Leaders in Lending
Leaders in Lending

Episode 74 · 2 weeks ago

Blockchain Banking: Another Avenue for Lending Markets

ABOUT THIS EPISODE

Is the future of everyday transactional banking going to be on the blockchain? Are we closer to bringing traditional currencies into and out of the crypto space for a wider range of banks and customers?

Sidney Powell shares his experience running and co-founding Maple Finance- a lending organization bringing capital markets on-chain.

Join us as Sidney and Jeff discuss:

  • Building an on-chain credit history and how grouping of funds can make lending more efficient and accessible
  • Application and value added services that can be provided on top of the blockchain to allow broader use
  • The real world adoption of crypto currency outside of the lending space, with examples from international payments and remittances.
  • Practical advice for people who want to get started in crypto

You're listening to leaders and lending from upstart, a podcast dedicated to helping consumer lenders grow their programs and improve their product offerings. Each week here, decision makers in the finance industry offer insights into the future of the lending industry, Best Practices around digital transformation and more. Let's get into the show. Welcome to leaders and women. I'm your host, Jeff Keltman. This weeks my conversation with founders, you know, maple clients. MAPLES watching based in the market lending company, and I think it's a great conversation. Interested in the real thing. Um. One of the things I really liked about Um think about where it is. I don't provide real world value either, oring off experiences on process. I think if you really perspective on what's happening where, it's added surprising things. Um, it's really, really, really conversations learning more about not really a world of financial enjoy this conversation. He said, thanks for joining us on the podcast today. I appreciate your making the time now. That's all right, Jeff, great to great to be here. So I thought I'd just started with the basic question before we get into to maple. What you guys, do tell me, like what what brought you into the crypto space? How well you know? I imagine you had a somewhat of a more normal life before you got into the crazy world that is crypto. What what attracted you to that space? Yeah, I began my career in banking and I went from working, uh, deal side in institutional bankings. We're dealing with very large companies that wanted to borrow so they could run their lending businesses. I went from that side to working at one of those lending business so that I could see what it was like to try and run operations and, uh, you know, what it was like to be a client of a really large bank. And it was actually whilst I was there I started learning about smart contracts, and so that was my first foray. Was not necessarily bitcoin or the direct purchase of an asset. It was the UM investigation and researching smart contracts to see if there was a way that we could run our business more efficiently. So I kind of started researching it. Is like, is there a project here or an opportunity to run a lending business more efficiently by being able to program the transfer of money and and and program how loans might work. M It was there. Well, evidently there was in the end, because that's what I'm doing now for a for a living. But that was back in so mid after the last Um, after the last big cycle, or before the most recent one, and there was not a lot happening in smart contracts with respect to this kind of thing.

So lending and what is now called, you know what is now lumped together under the umbrella of decentralized finance. So when we started investigating that, I started reading all the white papers, speaking to everyone in the space and then I wrote a white paper of our own. That was the first maple one in about January, so even still, probably twelve months before defi really took off. Um. So a lot of investigation. We had to we actually had to pay me and my co founder out of our savings to make a very basic proof of concept. We pivoted a couple of times and then it was around late were actually able to get this idea off the ground because the environment had caught up. It would have been like trying to do Amazon or something in the eighties, you know. Not. Not, not the things of h yeah, not not that we're comparing ourselves to Amazon, but trying to do like an internet company in the eighties is probably what it was best characterized as well. You should read, I just fish reading a book on Amazon and they talked about their first attempt in streaming before Internet and devices were ready for it. We had to only stream to a laptop and it took like six hours to download. They were like yeah, but the wrong, wrong moment where you didn't really have the infrastructure to provide the right experience, right capabilities. But you know, obviously over time that that became the way we all it's hard to imagine the time before like streaming, right like what? So, yeah, look at look at the transition of Netflix right like before streaming. They had to begin as posting DVDs in the mail and then they were just at the cost where they were both the kind of the very beginning and the wrong side of it, and then they managed to be the first to kind of, you know, do it. Maybe they weren't the first, but they are the ones that we know of today. Similar with Uber. Uber really couldn't have existed before you have GPS and phones and there are still a number of things today that kind of prevent our business from achieving super widespread adoption on and off ramps are probably one of the one of the key picks and shovels that we want to see come to the market. Well, tell me what you what you guys do Orly just mable, but like what was the idea of what was possible and what you guys are trying to achieve through the platform you have? I think it's a pretty interesting space, right that you're trying to go and leverage CRYPTOTA solve a real problem, which is maybe not what everything in crypto feels like the people. Well, yeah, I mean at a high level, the way you can think of maple is a platform to run a lending business. So what kind of you know that there's a whole lot sitting within that. Like are we trying to run a bank? No, so you have to position your product really carefully, and the way that we've tried to position maple is that it is targeting middle market lending and one of our core customers is actually lending businesses or credit funds. So it's people who understand how to underwrite and we're trying to give them the tools to gather a capital. So either gathered depositors, lps funds. They do that on chain, and then the software so they can send out loans and manage repayments. Ordinarily, if you were a credit fund or lending business, this is like five or six systems you have to stand up and it's about a half a dozen operations stuff. So we compress that into a bundle that we offered to lending businesses or credit underwriter Um to get them...

