kind of transition where I think the benefits of educating yourself and getting involved extend far beyond what you can even perceive in the early stages. That could be going to interviews, going to conferences, watching content online, going to meetups, etc. I strongly recommend, even if you don't see any immediate benefit, just get yourself familiarized with these concepts.

Getting educated about them is so helpful and it will pay massive dividends down the line. It is early and especially if you're in gen z, if you are that young, what do you think the world's gonna be like when you're 30 or 40? At that stage you still have a lot of your life ahead of you. I'm 29 just for context.

So I think it's really something to approach as an inevitability. I don’t mean that in a dark way, but if you look at the Internet paradigm, that is such a great parallel. You can avoid it for as long as you can, but eventually, it's coming into your life and into your work in particular. If you can become familiar with that and get comfortable with that, you will have many more opportunities down the road.

If anyone wants to get into web3 before web3 gets into their life, what are the most helpful one or two resources you’d recommend?

One of the places I’d start, and this sounds very simplistic but it's not, is I would start exploring transacting in cryptocurrency. It's something you will not understand fully or really perceive the benefits of until you experience it. Even if it's with a friend, if you could pay them back in Ethereum, or if you could just try to trade.

Inherently, in one way or another, your capital gets involved. This is the internet of wealth, the internet of value, the internet of money. So you have to be very careful. It's not just like exploring a cool tech product. There is money involved.

People often say what's the benefit of of cryptocurrency? For most people, it’s just an investment. But if someone is active in the space, if you have a graphic designer who lives halfway across the world and they want you to pay them for the work, and it's like 8:00 PM on a Saturday, you can just do it instantly with crypto. And it costs nothing. Then you're like, “Wow, this actually is quite a powerful technology.” That's just a very simplistic example.

But then you end up having some capital in there, in your wallet. Then you’re like, I really should add more capital just in case. Then you’re like, “Well, I might as well have this grow.” And then you start to explore DeFi and other things like that. It's very natural.

So that really answers your question as directly as possible, which was, “how can you get into web3 before web3 gets you”. The answer is: start transacting in these assets with a friend or in some way before they get pushed into your life. And this way you'll be very well prepared. You'll have made a couple mistakes with a very small amount of money and you'll understand how the systems work and you'll be able to see how they benefit you.

That to me is the most important thing. If you have some capital, if you have some skin in the game, you'll start to explore some things. Wherever that takes you is your own adventure to have.


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