...to use our platform. And so this really represents where I think the future of finance is going, which is on chain. And the reason I think that is because it is just a much lower cost way to send money, in the same way that a lot of internet businesses were able to spring up because of the suddenly very low cost of sending information versus what came before that. New Business models evolved, and so a lot of people will say that what you can do or what we offer is something that could be done today. That is true, but it is significantly higher costs. You can originate loans, of course, but can you stand up a lending business at a fraction of the cost and start lending loans and being profitable, you know, within your first month? No, I would argue that's pretty impossible absent blockchain. Interesting. What what is? What are the parts of that process where the costs get lowered so much, because I feel like there's a a SAS version of what you're describing. I think just a pure software I can stand up the contract doing in the online portal to acquire capital and you know, people can a c h money and you can, you know, you could do some of this in a non chain driven, software oriented world. is a vertical SAS product. That's a thing that exists, but you're talking about like parts of the chain that fundamentally altered components of that business, and I'm curious which which components do you feel like are really the constructure gets fundamentally offered by doing it on chain, versus just like, you know, a database driven SAS product. Yeah, so, Um, I mean the SAS product and the database, which is just, you know, capturing records of who has what loans and who's made what payments. Um, that's not the I wouldn't say that's the key innovation here. Instead of it's it's the fact that you have that kind of database. So that that is the blockchain, but it's many people can read and write to that. So it's otherwise I would have a database and then you would have to trust that I have accurate records here, Um sit, you know, sitting on my database. But what what that requires me to do is, if I want to run that lending business and have that database, is I also have to connect to a bank and really to do that you start introducing third parties like middleware. So I would say if the banking system was truly efficient, and if if so, if the banking system was truly efficient, you wouldn't have multibillion dollar businesses like stripe and like plaid who are able to do this and be valued at the billions of dollars that they are, because that would be something that is just, you know, the Bundle Service of how banks work, and so that's really where the margin is coming from. So, you know, the transfer of money between banks is fine. It is when you look outside the banking system and you want to operate like a lending business or a financial services business without being a bank, and you might do that if you didn't want to, say, take customer deposits in the same way that a bank does and carry that capital. You want to run like a credit fund, or you want to run a non bank lending business. That's when you have to start...

...to pay the margin for, you know, middleware, middleware services and products like like plaid. So just bring it back to a more simplified answer to your question, which is where does web three, where does the blockchain, make this simpler? It's the gathering of funds. So you're doing that into an UN chained wallet or a smart contract that's non custodial. So that means suddenly, already I don't have to pay a custodian and a trustee so that people can trust that I'm not going to do funny things with that money. That smart contract, you can program it so that it's only sending out and receiving payments from loans, I. E. Borrowers, and so that would ordinarily be like an operation staff who's doing that manually each time. But what we can do with the blockchain is program it so that it's just the click of a button when a lean comes up that matches the terms that I've approved for a borrower. And so suddenly what you can have is a lending business that my to be maybe three million dollars in size. So the size of its loans, which could be run by four to five people, because all of the operations stuff has now been turned into a software product that's bundled into, you know, the variable margin of my business. It's not a huge fixed cost investment for me just to get started. Interesting that you mentioned. We've made the kind of Amazon and Amazon video examples. But you know even the environment that we're holding you back or that we're making it harder for people to adopt on mass the kinds of technologies you guys have. What do you think those are like? What what do you think are the equivalent of slow internet or lack of Internet penetration or whatever it is that that would have made it hard to start at Amazon business? And and do you see them shifting over time? Yeah, well, I mean the first preceding Um, the thing that we required was uh, the ability, you know, smart contracts. So really it's since so that was the first impediment. That was a um what we need now, and so that the real equivalent that I see of slow Internet is uh is on and off rams. So the fact is we are. So we've done about one point seven billion in loans to date through the platform, but those are only two crypto native companies. So it's market makers, high frequency trading firms that are adopting at a Delta neutral posture. But what I really want to be able to do is for maple to serve companies that might be at a Fintech or at a company that's operating in the real economy. You know, maybe it's a large consumer electronics company or a large software company. Those, those potential clients couldn't deal with stable coins at the moment, and so what we need is better on an off ramps so that we have a wider set of customers we can distribute or um serve through our channels. Interesting. Yeah, so are the loans that you're doing now mostly pure crypto and like, are there on off rams for were more...

...traditional Fiat money denominations, on distributions, payments and center, or is it mostly stuff this is actually being conducted into purely in Crypto? It's pure crypto. But when I say Crypto, I'm referring to stable coins. So US u, S DC is the predominant one. You know, that's of the volume on the platform, and so that is for any reader who's WHO's not familiar with it. It is a Fiat backed stable coin which is backed by reserves in in bank accounts, and so it maintains a one to one peg with the US maintains a one to one peg with the US dollar, and so so generally that that's used by the borrowers. They take it down, they might use it for salaries, for vendor expenses um or for the trading firms operating with they use it as inventory on centralized exchanges. What's missing? We can't do it, do feat at the moment because that would require an off ernt, and so that really needs like a banking provider or some other provider with a deep balance sheet to Um to step in and kind of, you know, provide that last smile service. I think my own view, Jeff, is that the future is that most people are going to be conducting most of their financial transactions using stable coins and doing this on chain. I'm already kind of most of the way there and myself and I really only use fee it when I have to go and pay with a credit card or something. So it's like I manage most of my finances on chain and then when I need to to, you know, pay off the credit card or put money on a debit card. That's when I do the last file through a bank Um and I suspect that's where the future is heading, because it is significantly lower cost, particularly if you're traveling internationally, and it does give you more flexibility. Yeah, certainly. I'm curious. Did you see any shift in thinking in this space or impact your business with the recent volatility and prices and even, in certain instances, volatility and some of the stable coins, because the stable coins obviously like that peg is tied to some liquidity in the market for the stable coins and the ability to actually maintain that, and we saw some disruption in that. Have you seen that? It was it? Was that a blip in your mind or was that? Did that cause some concern about your customers or people in the space or shift the way you thought about it at all? No, I mean it the the tether short is a popular hedge fund play amongst the trap fire audience, but I mean, as far as I can tell, tether maintain pretty flawless redemptions on, you know, ten billion or so during June or July. Um Circle is circle in USDC are the predominant stable coin we use and redemptions have been have been um performed very well and that increasingly the stable coin providers are offering either attestations or proofs of proofs of reserve in some way. And so my own view, like I know it's very popular to say that Central Bank digital currencies are coming, but if I think about this, this is a service that is most naturally offered by the private sector because it is very engineering heavy and it's...

...not clear that the Central Bank can pay competitive salaries to attract the best developer talent and product management talent and, you know, maintain that and deliver a product is not going to be glitchy and that is going to be delivered on time. I think, though, that if the concern is the stability and how these services are managed, well, you know, polls and wires are managed by the private sector and this is, you know, a regulated utility. If you treated digital stable coins like a regulated utility, then you can still have private companies offering the service. They earn kind of a regulated acceptable rate of return Um, but they meet S L as. I don't think this is a service that's naturally best offered by the government because of their track record of technology. Well, we see even the feds desire to get a real time payment network and you know, I wouldn't say that's been the most quickly. Years, years, years late, billions over budget and even yeah, but but let me ask, do you think there's any sense, at least among the crypto community, that the sort of solution you're talking about is a somewhat centralized Um Center push but you don't have, if you think about Poles and wires, you don't have like five thousand providers and lots of flight. I mean it's like like pretty centralized service. You want some degree of scale that provides stability. If you're talking about reserves and stuff like. You you know you want to a relatively larger entity doing that, which runs a little bit counter to the no centralization inherent in the phrase. You know, defy, if not the whole, you know, Web Free Crypto community. Do you see any resistance to the kind of centralization you're talking about at certain points in the value chain that allow for this kind of you know, in this case that the stability of stable coins and the tying to Fiat currency, which is I think, I mean right now most us buy things in the real world, and so the connection to currencies that merchants take. I mean it's it's a really important thing in at least the medium term. Do you see any hesitance to that because of it kind of runs counter to the the ethos of centralization and no central authorities running the blockchain? M I mean you still have no central authorities running the blockchain itself, but what we're talking about is like applications and value added services that are being provided on top of the blockchain. Now, if stable coins is one that tends towards more centralization, but you have inherent checks and balances in there and a level of transparency, then I think that's fine. Um, certain certain companies will actually only be able to use a centralized stable coin. They won't be able to use diet, but you will have a you will have various alternatives, like die or like other decentralized stable coins. I mean, for our use case, we are trying to serve legitimate, known businesses who want to borrow, and so there's not a huge need for that stable coin to be decentralized, because we would never entertain the idea of serving customers who are, you know, actually or likely to be sanctioned. Yeah, and that makes sense, and I...

...can certainly see the argument that the blockchain can be decentralized with certain elements, particularly on Rams and off rams might be, you know, or thetibility of a stable coin might be tied to more centralizing limit the use case, the black chaine of those things. But it provides the Stability Union for those cases that are making more widely adoptable. For sure, and I mean one of the one of the reasons that stable coins even came about in the first place was banks reluctance to serve exchanges. So people weren't able to do dollar deposits onto centralized exchanges, and so that was a valuable financial service that was not being provided by the dominant incumbents in the financial sector. So the market Ahoors a vacuum and entrepreneurs were able to find a way to solve this solution. So we actually still continue to see that. Uh, you know, banks aren't serving even large corporates that say, you know, maybe some of their clients want to hold or transact in Crypto, and so that vacuum in the market is what is created the opportunity to provide a service and charge for that product. Yeah, I will say that most of the banks I talked to now are thinking about are looking at at least allowing by cell hold, you know, kind of as an asset, as a speculative asset class, something that like maybe I want to help my clients, but thinking is rarely gone much farther than that. Um, I'm curious. One of the other like real world use case adoption. I mean I have not yet bought myself a picture of a monkey with the hat and uh and sunglasses and a cigar or whatever. I don't see that in my future. And I think so many people see cryptos this kind of set of bizarre use cases that feel, you know, in crowd joke but not really serious and impacting. And normal people's lives are useful. Where do you see the real adoption and interesting real world use cases happening, even outside of the lending space? You guys rinks. I think that's something that some people struggle to see because the headlines tend to go to these kind of crazy projects to get nutty value stations on n F T S or whatever they will. That's not a real thing, like that's a fat and I'm not arguing board apes aren't necessarily a Fato I think crypto is different and I'm curious where you see the most interesting real world adoption of crypto outside of that kind of famous N F T project space. Hm. Well, I think I mean in our space. You know, we operate in the lending and lending and borrowing space, and so it is, uh, you know, we we currently serve institutional borrowers and they are taking down lines. Those are crypto native companies at the moment and so they don't have a viable alternative. But that created the initial market wedge that we stepped into film. What we want to get to from here is serving companies that, you know, that might have access to alternates, because that's when we start to get to a point where we can show apples to apples comparison. This is a product with a better user experience, it's more convenient to use, it has more uptime than the banking system. So it's Um, it's you know, it's it's a it's a better service for them than going to like...

...a you know, Credit Fund, like a fortress group or some other bank. Um. So that that would be, you know, starting to lend to maybe corporates who are in fintech SAS or other business lines, but they're going to be somewhat Chech forward because they still have to use the best to use the technology. The other ones where you've seen sort of quite large adoption or traction have obviously been decentralized exchanges. I think that, you know, that was pretty consistent with a ball market in all growth or risk on assets, I would say, which is like uh, Peter it out, or or Um, you know, cooled down a bit, and then Um and and the other one is, of course, like international payments and remittances. So I think this is the most natural advantage where the blockchain really shines. We had, you know, we have a corporate entity out of Australia that does software development. It receives grants from the Tao, which raised funds from maple, but we are frequently dealing with vendors overseas um and so it's actually it's easiest for us to always pay them in USDC to an ethereum wallet address. That is lower cost. It's instantaneous settlement versus US coppying the forex interchange fees Um that our local bank would charge or people having to wait three days for settlement. So I think you know the way, the way I view the blockchains, it's kind of like having an international highway system for money. It is a common good that is very easy to access, but it replaces, you know, the swift system, which is, you know, forty years old now, Um, very difficult to access very high level of tech debt for its ongoing maintenance and this, uh, by opening this up, it actually frees up a lot more business models that can be built on top of the technology now that it's open. I'm gonna say I love your your focus on where you can actually provide value. You too, users or businesses or or the process, because I do think so much of what I see in startups in general, but in Crypto for sure, is like it feels like a solution in search of a problem. Like, you know, you throw the eye and Crypto into your startup because that's the sexy stuff, but you're not doing it to solve any real problems or improve any real processes, outcomes, experiences for actual covers. And Uh, you're right there. I mean it's great to see somebody focus on like where do we actually make things that are happening to the easier, better, faster, cheaper, more convenient with these technologies and not just how do I try and three x evaluation? I start up by saying Crypto at the end of my description and hopefully that makes people feel better about what we're doing, even it's not even related to or necessary for, the value we're trying to create. There's there's a lot of that going around. Yeah, yeah, it's Um. A lot of people, particularly from like mid twenty early up until about Mayo, there was a huge emphasis on what is your token do, absent what is your product...

...to do, and so in a lot of cases the idea of a token that was associated with the project was being conflated with the utility of the of the project itself, and I think at this stage that argument has petered out and you're now seeing as much more emphasis on what is the project or what does the product do? Um, and that's unfortunately meant that, you know, a lot of a lot of excitement and a lot of excitement has drained out of the space and a lot of skepticism kind of greets new ideas. But there are really very innovative things happening in the space and this is kind of the ideal time to be doing that. And grinding away on products of delivering real utility because there's not as much noise that kind of you know, drowns out the builders. Now it's always every technology is the Gartner calls it the technology hype cycle. Yeah, the hype cycle. That that kind a lot of press thing. Yeah, it's it's always true that, you know, people overestimate. Still, Alan Kate quote two. People will overestimate the benefit of technology in the short term and underestimated in the long term. And so they you've got that kind of quick hit where everybody's trying to cash in and there's a longer period that they think Gardner calls the trough of disillusionment, which maybe is not the sex name for actual value is created right when people have forgotten the hype and and you're actually delivering on value with the new technologies as they reach maturity, UH and longer adoption. And that's really where the big businesses and the value for the market are being created, not at the the peak of the hype in the you know, which is probably the crazy n f t craze a year or two ago, where you just went like like how are these? These were millions of dollars and how do people like? It's just just crazy, um, but it's great to see on. What are you most excited about in the space over the next couple of years? Mean, what do you see coming that gets you excited? Maybe past the trough of disillusionment, at least a name to some sort of vision of what's coming down the road that gets you excited? Yeah, I mean we we still see a lot of institutional interest and what's being built in the spice uh, and so I think I expect that trend to kind of continue linearly, if not accelerate. And then the other thing, uh, you know I mentioned before, but like on an off ramps. And so I think when there are widely distributed solutions there, the rate of adoption of this technology will really be, you know, little hockey stick. And the and the right mental model for that is, you know, it's like you're pumping out a bunch of Tesla's, but there were no charging spaces anywhere, so it was kind of no good for a lot of people. And what you see now is if you have more on an off ramps, then it's kind of like having that, you know, that charging infrastructure that you needed to really get you know, to actually be able to take your Tesla where you wanted to go. Um. So I think that those are two of the main things. Institutional adoption, Um and Um, you know, increased ability for everyday people to access this kind of technology. I think. Can I ask you about an on off ramp and maybe I think typically you're talking about the ability to bring traditional currencies into and out of the CRYPTO space. We'll talk...

...about that, but there's also this interesting on or off ramp, or at least connectivity to the real world, that is, around real business or human identities, where someone would like to use a platform like this but as a business it's not crypto native. It needs to bring not just money but maybe their identity, their credit worthiness, their payment history, is they're underwriting kind of data into a world where it can be leveraged on chain, and that connectivity between real world identity, a human or a business, and real world data, payment history or bank bank transaction history or whatever it is that an underwriter might want into the blockchain world is a different thing. How do I know that? I'm really we get a whole ky c process in the real world for that. That kind of like I can tell you I'm really seeing the mind of that wallet. But who really owns that wall? You know, there's a whole different set of questions and what all I really know about them. Do you see interesting things happening in that space? I feel like that's for a more traditional business to move into your kind of lending platform would require some connectivity to their real world identity and real world transaction history, revenue, P and l state, whatever it might be. What do you see happening in that space? That feels like another set of on ramp off ramp. That's not currency related, but it's really important for more traditional businesses to be leveraging this kind of technology to transact M so that's some that's a middleware interface. So, uh, you know, you could you could bring something like somebody's financial history on chain and people are looking at like zero knowledge proofs. So you could say, you know, Jeff has a great credit score and credit history without it being publicly discernible, but that is you, Jeff, and then you could share that with who you choose so that, you know, maybe you could take out a loan on chain by sharing a private you know, sharing that information privately. So I think that's super interesting and that is a piece that I see a number of teams working on. You know, circle is working on a KYC like a tokenized version of KYC. Um. There are several other teams working on similar things. You know, what's funny, though, is that that's not a technology bottleneck, that is a legal bottle neck where if you conduct KYC, so circle could conduct KYC, put a token, give you a token and I could know that circle conducted KYC on you. But if I'm another company, I have to then get that past my legal and risk team who say no, no, no, this is a crime of strict liability. We can't take the chance there might have been an issue there. So you have everybody just duplicating work. So that is a legal bottleneck that is totally holding back something. There is already a technology solution for Um. So those are the interesting things and that's actually, you know, part of the biggest bottle next today are actually on the legal and compliance side and that is significantly behind where the technology is today. But in answer to you, to your question, there's I know about, you know, five different projects that are trying to do credit scores on chain. I think that's hugely important. For bringing the everyday people on board and delivering, you know, valuable services. Yeah, I mean certainly my credit awardness is pretty tied to my credit history, my n chain, Credit Scorp. Probably, I don't know, if you were to look at my own chain activity, would go that's a weird dude. Yeah, yeah,...

...it's a little bit of over to that and has done some weird stuff. And I mented an NF bunk of Monkey, monkey, N F T S. No, I mented my own n F T of drawing. I did just to see what it what the process, you know, you believe he would kind of see one, do one, teach one. So I went I won't get it unless I tried. I bought some stuff, nothing like a board, and then I mented one just too yeah, look like when you do that and I don't think it's worth much. I did get somebody to offer on me, UH, for my n F T, offer me something and I was like really excited and I realized it was like a friend of mine and I went out. That's not as exciting. A buddy of my sent me like an offer for five bucks from. Oh, I thought I had like a real life maybe maybe ours, but they're just started writing the first copy of a book and your your mom's the first customer. Yeah, it to be fair only. So, yeah, yeah, yeah, that's where I'm at my n F T career, but that's I'll keep my day job, I guess. Um. Yeah, my support, my standard. Any questions are kind of all the same. One. My first is what's the best piece of career advice you've ever gone? So I think people should. I like the idea of regret minimization in your career choices. Like I think too many people uh, don't make a leap or or take a chance with a different job because they're either afraid of disappointing the team that they're with now. It's kind of the sense of obligation that, oh no, I'd be letting down the team. Um, but I think people are always generally happy if you take a good opportunity. They might be a little bit, you know, a little bit Um, I annoyed at first, but I've never seen that, either kind of with myself or others, that people are disappointed when when there was a different opportunity that was you know, that was truly right fit for someone. Yeah, I like them. I think Jeff Bezos is famous for his regret minimization being kind of yeah, because you are is Shagiro, like remains of the day book. I think I think that's very true and I've I've tried to, uh, you know, try to use that a number of times. I think it's right as to think that the moment of greatest fear, as a will smith video, that all sorts of stuffing here, but this is the moment of greatest fear, is the moment of least rescued. I think it's about like going skydiving, in the moment of the greatest fears before you jump out of the plant and once you do it it doesn't seem really as scary as you thought it was before. And I think the same thing is true for like taking a risk in your career. When you're sitting there with the job one should I do the thing? It feels really risky and really scary. Then you do it and you go this is not as scary as I thought it would be. And so that you know that sense of fear is often greatest not when you're actually taking the risk but when you're kind of plating it. Yeah, yeah, yeah, I think that. And like the fear of looking stupid is often what holds people back. You know far too much. Very true, just except that you're gonna look stupid in the myf it's a lot easier. Yeah, exactly, I plan for it. There's a quote, one of my favorite quotes I was my kids, is learning to laugh at yourself is the beginning of a lifetime of comedy and uh, you know the same kind of thing. If you learn to take yourself too seriously, a lot of things get a little bit easier. Yeah, all right. The second question, maybe I'll ask us from the concept, for the perspective of, you know, the audience, which is crypto curious but not super in depth yet. What's your best piece of advice for getting started in Crypto or kind of learning more out the space? And I'm a big believer in hands on. So...

...where would you have people go to get started or try some things out and kind of get a little bit deeper than they're at today? M So I think if, Um, if people like communities, it's good to go to the twitter of one of your favorite crypto projects. So find its twitter page. Typically there'll be a link to the discord and that's where you can go to be part of community discussion. So it's kind of like the Forum for that Forum for that project or startup or community. And then the other one would be, you know, I think podcasts are really good. So, you know, if you're more onto the institutional side, you know, I think Um, you know, aside from yours, Jeff, but block, block works runs a really good one um called Empire Castle island has on the brink, which is really good. I also like the bank list podcast. But I think just hearing in conversational tone how people describe their business or their product is is one of the really good things you can do. And the other one is don't be a yeah, don't be afraid to go and take a job at a at a at a crypto company, like, there's nothing like doing something as a profession to really learn an inside out. I did, you know, finance at university, but I don't think you know. I think I had maybe ten percent in my head of what I knew after five years. The rest came from on the job learning. Yeah, it's true. Most places, right, you learn by doing and you learn from on the job. Training can be the wrong word, but experience. Yeah, yeah, also go to go to go to a conference. So there are a lot of people who don't necessarily work in the blockchain sector, but there's a bunch of conferences coming up in New York over September. There's always conferences in Miami, San Francisco, London, Singapore, and just head along and see some of the panels. Yeah, it's always, always. They're there for a reason. People go for a reason. All right, my last question. What's one bold prediction for the future? Can Be Crypto, can be banking, can be not, whatever you like. Bold. Yeah, bold prediction for the future? Well, I think I think within five years most people are going to do transact like, are going to spend most of their financial transactions will be on chain. So I think, I think most people in this a podcast audience, probably don't have that. So the other one I'll give you. I'll give you a two per our prediction, Jeff. The other one is that, um, I think new sectors and new sectors and industries emerge with you know, new players come along. It's very rarely the incumbents who successfully transition to a new either distribution channel or set of infrastructure. Like look at the dominant e commerce retailers are not the big box ones that were set up forty years ago. Um. And similarly, when the big box format came out, you know, it's swallowed up retail giants like a and p. So I think if we look at financial services, I think the ones who are the powerhouses ten years from now will be...

...the ones who can make use of an adopt the new technology. And I think, yeah, obviously I'm biased, but I think the new technology is doing this on chain. Interesting predicting the end of the banks as we know them. Not The end, just significant reduction in market share and asset balances. I think they go and become much simpler products because they won't be able to compete in business lines with Um, you know, with different things, whether it's in UH. I think they basically get unbundled. Yeah, I think. I mean there's certainly a history in the technology space and others of Major Generational Transformations in terms of paradigm tend to tend to not have the same same folks winning. In the end it's it's the rare company that survives a couple of those transitions. Interesting Boll predictions said, I appreciate your time. This is a fascinating conversation. I certainly learned a lot and I appreciate making time to have it with us. Thanks for having me, Jeff, really enjoyed it. Upstart partners with banks and credit unions to help grow their consumer loan portfolios and deliver a modern, all digital lending experience. As the average consumer becomes more digitally savvy, it only makes sense that their bank does too. Up Starts AI lending platform uses sophisticated machine learning models to more accurately identify risk and approve more applicants than traditional credit models. With fraud rates near zero, up starts all digital experience reduces manual processing for banks and offers a simple and convenient experience for consumers. Whether you're looking to grow and enhance your existing personal and auto lending programs or you're just getting started, upstart can help. Up Start offers an end to end solution that can help you find more credit worthy borrowers within your risk profile, with all digital underwriting, onboarding, loan closing and servicing. It's all possible with upstart in your corner. Learn more about finding new borrowers, enhancing your credit decisioning process and growing your business by visiting upstart dot com slash forward dash banks. That's upstart dot com, slash forward dash banks. You've been listening to leaders and lending from upstart. Make sure you never missed an episode. Subscribe to leaders and lending in your favorite podcast player, using apple podcasts. Leave us a quick rating by tapping the number of stars you think the show deserves. Thanks for listening. Until next time,.

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